This study examines the impact of board composition and risk management on
corporate performance in the Taiwanese life insurance industry. In terms of board
composition variables, the CEO/chairperson duality is associated with lower corporate
performance. Insurers with higher percentages of independent directors on their
boards tend to have better corporate performance. However, the higher percentage
of supervisors on the board is associated with lower corporate performance. Evidence
shows that the corporate performance of insurers with risk management does not
change compared with that of insurers without risk management, when controlling
for board composition characteristics. An examination of the impact of government
regulations on corporate performance indicates that insurers do not show significant
changes when controlling for board composition and risk management variables.
Overall results also show that board composition variables affect corporate
performance. Finally, this study concludes that an insurer can control its corporate
performance through corporate governance mechanism.
The IUP Journal of Risk and Insurance 8(4), p.7-27