The determinants of board size and independence: Evidence from China

China's corporate governance reform offers an interesting context for investigating the determinants of board size and independence. Analysing a large panel dataset from 1999 to 2003, we find that Chinese board size is primarily driven by firm complexity; board independence is mainly driven by regulation. Some governance factors newly introduced in this study also have a significant impact. For example, board independence is negatively associated with the size of supervisory board and state ownership. The findings have important implications and provide new insights into the subject.

► We investigate the determinants of corporate board size and structure in China. ► We find that board size is determined by firm characteristics and some governance mechanisms. ► We find that board structure is determined by firm size and other governance mechanisms in place. ► We find that board independence is largely driven by regulations.