How outside directors on board and Chief Executive Officer’ compensation impact on firm performance

Treball Final de Grau en Finances i Comptabilitat. Codi: FC1049. Curs acadèmic 2014-2015 The aim of this paper is to analyze whether independent and institutional directors on board as well as chief executive officer (CEO)’ compensation of Spanish listed firms affect firm performance. We hypothesise that firm value is positively affected by independent and institutional directors on board and by CEO’s remuneration. Firm value has been measured by means of the Tobins_Q. The results, based on a sample of 96 firms listed on the Madrid Stock Exchange in 2013, show that independent and institutional directors on board impact positively on firm value, while CEO’s compensation does not have effect on it.