Investigating the Relationship between Board Characteristics and Corporate Performance with the Moderating Role of the Audit Committee

The theory of agency shows that companies in good governance are relatively better off than their weak counterparts. However, resource dependency theory suggests that a board with internal directors can perform better, thus contributing to better company performance. This study examines whether the characteristics of the board, audit committee, and audit committee formation are related to firm performance. The purpose of this study is applied and its nature and method are descriptive, analytical and correlational. In the process of collecting, classifying and initial processing the data, Excel software was used and the hypotheses were tested using Eviews 10 software. By studying a sample of company’s active in Tehran Stock Exchange during 2012-2017, we found that there is a significant positive relationship between the formation of audit committee and the complexity of company operations with firm performance. However, the significant relationship between board size and firm performance was not confirmed. In addition, the results show that neither the size of the audit committee nor its formation modifies the relationship between board size and firm performance