Abstract
We examine the relation between board-level financial expertise and six measures of performance using panel data drawn from the United Kingdom’s non-life insurance industry. We find that collectively, financial experts have a beneficial influence on the performance outcomes of insurers. We also observe that board-level qualified accountants and actuaries are linked with superior performance in all six of our selected financial outcome measures. Professional insurance underwriters are associated with sound solvency levels (low leverage) and underwriting results, but not positive earnings-based measures. This suggests that underwriters may not be as adept at group-level earnings enhancement as accountants and actuaries. In addition, we find that the introduction of IFRS 4 in 2004/2005 did not have a significant impact on board composition and financial outcomes. Finally, we consider that our results could have commercial and/or policy implications.
| Original language | English |
|---|---|
| Article number | 1 |
| Pages (from-to) | 168-195 |
| Number of pages | 28 |
| Journal | Journal of Accounting, Auditing and Finance |
| Volume | 35 |
| Issue number | 1 |
| Early online date | 30 Apr 2017 |
| DOIs | |
| Publication status | Published - 1 Jan 2020 |
Bibliographical note
Funding Information:We appreciate the assistance of Edward Lee, Elena Veprauskaite, Bharat Sarath (Editior-in-Chief), Andy Stark, and an anonymous referee. The article also benefited from the comments of participants of presentations held at the Henley Business School, University of Reading, United Kingdom, the 2015 British Accounting and Finance Association Conference, Manchester, United Kingdom, and the 2015 World Risk and Insurance Economics Congress Conference, Munich, Germany. The author(s) received no financial support for the research, authorship, and/or publication of this article.
Publisher Copyright:
© The Author(s) 2017.
Keywords
- UK
- financial experts
- governance
- insurance
- performance
ASJC Scopus subject areas
- Accounting
- Finance
- Economics, Econometrics and Finance (miscellaneous)
