This study empirically investigates the relationship between boardroom independence and financial performance of non-financial firms in Pakistan, an emerging market characterized by family-controlled businesses and concentrated ownership. Analyzing 152 non-financial firms listed on the Pakistan Stock Exchange (2003-2018), using the dynamic GMM approach, the study finds a significant negative relationship between boardroom independence and financial performance (measured by ROA, ROE, MBR, and Tobin's Q). This negative impact is attributed to close ties between independent directors and dominant shareholders/management. The study also finds a significant negative influence of board size and CEO duality on firm performance. The findings provide empirical insights for strengthening corporate governance mechanisms in emerging markets.

Majid Jamal Khan, Faiza Saleem, Shahab Ud Din, Muhammad Yar Khan