By using the panel data of China’s listed companies from 1999 to
2013 in the CSMAR database, this paper empirically finds that top management
team (hereinafter referred to as TMT) size has a significant impact on
corporate performance and presents an inverted U-shaped relationship, with the
optimal TMT size being about 14 to 15. But the influence of TMT size is no
longer significant after controlling board size, that is to say, board size is
the core problem of executive governance. The paper also proves that there is
an inverted U-shaped relationship between board size and corporate performance,
with the optimal board size about 9. At the same time, the paper also verified
the influence of other characteristics of TMT on corporate performance, such as
the gender ratio of senior executives, the board shareholding ratio and the
independent director percentage.
Keywords: TMT size, Board
Size, Corporate Performance.