Board monitoring and firm performance: Controlling for endogeneity and multicollinearity

Purpose of this study is to investigate the relation between board monitoring and firm performance after controlling the endogeneity and multicollinearity problem that exist in most corporate governance research. Prior studies failed to establish any significant relationship between board monitoring and firm performance because of not properly control for endogeneity and multicollinearity problems. After controlling for both problems the coefficient of board monitoring increases and becomes significant.