performance refers to that the comparison of an actual output with expected output.
Mainly, there are three aspects of measuring performance of particular company.
Operational performance, financial performance and the market performance have
been considered as the key performance measures. In contrast, the operational
performance can be measured by market share, customer satisfaction, new product
introductions, and product service quality and marketing effectiveness.
Likewise, the profitability of the firm, growth rate, leverage, liquidity and
cash efficiency could be used to measure the financial performance or the
accounting performance of the organization. Similarly return to the shareholders,
annual return and market value added would have been considered as market based
performance measures. In addition to these measurements it can be seen that customer
service, organizational engineering, performance improvement, stewardship of the
employees and social responsibilities has also been taken into account as
In this study, the
financial performance of the listed companies in Sri Lanka has been considered
as the performance measure. Simply the financial performance refers to the
profitability. Profitability can be measured by calculating profitability
ratios like Return on Assets (ROA), Operating Profit Margin or Return on Sales.
Most commonly listed company’s performance is measured by profitability.
mainly in North America and Europe expansively examine the profitability in
banking sectors. Return on Assets ratio has been taken into account in this
study in order to measure the profitability of the listed companies in Sri
The size of the board, composition of the board, the size of the Audit committee, the composition of the Audit Committee, CEO duality, the board meetings, the sex of the directors, the qualification of the directors, the experience of the directors have been considered as independent variables for test the relationship between boards and financial performance in this study. Also, Return on Asset (ROA) has been used to measure the dependent variable in this study. Return on Assets is largely used to measure the efficiency and operational performance of listed companies as it gives returns generated from the assets financed by the company. As previous studies also have used ROA as a measurement of profitability, it is easy to compare results of this study with other literature. Return on Assets ratio would be arrived as follows. ROA is calculated by net profit, dividing total assets. ROA = Net Profit ×100 Total Asset So, in this study considered nine independent variables. Financial performance considered as dependent variable. In this context, it is important to study the impact of the Panel’s attributes for financial performance of listed companies in Sri Lanka.