Relationship: Director Experience and Company Profits (ASX)

This project investigates the relationship between director experience and company profits within the top 20 ASX-listed companies. The research delves into the theoretical frameworks of agency theory, resource dependency theory, and corporate law to understand how director expertise and board diversity impact financial performance. The study utilizes annual reports from 2016 to analyze the correlation between director experience, specifically the CEO's tenure, and company profits, measured by Net Profit After Tax (NPAT). The methodology includes descriptive statistics, correlation analysis, and regression analysis using SPSS to determine the significance of the relationship. The literature review examines the impact of board composition, expertise, and heterogeneity on firm value and shareholder wealth. The project aims to determine if a significant association exists between director experience and company profitability, contributing to the existing body of knowledge on corporate governance and board effectiveness. The limitations of the study are also discussed, including the scope of the data and variables. The findings provide insights into the factors that contribute to the success of the firm and improve its performance.