The Odd-Even Effect in The Boards of Commissioners and Corporate Values

Ardhi Islamudin (Faculty of Economics and Business, Airlangga University, Indonesia)
Gerrinko Giffari Wurintara (Faculty of Economics and Business, Airlangga University, Indonesia)
Yustrida Bernawati (Faculty of Economics and Business, Airlangga University, Indonesia)

Jurnal Ilmiah Akuntansi dan Bisnis
Vol 15 No 2 (2020)

This article expands the understanding of board of commissioners' characteristics by introducing the concept of the odd-even effect in their structure. The study employs a quantitative research approach to explore this phenomenon. When a board of commissioners is composed of an odd number of members, the decision-making process tends to be more straightforward and efficient due to the absence of tie votes, leading to a more unified perspective. In contrast, an even-numbered board is prone to voting ties, which can introduce diverse viewpoints and potential conflicts in decision-making. Consequently, the composition of the board, whether odd or even, significantly impacts corporate value. Boards with fewer members tend to be more effective, with companies having odd-numbered boards generally exhibiting higher corporate value compared to those with even-numbered boards. Keywords: corporate value, odd-even effects, board of commissioners.