Exploring the Effects of Audit Committee Size, Board Size, Female Directors, and Tax Aggressiveness on Firm Profitability


  • Hafiz Muhammad Ahmed Siddiqui Department of Office of Research, Innovation and Commercialization, Indus University, Karachi, Pakistan
  • Farrukh Zafar Department of Business and Management Studies, Nazeer Hussain University, Karachi, Pakistan
  • Asma Bano PhD Scholar


Corporate Governance, Firm performance, Tax aggressiveness, Panel data



 The purpose of this study is to examine how the characteristics of the board of directors and the audit committee affect the profitability of non-financial firms in Pakistan, and how tax aggressiveness moderates this relationship.



The study uses a panel data analysis of 1067 observations from 180 public limited non-financial firms listed in the Pakistan Stock Exchange (PSX) for the period 2013-2018. Two statistical methods of analysis are employed: The Feasible Generalized Least Squares (FGLS) method and for robustness the Prais-Winsten Panel-Corrected Standard Errors (PW-PCSE) method.



 The results show that the audit committee size and the board size have a positive and significant impact on the profitability of the firms, while the presence of female directors has a negative and significant impact. Tax aggressiveness has a negative but insignificant impact on profitability. Other control variables such as firm size and leverage have a negative and significant impact, while firm age has a positive but insignificant impact.


Novelty/originality of the study

This study contributes to the literature on corporate governance and financial performance by providing empirical evidence from an emerging market context. It also examines the role of tax aggressiveness as a moderating variable in the relationship between board characteristics and profitability, which has not been explored in previous studies in developing countries.