Association Between Board and Organizational Performance Among Nonprofit Foundations in China

Abstract

On the basis of agency and resource dependence theories, this paper mainly discusses the relationship between the board and financial performance of nonprofit foundations (NPFs) in China. The data used in this study were obtained from the 2017 annual work report of 203 national public and private fundraising NPFs. Conclusions of this empirical research are as follows. Board size is positively correlated with organizational performance. The size of the supervisory board is positively associated with total and donation incomes. In public NPFs, a negative relationship exists between the average age of directors and total and donation incomes. Foundations with fewer government officials among their directors have a higher total income. In public fundraising NPFs, a positive relationship exists between the proportion of paid directors and total and donation incomes, whereas no correlation is observed in private fundraising NPFs. This study has significant implications for understanding the relationship between board composition and organizational performance among NPFs in China. This study focuses on the effective features of boards in NPFs to enhance competitiveness in access to public resources after the enactment of the Charity Law.