This study
investigates the impact of corporate governance, specifically board composition
and CEO compensation, on the financial performance of oil and gas companies in
the United States. Relying on a sample of 95 major publicly traded U.S. energy
firms from 2006 to 2019, and employing a panel data analysis methodology, the
study finds that board size has a positive and significant effect on financial
performance. As anticipated, board independence plays a crucial role in
enhancing firm performance. Moreover, CEO duality is positively associated with
the sales growth of oil and gas companies. Conversely, CEO compensation
exhibits a strong and statistically significant negative impact on financial
performance. Additionally, the age of the CEO is found to negatively affect
firm performance. This paper contributes to a deeper understanding of board
governance dynamics within the U.S. oil and gas sector and offers insights into
the optimal board structure that can enhance corporate stability and support
the broader stability of global energy markets.
