The board of directors is the highest institution in a company that monitors managers and the corporate decision process. In the last few decades, capital market regulators around the world have actively encouraged the inclusion of independent directors on the board. Independent directors are directors who have minimal ties to corporate insiders and managers. For example, independent directors must not be managers/insiders of the firm themselves, nor can they be close relatives of these managers/insiders. Also, independent directors cannot work for the firms major customers and suppliers. Researchers, therefore, are interested in how a companys operation decisions and executive behaviour are affected by the percentage of independent directors relative to all directors on a board. Propose a research program on this topic and provide discussions on the following points.

Required:

a. Propose a research question (Suggest which aspect of a company might be affected when the board independence is high, and explain why). (4 marks)