The Effect of Corporate Governance on Supply Chain Integration

Abstract

This study investigates the impact of corporate governance on supply chain integration among medium and large manufacturing firms. Using data collected through a structured survey from 120 firms across diverse industry sectors, the research examines core governance elements-including board independence, board size, board meetings, ownership concentration, and the existence of audit committees-and their influence on internal, supplier, and customer integration within the supply chain. Descriptive, correlational, and regression analyses reveal that higher board independence and the presence of audit committees are significantly associated with greater integration across all supply chain dimensions. The frequency of board meetings was found to enhance internal and customer integration, while board size and ownership concentration did not have a significant effect. These findings demonstrate that robust corporate governance frameworks, particularly those enhancing board independence and oversight, facilitate stronger and more cohesive supply chain integration. The results have important implications for the governance strategies of manufacturing firms seeking to optimize their supply chain performance and competitive position. Limitations concerning sample size and the availability of direct literature in this domain are acknowledged.