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Study of large-cap firms links small boards to big shareholder returns.

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Big companies with relatively few board--directors produce better returns for--investors than their peers with larger boards, according to a study of US firms with market caps of at least $10bn.

The research, conducted by GMI Ratings for the Wall Street Journal, found that companies with smaller boards typically produced substantially better shareholder returns between 2011 and 2014 than those with bigger boards.

GMI analysed 400 firms in 10 industries, including energy, finance, healthcare and technology. It defined small boards as those with eight to 10 directors and large boards as those with 12 to 14. It found that companies with the smallest boards outperformed their overall sector by 8.5 percentage points.

Apple, which has a board of eight, outperformed the average shareholder return in the technology sector by 37 percentage points...

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