For enterprises seeking to improve the ratio of external independent directors to effectively reduce the company agency problem, the professionalism and knowledge of external independent directors can objectively monitor management performance. However, Crystal (1991) indicated that the board cannot effectively determine manager compensation because external independent directors may be assigned through senior managers, resulting in the decline of supervisory capacity, thereby affecting firm value. Therefore, the possible effect of
external independent directors should be given control to avoid affecting the empirical results.