H2-1: The shareholding ratio of directors serving as managers positively affects business performance.
Brick, Palmon and Wald (2005) found that the board did not play a supervisory function well. When senior
managers collude with each other or cronyism occurs, director compensation is significantly positively
correlated with manager compensation. Based on the literature, the controlling shareholders combined with the
board of directors and managers form a community of interest (Yen & Yang, 2012), and collusion occurs among
controlling shareholders, managers, directors, and supervisors. Thus, the following hypotheses are established: