The Corporate Governance Role of Shareholders in Common-Law Jurisdictions

Analyst Following, Corporate Governance And Valuation: Emerging-Market Evidence

Journal of Applied Business Research (JABR) ◽

10.19030/jabr.v25i6.996 ◽

2011 ◽

Vol 25 (6) ◽

Author(s):

Minna Yu

Keyword(s):

Corporate Governance ◽

Emerging Markets ◽

Emerging Market ◽

Common Law ◽

Analyst Following ◽

The Common ◽

Corporate Governance Quality ◽

High Level

This paper considers analyst following as a substitute way of disciplining companies and examines the joint impact of corporate governance and analyst following on valuation in an emerging-market setting. I find that the interaction of analyst following and corporate governance on valuation is not significant for my whole sample. Breaking down the sample to common law versus code law countries indicates that, only for common law countries, the positive relation between the quality of corporate governance and valuation is weaker for companies with greater analyst following than for companies with lower analyst following. This paper joins the stream of research on the monitoring role of financial analysts.<a name="OLE_LINK2"></a><a name="OLE_LINK1"> </a>It extends Lang et al. (2004) by examining the joint impact of analyst following and corporate governance on valuation with a proxy of overall corporate governance quality. In addition, the finding from this paper suggests that analyst’s governance role is more pronounced in common law countries of emerging markets where analyst service is in greater need. The results have implications for investors, analysts and managers in the common law countries of emerging markets that firms with weak corporate governance benefit more from having a high level of analyst following in terms of market valuation.

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Corporate Governance in the Common-Law World

10.1017/cbo9781139003964 ◽

2013 ◽

Cited By ~ 7

Author(s):

Christopher M. Bruner

Keyword(s):

Corporate Governance ◽

Common Law ◽

The Common

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Convergence of Corporate Governance Models

Voprosy Ekonomiki ◽

10.32609/0042-8736-2004-1-129-140 ◽

2004 ◽

pp. 129-140 ◽

Cited By ~ 1

Author(s):

M. Tretyakov

Keyword(s):

Corporate Governance ◽

Institutional Environment ◽

Driving Forces ◽

Commodity Markets ◽

Legal Systems ◽

National Institutions ◽

Governance Models ◽

Changing Role

The article focuses on the analysis of the process of convergence of outsider and insider models of corporate governance. Chief characteristics of basic and intermediate systems of corporate governance as well as the changing role of its main agents are under examination. Globalization of financial and commodity markets, convergence of legal systems, an open exchange of ideas and information are the driving forces of the convergence of basic systems of corporate governance. However the convergence does not imply the unification of institutional environment and national institutions of corporate governance.

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