Factors influencing quality corporate governance in Sub Saharan Africa: an empirical study

2014 ◽  
Vol 14 (4) ◽  
pp. 555-574 ◽  
Author(s):  
Nelson Waweru
Keyword(s):  
Corporate Governance ◽  
Firm Size ◽  
Audit Quality ◽  
Developing Economies ◽  
Sub Saharan Africa ◽  
Content Type ◽  
Factors Influencing ◽  
Investment Opportunities ◽  
Sub Saharan

Purpose – This study aims to examine the factors influencing the quality of corporate governance in South Africa (SA). Firm-level variables including performance, firm size, leverage, investment opportunities and audit quality were identified from the corporate governance literature. Design/methodology/approach – The study used ordinary least squares regression on firm-specific and corporate governance variables obtained from panel data of 247-firm years obtained from the annual reports of the 50 largest companies listed on the Johannesburg Stock Exchange (JSE) Securities Exchange of SA. Findings – This study found leverage, firm size and investment opportunities as the main factors influencing the quality of corporate governance in SA. Research limitations/implications – The research findings should be interpreted in the light of the following limitations. First, the study sample consists of the 50 largest firms listed in the JSE of SA. Because these are large companies, the results may not be generalized to other smaller firms operating in SA. Second, this study is constrained to SA. Firms in other developing countries may differ from their SA counterparts. Originality/value – The results of this study are important to the King Committee and other corporate governance regulators in Sub-Saharan Africa, in their effort to improve corporate governance practices and probably minimize corporate failure and protect the well-being of the minority shareholders. Furthermore, the study contributes to our understanding of the variables affecting the quality of corporate governance in developing economies of Africa.

Determinants of quality corporate governance in Sub-Saharan Africa

2014 ◽  
Vol 29 (5) ◽  
pp. 455-485 ◽  
Author(s):  
Nelson Waweru
Keyword(s):  
Corporate Governance ◽  
Audit Quality ◽  
Developing Economies ◽  
Well Being ◽  
Sub Saharan Africa ◽  
Annual Reports ◽  
Content Type ◽  
Factors Influencing ◽  
Sub Saharan

Purpose – This study aims to examine the factors influencing the quality of corporate governance in South Africa (SA) and Kenya. Firm-level variables including performance, firm size, leverage, investment opportunities and audit quality were identified from the corporate governance literature. Design/methodology/approach – The study used panel data of 247-firm years obtained from the annual reports of the 50 largest companies listed on the Johannesburg Securities Exchange (JSE) of SA and 234-firm years obtained from the 49 companies listed on the Nairobi Stock Exchange (NSE). The author then used content analysis to extract the study variables from the annual reports and multiple regression analysis to determine their relationship. Findings – The study found audit quality and firm performance as the main factors influencing the quality of corporate governance in Kenya and SA. There are also differences in the quality of corporate governance between the two countries. Research limitations/implications – First the study sample consists of the 50 largest firms listed in the JSE of SA and another 49 companies listed in the NSE of Kenya. Since these are large companies, the results may not be generalized to other smaller firms operating in both SA and Kenya. Second, this study is constrained to SA and Kenya. Firms in other developing countries may differ from their SA and Kenyan counterparts. Originality/value – The results of this study are important to the King Committee and other corporate governance regulators in Sub-Saharan Africa, in their effort to improve corporate governance practices, minimize corporate failure and protect the well-being of the minority shareholders. Furthermore, the study contributes to the understanding of the variables affecting the quality of corporate governance in developing economies of Africa.

Audit committee versus other governance mechanisms and the effect of investment opportunities: evidence from Palestine

2020 ◽  
Vol 20 (3) ◽  
pp. 527-544 ◽  
Author(s):  
Islam Abdeljawad ◽  
Ghassan A.I. Oweidat ◽  
Norman Mohd Saleh
Keyword(s):  
Corporate Governance ◽  
Audit Committee ◽  
Audit Quality ◽  
Valuable Insight ◽  
Governance Mechanisms ◽  
Content Type ◽  
Corporate Governance Mechanisms ◽  
Investment Opportunities ◽  
The Relationship

Purpose This paper aims to explore how the presence of an audit committee is associated with other corporate governance mechanisms, i.e. board structure, ownership structure and quality of external audit. The present study evaluated whether the presence of the audit committee complements or substitutes other governance mechanisms in Palestinian companies. Moreover, the effect of investment opportunities on the relationship between the formation of the audit committee and the quality of the auditor was addressed. Design/methodology/approach The association between the formation of the audit committee and other governance variables was modelled as a binary logistic model. The sample comprising 44 firms listed on Palestine exchange for the period between 2013 and 2017, amounting to 220 firm-year observations. Findings Based on the investigation, the results have indicated that board independence, the distinction between the chairman and chief executive officer function, ownership concentration and audit quality enhance the chance of audit committee formation, implying complementary effect. Contrastingly, board size and board ownership serve as a substitute to audit committee formation. It has also been found that investment opportunities act as an effective moderating factor that strengthens the relationship between audit quality and the formation of the audit committee. Originality/value The study provides valuable insight into the interaction between multiple corporate governance mechanisms within the economy of Palestine where the external uncertainty is high and investment opportunities are constrained by the decisions of the occupying authority. The findings may help regulators and policymakers in Palestine alongside those of other countries with similar environmental features to revise and update their corporate governance codes to ensure that the best control can be achieved, subsequently attracting more foreign and domestic investments.

Innovation, institutions and economic growth in sub-Saharan Africa – an IV estimation of a panel threshold model

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Joseph Ato Forson ◽  
Rosemary Afrakomah Opoku ◽  
Michael Owusu Appiah ◽  
Evans Kyeremeh ◽  
Ibrahim Anyass Ahmed ◽  
...  
Keyword(s):  
Economic Growth ◽  
Developing Economies ◽  
Innovation Policy ◽  
Threshold Model ◽  
Sub Saharan Africa ◽  
Content Type ◽  
Panel Regressions ◽  
Sub Saharan ◽  
The Impact ◽  
The Relationship

PurposeThe significant impact of innovation in stimulating economic growth cannot be overemphasized, more importantly from policy perspective. For this reason, the relationship between innovation and economic growth in developing economies such as the ones in Africa has remained topical. Yet, innovation as a concept is multi-dimensional and cannot be measured by just one single variable. With hindsight of the traditional measures of innovation in literature, we augment it with the number of scientific journals published in the region to enrich this discourse.Design/methodology/approachWe focus on an approach that explores innovation policy qualitatively from various policy documents of selected countries in the region from three policy perspectives (i.e. institutional framework, financing and diffusion and interaction). We further investigate whether innovation as perceived differently is important for economic growth in 25 economies in sub-Saharan Africa over the period 1990–2016. Instrumental variable estimation of a threshold regression is used to capture the contributions of innovation as a multi-dimensional concept on economic growth, while dealing with endogeneity between the regressors and error term.FindingsThe results from both traditional panel regressions and IV panel threshold regressions show a positive relationship between innovation and economic growth, although the impact seems negligible. Institutional quality dampens innovation among low-regime economies, and the relation is persistent regardless of when the focus is on aggregate or decomposed institutional factors. The impact of innovation on economic growth in most regressions is robust to different dimensions of innovation. Yet, the coefficients of the innovation variables in the two regimes are quite dissimilar. While most countries in the region have offered financial support in the form of budgetary allocations to strengthen institutions, barriers to the design and implementation of innovation policies may be responsible for the sluggish contribution of innovation to the growth pattern of the region.Originality/valueSegregating economies of Africa into two distinct regimes based on a threshold of investment in education as a share of GDP in order to understand the relationship between innovation and economic growth is quite novel. This lends credence to the fact that innovation as a multifaceted concept does not take place by chance – it is carefully planned. We have enriched the discourse of innovation and thus helped in deepening understanding on this contentious subject.

Choice of governance structure and earnings quality

2016 ◽  
Vol 29 (4) ◽  
pp. 372-390 ◽  
Author(s):  
Pamela Kent ◽  
Richard Anthony Kent ◽  
James Routledge ◽  
Jenny Stewart
Keyword(s):  
Cluster Analysis ◽  
Corporate Governance ◽  
Firm Size ◽  
Design Methodology ◽  
Best Practice ◽  
Earnings Quality ◽  
Governance Structure ◽  
Governance Mechanisms ◽  
Content Type

Purpose The purpose of this paper is to examine the effectiveness of voluntary governance mechanisms in Australia. Design/methodology/approach This study identifies similar choices of corporate governance by Australian firms and tests the effectiveness of the choices made based on the earnings quality of reported firms. Cluster analysis is conducted using governance best practice variables, firm size and an earnings quality variable. Findings This paper’s results support the voluntary governance approach for smaller firms, but suggest that mandatory governance requirements could be beneficial for larger firms. Evidence suggests that a benefit accrues for larger firms with the adoption of governance best practice. Cluster analysis indicates that larger firms tend to exhibit higher levels of adoption of governance best practice than smaller firms. Originality/value This paper adds to the literature by providing important information regarding the suitability of adoption of voluntary governance mechanisms in Australia.

scholarly journals Managing university records in the world of governance

2018 ◽  
Vol 28 (1) ◽  
pp. 47-61 ◽  
Author(s):  
Mathews J. Phiri ◽  
Alistair George Tough
Keyword(s):  
Higher Education ◽  
Corporate Governance ◽  
Sub Saharan Africa ◽  
Records Management ◽  
Content Type ◽  
Collective Case Study ◽  
Record Keeping ◽  
The World ◽  
Sub Saharan

Purpose The purpose of this paper is to investigate the relationship between corporate governance and records management in the context of higher education in Sub-Saharan Africa. Design/methodology/approach This is a qualitative research taking the form of a collective case study of six institutions. Findings That good records management can and does contribute to effective corporate governance and accountability. However, this relationship is not necessarily present in all circumstances. Research limitations/implications That further corporatisation in higher education is likely to be supported by, and result in, better records management. Originality/value The paper proposes governance record keeping as an approach to managing records and documents in the world of governance, audit and risk.

Business ethics disclosure and corporate governance in Sub-Saharan Africa (SSA)

2020 ◽  
Vol 28 (2) ◽  
pp. 363-387 ◽  
Author(s):  
Nelson Waweru
Keyword(s):  
Corporate Governance ◽  
Business Ethics ◽  
Gender Diversity ◽  
Sub Saharan Africa ◽  
Stock Exchanges ◽  
Government Ownership ◽  
Content Type ◽  
Sub Saharan ◽  
Board Gender Diversity ◽  
The Relationship

Purpose The purpose of this paper is to examine the relationship between business ethics practices disclosure and corporate governance characteristics in Sub-Saharan Africa. Design/methodology/approach The study uses multiple regression to investigate the association between business ethics disclosure (BED) and corporate governance characteristics in SAA. The study sample is based on 573 non-financial corporations listed on the national stock exchanges of Ghana, Kenya, Nigeria, South Africa and Zimbabwe as of 31 December 2015. Findings The findings show that corporate governance characteristics (including the proportion of government ownership, board independence and board gender diversity) are positively and significantly related to BED. Originality/value The study contributes to the limited literature by analyzing the relationship between BED practices and corporate governance characteristics in the sub-Sahara African context, which is significantly different from the Anglo-Saxon world.

Does the corruption perception level of a country affect listed firms’ IFRS 7 risk disclosure compliance?

2017 ◽  
Vol 17 (4) ◽  
pp. 727-747 ◽  
Author(s):  
Ben Kwame Agyei-Mensah
Keyword(s):  
Corporate Governance ◽  
Sub Saharan Africa ◽  
Risk Disclosure ◽  
Reporting Standard ◽  
International Financial Reporting Standard ◽  
Content Type ◽  
Listed Firms ◽  
Ifrs 7 ◽  
Sub Saharan ◽  
The Impact

Purpose This paper aims to examine the relationship between corporate governance, corruption and compliance with International Financial Reporting Standard (IFRS 7) risk disclosure requirements in listed firms in two Sub-Saharan Africa countries: Botswana and Ghana. This study tries to test whether the transparency level of a country has any impact on the transparency level of its firms. Design/methodology/approach The study uses 174 firm-year observations between the period 2013-2015 for listed firms in the two countries. Each annual report was individually examined and coded to obtain the disclosure of corporate risk disclosure index. Descriptive analysis was performed to provide the background statistics of the variables examined. This was followed by regression analysis, which forms the main data analysis. Findings The results suggest that the extent of risk disclosure compliance over the three-year period is, on average, 63 and 53 per cent for Botswana and Ghana, respectively. The differences in the disclosure levels in the two countries can be attributed to the different levels of corruption in the two countries. One way of hiding corrupt practices is for companies to disclose scanty information. Originality/value This is one of the few studies in Sub-Saharan Africa that tests the transparency levels of listed firms in the two countries by considering the impact of corporate governance factors on IFRS 7 risk disclosure compliance. The findings of this study will help market regulators in Ghana, Botswana, the Sub-Saharan Africa Security and Exchange Commission (SEC) and the Sub-Saharan Africa exchanges in evaluating the adequacy of the current disclosure regulations in their countries.

Does the historical and institutional re-construction of Ghana support the transfer of HRM practices?

2018 ◽  
Vol 24 (4) ◽  
pp. 414-434 ◽  
Author(s):  
Desmond Tutu Ayentimi ◽  
John Burgess ◽  
Kantha Dayaram
Keyword(s):  
Host Country ◽  
Developing Economies ◽  
Sub Saharan Africa ◽  
Local Conditions ◽  
Content Type ◽  
Hrm Practices ◽  
Country Factors ◽  
Practice Transfer ◽  
Sub Saharan ◽  
Institutional Legacies

Purpose This study aims to investigate whether the historical and institutional re-construction of Ghana support the transfer of human resource management (HRM) practices and if so, what local conditions support such transfer? Design/methodology/approach The paper draws from an exploratory qualitative study design by assimilating history, culture and institutions (social institutionalist perspective) to explore host-country factors and conditions supporting the transfer of HRM practices in a developing country context. Findings The study finds the colonial history, and the political and economic interests of Ghana to mimic best HRM policies and practices from its colonial masters and other advanced economies provided strong institutional support for the transfer of HRM practices. Research limitations/implications This paper complements the understanding of HRM practice transfer literature by highlighting the significance of host-country historical and institutional re-construction support in developing economies as key drivers for the diffusion of HRM practices. Practical implications By incorporating institutions, history and culture to form the underpinning social context, it offers a new perspective into how historical, cultural and colonial institutional legacies as entrenched social instruments facilitate HRM practice transfer in Sub-Saharan Africa. Originality/value The integration of institutions, history and culture (social institutionalist perspective) provide a wider understanding of factors that denote the effect of Ghanaian contextual distinctiveness as against the continued colonial institutional legacies (inheritance) supporting the transfer of HRM practices. This is the first study to consider how local institutions, culture and history of Ghana support the transfer of HRM practices to subsidiaries.

COVID-19 will embolden autocrats

2020 ◽  
Keyword(s):  
Human Rights ◽  
Sub Saharan Africa ◽  
Quality Of Democracy ◽  
Checks And Balances ◽  
Security Forces ◽  
Content Type ◽  
Human Rights Abuses ◽  
The World ◽  
Sub Saharan

Subject Democracy and COVID-19 Significance A growing number of leaders are using the COVID-19 pandemic as an opportunity to curtail the activities of opposition parties and to expand their powers. In some cases, such as Malawi, unpopular presidents are using a declaration of emergency to prohibit opposition rallies and protests. In others, such as Hungary, emergency laws have been introduced that effectively undermine democratic checks and balances. The need for lockdown and quarantine to contain the virus has also led to a militarisation of the healthcare response -- with significant human rights abuses already reported in Kenya, Rwanda and South Africa. Impacts Further power grabs are likely as the crisis's impact is increasingly felt in Sub-Saharan Africa. Human rights violations will increase as stretched security forces enforce lockdowns on populations that have limited trust in government. The quality of democracy in many parts of the world will continue to decline.

Firm productivity in Sub-Saharan Africa: how relevant is quality of tax administration?

2019 ◽  
Vol 11 (1) ◽  
pp. 75-90
Author(s):  
Kofi Kamasa ◽  
George Adu ◽  
Eric Fosu Oteng-Abayie
Keyword(s):  
Business Environment ◽  
Poor Quality ◽  
Least Square ◽  
Sub Saharan Africa ◽  
Tax Administration ◽  
Firm Productivity ◽  
Content Type ◽  
Sub Saharan ◽  
The Impact

Purpose The purpose of this paper is to find the effect of quality of tax administration on firm productivity in Sub-Saharan Africa (SSA). Also, the paper investigates whether the effect of quality of tax administration on firm productivity varies with respect to firms of different ages and sizes. Design/methodology/approach The paper uses the World Bank Enterprise Survey data for 6,718 firms across 40 countries in SSA. By employing the least square method, the estimations are robust since country and industry heterogeneity are controlled, as well as other covariates that affect firm productivity such as capital, technology, business environment, infrastructure and firm characteristics. Findings Results of the paper reveal that productivity of firms reduces with poor quality of tax administration. With positive and significant interaction term coefficient between smaller firms and quality of tax administration, the findings also reveal that smaller firms do benefit in the presence of poor quality of tax administration than larger firms. Originality/value The study contributes to policy by providing empirical evidence on the impact that quality of tax administration has on firm productivity. Empirically, the paper is also the first to assess the effect of tax administration quality on firm productivity with sole emphasis on SSA (to the best of the authors’ knowledge after review of literature). The paper suggests reforms and improvement in tax administration so as to reduce compliance burden and improve productivity.

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