Does cultural value affect board efficacy? Insights on international corporate governance

2017 ◽  
Vol 59 (6) ◽  
pp. 1257-1268 ◽  
Author(s):  
Mohammad Nurunnabi
Keyword(s):  
Corporate Governance ◽  
Negative Impact ◽  
Positive Impact ◽  
Religious Diversity ◽  
Cultural Value ◽  
Corporate Ethics ◽  
Content Type ◽  
The World ◽  
Governance Practices ◽  
Significant Negative Impact

Purpose This study aims to investigate how culture can either reinforce or attenuate the board efficacy (a key element of corporate governance). Design/methodology/approach The study uses the data from the World Economic Forum (2006-2014) of 69 countries. The data were restricted to 69 countries because Hofstede et al. (2010) provided cultural value data from 111 countries. However, the data from 42 countries were incomplete for Hofstede et al.’s four dimensions. Findings The study is the first to show that more religious diversity has a significant negative impact on stronger board efficacy in evaluating corporate governance practices. The results also indicate that more uncertainty avoidance in a country has a significant negative impact and corporate ethics and auditing standards have a positive impact on board efficacy. Originality/value The study extends Hofstede et al.’s (2010) cultural value by incorporating religious diversity and corporate ethics as cultural variables in explaining board efficacy in corporate governance literature. The Organisation for Economic Co-operation and Development, the World Bank and the International Monetary Fund should focus on cultural factors while developing a single set of Corporate Governance Code worldwide.

Corporate governance and performance of medium-sized firms in Nigeria: does sustainability initiative matter?

2020 ◽  
Vol 20 (3) ◽  
pp. 401-427
Author(s):  
Babatunji Samuel Adedeji ◽  
Tze San Ong ◽  
Md Uzir Hossain Uzir ◽  
Abu Bakar Abdul Hamid
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Financial Reporting ◽  
Structural Equation ◽  
Negative Impact ◽  
Positive Impact ◽  
Mediating Effect ◽  
Content Type ◽  
And Performance ◽  
The Relationship

Purpose The non-existence of the corporate governance (CG) concept for practices by non-financial medium-sized firms (MSFs) in Nigeria informed. This study aims to determine whether CG practices influence firms’ performance and whether sustainability initiative (SI) mediates the relationship between CG and MSFs’ performance in Nigeria. Design/methodology/approach A total of 300 firms were selected on convenience sampling basis from South Western Nigeria using a structured questionnaire. The authors used Statistical Package for Social Sciences for exploratory data analysis and hypotheses were tested using covariance-based structural equation modelling. Findings The results show that CG has a significant positive effect on performance [financial performance (FNP) and non-financial performance (NFP)] and SI. SI has a mixed impact on performance, e.g. a significant positive impact on NFP but insignificant negative impact on FNP. Similarly, SI has a combined mediating effect in the relationship between CG and performance, e.g. fully mediates CG → NFP and does not mediate CG → FNP. Firms are to invest in social and environmental initiatives substantially. CG codes will complement the International Financial Reporting Standards for MSFs. Research limitations/implications This study supports the assumptions of theories (institutional, stakeholder and agency) as the basis for the usage of multiple approaches to determine the outcome of hypotheses, especially in developing climes. Practical implications The study contributes to CG and performance literature by examining the mediating effects of SI. The paper also shows the necessity to emphasise NFP aspect. Policymakers should evolve CG codes to encourage stakeholders to believe more in the corporate existence of MSFs for strengthening capital-base and quality personnel engagement. Originality/value To the best of the authors’ knowledge, this is one of the first empirical attempts showing the evidence on the relationship between CG and NFP in Nigeria.

scholarly journals Relationship between Earning Multiples, Corporate Governance and Earnings Management Practices: An Empirical View with a Mediation Analysis

2019 ◽  
Vol IV (I) ◽  
pp. 387-395
Author(s):  
Syeda Faiza Urooj ◽  
Muhammad Anees Khan ◽  
Muzammal Ilyas Sindhu
Keyword(s):  
Corporate Governance ◽  
Audit Committee ◽  
Management Practices ◽  
Negative Impact ◽  
Positive Impact ◽  
Random Effect ◽  
Random Effect Model ◽  
Mediation Process ◽  
New Findings ◽  
Significant Negative Impact

This paper investigated the effect of corporate governance in improving the earnings multiple and reducing the discretionary accruals. This study developed four econometrics models. Random effect model employed for examining the first three econometric models, while for the fourth econometric model study used Andrew F. Hayes mediation process. Results suggest that BOD size, BOD meetings and audit committee size has a significant positive impact on earnings multiples, while earnings multiples have a negative impact on dictionary accrual. Moreover, BOD size and audit committee size has a significant negative impact on dictionary accrual, whereas BOD meetings and employee ownership has a significant positive impact on dictionary accrual. The results further revealed the novel link that earnings multiples partially mediate the relationship between corporate governance variables and dictionary accrual. The new findings provide important insights for all the stakeholders like government, practitioners, academia, researchers, banks, Bursa Malaysia, security commission and public listed companies.

scholarly journals Does Growing Economy And Better Governance Impede Banking Efficiency? A DEA Analysis

2015 ◽  
Vol 31 (6) ◽  
pp. 2213
Author(s):  
Ramiz Ur Rehman ◽  
Junrui Zhang ◽  
Rizwan Ali ◽  
Abdul Qadeer
Keyword(s):  
Corporate Governance ◽  
Interest Rates ◽  
Banking Sector ◽  
Negative Impact ◽  
Positive Impact ◽  
Foreign Banks ◽  
Significant Difference ◽  
Governance Practices ◽  
Growing Economy ◽  
The Impact

The paper estimates the efficiencies of Pakistani banking sector from 1998-2009. The analysis is further extended and regressed estimated banking efficiencies by using Data Envelopment Analysis (DEA), with macro-economic indicators and corporate governance variables of the banking sector. The purpose of this analysis is to determine the impact of overall economic conditions of a country and corporate governance practices on banking efficiencies. The results suggest that the corporate governance practices, like, board size, board independence have positive impact on overall banking sector efficiencies of Pakistan. Also, the GPD growth and interest rates have positive and negative impact on banking efficiencies respectively. The study has not found any significant difference in banking efficiencies of state-owned, private and foreign banks of Pakistan. 

The land is what matters: factors driving family farms to organic production in Poland

2019 ◽  
Vol 121 (6) ◽  
pp. 1354-1367
Author(s):  
Pawel Chmielinski ◽  
Aleksandra Pawlowska ◽  
Monika Bocian ◽  
Dariusz Osuch
Keyword(s):  
Organic Farming ◽  
Negative Impact ◽  
Positive Impact ◽  
Organic Production ◽  
Family Farm ◽  
Family Farms ◽  
Content Type ◽  
The Family ◽  
Significant Negative Impact ◽  
Direct Payments

PurposeThe purpose of this paper is to analyse tendency of farms to switch from conventional to organic production.Design/methodology/approachThe study used data on 6,229 individual farms, which in 2009–2016 continued to participate in the Polish FADN. Estimation of logit models allowed the authors to indicate, separately for each period in the years between 2009 and 2015, a set of characteristics influencing the decision of farms on the use of organic production.FindingsThe authors demonstrate that, first of all, land factors were of major importance when deciding on conversion to organic farming, with only the own land inputs (owned by the farm) having a positive impact on the transition of farms to organic production. But then the resource of the capital factor, identified with the assets owned by the farm, exercised a significant negative impact. Income derived from the family farm, although had a positive impact, did not significantly determine the farm’s decision on conversion to organic production. While support for agri-environmental purposes had a positive impact on the decision of farm to convert, the payments received under the direct payments affected this decision negatively. The tendency to start organic production is also conditioned regionally.Research limitations/implicationsThe data of this study are limited in size, and limited to the Polish context.Originality/valueThe research setting for this paper is original; the study takes part in the discussion about factors of conversion to organic farming, on example of Poland and is a voice in the discussion on effective support for the development of organic farming in the context of sustainable development.

scholarly journals Corporate Governance Practices and Bank Performance: Evidence from Indian Banks

2020 ◽  
Vol 4 (1) ◽  
pp. 33-41
Author(s):  
Brahmaiah Bezawada
Keyword(s):  
Corporate Governance ◽  
Banking Industry ◽  
Negative Impact ◽  
Positive Impact ◽  
Negative Relationship ◽  
Bank Performance ◽  
Tobin’S Q ◽  
Board Size ◽  
Tobin's Q ◽  
Governance Practices

The study examines the corporate governance practices and analyzes the role of the board characteristics (size of the board, the composition of the board, and functioning of the board) on the performance and asset quality of banks. We use a sample of 34 commercial banks consisting of 19 public sector banks and 15 private sector banks from 2009 to 2018 accounting for 93 percent of the total banking industry in India. The study finds that busy directors and the number of meetings have a positive significance on bank performance. The percentage of independent directors and the percentage of busy directors influence a significant negative relationship on the net non-performing assets ratio. The board size and number of meetings are associated negatively with Tobin's Q significantly and the percentage of busy directors is a significantly positive impact on Tobin's Q. The board size has a significantly negative impact on bank performance. The research findings provide some insights into corporate governance to the RBI for considering appropriate policy guidelines on corporate governance in the banking industry in India. The paper adds to the existing literature on corporate governance mechanisms and banking industry performance.  

scholarly journals Corporate governance practices and comprehensive income

2018 ◽  
Vol 18 (3) ◽  
pp. 462-477 ◽  
Author(s):  
Erika López-Quesada ◽  
María-del-Mar Camacho-Miñano ◽  
Samuel O. Idowu
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Positive Impact ◽  
Negative Relationship ◽  
Multivariate Statistical ◽  
Main Hypothesis ◽  
Content Type ◽  
Comprehensive Income ◽  
Governance Practices ◽  
Governance Strategies

PurposeThe purpose of this paper is to analyze the effect of corporate governance practices on firms’ financial performance, as measured by comprehensive income (CI).Design/methodology/approachUsing a sample of 237 firms from the Standards & Poor (S&P) 500 index during the years 2004-2009, multivariate statistical analyses are conducted to confirm the authors’ main hypothesis.FindingsThe results indicate that having high levels of corporate governance culture has a positive impact on a measure of firms’ financial performance, namely, CI. Furthermore, they indicate a positive correlation between a higher percentage of external directors and financial performance, and a negative relationship between number of board meetings and financial performance.Originality/valueThe main contribution of this research is that good corporate governance strategies deliver superior financial performance for businesses in terms of CI. This serves as a method of value creation, which is the ultimate goal of a business. In addition to the use of CI as an indicator of financial performance, a unique measure of corporate governance level is tested.

scholarly journals Pengaruh Audit Internal, Struktur Modal, Dan Good Corporate Governance Terhadap Kinerja Keuangan

2020 ◽  
Vol 2 (1) ◽  
pp. 2001-2019
Author(s):  
Amara Meidiana ◽  
Erinos NR
Keyword(s):  
Corporate Governance ◽  
Capital Structure ◽  
Financial Performance ◽  
Sampling Method ◽  
Negative Impact ◽  
Positive Impact ◽  
Stock Exchange ◽  
Internal Audit ◽  
Good Corporate Governance ◽  
Significant Negative Impact

Economic growth according to business field said that financial sector in 2016 to 2018 were decreased year by year. It indicates that there was a financial performance’s decline in financial sector’s companies. In order to increase financial performance, we need to find out factors that could accelerate financial performance’s potential. Internal audit, capital structure, and good corporate governance are independent variables that will be tested in this research for their impacts on financial performance. This research uses ROA, ROE, & NPM combination as internal audit’s proxies and DAR, DER, & LDER as capital structure’s proxies which are still minor in prior researchs. The purpose of this research is to test how far internal audit, capital structure, and good corporate governance could affect financial performance partially. This research was tested on financial sector’s companies that listed on Indonesia Stock Exchange in 2016 to 2018 with 129 samples using purposive sampling method with judgment. The results of this research proved that internal audit had insignificant positive impact on financial performance, capital structure had significant negative impact on financial performance, while good corporate governance had significant positive impact on financial performance with significant level 0,005 which is had not reach the maximum standard 0,05 yet.

scholarly journals The Impact of Corporate Governance on the Profitability of Insurance Firms in Syria

2021 ◽  
Vol 12 (2) ◽  
pp. 150
Author(s):  
Souzan M. Kabbani ◽  
Essam K. Zaneldin
Keyword(s):  
Corporate Governance ◽  
Firm Size ◽  
Negative Impact ◽  
Positive Impact ◽  
Board Members ◽  
Return On Equity ◽  
Independent Variables ◽  
Significant Negative Impact ◽  
Insurance Firms ◽  
The Impact

This paper investigates the impact of corporate governance on the profitability of joint-stock insurance firms listed and unlisted in the ‘Damascus Securities Exchange’ in Syria during the period from 2013 to 2019. Research data was collected from the financial reports of the insurance firms and the reports of the ‘Syrian Insurance Supervisory Commission’ and the ‘Syrian Commission of Financial Markets and Securities’. A model was then proposed for corporate governance of insurance firms. The proposed model considers eight independent variables (board size, independence of board members, non-executive board members, solvency, ownership, firm size, firm age, and joint-stock) and two dependent variables (return on equity and return on shares). Multi regression analysis for the ‘Balanced Panel Data’ is used to analyze the relationship between the governance of insurance firms and their profitability. The analysis of the results revealed that some independent variables (such as firm size, ownership, and none-executive members) have a significant positive impact on the return on equity while the ‘firm size’ and ‘ownership’ independent variables have a significant positive impact on the return on shares. The ‘solvency’ variable has a significant negative impact on the return on equity and return on shares. On the other hand, the ‘firm age’ variable has a significant negative impact on the return on equity while the ‘joint-stock’ variable is considered statistically significant with a positive impact on the return on shares. It was also observed that the ‘independence of board members’ variable has no impact on the dependent variables.

Corporate governance, financial crises and bank performance: lessons from top Russian banks

2016 ◽  
Vol 16 (5) ◽  
pp. 798-814 ◽  
Author(s):  
Nurlan Orazalin ◽  
Monowar Mahmood ◽  
Keun Jung Lee
Keyword(s):  
Corporate Governance ◽  
Financial Crisis ◽  
Financial Crises ◽  
Positive Impact ◽  
Operating Performance ◽  
Annual Reports ◽  
Bank Performance ◽  
Content Type ◽  
Governance Practices ◽  
The Impact

Purpose The purpose of this paper is to investigate the impact of different dimensions of corporate governance practices such as board characteristics, ownership structure, corporate disclosure and CEO education on the operating performance of Russian banks before, during and after financial crises. Based on the findings, it proposes some policy measures for improved governance practices to protect banks from future financial crisis or economic downturns. Design/methodology/approach The study comprises data from the largest publicly traded Russian banks listed on the Russian Stock Exchange RST for the period. Operating performance data were collected from financial statements, while corporate governance mechanisms were collected from annual reports available on the banks’ websites. Because panel data were used, the panel regression model was used to control unobserved time-constant heterogeneity. Findings The findings revealed a positive impact of corporate governance on bank performance before and after the financial crisis. The financial crisis enforced Russian banks to improve their corporate governance practices, resulting in better operating performance after the crisis. Surprisingly, the results for the during-crisis period show that better governance did not yield higher operating performance in Russian banks. Originality/value This is one of the first studies to provide empirical results regarding the relationship between corporate governance practices and bank performance in Russia across different financial crisis periods. The findings revealed the uniqueness of corporate governance scenarios of Russia which could provide important guidelines for other transition economies and emerging markets.

scholarly journals Corporate governance and bank performance: Evidence from Bangladesh

2012 ◽  
Vol 8 (1) ◽  
pp. 62-68 ◽  
Author(s):  
Mohammad Badrul Muttakin ◽  
Md. Shahid Ullah
Keyword(s):  
Corporate Governance ◽  
Negative Impact ◽  
Positive Impact ◽  
Governance Structure ◽  
Bank Performance ◽  
Corporate Governance Structure ◽  
Corporate Governance Mechanisms ◽  
Significant Negative Impact ◽  
And Performance ◽  
The Relationship

The study investigates the relationship between the corporate governance structure and performance of listed banks in Bangladesh. We find that board independence and board size have a significant positive impact on performance. However, female directors appear to have no impact on performance. Our evidence indicates that the extent of the managerial ownership level has a significant negative impact on bank performance. These results suggest that better corporate governance mechanisms are imperative for every banking company and should be encouraged for the interest of the investors and other stakeholders.

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