Corporate governance practices: global convergence and Indian perspective

2018 ◽  
Vol 10 (3) ◽  
pp. 285-308 ◽  
Author(s):  
Shigufta Hena Uzma
Keyword(s):  
Corporate Governance ◽  
Global Convergence ◽  
Ownership Structure ◽  
Gender Diversity ◽  
Governance Structure ◽  
Developed Countries ◽  
Regulatory Compliance ◽  
Regulatory Environment ◽  
Content Type ◽  
Governance Practices

Purpose This paper aims to study from three perspectives: the developed countries corporate governance (CG) practices, the role of OECD in the global convergence of CG standards and India as an emerging country. Design/methodology/approach The paper reviews the various CG codes and regulations enacted in the Indian paradigm with special reference to the Indian Companies Act 2013 (cited as Act 2013). Findings The Act 2013 endeavours to provide a governance landscape in India with reforms. The new CG codes comprehensively introduce more accountability, transparency and stringent disclosure requirements. However, these changes are affected by the ownership structure, the level of enforcement and regulatory compliance of CG disclosure practices imposed on companies. Research limitations/implications Further research can be carried out in three domains in emerging countries: ownership structure, the effect of legal and regulatory environment and impact of mandatory compliance. Practical implications Legal and regulatory environment are notable extent that can effectively govern the CG codes. An increase in the board size, investor protection and gender diversity, with strong governance structure, can enhance the transparency of companies. Originality/value The paper examines the prominence of CG norms with the ratification of the Indian Companies Act 2013, which is analogous with global CG policies and regulations.

The role of national culture in the impact of board gender diversity on firm performance: evidence from a multi-country study

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Navaz Naghavi ◽  
Saeed Pahlevan Sharif ◽  
Hafezali Bin Iqbal Hussain
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Generalized Method Of Moments ◽  
Gender Diversity ◽  
Governance Structure ◽  
Corporate Governance Structure ◽  
Data Set ◽  
Content Type ◽  
Board Gender Diversity ◽  
The Impact

PurposeThis study seeks to add more insights to the debate on “whether”, “how”, and “under which condition” women representation on the board contributes to firm performance. More specifically, the current study aims to investigate if the effect of board gender diversity on firm performance is dependent on macro factors of national cultures.Design/methodology/approachThe authors used the generalized method of moments regression and a data set consists of 2,550 company year observations over 10 years.FindingsThe results indicated that cultural variables interact with board diversity to influence firm performance. Having women on the board in countries with high power distance, individualist, masculine and low-uncertainty avoidance culture influences the firm performance negatively.Originality/valueThe findings indicate that the effects of corporate governance structure on firm performance depends on culture-specific factors, providing support for the argument that institutional norms that are governed by cultural norms affect the effectiveness of corporate governance structure.

scholarly journals Corporate Governance Practices in Listed State-owned Enterprises in India: An Empirical Research

2019 ◽  
Vol 12 (1) ◽  
pp. 94-121
Author(s):  
J. Kiranmai ◽  
R. K. Mishra
Keyword(s):  
Corporate Governance ◽  
Gender Diversity ◽  
Formal System ◽  
Governance Structure ◽  
Firm Age ◽  
Board Committees ◽  
The Social ◽  
Governance Practices ◽  
Governance Practice ◽  
Entire Network

Corporate Governance (CG) refers to a system in which corporations are directed and controlled. The governance structure specifies the distribution of rights and responsibilities among different participants in the corporation and specifies the rules and procedures for making decisions in corporates. Governance provides the structure through which corporations set and pursue their objectives, while reflecting the context of the social, regulatory and market environment. Governance is a mechanism for monitoring the actions, policies and decisions of corporations. Governance involves the alignment of interests among the stakeholders. CG is an umbrella term. In its narrower sense, it describes the formal system of accountability of corporate directors to the owners of companies. In its broader sense, the concept includes the entire network of formal and informal relationships involving the corporate sector and the consequences of these relationships on society in general. The center objective of the paper is to create linkages between firm performance and governance practice in the listed SOEs in India. The present paper makes an attempt to compare the various CG variables of the listed SOEs for a period of five years ie 2012-13 to 2016-17. A detailed analysis of the 42 listed State Owned Enterprises (SOEs) in terms of board size, board meetings, board committees, board composition, independent directors, firm age, gender diversity has been compared. Finally conclusions are drawn from empirical analysis.

Disclosure and corporate governance in developing countries: evidence from Ghana

2007 ◽  
Vol 22 (3) ◽  
pp. 319-334 ◽  
Author(s):  
Mathew Tsamenyi ◽  
Elsie Enninful‐Adu ◽  
Joseph Onumah
Keyword(s):  
Developing Countries ◽  
Corporate Governance ◽  
Firm Size ◽  
Ownership Structure ◽  
Developing World ◽  
Stock Exchange ◽  
Content Type ◽  
Market Capitalization ◽  
Governance Practices ◽  
Structure Dispersion

PurposeFollowing previous studies the paper seeks to use disclosure scores to examine corporate governance practices of Ghanaian listed firms. The study is motivated by the dearth of literature on corporate governance practices in the developing world despite the increasing interests in the topic in both the developed and the developing world.Design/methodology/approachThe data for the analysis are gathered from 22 listed companies on the Ghana Stock Exchange (GSE representing 95 percent of the Ghanaian market capitalization). The paper also examines the extent to which factors such as ownership structure, dispersion of shareholding, firm size, and leverage influence disclosure practices.FindingsConsistent with findings reported in studies from other developing countries the study finds that the level of disclosure in Ghana is low. Furthermore, ownership structure, dispersion of shareholding, and firm size (measured as total assets and market capitalization) all have significant effect on disclosure. However, the correlation between disclosure and leverage is insignificant.Research limitations/implicationsThe findings of the research will help policy makers and practitioners in formulating corporate governance policies. However, this research is limited because it focuses on only companies listed on the GSE. The results may therefore not be representative of all companies operating in Ghana.Originality/valueThe study is important because of the recent surge in international capital into the developing world (including Ghana) as a result of the ongoing World Bank and IMF led economic reforms. These reforms have emphasized transparency and accountability. There is therefore the need to understand corporate governance practices in these environments.

Corporate governance, risk and efficiency: evidence from GCC Islamic banks

2018 ◽  
Vol 44 (5) ◽  
pp. 551-569 ◽  
Author(s):  
Ghada Ben Zeineb ◽  
Sami Mensi
Keyword(s):  
Corporate Governance ◽  
Ownership Structure ◽  
High Efficiency ◽  
Supervisory Board ◽  
Governance Structure ◽  
Islamic Banks ◽  
Ceo Duality ◽  
Content Type ◽  
Frontier Analysis ◽  
Simultaneous Effect

Purpose The purpose of this paper is to determine the simultaneous effect of corporate governance (CG) of Gulf Cooperation Council (GCC) Islamic banks (IBs) on efficiency and risk. Design/methodology/approach The authors include Shariah supervisory board (SSB) size, Chief Executive Officer (CEO)-duality and ownership structure as CG variables. Efficiency and risk are measured using the data envelopment analysis (DEA)/stochastic frontier analysis (SFA) and Z-score, respectively. This paper also examines the risk-efficiency relationship. To test the hypotheses, the authors used seemingly unrelated regressions on a sample of 56 GCC IBs during the period 2004-2013. Findings The results indicate that implementing rigorous CG structures correlate with higher efficiency levels. Particularly, the authors show that the governance structure of IBs allows them to take higher risks to achieve a high efficiency level. In addition, results show that bank efficiency and risk are positively related. Practical implications This paper gives some insights to policy makers. It points out detail attention toward the importance of CG in IB that influences the efficiency level and risk-taking behavior. Thus, IB should improve governance procedures that can lead to higher efficiency and survival in a competitive environment and sustain financial crisis. Moreover, the economic conditions of a country are the main determinant of an IB’s efficiency and risk relationships. Originality/value The simultaneous effect of the CG of the GCC IBs on efficiency and risk is examined, taking into consideration different CG proxies, i.e., SSB size, CEO-duality and ownership structure, and different efficiency estimation techniques, i.e., SFA and DEA.

Ownership concentration in the Gulf Cooperation Council

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Irma Martinez-Garcia ◽  
Rodrigo Basco ◽  
Silvia Gomez-Anson ◽  
Narjess Boubakri
Keyword(s):  
Corporate Governance ◽  
Ownership Structure ◽  
Gulf Cooperation Council ◽  
Ownership Concentration ◽  
Content Type ◽  
Listed Firms ◽  
Gcc Countries ◽  
Governance Practices ◽  
Institutional Contexts ◽  
Pyramid Structures

PurposeThis article attempts to answer the following questions: Who ultimately owns firms listed in the Gulf Cooperation Council (GCC) countries? Does ownership structure depend on the institutional context? How does ownership affect firm performance? Do institutional factors influence the ownership–performance relationship?Design/methodology/approachWe apply univariate analyses and generalised methods of moments estimations for a sample of 692 GCC listed firms during 2009–2015.FindingsOur results reveal that corporations are mainly controlled by the state or families, the ownership structure is highly concentrated and pyramid structures are common in the region. Ownership is more concentrated in non-financial than financial firms, and ownership concentration and shareholder identity differ by institutional country setting. Finally, ownership concentration does not influence performance, but formal institutions play a moderating role in the relationship.Practical implicationsAs our findings reveal potential type II agency problems due to ownership concentration, policymakers should raise awareness of professional corporate governance practices and tailor them to GCC countries’ institutional contexts.Social implicationsEven with the introduction of new regulations by some GCC states to protect minority investors and promote corporate governance practices, ownership concentration is a rigid structure, and its use by investors to protect their economic endowment and power is culturally embedded.Originality/valueAlthough previous studies have analysed ownership concentration and large shareholders’ identities across countries, this study fills a research gap investigating this phenomenon in-depth in emerging economies.

Foreign investors? The effects of the property structure and legal system as mechanisms of corporate governance in Brazilian regulated companies

2019 ◽  
Vol 19 (5) ◽  
pp. 1082-1116
Author(s):  
Ruan Carlos dos Santos ◽  
Lidinei Éder Orso ◽  
Mônica Cristina Rovaris Machado ◽  
Antonia Márcia Rodrigues Sousa
Keyword(s):  
Corporate Governance ◽  
Legal System ◽  
Ownership Structure ◽  
Control Measures ◽  
The Other ◽  
Regulatory Body ◽  
Foreign Investors ◽  
Content Type ◽  
Governance Practices ◽  
The Impact

Purpose This paper aims to contribute to research on corporate governance in regulated sectors, with emphasis in the field of activity of foreign investors through the ownership structure and legal system that regulates companies in Brazil. Design/methodology/approach In the first moment, the investigation had a quantitative approach of relational nature. Based on the data about the valuation of actions, statistical methods were applied to a secondary database containing measurable information provided by the organizations that operate the Brazilian stock-market and documentary evidence provided by the companies. In the second moment, a qualitative approach was adopted, resorting on the use of semi-structured interviews with investors and agents of the sector. Findings The results lead to two paths: presenting the perspective that foreign investors play a key role in improving governance practices because foreign ownership mitigates agency problems, provides adequate follow-up and optimizes the use of corporate resources; and evidencing the existence of a mitigation of operational risks in the face of the various obligations imposed by the concession contract with the regulatory agency, without direct interference under the ownership structure of regulated companies. Research limitations/implications The literature portrays a distinct economic scenario in Brazil, where stock control is pulverized and mechanisms of corporate governance and scope of action of investors and regulated sectors are well-defined and implemented. Practical implications A great part of the studies from this field discusses the same object: the impact of the adoption of corporate governance mechanisms on selected efficiency indicators or on the value of the companies' actions. This investigation, on the other hand, targeted a differentiated approach so that its contribution would lie in the investigation under the influence of the regulation on the legal attributions and the performance of the investors how many conflicts between the other shareholder/regulatory body, as the control measures import by the regulatory agent the concessionaires of the Brazilian highways and transportation sector. Social implications The identification of the presence of foreign investors as a determinant for: better performance of companies in Brazilian regulated sector in terms of market valuation; better mitigation of requirements with the regulatory framework for the agencies that regulate the concession sector, targeting a reduction in the asymmetry of information and transparency among all stakeholders. Originality/value The fact that Brazil is an emerging country that lacks a rigid legal system and corruption-control measures in corporate environments and public sectors, stresses the importance of the application of the “Best Codes of Corporate Governance Practices” in the main developed countries. This also stresses the need for effective supervisory bodies that contribute to a better financial performance of companies, guaranteeing investors the legal system.

Diversity, corporate governance and CSR reporting

2019 ◽  
Vol 30 (1) ◽  
pp. 116-136 ◽  
Author(s):  
Dina El-Bassiouny ◽  
Noha El-Bassiouny
Keyword(s):  
Corporate Governance ◽  
Institutional Theory ◽  
Governance Structure ◽  
Developed Countries ◽  
Organizational Level ◽  
Content Type ◽  
Explanatory Variables ◽  
Reporting Practices ◽  
Csr Reporting ◽  
The Usa

PurposeTaken from an institutional theory perspective, the purpose of this paper is to explore the effects of organizational-level factors, specifically diversity and corporate governance structure, on the corporate social responsibility (CSR) reporting practices of corporations operating in developing and developed country contexts, namely, Egypt, Germany and the USA. Since developed countries are exposed to different settings, the paper argues that there is likely to be a difference in the organizational-level drivers of CSR reporting in developed vs developing countries.Design/methodology/approachThe sample consists of companies listed on the Egyptian EGX 30 index, the German DAX 30 index and the US Dow Jones 30 index. Governance- and diversity-related data are gathered from multiple sources including the BoardEx and Orbis databases. Content analysis is used to analyze the CSR information of sample companies using the software package MAXQDA. To examine the relationship between the explanatory variables of the study and CSR disclosures, multiple regression analysis is used.FindingsThe results are mostly consistent with institutional theory where the effects of diversity and governance structure, observed mainly by foreign BOD, board independence and institutional ownership, are found to be significant on the CSR disclosure levels of sample Egyptian companies only. On the other hand, no significant influence of tested factors was observed on the level of CSR reporting in the USA and Germany. The results thus indicate that the influence of organizational-level factors on CSR is highly dependent on the institutional context where companies operate.Originality/valueThe influence of diversity and corporate governance on CSR has been separately studied in the management literature. Yet, the potential effects of both variables on CSR have received limited attention. In addition, no study combining such explanatory variables of CSR was carried out in the specific context of developing Middle Eastern countries. Also, illustrating how institutional contexts can influence the dynamics of interaction between organizational-level variables and CSR is still understudied. This kind of multi-level research can help broaden the understanding of the drivers and practices of CSR in developing vs developed countries that have distinct institutional environments.

The relationship between ownership structure, capital structure and corporate governance practices

2014 ◽  
Vol 10 (4) ◽  
pp. 511-536 ◽  
Author(s):  
Krishna Reddy ◽  
Stuart Locke
Keyword(s):  
Corporate Governance ◽  
New Zealand ◽  
Capital Structure ◽  
Ownership Structure ◽  
Agency Costs ◽  
Ordinary Least Squares ◽  
Agency Cost ◽  
Least Squares Regression ◽  
Content Type ◽  
Governance Practices

Purpose – The purpose of this paper is to investigate the nature of corporate governance practised by co-operatives and mutual societies in New Zealand and whether there is any relationship between co-operatives’ ownership structure, capital structure and agency costs. The study also explores whether the capital structure and the ownership structure changed during the period 2005-2011. Design/methodology/approach – Panel data for the period 2005-2011 are analysed using ordinary least squares regression and the Tobit model regression. The authors have used operating expense to sales, asset utilisation and ROA as the dependent variables. Findings – The findings indicate that an increase in independent directors, board member experience and size (measured by total annual sales) reduces agency costs in co-operatives and mutuals in New Zealand. Also, borrowing from members rather than banks reduces agency cost and increases profitability in co-operatives and mutuals. Research limitations/implications – Caution should be exercised when generalising the findings of the study as it is restricted to New Zealand environment and the sample size used is relatively small. Practical implications – This study offers insights for policy makers internationally who are interested in adopting similar corporate governance practices in their own countries. Within New Zealand, the corporate governance debate associated with co-operatives and mutual societies will be better informed as a direct consequence of this research. Originality/value – This is the first study that extends the research undertaken by Ang et al. (2000) and Singh and Davidson (2003) to the cooperative and mutual business model in New Zealand.

Ownership structure and financial performance in European football

2017 ◽  
Vol 17 (3) ◽  
pp. 511-523 ◽  
Author(s):  
Isabel Acero ◽  
Raúl Serrano ◽  
Panagiotis Dimitropoulos
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Ownership Structure ◽  
Boards Of Directors ◽  
Good Practice ◽  
Content Type ◽  
Football Clubs ◽  
Governance Practices ◽  
European Football ◽  
The Impact

Purpose This paper aims to analyse the relationship between ownership structure and financial performance in the five major European football leagues from 2007-2008 to 2012-2013 and examine the impact of the financial fair play (FFP) regulation. Design/methodology/approach The sample used comprises 94 teams that participated in the major European competitions: German Bundesliga, Ligue 1 of France, Spanish Liga, English Premier League and the Italian Serie A. The estimation technique used is panel-corrected standard errors. Findings The results confirm an inverted U-shaped curve relationship between ownership structure and financial performance as a consequence of both monitoring and expropriation effects. Moreover, the results show that after FFP regulation, the monitoring effect disappears and only the expropriation effect remains. Research limitations/implications The lack of transparency of the information provided by some teams has limited the sample size. Practical implications One of the main issues that the various regulating bodies of the industry should address is the introduction of a code of good practice, not only for aspects related to the transparency of financial information but also to require greater transparency in the information concerning corporate governance. Social implications Regulating bodies could also consider other additional control instruments based on corporate governance, such as for example, corporate governance practices, corporate governance codes, greater transparency, control of the boards of directors, etc. Originality/value This study tries to provide direct evidence of the impact of large majority investors in the clubs and FFP regulation on the financial performance of football clubs.

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