Do Shareholder Activism Effect Corporate Governance and Related Party Transactions: Evidences from India?

2020 ◽  
Vol 13 (2) ◽  
pp. 165-189
Author(s):  
Ajaz Ul Islam
Keyword(s):  
Corporate Governance ◽  
Shareholder Activism ◽  
Close Monitoring ◽  
Related Party Transactions ◽  
Listed Firms ◽  
Significant Difference ◽  
Governance Practices ◽  
Governance Practice ◽  
The Impact ◽  
The Relationship

The study investigates the relationship between corporate governance performance, related party transactions and shareholder activism among listed firms in India. The study provides valuable insights into the impact of shareholder activism on corporate governance performance (CGP) and the occurrence of related party transactions (RPTs). Results infer a significant difference in overall CGP between the firms subjected to shareholder activism and firms not subjected to shareholder activism. The study proposes significant evidence on the close monitoring of the governance practices of the firm by activists’ investor and they respond immediately to any evidence of poor governance practice of the firm. A significant difference was found in the amount of sales to RP prior to the incidence of SA than the post incidence of SA for the firms subjected to SA. However, no such difference was found with respect to other major components of RP.

scholarly journals Performance, corporate governance and new regulation

2017 ◽  
Vol 9 (18) ◽  
Author(s):  
Heriberto García
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Financial Market ◽  
Information Disclosure ◽  
Potential Growth ◽  
Listed Firms ◽  
Risk Return ◽  
Corporate Governance Code ◽  
Governance Practices ◽  
The Relationship

Abstract. After the adoption of the Corporate Governance Code (Code) in Mexico, many companies increased financial performance and the leveraged during the following five years; we investigated the effect of how those firms improved the corporate governance practices and how was translated into better risk return company. We analyzed how and where better corporate governance practices affects performance and what was the relationship with Transparency, New Regulation and Governance Practices. Also we explored the gaps between transparency and information disclosure of Mexican Firms listed in U.S stockexchange and non U.S listed firms our findings were related to the potential growth of the Mexico Financial Market, Law and Finance.Keywords: corporate governance, financial performance, regulationResumen. Después de la adopción del Código de Gobierno Corporativo en México, algunas compañías incrementaron el desempeño financiero y el uso de deuda durante los siguientes cinco anos, nuestra investigación se enfoca en como dichas compañías mejoraron sus prácticas de gobierno corporativo y como estas prácticas se han traducido en un mejor relación de riesgo y rendimiento. En esta investigación exploramos cómo y en dónde mejores prácticas de gobierno corporativo afectan el desempeño y qué relación tiene con laTransparencia, Nuevas Regulaciones y prácticas de Gobierno Corporativo. Con lo anterior también identificamos aquellas compañías que cotizan fuera de México para identificar potenciales diferencias en dichas prácticas.Palabras clave: desempeño financiero, gobierno corporativo, regulación

The Impact of Corporate Governance Mechanisms on the Relationship Between Cash Holdings and Audit Fees in Egyptian Listed Companies

2019 ◽  
Vol 9 (2) ◽  
pp. 314
Author(s):  
Eman Abdel-Wanis
Keyword(s):  
Corporate Governance ◽  
Audit Committee ◽  
Panel Data Analysis ◽  
Cash Holdings ◽  
Audit Fees ◽  
Governance Mechanisms ◽  
Listed Firms ◽  
Corporate Governance Mechanisms ◽  
The Impact ◽  
The Relationship

This paper explores the impact of corporate governance mechanisms on the nature of the relationship between cash holdings and audit fees, which helps provide an opportunity to identify whether these mechanisms enable to mitigate agency problems, and thus lower audit fees through a sample of 78 Egyptian listed firms in EGX 100 during the period 2014-2016 using panel data analysis. Results indicated that cash holding increases auditing fees. The board characteristics affect negatively on the relationship between cash holdings and audit fees. Also, ownership structure affects negatively on the relationship between cash holdings and audit fees. As well audit committee affects negatively on the relationship between cash holdings and audit fees. There results support the view that corporate governance mitigate on the relationship between cash holdings and audit fees.

scholarly journals The Impact of Corporate Cultural Behaviour on Common Stock Return: Some Implications for Corporate Governance

2018 ◽  
Vol 80 (1) ◽  
pp. 115-130
Author(s):  
Chamil W. Senarathne
Keyword(s):  
Corporate Governance ◽  
Stock Returns ◽  
Stock Return ◽  
Stock Exchange ◽  
Common Stock ◽  
Listed Firms ◽  
It Impacts ◽  
Research Questions ◽  
The Impact ◽  
The Relationship

AbstractThis paper examines the relationship between common stock return and corporate cultural behaviour of twenty listed firms from Shanghai Stock Exchange. The particular research questions of this study include: whether corporate cultural behaviour impacts common stock returns and under what conditions it impacts shareholder expectations and corporate governance.

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. 

scholarly journals The impact of Board Size on the Performance of Shariah-Compliant Companies in Malaysia

2019 ◽  
Vol 8 (4) ◽  
pp. 6709-6711
Keyword(s):  
Corporate Governance ◽  
Consumer Products ◽  
Strong Positive Correlation ◽  
Board Size ◽  
Daily Lives ◽  
Governance Practices ◽  
And Performance ◽  
Code Of Corporate Governance ◽  
The Impact ◽  
The Relationship

The objective of this study is to examine the relationship between the board size and firm performance of Shariah-Compliant companies in Malaysia. The characteristics of the board of Shariah-compliant companies in Consumer Products counter of Bursa Malaysia are being examined against the firm’s performance using data from 77 companies from year 2014 to 2016. Based on the result of regression, board size has a strong positive correlation with the performance of the firms. This study suggests that Shariah-Compliant Companies need to strengthen the Shariah governance to produce products that Muslim consumer use in their daily lives. The appointment of director with Shariah background must be highly encouraged if not mandatory to companies involved in producing food, drinks, pharmaceutical and cosmetics in order for the companies to tap their expertise in enhancing halal governance. The findings of the study would be very useful to the regulators to improve the Malaysian Code of Corporate Governance. Furthermore, the findings of the study also help to fill the gap on scarce of literatures that study the relationship between the corporate governance practices and performance.

scholarly journals The relationship between corporate governance and firm performance revisited: where do we stand?

2010 ◽  
Vol 7 (3) ◽  
pp. 124-137 ◽  
Author(s):  
Stefan Hilger
Keyword(s):  
Corporate Governance ◽  
Business Models ◽  
Corporate Performance ◽  
Holistic Approach ◽  
Governance Mechanisms ◽  
Governance Practices ◽  
The Usa ◽  
The Impact ◽  
The Relationship

How is corporate governance measured, and what is the relationship between corporate governance mechanisms and corporate performance? This paper aims to shed light on these questions by providing an overview of the most important research findings in this area with a focus on the USA and Germany. My analysis gives rise to the following remarks. First, studies examining the impact of singles governance mechanisms are inconclusive and mixed in their findings, and especially the question of causality is still unanswered. Second, when a holistic approach is used, the proposition that good corporate governance enhances long-term performance is supported. However, corporate governance practices alone cannot assure long-term corporate performance and good standards of corporate governance are no substitute for the solidity of business models.

scholarly journals The Impact of Compliance with Codes of Corporate Governance on Quality of Disclosure: Comparative Study between Palestine and Jordan

2016 ◽  
Vol 8 (9) ◽  
pp. 215
Author(s):  
Naser - Abdelkarim ◽  
Mohammed T. Abusharbeh
Keyword(s):  
Corporate Governance ◽  
Regression Model ◽  
Listed Companies ◽  
Multiple Regression Model ◽  
Financial Data ◽  
Listed Firms ◽  
Governance Practices ◽  
The Impact ◽  
Analyze Data

<p>This study seeks to achieve two objectives; (1) to examine the degree of compliance with corporate governance requirements in Palestine and Jordan by listed firms, and (2) to investigate the impact of corporate governance on quality of disclosure for Palestinian and Jordanian listed firms. A sample of 15 Palestinian listed companies and 30 Jordanian listed companies that fully disclosed their financial data in year 2007 and 2014 was used. This research employs multiple regression model and one sample t-test in order to analyze data variables and to test the research hypotheses.The research reveals that there are no statistically significant differences between Jordan and Palestinian listed firms in applying the respective codes of corporate governance, but these two countries are relatively still modest in observing corporate governance rules. This study also concludes that boards of director’s characteristics have no significant impact on quality of disclosure in Palestine and Jordan. This indicates that corporate governance practices didn’t have any significant effect on quality of disclosurefor Palestinian and Jordanian listed firms.</p>

The impact of corporate governance on the relationship between earnings management and CEO compensation

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Oheneba Assenso-Okofo ◽  
Muhammad Jahangir Ali ◽  
Kamran Ahmed
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Ceo Compensation ◽  
Empirical Support ◽  
Vital Role ◽  
Governance System ◽  
Content Type ◽  
Governance Practices ◽  
The Impact ◽  
The Relationship

PurposeThe study examines whether corporate governance moderates the relationship between CEO compensation and earnings management.Design/methodology/approachThe study uses 1,800 firm-year observations from 2005 to 2010 and employ multiple regression analyses and other sensitivity tests.FindingsThe study finds a positive relationship between CEO compensation and earnings management. The study’s results also suggest that CEO bonus compensation increases in relation to earnings management and therefore the study infers that managers may become involved in earnings management to increase their compensation. However, the study finds that the relationship is moderated by a strong corporate governance system which reduces the impact of earnings management on CEO compensation.Research limitations/implicationsThe study is conducted in a specific context, and therefore it may be subject to a set of limitations. The study emphasises exclusively on whether executives manage earnings to increase their compensation. The study does not consider the issue of several other and potentially contradictory motivations here.Practical implicationsThe study’s findings highlight potential implications and offer useful propositions for stakeholders, particularly accounting and corporate governance regulators, to consider. The findings offer a basis for the accounting professions to further discuss and improve accounting standards to provide adequate regulations and monitoring to decrease managerial opportunistic behaviours in earnings manipulations. The findings also emphasise the need for appropriately designed CEO compensation packages in such a manner that improves the manager–shareholder alignment and reduces the information asymmetry problem. The results signify that corporate governance plays a vital role in mitigating the relationship between CEO compensation and earnings management.Originality/valueThis study adds to the existing literature by documenting empirical support on the link between earnings management and CEO compensation against a backdrop of high demand for strong corporate governance practices.

Dynamic study of corporate governance structure and firm performance in China

2019 ◽  
Vol 13 (2) ◽  
pp. 299-317 ◽  
Author(s):  
Lin Shao
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Generalized Method Of Moments ◽  
Supervisory Board ◽  
Governance Structure ◽  
State Ownership ◽  
Content Type ◽  
Listed Firms ◽  
The Impact ◽  
The Relationship

Purpose The paper aims to provide a comprehensive investigation of the relationship between corporate governance (CG) structure and firm performance in Chinese listed firms from 2001 to 2015. The authors’ motivation derives from the fact that the CG system in China is different from those in the US, the UK, Germany, Japan and other countries. Design/methodology/approach A large unbalanced sample, covering more than 22,700 observations in Chinese listed firms, was used to explore, by means of a system-generalized method-of-moments (GMM) estimator, the relationship between CG structure and firm performance to remove potential sources of endogeneity. Findings Results show that Chinese CG structure is endogenously determined by the CG mechanisms investigated: there is no relationship between board size (including independent directors) and firm performance; CEO duality has a significantly negative effect on firm performance; concentration of ownership has a significantly positive influence on firm performance; managerial ownership is negatively correlated with firm performance; state ownership has a significantly positive effect on firm performance; and a supervisory board is positively correlated with firm performance. Practical implications The findings provide policymakers and firm managers with useful empirical guidance concerning CG in China. Originality/value Few integrative studies have examined the impact of CG structure on firm performance in China. This study adds new empirical evidence that the relation between CG structure and performance in China is endogenous and dynamic when controlling for unobserved heterogeneity, simultaneity, and dynamic endogeneity.

scholarly journals The impact of corporate governance on market capitalization: evidence from Bahrain bourse

2016 ◽  
Vol 13 (3) ◽  
pp. 121-130 ◽  
Author(s):  
Muneer Mohamed Saeed Al Mubarak ◽  
Allam Mohammed Mousa Hamdan
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Ownership Structure ◽  
Fixed Effects ◽  
Future Research ◽  
Market Capitalization ◽  
Listed Firms ◽  
Econometric Methods ◽  
The Impact ◽  
The Relationship

Our study is based on the “Agency Theory”, as it interprets the relationship between corporate governance and market capitalization of firms listed in Bahrain Bourse (BB). Longitudinal data is used in this study from 36 listed firms in Bahrain Bourse during the period of 2009-2013. A set of econometric methods, including the fixed effects method, is used to overcome different measurement problems of such relationship. The study findings include a set of results that are related to effect of ownership structure and board of directors’ characteristics on market capitalization of firms. Based on these findings, a set of recommendations, along with study limitations and future research, are put forward.

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