Corporate Governance Codes and Groups of Companies: In Search of Best Practices for Group Governance

2018 ◽  
Vol 15 (4) ◽  
pp. 697-731
Author(s):  
Dániel Gergely Szabó ◽  
Karsten Engsig Sørensen
Keyword(s):  
Corporate Governance ◽  
Best Practices ◽  
Detailed Analysis ◽  
Listed Companies ◽  
Group Interest ◽  
Good Group ◽  
Corporate Governance Codes ◽  
Initial Survey ◽  
The Individual ◽  
The Right

Many listed companies are part of a group of companies and therefore they are facing the special challenges of effecting group governance. Group governance will involve balancing the interests of the group against the interests of the individual companies in the group. Finding the right balance between these two is not always easy, which is confirmed by that the Commission has announced its intention to facilitate the recognition of the concept of ‘group interest’ in EU company law.We have analysed a number of corporate governance codes to see how they address the issue of group governance. We initially examined 48 codes, but selected 16 codes for detailed analysis. In the codes analysed we have found some recommendations for how groups of companies should be governed, but they are often found in different codes, often apply to a broader category of situations, not specifically group situations, and in some cases point in different directions. Therefore, it seems fair to say that the current recommendations for group governance are fragmented and superficial. Since we have analysed those codes that, based on our initial survey of 48 codes, were most likely to contain recommendations on these issues, the recommendations on group governance in other codes are even more likely to be fragmented or non-existent.Therefore, there seems to be a need for more clarity on group governance and the Commission’s intention to address the issue of group interest should be welcomed. However, since there is little consensus on what constitutes good group governance, considering the often opposing strategies underlying the analysed codes’ recommendations, the Commission also has a difficult task if it decides to take steps to operationalise the recognition of group interests.

scholarly journals Analysis of Pre and Post-MCCG 2017: Leadership Effectiveness Through the Board Nomination Committee of Top 50 Malaysian PLCs

2020 ◽  
Vol 11 (2) ◽  
pp. 43
Author(s):  
Dayana Mastura Baharudin ◽  
Maran Marimuthu
Keyword(s):  
Corporate Governance ◽  
Best Practices ◽  
Statistical Methods ◽  
Design Methodology ◽  
Annual Review ◽  
Target List ◽  
Corporate Governance Code ◽  
Recruitment Activities ◽  
The Right ◽  
The Impact

Purpose – This paper investigates the impact of the two main aspects on selecting the right Board candidate including best practices within the position and structure along with the recruitment activities proposed under the Malaysian Corporate Governance Code (Code) compared across 2012 and 2017.Design/ methodology approach - For this analysis, a target list of the top 50 PLCs based on market capitalization was gathered from 784 Malaysian PLCs as of 14 August 2020. In the annual review of the reports, this study includes statistical methods to quantify and interpret the disclosures.Originality - This study reviews the developments of the policies from the Code in 2012 to the Code in 2017. Also applicable to other PLCs other than the top 50 Malaysian PLCs would be the Board Nomination Committee – Role and Structure and the Board Nomination Committee – Recruitment Activities scoring indices designed.

Corporate governance codes of Eurasian Economic Union countries: a comparative investigation

2017 ◽  
Vol 17 (4) ◽  
pp. 748-769 ◽  
Author(s):  
Mirgul Nizaeva ◽  
Ali Uyar
Keyword(s):  
Corporate Governance ◽  
Best Practices ◽  
Transition Countries ◽  
Special Focus ◽  
Content Type ◽  
Eurasian Economic Union ◽  
Oecd Principles ◽  
Corporate Governance Codes ◽  
Economic Union ◽  
The Uk

Purpose The purpose of this paper is to comparatively analyze the corporate governance codes of transition economies, particularly five Eurasian Economic Union (EAEU) members (i.e. Russia, Belarus, Kazakhstan, Kyrgyzstan and Armenia). Specifically, the convergence or divergence of these countries’ corporate governance codes among themselves as well as relative to the best practices of the UK Corporate Governance Code (UK Code) and the OECD Principles of Corporate Governance are investigated. Design/methodology/approach Initially, the existing literature on corporate governance with special focus on transition countries is reviewed. Afterwards, benchmarking the international best practices, based on main chapters and contents, the corporate governance codes of all countries in the sample are analyzed. Findings The paper finds that even though some principles of the corporate governance codes of the countries in the sample differ in some aspects, they do converge to some extent. However, high misalignments between the UK Code and the OECD Principles and the codes of selected countries in some aspects were found. Research limitations/implications The conclusion and implications of the study characterize the corporate governance of selected developing countries; thus, they might not be generalizable to other countries. Practical implications The codes of the countries in the sample should be revised, and more specifications regarding the stakeholder, board structure, its subcommittees, independence, diversity and transparency issues need to be addressed. Originality/value The paper comprehensively analyzes the contents of corporate governance codes of transition countries; from both practical and academic point of view, it was important gap that needed to be fulfilled.

scholarly journals The code of corporate governance in Nigeria: Efficiency gains or social legitimation?

2012 ◽  
Vol 9 (3) ◽  
pp. 262-275 ◽  
Author(s):  
Elewechi Okike ◽  
Emmanuel Adegbite
Keyword(s):  
Corporate Governance ◽  
Best Practices ◽  
Sub Saharan Africa ◽  
Efficiency Gains ◽  
Social Legitimacy ◽  
Corporate Governance Codes ◽  
Social Legitimation ◽  
International Pressures ◽  
Sub Saharan ◽  
Code Of Corporate Governance

This paper is the first study which examines the rationale behind the adoption of corporate governance codes, the requirements of the codes and their operationalisation, and the effectiveness of the codes in addressing corporate governance abuses in the turbulent and endemically corrupt environment of sub Saharan Africa (Nigeria). It examines the extent to which the adopted Codes of Corporate Governance is as a result of international pressures or internally driven by the need for effective accountability to the shareholders, in a way which addresses the peculiar problems of corporate governance in Nigeria. Through the theoretical lens of efficiency gains and social legitmation, the paper found that the Code of Best Practices for Corporate Governance in Nigeria is driven more by social legitimacy pressures while the Code of Corporate Governance for Banks in Nigeria Post Consolidation, developed by the CBN, is predominantly aimed at pursuing efficiency gains.

scholarly journals Does Commitment to Anti-Corruption Matter?

2019 ◽  
Author(s):  
Susela Devi ◽  
YoungKyung Ko ◽  
Ravichandran Subramaniam
Keyword(s):  
Corporate Governance ◽  
Capital Market ◽  
Firm Value ◽  
Listed Companies ◽  
Foreign Firms ◽  
Political Connections ◽  
Corporate Transparency ◽  
Transparent Reporting ◽  
Corporate Governance Codes ◽  
Organizational Transparency

The Malaysian capital market regulators take great efforts to continuously enhance corporate governance codes and practices to improve transparent reporting and enhance board responsibility and investors’ protection. In 2017, the Malaysian Institute of Corporate Governance published a report assessing the transparency of reporting by top 100 listed companies in respect of anti-corruption, organizational disclosure, and sustainability. This study uses this unique set of data on scores on anti-corruption commitment, organizational transparency, and sustainability to investigate the association between corporate transparency and firm value, and whether political connections moderate this relationship. Not surprisingly, findings show that listed government-linked companies (GLCs) have higher scores than non-GLCs, such as family and foreign firms. Firms with enhanced anti-corruption commitment are more likely to have higher firm value, and this relationship is stronger for politically connected firms. The implications for investors and regulators are discussed in this paper.

Listed Companies

2020 ◽  
pp. 43-51
Author(s):  
Theodor Baums
Keyword(s):  
European Union ◽  
Corporate Governance ◽  
Self Regulation ◽  
Listed Companies ◽  
Independent Directors ◽  
Board Members ◽  
The European Union ◽  
Controlling Shareholder ◽  
Corporate Governance Code ◽  
Corporate Governance Codes

Although corporate governance codes have spread across the European Union and beyond, and are regularly revised and adapted to changing national and international expectations of investors and other stakeholders, some important questions have not yet been unanimously answered. Two of these ongoing debates are addressed in this chapter. First, where should the line be drawn between statutory provisions and corporate governance codes as an instrument of self-regulation? Second, what is the rationale behind the idea of independent directors? In particular, how should independence be understood in relation to board members: independent of the incumbent management and company or independent of a controlling shareholder? The chapter discusses both questions using the example of the German Corporate Governance Code.

scholarly journals Corporate governance practices in Europe: A descriptive study.

2016 ◽  
Vol 13 (2) ◽  
pp. 238-249 ◽  
Author(s):  
Eldi Metushi ◽  
Jackie Di Vito ◽  
Andrea Fradeani
Keyword(s):  
Corporate Governance ◽  
Best Practices ◽  
Practice Guidelines ◽  
Best Practice ◽  
National Guidelines ◽  
Firm Level ◽  
Best Practice Guidelines ◽  
Corporate Governance Codes ◽  
Level Statistics ◽  
Governance Practices

Our study examines corporate governance practices in Europe according to the best practice guidelines of 17 countries. We particularly focus on the independence criteria of Board members. Doing so, we wish to understand how these best practices are enforced in the actual corporate governance guidelines in each country. To better define the independence criteria, which is very different among European countries, we develop our own measure of independence, taking into account the strictest criteria of independence recommended in the corporate governance codes of the studied countries. Then, we gather firm-level statistics on a sample of 463 European firms to understand whether the best practice guidelines are actually enforced by these firms. Hence, we contribute to the existent literature by presenting descriptive statistics on the compliance of European firms to their national guidelines. Our findings show that most European firms tend to comply with their local best practice guidelines of corporate governance. We also document a high compliance of our European sample-firm with the Anglo - Saxon best practices of corporate governance.

Corporate Governance Codes in a Transitional Economy

2014 ◽  
pp. 27-47
Author(s):  
Marwa Hassaan
Keyword(s):  
Corporate Governance ◽  
Best Practices ◽  
Cultural Values ◽  
Financial Reporting ◽  
Stock Exchange ◽  
Emerging Market ◽  
Fiscal Year ◽  
Corporate Governance Code ◽  
Disclosure Requirements ◽  
Corporate Governance Codes

This study aims to investigate the influence of the introduction of a corporate governance code in 2005 on the levels of compliance with mandatory IFRS disclosure requirements by companies listed on the Egyptian Exchange (EGX) as a leading stock exchange in the Middle East. Using a disclosure index derived from mandatory IFRS disclosure requirements for the fiscal year 2007, this study measures the levels of compliance by a sample of 75 non-financial companies listed on the focus stock exchange. This study extends the financial reporting literature and the emerging market disclosure literature by being the first to investigate the influence of corporate governance requirements for best practices on the levels of compliance with mandatory IFRS disclosure requirements by companies listed on the EGX. Results provide evidence of the lack of influence of corporate governance best practices on the levels of compliance with mandatory IFRS disclosure requirements as it is not yet part of the cultural values within the Egyptian context. These findings are consistent with the notions of the proposed theoretical foundation.

scholarly journals Audit committees in listed companies: an international comparison of composition and meetings

2008 ◽  
Vol 5 (3) ◽  
pp. 75-85
Author(s):  
Esmée Van Gansbeke ◽  
Patricia Everaert ◽  
Gerrit Sarens ◽  
Ignace De Beelde
Keyword(s):  
Corporate Governance ◽  
The Netherlands ◽  
Audit Committee ◽  
Listed Companies ◽  
Audit Committees ◽  
Annual Reports ◽  
Internal Auditor ◽  
Corporate Governance Codes ◽  
The Usa ◽  
The Uk

This paper compares the number of audit committee (AC) members, meeting frequency and the presence of internal auditors at AC meetings of listed companies according to their country of domicile. We consider the USA, the UK, the Netherlands, France and Belgium. Hypotheses are developed based on differences in corporate governance codes. Data are gathered from annual reports of 100 listed companies in these countries. Our results indicate fewer AC members in the Netherlands, and a higher frequency of AC meetings in the UK and Belgium, countries where corporate governance codes do not proscribe a minimum number of meetings. The presence of an internal auditor at AC meetings was, on average, highest for firms listed in the USA.

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