scholarly journals The Impact Of Corporate Governance And The Sarbanes-Oxley Act On CEO Compensation

2012 ◽  
Vol 28 (3) ◽  
pp. 463 ◽  
Author(s):  
Mahmoud M. Nourayi ◽  
Lawrence Kalbers ◽  
Frank P. Daroca
Keyword(s):  
Corporate Governance ◽  
Ceo Compensation ◽  
Outside Directors ◽  
Economic Determinants ◽  
Multiple Observations ◽  
Sarbanes Oxley ◽  
Corporate Governance Mechanisms ◽  
Ceo Age ◽  
Regulatory Controls ◽  
The Impact

This paper examines the effects of corporate governance on CEO compensation in light of regulatory controls introduced by the Sarbanes-Oxley Act of 2002 (SOX). The influence of economic and corporate governance variables on incentive-based CEO compensation are considered, using cross-section time-series panel data that includes multiple observations for the years 1999 to 2005. As expected, sales, firm performance (returns), and CEO age were found to positively affect the incentive components of CEO compensation. CEO duality, board size, and the percentage of outside directors had a significant influence on CEO compensation in the pre-SOX, but not post-SOX, period. The influences of these three variables in the pre-SOX period were not in the expected directions. Stratification of our sample into two groups by size reveals similarities and differences between smaller and larger firms. For both groups, economic determinants are more dominant than corporate governance variables as determinants of incentive-based CEO compensation. We find differences in the pattern and significance of variables between the smaller and larger firms, particularly for corporate governance variables, pre- and post-SOX. These results suggest that the effectiveness of corporate governance mechanisms may vary by size of company.

scholarly journals The Impact of Corporate Governance on Corruption Disclosure in European Listed Firms through the Implementation of Directive 2014/95/EU

2019 ◽  
Vol 11 (22) ◽  
pp. 6479
Author(s):  
María Inmaculada Alonso Carrillo ◽  
Alba María Priego De La Cruz ◽  
Montserrat Nuñez Chicharro
Keyword(s):  
Corporate Governance ◽  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Outside Directors ◽  
Governance Mechanisms ◽  
Listed Firms ◽  
Corporate Social Responsibility Disclosure ◽  
Corporate Governance Mechanisms ◽  
Corporate Social ◽  
The Impact

The publication of Directive 2014/95/EU represents an important milestone related to the disclosure of non-financial information. This fact together with the role of the corporate governance guide firms towards achieving of an ethical, transparent, and responsible behavior. To contribute towards the understanding of this issue, this study investigates the relationship between corporate governance mechanisms and corporate social responsibility disclosure, namely, in corruption aspects relating to Directive 2014/95/EU. In so doing, a multiple regression analysis was carried out on a panel data sample of 198 European listed firms that are part of the EuroStoxx 200 index, in a studied period from 2014 to 2017. The findings reveal that outside directors and CEO duality impact positively and significantly on corruption disclosure. Therefore, this paper contributes to the existing research on corporate social responsibility disclosure, specifically, to the corruption disclosure literature by studying the corporate governance mechanisms that enhance these practices.

scholarly journals Sarbanes-Oxley, corporate governance, and strategic dividend decisions

2019 ◽  
Vol 17 (1) ◽  
pp. 116-124
Author(s):  
Mark Bertus ◽  
John S. Jahera Jr. ◽  
Keven Yost
Keyword(s):  
Corporate Governance ◽  
Dividend Policy ◽  
Governance Structure ◽  
Equity Market ◽  
Outside Directors ◽  
Policy Changes ◽  
Significant Relation ◽  
Sarbanes Oxley ◽  
The Impact ◽  
The U.S

This paper empirically analyzes the impact of the Sarbanes-Oxley Act on the relation between measures of corporate governance and a firm’s dividend policy in the U.S. equity market. Using the IRRC database, we find that there is a statistically significant relation between governance measures and a firm’s dividend policy in the years prior to the introduction of the Sarbanes-Oxley Act. However, following Sarbanes-Oxley, the relation between a firm’s governance structure and dividend policy changes. In particular, shareholders’ rights and the proportion of outside directors are no longer significant in explaining a firm’s dividend policy.

scholarly journals The Impact of Corporate Governance Mechanisms on the Commitment of Managers in an IPO Setting: Evidence from Korean Small and Venture Firms

2022 ◽  
Vol 14 (2) ◽  
pp. 730
Author(s):  
Youngjoo Lee
Keyword(s):  
Corporate Governance ◽  
Initial Public Offering ◽  
Sustainable Growth ◽  
Audit Committees ◽  
Outside Directors ◽  
Governance Mechanisms ◽  
Corporate Governance Mechanisms ◽  
Public Offering ◽  
The Impact ◽  
Lockup Period

Managers’ commitment and dedication crucially affect the sustainable growth of firms. When private companies first offer their shares to the public in an initial public offering (IPO), an IPO lockup is one way of revealing managers’ commitments. IPO lockups are agreements that promise not to sell the shares retained by pre-IPO shareholders for a specified period in the market after the IPO. This paper investigates the impact of corporate governance mechanisms on the length of the lockup period. The paper’s sample consists of IPO firms that have gone public in Korea’s KOSDAQ market, which is a listing venue for small and venture companies. The major findings of this paper are as follows: first, the length of the lockup period increases with the number of outside directors and, second, IPO firms with audit committees have longer lockup periods than those without them. These results indicate that managers of firms with greater board independence choose a longer lockup period when going public. This paper also finds that the lockup period is positively related to the presence of venture capitalists serving as directors of IPO firms, which suggests that venture capital directors may ensure that managers have longer lockups. Overall, these findings suggest that, when small and venture companies go public, managers may use the IPO lockup as a commitment device that complements corporate governance mechanisms in reducing investor concern about the moral hazard problem of managers.

scholarly journals Do Multinational Companies Practice Good Corporate Governance? Empirical Evidence from Bangladesh

2017 ◽  
Vol 7 (2) ◽  
pp. 96
Author(s):  
G. M. Wali Ullah ◽  
Sarwar Uddin Ahmed ◽  
Samiul Parvez Ahmed ◽  
Kazi Md. Jamshed
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Stock Returns ◽  
Governance Structure ◽  
Multinational Companies ◽  
Governance Mechanisms ◽  
Corporate Governance Structure ◽  
Corporate Governance Mechanisms ◽  
The Impact ◽  
The Way

Corporate Governance refers to the way an organization is directed, administrated or controlled. It includes the set of rules and regulations that affect the manager's decision and contribute to the way company is perceived by the current and potential stakeholders. The corporate governance structure specifies the distribution of rights and responsibilities among different participants in the corporation such as; boards, managers, shareholders and other stakeholders and spells out the rules and procedures and also decision-making assistance on corporate affairs. Corporate governance practices in Bangladesh are gradually being introduced in most companies and organizations (Du, 2006). However, Bangladesh has fallen behind its neighboring countries and global economy in corporate governance (Gillibrand, 2004). Corporate governance structure is mainly considered ambiguous. Specific governance structures or practices will not necessarily fit all companies at all times. Firms with strong corporate governance mechanisms are generally associated with better financial performance, higher firm valuation and higher stock returns. Unfortunately, investors in Bangladesh have a little information about how these corporate values affect the performance of the Multinational Companies (MNCs). This study aims to provide a quantitative contribution to the literature by examining the impact of corporate governance mechanisms on financial performance from the perspective of MNCs. A panel data based Ordinary Least Squared (OLS) regression model was used to measure the quantitative significance of various corporate governance related variables on MNC performance, as identified through a detailed literature review.

scholarly journals Capital Structure and Corporate Governance Mechanisms in Kuwait Stock Exchange (KSE)

2020 ◽  
Vol 12 (6) ◽  
pp. 38
Author(s):  
Mejbel Al-Saidi
Keyword(s):  
Corporate Governance ◽  
Capital Structure ◽  
Stock Exchange ◽  
Ownership Concentration ◽  
Government Ownership ◽  
Governance Mechanisms ◽  
Corporate Governance Mechanisms ◽  
Kuwait Stock Exchange ◽  
Corporate Capital Structure ◽  
The Impact

The study investigated the impact of corporate governance mechanisms on the corporate capital structure of the Kuwait Stock Exchange (KSE). Specifically, this study linked five corporate governance mechanisms—large shareholder ownership concentration, government ownership concentration, board size, board independence, and family directors—with capital structure for 81 non-financial listed firms between 2017 and 2018. The data indicated that only government ownership concentration and family directors affect capital structure.

scholarly journals The impact of ownership type on the relationship between corporate governance and earnings management: An empirical study

2019 ◽  
Vol 16 (4) ◽  
pp. 31-44
Author(s):  
Ahmed Boghdady
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Cash Flows ◽  
Real Earnings Management ◽  
Ownership Type ◽  
Moderation Effect ◽  
Corporate Governance Mechanisms ◽  
The Impact ◽  
The Relationship ◽  
Privately Owned

This study investigates the effect of ownership type on the relation between corporate governance and earnings management. While previous literature has mainly examined the relationship between corporate governance and both accrual and real earnings management, no study to date, to the researcher’s best knowledge, focused on the moderation effect of ownership type on this relationship. Three proxies for measuring accrual and real earnings management, namely discretionary accruals (DA), abnormal cash flows (ACFO), and abnormal discretionary expenses (ADISX) are employed. Three empirical models (i.e. DA, ACFO, and ADISX) are developed in which the earnings management proxies represent the dependent variables and are tested using a sample of non-financial companies containing state-owned and privately owned companies over the period from 2010 to 2017, with 1030 firm-year observations. The results show a positive relationship between ownership type and both accruals manipulation and sales manipulation. In general, the results suggest that the ownership type moderates the relationship between corporate governance and earnings management. The results suggest also that corporate governance mechanisms may not play an almost the same role in monitoring and mitigating real earnings management (REM) practices as they do for accrual earnings management (AEM) in Egypt. Moreover, no evidence is found supportive of the trade-off effect which means that managers in Egyptian firms use both types of earnings management jointly to reach the target levels of earnings

scholarly journals Agency costs and corporate governance mechanisms in Indian state-owned companies and privately owned companies - A panel data analysis

2014 ◽  
Vol 11 (4) ◽  
pp. 8-17
Author(s):  
Stuart Locke ◽  
Geeta Duppati
Keyword(s):  
Corporate Governance ◽  
Agency Costs ◽  
Panel Data Analysis ◽  
Agency Cost ◽  
Open Market ◽  
Public Companies ◽  
Corporate Governance Mechanisms ◽  
The Government ◽  
Suitable Reference ◽  
The Impact

This paper explores the impact of corporate governance reforms and changing ownership patterns of core public sector enterprises. A number of reforms were introduced by the Government of India in 1991, and intensified in 2004 with the aim of improving efficiency and financial performance across state owned enterprises. The core state enterprises provide a unique opportunity to consider two aspects of the reforms. First, did the reforms have an impact, and second, is there a distinguishable difference between wholly government owned and partially-public shareholding enterprises? The public listed companies provide a suitable reference point for comparison. A comprehensive dataset of 123 SOEs and matching listed public companies for 10 years was collected for the study. A regression approach is adopted with agency cost as the dependant variable and several corporation-specific governance variables. Size and industry are the independent variables. The findings of the study indicate that the agency costs for mixed ownership models tend to be lower than those of the concentrated state-owned firms because they operate in an open market with the market facing the regulatory framework of a competitive environment.

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