scholarly journals Corporate performance and boards’ dilemma of listed subsidiaries

2013 ◽  
Vol 10 (4) ◽  
pp. 130-147 ◽  
Author(s):  
Emiliano Di Carlo ◽  
Francesco Ranalli
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Financial Performance ◽  
Ownership Structure ◽  
Corporate Performance ◽  
Listed Companies ◽  
The Impact ◽  
The Relationship ◽  
Parent Companies

The paper focuses on listed companies controlled by other (listed or not listed) entities. The decisionmaking power of listed subsidiary’s boards could be strongly influenced by (or instead could be autonomous from) the parent companies’ board. However, so far literature on corporate governance seems not to have considered adequately this aspect as well as the impact of that influence on listed companies’ financial performance and on corporate governance variables. The main objective of this paper is to explore how and why this phenomenon is relevant, giving some preliminary suggestions on the interpretation of the ownership structure, board demography and the financial performances of directed listed subsidiaries. In order to explore the relevance of the phenomenon, we use a sample of Italian listed companies controlled and consolidated by other companies for the year 2010. The analysis shows that 71.4% (145 firms) of Italian non-financial listed companies are consolidated by the respective controlling entities and 24.1% (35 firms) of these listed subsidiaries declare to be directed by their parents. Thus, they are not independent economic entities and the effort to study the relationship between corporate governance variables and firm performance could be strongly biased.

scholarly journals Does Ownership Structure Matter For Publicly Listed Companies Performance In Malaysia?

2015 ◽  
Author(s):  
Rozita Arshad
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Ownership Structure ◽  
Listed Companies ◽  
Governance Practices ◽  
Using Data ◽  
Open Markets ◽  
The Impact ◽  
The Relationship ◽  
Insight Into

The word of corporate governance has become a very important concept that requires many countries around the world to concentrate on its reformation. Globalisation of markets, open markets competition, and international business has generated awareness about the importance of improving corporate governance practices. Protecting shareholders and other stakeholders are also being attentive agenda and play important roles in corporate governance reforms due to ensure their value creation and their right as the owner of the shares. This article attempts to address this issue by examining the relationship between ownership structure and firm performance. The hypothesis is tested by assessing the impact of the structure of ownership on firm performance, using data for 237 Malaysia Public Listed Companies (PLCs). Therefore, this paper will provide an insight into further understanding on the issue of the relationship between ownership structure and firm performance Keywords: Corporate governance, ownership structure, shareholders, firm performance

Corporate governance mechanisms and corporate performance of firms in Nigeria and Ghana

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Martha Coleman ◽  
Mengyun Wu
Keyword(s):  
Corporate Governance ◽  
Ownership Structure ◽  
Financial Distress ◽  
Corporate Performance ◽  
Tobin’S Q ◽  
Tobin's Q ◽  
Content Type ◽  
Structure Index ◽  
The Impact ◽  
The Relationship

PurposeThis study investigates the impact of corporate governance (CG) mechanisms with inclusion of compliance and diligence index on corporate performance (CP) of firms in Nigeria and Ghana. It further examines the moderating effect of financial distress on the relationship between CG and CP.Design/methodology/approachThe study used panel data of 102 nonfinancial listed firms of Nigeria and Ghana stock exchange for the period 2012–2016 with total observation of 510. The study first used OLS in estimating the influence of CG mechanisms on CP. Due to multicollinearity in the independent variables, ridge regression was employed.FindingsIt was revealed that ownership structure index and board compliance and diligence index, board size, board disclosure, ownership structure, shareholders' right and board compliance and diligence index had positive influence on ROA and ROE. Growth of Tobin's Q depends on board procedure and board compliance and diligence index. Also, financial distress (ZFS) negatively moderates the relationship between board structure index, board disclosure index, board procedure index, shareholders' right and performance (ROA and ROE) but negatively moderates between ownership structure index and Tobin's Q.Practical implicationsThis study provides interesting findings to policymakers in full implementation of CG codes as stated by OCED (2015) by West African firms with greater emphasis on compliance and diligence index since it positively influences all CP measures.Originality/valueThe study provides evidence of the importance of the introduction of the new index: compliance and diligence, which looks at disclosure of CSR activities. This has been overlooked by most researchers especially in Africa in assessing quality CG mechanisms.

scholarly journals The Impact of Firm Performance on Executive Compensation in France

2017 ◽  
Vol 8 (2) ◽  
pp. 63-69 ◽  
Author(s):  
Amarou Yamina ◽  
Bensaid Mohamed
Keyword(s):  
Firm Performance ◽  
Financial Performance ◽  
Executive Compensation ◽  
Corporate Performance ◽  
Variable Part ◽  
Accounting Performance ◽  
Enterprise Level ◽  
Improved Performance ◽  
The Impact ◽  
The Relationship

Abstract The purpose of this article is to model the executive compensation in France. From a sample of 90 companies included in the SBF 120 over 2004, we examine whether there is a significant link between the overall executive compensation and corporate performance, and then determine the relationship between the fixed and variable part of the compensation with performance. Our findings highlight in particular the level of total executive compensation that is linked with relatively improved performance. And clearer, the pay of executive increases with the increase of financial performance, whereas, the bonus depends on level of accounting performance. The grant of options to executive is relatively linked to the financial performance of the enterprise level.

scholarly journals Ownership structure and firm performance: Evidence from Nigerian listed companies

2011 ◽  
Vol 8 (4) ◽  
pp. 391-400
Author(s):  
Adebiyi J. Abosede ◽  
Kajola Oluwafemi Sunday
Keyword(s):  
Firm Performance ◽  
Financial Performance ◽  
Linear Relationship ◽  
Ownership Structure ◽  
Significant Relationship ◽  
Listed Companies ◽  
Firm Financial Performance ◽  
Non Linear ◽  
The Relationship

This paper examines the relationship between firms’ ownership structure and financial performance in Nigeria, using a sample of thirty listed companies between 2001 and 2008. Using pooled OLS as a method of estimation and after controlling for four firm-specific characteristics, our results show a negative and significant relationship between ownership structure (director shareholding) and firm financial performance (ROE). This is in support of Entrenchment hypothesis. Also, our study does not support a non-linear relationship between ownership structure and firm performance.

Corporate Performance, Corporate Governance and CEO Dismissal in Malaysia

2013 ◽  
Vol 1 (2) ◽  
pp. 113-126
Author(s):  
Rokiah Ishak ◽  
Mohd ‘Atef Md. Yusof
Keyword(s):  
Corporate Governance ◽  
Ownership Structure ◽  
Corporate Performance ◽  
Voluntary Turnover ◽  
Ceo Turnover ◽  
Business Organization ◽  
Market Place ◽  
Ceo Dismissal ◽  
The Impact ◽  
The Relationship

Objective- This study empirically examines the incidence of CEO dismissal in Malaysian Public Listed Companies (PLCs). Methodology/Technique Logistic regression is used in this study to estimate the relationship between firm performance, corporate governance and CEO. Findings The result shows the impact of evaluation SPMS to solve the market place error and also ability of executives' level of management to solve the behaviours issue in business organization. Novelty - This paper study on the type of CEO turnover which segregate the type of turnover into forced and voluntary turnover. This research idea has limited finding globally as previous research on CEO turnover do not separate between forced and voluntary turnover Type of Paper Empirical paper Keywords: , CEO dismissal; corporate performance; board attributes; ownership structure

The mediating role of intellectual capital in corporate governance and the corporate performance relationship

2020 ◽  
Vol 36 (4) ◽  
pp. 531-561
Author(s):  
Tamer Mohamed Shahwan ◽  
Mohamed Mahmoud Fathalla
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Intellectual Capital ◽  
Corporate Performance ◽  
Superior Performance ◽  
Operating Efficiency ◽  
Efficiency Ratio ◽  
Content Type ◽  
The Impact ◽  
The Relationship

Purpose This paper aims to investigate the impact of intellectual capital (IC) as a mediator variable on the association between corporate governance (CG) practices and firm performance. This study also examines bi-causality linkages between these variables. Design/methodology/approach The designated corporate governance index and the value-added intellectual coefficient method were used to assess the level of CG practices and the performance of IC. Tobin’s Q (TQ) and operating efficiency ratio were used to measure firm performance. Findings The aggregate CG score has a significant positive impact on the IC and the two measures of firm performance. However, the IC has only a partial mediation effect on the relationship between the aggregate corporate governance score and a firm’s operational efficiency ratio. The IC has partial and full mediation effects in the relationship between the sub-dimensions of corporate governance and the performance of Egyptian corporates. Moreover, a bi-causality relationship can be observed between CG and TQ. Research limitations/implications Generalizing the obtained results would require the sample size to be extended. Practical implications The findings should alert legislative institutions and practitioners of the need to comply with good CG practices and develop the efficiency of IC to elicit a firm’s superior performance. Originality/value This study is one of the first attempts to investigate the causality relationships and the mediation impact of IC on the relationship between CG practices and corporate performance in the Egyptian context.

Corporate governance guidelines compliance and firm financial performance

2016 ◽  
Vol 31 (8/9) ◽  
pp. 891-914 ◽  
Author(s):  
Erick Rading Outa ◽  
Nelson M. Waweru
Keyword(s):  
Corporate Governance ◽  
Life Cycle ◽  
Firm Performance ◽  
Financial Performance ◽  
Firm Value ◽  
Design Methodology ◽  
Content Type ◽  
Firm Financial Performance ◽  
The Impact ◽  
The Relationship

Purpose This paper aims to examine the impact of compliance with corporate governance (CG) guidelines during the period 2002-2014 on firm financial performance and firm value of Kenyan-listed companies. Design/methodology/approach Using panel data of 520-firm year’s observations between 2005 and 2014, the authors test the hypothesis that compliance with CG guidelines issued in 2002 by Capital Markets Authority (CMA) improved firm financial performance and firm value. Findings Compliance with CG Index which is an aggregate of all the CG guidelines is positively and significantly related to firm performance and firm value. Board evaluation is also positively and significantly related to firm performance. The findings suggest that CG guidelines are associated with firm financial performance and firm value. Originality/value The authors provide evidence on the relationship between CG practices and firm financial performance and firm value in Kenya. Second, the authors provide evidence on board evaluation which has not been tested before in a “comply or explain” environment. Finally, they evaluate how CMA 2002 CG guidelines steered firm financial performance and firm value over its life cycle from 2002 to 2014. These results are important to CMA and other CG regulators and boards in their efforts to improve CG practices in the region.

scholarly journals The impact of corporate governance on firm performance in Egyptian listed companies

2013 ◽  
Vol 11 (1) ◽  
pp. 691-705 ◽  
Author(s):  
Ehab K. A. Mohamed ◽  
Mohamed A. Basuony ◽  
Ahmed A. Badawi
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Ownership Structure ◽  
Stock Exchange ◽  
Listed Companies ◽  
Board Independence ◽  
Board Structure ◽  
Cross Sectional ◽  
Book Value ◽  
The Impact

This paper examines the impact of corporate governance on firm performance using cross sectional data from non-financial companies listed in the Egyptian Stock Exchange. The 88 non-financial companies on EGX100 index of listed companies on the Egyptian Stock Market are studied to examine the relationship between ownership structure, board structure, audit function, control variables and firm performance by using OLS regression analysis. The results show that ownership structure has no significant effect on firm performance. The only board structure variable that has an effect on firm market performance is board independence. Firm book value performance is affected by both board independence and CEO duality. Firm size and leverage have varying effects on both market and book value performance of firms

scholarly journals Corporate governance: the impact of director and board structure, ownership structure and corporate control on the performance of listed companies on the Ghana stock exchange

2016 ◽  
Vol 16 (2) ◽  
pp. 259-277 ◽  
Author(s):  
Josephine Darko ◽  
Zakaria Ali Aribi ◽  
Godfrey C. Uzonwanne
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Ownership Structure ◽  
Audit Committee ◽  
Corporate Control ◽  
Sub Saharan Africa ◽  
Board Structure ◽  
Content Type ◽  
The Impact ◽  
The Relationship

Purpose The purpose of this paper is to examine the relationship between corporate governance and firm performance of listed Ghanaian companies. Design/methodology/approach The paper adopts a longitudinal and cross-sectional data set of 20 sampled companies over a period of five years. The data were analyzed using a panel regression and ANOVA analysis to establish the relationship between corporate governance and firm performance. Corporate governance is defined in terms of three indices – board structure, ownership structure and corporate control, while firm performance is measured by return on assets, return on equity, net profit margin and Tobin’s Q. Findings The empirical results show that ownership concentration and female representation on board have a positive impact on performance. Although the results revealed no evidence to support the impact of board size and audit committee size on performance, there is significant evidence to support the fact that independent directors and audit committee frequency both adversely affect firm performance. Research limitations/implications The scope of this paper can be expanded to include non-listed firms. In addition, other corporate governance mechanisms could be considered to broaden the scope of the paper. Originality/value This paper contributes to the scarce literature on corporate governance and firm performance in developing countries, especially in sub-Saharan Africa. The paper provides useful information that is of great value to policymakers, academics and other stakeholders.

scholarly journals The relationship between corporate governance and financial performance

2019 ◽  
Vol 9 (1) ◽  
pp. 54-78 ◽  
Author(s):  
Zaid Saidat ◽  
Mauricio Silva ◽  
Claire Seaman
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Financial Performance ◽  
Family Firms ◽  
Corporate Performance ◽  
Independent Directors ◽  
Governance Mechanisms ◽  
Content Type ◽  
Corporate Governance Mechanisms ◽  
The Relationship

PurposeThe purpose of this paper is to attempt to fill a research gap in the relationship between corporate governance mechanisms and financial performance of family and non-family firms’ by using a sample of non-financial firms listed on Amman Stock Exchange (ASE) for the period 2009–2015.Design/methodology/approachThis research employs a quantitative method using data that include corporate governance mechanisms, firm characteristics and financial ratios of a sample of Jordanian listed firms in the ASE over the period 2009–2015. The sample covers all companies that have been part of the ASE during the period including both family and non-family firms, part of total of 228 companies listed on the ASE as of 31 December 2015. The study used accounting-based measures such as return on asset (ROA) and market-based measures such as Tobin’sQas proxies for corporate financial performance.FindingsThe study found that board size both in term of Tobin’sQand ROA has a negative relationship with the performance of family firms. In non-family firms, there is no systematic relationship with corporate performance. There is a strong relationship between corporate performance and independent directors in non-family firms. In addition, the authors found some evidence for a relationship between performance and independent directors in family firms. Also, results indicated that ownership concentration has an insignificant correlation with corporate performance and in family firms has a negative and significant correlation with Tobin’sQ. There is a significant relationship between local investors’ ownership and corporate performance as measured by Tobin’sQin family and non-family firms.Originality/valueStudies concerned with the effect of corporate governance on firm performance remains comparatively under-researched in Middle East countries and Jordan in particular (Najib, 2007; Omet, 2004; Marashdeh, 2014). Moreover, studies investigating whether the practice of corporate governance has the same impact on family firm performance are still relatively less well known than those when ownership is distributed widely (non-family firms) (Jaggi, Leung and Gul, 2009; Prencipe and Bar-Yosef, 2011). This research is seeking to fill this current gap in Jordan, which is one of the developing countries with an emerging economics that are very poorly represented in the literature.

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