scholarly journals Editorial: Corporate governance through a prism of multi-disciplinary research

2020 ◽  
Vol 17 (2) ◽  
pp. 4-6
Author(s):  
Cesario Mateus ◽  
Irina B. Mateus
Keyword(s):  
Corporate Governance ◽  
Performance Management ◽  
Audit Quality ◽  
Academic Research ◽  
Audit Fees ◽  
Point Of View ◽  
Cultural Dimensions ◽  
Risk Disclosure ◽  
And Performance ◽  
Cross Cultural Management

This volume of the journal “Corporate Ownership and Control” is focused on corporate governance, corporate social responsibility, earnings and performance management, ownership concentration, institutional ownership, audit fees, audit quality and independence, cross-cultural management and cultural dimensions, financial instruments risk disclosure, equity incentives, firm performance, shareholder composition and monitoring effects, etc. The topics addressed in this issue highlight the continuing need for knowledge present in academic and non-academic research. The papers published in this issue offer an additional point of view with regard to the most important corporate governance issues.

scholarly journals Human resources managers as custodians of the King III code

2015 ◽  
Vol 18 (2) ◽  
pp. 206-217
Author(s):  
Frank De Beer ◽  
Daniel Hercules Du Toit
Keyword(s):  
Corporate Governance ◽  
Human Resources ◽  
Performance Management ◽  
Ethical Decision Making ◽  
Structured Interviews ◽  
Main Research ◽  
Hr Management ◽  
Human Resources Managers ◽  
And Performance ◽  
Hr Managers

The objective of this research was to perform an exploratory study on the knowledge and understanding of the King III code among Human Resources (HR) managers in South African companies. The King III code is a comprehensive international corporate governance regime which addresses the financial, social, ethical and environmental practices of organisations. HR management plays a role in managing corporate governance by using the King III code as a guideline. The main research questions were: Does HR management know, understand, apply, and have the ability to use the King III code in terms of ethical decision-making? What role does HR management play in corporate governance? A random sample of available HR managers, senior HR consultants and HR directors was taken and semi-structured interviews were conducted. The results indicated that the respondents had no in-depth knowledge of the King III code. They did not fully understand the King III code and its implications nor did they use it to ensure ethical management. The themes most emphasised by the participants were: culture, reward and remuneration, policies and procedures and performance management. The participants emphasised the importance of these items  and HR’s role in managing them.

scholarly journals Organisational Characteristics, Corporate Governance and Corporate Risk Disclosure: An Overview

2021 ◽  
Vol 15 (1) ◽  
pp. 77-92
Author(s):  
Musa Uba Adamu
Keyword(s):  
Corporate Governance ◽  
Empirical Research ◽  
Banking Sector ◽  
Academic Research ◽  
Listed Companies ◽  
Business Environment ◽  
Time Interval ◽  
Risk Disclosure ◽  
Major Factors ◽  
Corporate Risk

Certain attributes of corporate governance behaviour have been identified in academic research as major factors correlating with corporate risk disclosure amongst listed companies. This is in spite of the fact, however, that much of the empirical research in the area reveals mixed results. This study analyses corporate risk disclosure practice involving listed companies and investigates whether such diverse results are attributable to regulation, jurisdiction, operating industry, business environment, or the methodologies employed. We use risk disclosure, corporate governance and organisational characteristics keywords to search the relevant studies on which 46 empirical research papers were sampled, and employ a meta-analysis procedure to evaluate the findings of the previous empirical research. Our analyses reveal that firm size is the major organisational-specific characteristic affected by moderators, and board size and institutional investors are the major corporate governance variables that affect moderators. On the analysis of the nature of disclosure, financial risk information is higher for companies operating in the banking sector, while operational risk disclosure is higher for non-financial companies. Additionally, the study finds that the data generating procedure, time interval, diversity of sample and size, and the statistical technique employed are among the major factors that influence discrepancies among the prior studies. Such variables complicate stakeholders’ effort to comprehend the main factors that influence companies to unveil their risks profile. We propose that the current data collection process is labour intensive and time consuming, and promote the selection of smaller sample sizes compared to most of the existing research. It may be the case that constraints can be overcome through research that employs an automated procedure for analysis of textual data.

The effectiveness of internal corporate governance and audit quality: the role of ownership concentration – Malaysian evidence

2018 ◽  
Vol 18 (2) ◽  
pp. 233-253 ◽  
Author(s):  
Adel AlQadasi ◽  
Shamharir Abidin
Keyword(s):  
Corporate Governance ◽  
Audit Quality ◽  
Audit Fees ◽  
Ownership Concentration ◽  
Supporting Evidence ◽  
Governance Mechanisms ◽  
Internal Governance ◽  
Content Type ◽  
Internal Governance Mechanisms

Purpose This study is motivated by the competing views on whether internal governance mechanisms complement or substitute for external auditing, and how this association is affected by ownership concentration. The complementary view predicts that good internal governance mechanisms are related to high-quality audit. On the other hand, corporate governance mechanisms may be substituted for each other, so more investment in governance mechanisms leads to less investment in external auditing. Therefore, this study aims to examine the association between internal governance mechanisms and the demand for audit quality. Design/methodology/approach Data from Malaysian listed companies during the period 2009 to 2012 are used. Ordinary least square (OLS) regression is applied to analyse the data. Findings Companies with a higher concentration of ownership are less likely to demand extensive auditing. In addition, the study provides supporting evidence for the complementary association between a company’s governance and audit fees. However, the ownership concentration plays a minor role in the positive association between internal corporate governance and audit quality. Further tests are conducted and support the main findings. Practical implications Significant implications are provided for the audit profession in emerging economies, where concentrated ownership is common, to help policymakers and regulators in determining the power of controlling shareholders on audit quality and firm’s governance. The study’s findings open up avenues for further research. Originality/value This is the first work to address the role of ownership concentration in the association between corporate governance and audit quality; it suggests that the ownership structure must be considered in examining the effectiveness of corporate governance. The study also provides a comprehensive combination of internal governance mechanisms.

scholarly journals Does good corporate governance lead to better firm performance? Strategic lessons from a structured literature review

2018 ◽  
Vol 15 (4) ◽  
pp. 73-85 ◽  
Author(s):  
Bushra Khan ◽  
André Nijhof ◽  
Rosalien A. Diepeveen ◽  
Daniëlle A. M. Melis
Keyword(s):  
Corporate Governance ◽  
Meta Analysis ◽  
Academic Research ◽  
Company Performance ◽  
Board Diversity ◽  
Good Corporate Governance ◽  
Moderating Factors ◽  
And Performance ◽  
The Relationship ◽  
Ongoing Dialogue

The objective of this paper is to disclose proven relationships between good corporate governance variables and the financial and/or non-financial performance of companies based on a meta-analysis of relevant studies. A meta-analysis was performed by means of academic research published between 2006 and 2016 in the five highest-ranked academic journals according to the Association of Business Schools (ABS) ranking. The relevant academic studies were selected on the basis of the relationship between corporate governance and performance. Our study provides evidence for the correlation between five corporate governance variables (board independence, board diversity, CEO characteristics, remuneration and oversight) and company performance. Furthermore, several mediating and moderating factors influencing the relationship between corporate governance variables and company performance were identified in this meta-study. The overview of corporate governance variables and their relation to company performance serves as input for a better understanding of this relationship and subsequently the ongoing dialogue on enhancing corporate governance in practice.

scholarly journals CSR-based corporate governance: A Malaysian study

2009 ◽  
Vol 6 (4) ◽  
pp. 176-192
Author(s):  
Normah Omar ◽  
Rashidah Abdul Rahman
Keyword(s):  
Corporate Governance ◽  
Performance Management ◽  
Internal Control ◽  
Maximum Level ◽  
Annual Reports ◽  
Average Score ◽  
Point Score ◽  
Governance Practices ◽  
And Performance ◽  
Corporate Social

The current study focuses on corporate social responsibility-based corporate governance (CSR-based CG) reporting that is purely based on information divulged in the annual reports of the country’s top 100 public listed companies (PLCs) by market capitalization. It highlights the companies with the highest scores vis-à-vis reporting on their CSR-based corporate governance practices and the areas in which they excel in. The annual reports of these companies have either been obtained directly from the organizations concerned or from their respective websites via links from Bursa Malaysia. A CSR-based Corporate Governance Score Checklist is used in ensuring consistency in analysing the annual reports. A 5-point Likert Scale is used to measure the CSR-based CG attributes, a “5-point” score denotes the maximum level of compliance and acceptance of the gauged attributes for CSR-based CG reporting whilst a “1-point” score represents low or no compliance. The results of the study reveals that that there is much room for improvement vis-à-vis Malaysian companies’ reporting of their CSR-based CG practices, as the average reporting score of these sample firms only came up to 55.1% for the period 2006 and this figure has slightly improved relative to the average score of 52.2% obtained in 2002. Furthermore, CG reporting has been found lacking mainly in areas such as Strategic Planning and Performance Management, Risk Management and Internal Control, Financial Matters, Human Capital, and Intellectual Capital. As such, improvement may involve the implementation of corporatewide internal programmes in most of these areas.

scholarly journals Do boards influence audit quality? A multidimensional analysis

2021 ◽  
Vol 10 (1) ◽  
pp. 125-138
Author(s):  
Radhi Al-Hamadeen ◽  
Turki AlHmoud ◽  
Hasan El-Nader ◽  
Malek Alsharairi ◽  
Firas Almasri
Keyword(s):  
Corporate Governance ◽  
Empirical Evidence ◽  
Boards Of Directors ◽  
Audit Quality ◽  
Financial Statements ◽  
Audit Fees ◽  
Multidimensional Analysis ◽  
Service Firms ◽  
Corporate Boards

This study investigates how corporate boards of directors influence the quality of external audit in a sample of service firms listed on the Amman Stock Exchange (ASE). We contribute to the literature by providing empirical evidence on the efficacy of the corporate governance mechanisms through corporate boards to influence audit quality in an emerging country setting (i.e., Jordan). According to Chua (1986), this is mainstream “market-based” accounting research. We regress multiple dimensions that capture the quality of financial statements’ audit on a group of board of directors (BoD) characteristics for total observations of 225 firm-year obtained for 45 companies during the period (2014-2018). Specifically, the multidimensional analysis of the response variable, audit quality, includes audit firm’s internationalization, audit fees, auditor tenure, and the number of licensed practitioners at the audit firm. Using multiple linear (Panel Least Squares – PLS) and logistic regression models, we document empirical evidence that audit quality is positively affected by the independence and size of boards but negatively affected by CEOs duality, while no influence of the board’s expertise on any measures of the audit quality. The study provides implications for policymakers and investors regarding the signals that firms can send regarding the quality of financial statements audit when complying with the best practices of corporate governance

Mandatory Corporate Governance Rules and Auditor Behavior: The Case of Greece

2019 ◽  
Vol 54 (04) ◽  
pp. 1950015
Author(s):  
Konstantina Michalopoulou
Keyword(s):  
Corporate Governance ◽  
Risk Premium ◽  
Audit Quality ◽  
Audit Fees ◽  
Business Risk ◽  
Audit Opinion ◽  
Quality Audit ◽  
Audit Fee ◽  
The Impact ◽  
Of Greece

This study examines the impact of the first mandatory corporate governance regulation in the Greek environment on audit quality. Audit quality is operationalized with the number of audit qualifications, the monetary amount of audit qualifications, audit hours, and audit fees. It also utilizes the full content of the Greek audit report and constructs new audit quality proxies while it is the first that examines the association between corporate governance and actual audit hours. The findings suggest that following the implementation of the new regulation, auditors became more independent during the audit opinion process. Furthermore, the audit fee increases without audit hours showing a respective increase. It is concluded that the audit fee increase does not reflect differentiation in the delivered audit quality, as auditors do not exert more audit effort. The audit fee increase could reflect a risk premium due to the increase in auditors’ perceived business risk as a result of the increased spending and additional liability of listed companies under the new regulation.

scholarly journals Corporate Governance and Performance Management Systems at DHI Companies: Experiences of Managing Change

2016 ◽  
Vol 11 (2) ◽  
pp. 2634-2640
Author(s):  
Damber Singh Kharka ◽  
Tshering Denka ◽  
Dorji Nima
Keyword(s):  
Corporate Governance ◽  
Change Management ◽  
Performance Management ◽  
The State ◽  
General Introduction ◽  
Performance Management Systems ◽  
Managing Change ◽  
Governance Practices ◽  
And Performance ◽  
International Good

The Druk Holding and Investments (DHI), a government holding company in Bhutan that owns and manages majority of the state owned enterprises and holds government shares in many of the publically listed companies, has been initiating corporate governance and performance management reforms over the last eight years since its establishment in November 2007. Introduction of corporate governance practices in line with international good practices and introduction of performance management system in the state owned companies called for managing change. This paper, after a general introduction of the concept of change management, shares the experiences in change management. The paper highlights some of the initiatives undertaken by DHI and its companies, and underscores that success of introducing a new system is more certain when changes are introduced through a consultative process. 

scholarly journals The Effects of Corporate Governance Practices on the Choice between Efficient and Opportunistic Earnings Management

2016 ◽  
Vol 11 (9) ◽  
pp. 1
Author(s):  
Tim Vervaat ◽  
Georgios Georgakopoulos ◽  
Konstantinos Z. Vasileiou ◽  
Ioannis Sotiropoulos
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Audit Committee ◽  
Audit Quality ◽  
Audit Fees ◽  
Audit Committees ◽  
Outside Directors ◽  
Study Results ◽  
Governance Practices ◽  
The Impact

This study aims to explore the preferences of the publicly listed companies on the S&P 500 index regarding their earnings management (efficient or opportunistic) as well as the impact of the corporate governance practices (audit committee, board independence and audit quality) on their decision. Using two separate regression models, it was found that American firms listed on the S&P 500 index tend to conduct efficient earnings management, which is in line with the findings of prior research. Moreover, it emerged that the earnings management selection does not depend on the amount (high vs small) of audit fees paid by the companies. Additionally, the governance practice of employing more outside directors in the audit committees leads to more efficient earnings management. Finally, according to the study results, the impact of discretionary accruals on future profitability is not significantly related to the proportion of independent members on the board of directors.

scholarly journals Effect of Audit Quality on Earnings Management in Insurance Companies in Nigeria e

2021 ◽  
Vol 7 (2) ◽  
pp. 173-202
Author(s):  
Chizoba Mary Nwoye ◽  
Alphonsus Sunday Anichebe ◽  
Ifeanyi Francis Osegbu
Keyword(s):  
Earnings Management ◽  
Financial Institutions ◽  
Financial Literacy ◽  
Audit Committee ◽  
Audit Quality ◽  
Financial Institution ◽  
Audit Fees ◽  
Audit Committees ◽  
Insurance Companies ◽  
And Performance

The main objective of the study is to determine the effect of audit quality on earnings management in insurance companies in Nigeria with special consideration on accruals and performance measures of earning manipulations using insurance companies in Nigeria. Preliminary analyses were conducted, such as descriptive statistics and correlation matrix. In analyzing the data, the study adopted panel multiple regression to identify the possible effects of audit quality on earnings management of financial institutions in Nigeria We interpreted fixed effect analysis after using Hausman test. The result shows that audit quality had a significant effect on earnings management. We conclude that longer stay of auditors in financial institutions increases accrual and performance manipulation. However, financial institutions audited by the Big 4 auditing firms are associated with less accrual and performance earnings manipulation while financial institutions that have executive and non-executive directors as members of audit committee have greater accrual and performance earnings manipulations. Higher number of financial experts in audit committee increases accrual manipulation while higher number of experts with accounting background in audit committee reduces performance manipulating. Finally, increase in auditors’ fee leads to choices of using accounting methods to manipulate both accrual and performance earnings. Therefore, the study recommends that, financial institutions should have maximum number of years for auditors to stay. They should focus more on increasing the number of experts with accounting background in audit committees. Accounting bodies should regulate auditors’ fee in line with the size of the financial institution. (JEL M42) Keywords: Audit Fees, Audit Committee Independence, Audit Firm Size, Audit Quality, Earnings Management, Financial Literacy of Audit Committee Members, Length of Audit Tenure.

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