scholarly journals Corporate Governance Mechanisms and Firms’ Performance: An Empirical Analysis of Firms Listed on the Saudi Stock Exchange

2016 ◽  
Vol 6 (2) ◽  
pp. 101 ◽  
Author(s):  
Hamad Yuosef Alhumoudi
Keyword(s):  
Firm Performance ◽  
Stock Exchange ◽  
Positive Influence ◽  
Board Size ◽  
Cross Sectional ◽  
Ceo Duality ◽  
Ownership Structures ◽  
Board Characteristics ◽  
Corporate Governance Mechanisms ◽  
The Impact

This study examines whether implementation of internal CG mechanisms have affected the performance of non-financial firms listed on the Saudi stock exchange “Tadawul”, since the implementation of Saudi CG code. A cross-sectional regression analysis is employed on a sample of 118 non-financial Saudi firms in 2014, to test the hypotheses set out in the study. Board characteristics assessed include, board size, board composition, board meetings and CEO duality. Ownership structures include managerial and concentrated ownership. The study's empirical findings show board size and CEO duality, are amongst those board characteristics with a positive influence on firm performance. In the case of the second internal mechanisms of CG ownership structures, the findings suggest only managerial ownership positively affects performance. The study findings conclude that CG structures differ in every country, as each has its own social and regulations situation. The study contributes to existing literature about the CG in Saudi Arabia by reviewing the impact of CG practices eight years after the CGC. It enhances understanding among practitioners of CG, and explains how it influences firm performance in Saudi.

scholarly journals The Impact of board characteristics on Firm Performance: Evidence from Nonfinancial Listed Companies in Kuwaiti Stock Exchange

2012 ◽  
Vol 2 (2) ◽  
pp. 310 ◽  
Author(s):  
Ebrahim Mohammed Al-Matari ◽  
Abdullah Kaid Al-Swidi ◽  
Faudziah Hanim Fadzil ◽  
Yahya Ali Al-Matari
Keyword(s):  
Firm Performance ◽  
Audit Committee ◽  
Stock Exchange ◽  
Linear Regression Analysis ◽  
Control Variable ◽  
Discussion Section ◽  
Ceo Duality ◽  
Board Characteristics ◽  
Positive Effects ◽  
The Impact

The core aim of this study is to examine the relationship between board characteristics and the firm performance of non-financial listed Kuwaiti firms. To achieve the objectives of the study, the data were collected from a sample of 136 companies for the financial year 2009. Variables such as CEO duality, COE tenure, audit committee size, board size and board composition were considered as predictors of the firm performance that was measured employing the return on assets (ROA). By contrast, the effects of CEO tenure and leverage on firm performance were found to be negative and significant at the chosen level of significance. To test the hypotheses of the study, multiple linear regression analysis using SPSS 18.0 was utilized. Using the firm size and leverage as a control variable, the findings of the study support the positive effects of CEO duality and audit committee size on ROA. Other findings of the study were discussed in the discussion section and some other future study directions were provided.

scholarly journals The Impact of Board Composition on Firm Performance with Reference to Selected Indian Companies

2020 ◽  
Vol 8 (6) ◽  
pp. 2818-2824
Keyword(s):  
Firm Performance ◽  
Significant Relationship ◽  
Financial Services ◽  
Stock Exchange ◽  
Independent Directors ◽  
Board Composition ◽  
Women Directors ◽  
Board Size ◽  
Size Number ◽  
The Impact

This study examines effects of board composition on firm performance among 24 selected companies which are listed on the National Stock Exchange. It strives to understand the influence of corporate governance by testing 3 variables of board composition namely – board size, number of independent directors and the number of female directors on a company’s profitability measured through the tool – Tobin’s Q. One-way Anova test is used to establish a relationship between each of the three variables of board composition with firm profits. The study is conducted over a period of 5 years from 2013 to 2018 and concentrates on the following sectors - Auto, Financial Services, FMCG, IT, Media, Metal, Pharma, and Realty. The results revealed a significant relationship between board size and number of independent directors with firm profits which meant a firm with a greater sized board or more independent directors also showed higher profits in comparison. While, no significant relationship was found between the number of women directors on a firms’ board and firm performance.

scholarly journals The Impact of Governance Rules on Earnings Management: Applied Study on Industrial and Service Companies Listed on Palestine Stock Exchange

2019 ◽  
pp. 103-136
Author(s):  
Yousef Alrayyes ◽  
Nahed Al Khaldy
Keyword(s):  
Corporate Governance ◽  
Earnings Management ◽  
Stock Exchange ◽  
Negative Influence ◽  
Positive Influence ◽  
Board Independence ◽  
Independence Property ◽  
Ceo Duality ◽  
Board Directors ◽  
The Impact

The aim of the study is to analyze the impact of corporate governance rules on earnings management for companies listed on Palestine Exchange. A number of corporate governance variables was selected to achieve this aim, including size of board of directors, CEO duality, board of director’s independence, property rights, number of board directors’ meetings. Modified Jones Model has been used to detect earnings management. Panel Data Model has also been involved in the study, where the population study consists of the 48 companies listed on Palestine Exchange, and which are distributed across five main sectors. The study sample included 13 industrial and services companies listed on Palestine Exchange. This study found that there was a negative influence between board size and CEO duality, and between earnings management. The study also showed that there is a positive influence between board independence and earnings management. Moreover, it showed that no relationship between board directors meetings and internal ownership with earnings management. The study stressed on the need for continued reinforcement of the governance rules, in order to avoid the negative impacts resulted from failure to apply these rules, taking into consideration the support of board independence in their relationship with areas of executive work to avoid taking decision that may affect earnings management. It also recommended that doing other researches on the same subject should be continued, taking into account the examination of variables other than those in this study to get to the variables that have the greatest impact on earnings management for companies listed on Palestine Exchange. 

scholarly journals The Effect of IAS-24 Disclosures on Governance Mechanisms and Ownership Structures in Pakistan

2016 ◽  
Vol 5 (1) ◽  
pp. 15-36
Author(s):  
Abdul Rafay Abdul Rafay ◽  
Ramla Sadiq ◽  
Mobeen Ajmal
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Financial Reporting ◽  
Negative Impact ◽  
Positive Impact ◽  
Stock Exchange ◽  
Institutional Ownership ◽  
Governance Mechanisms ◽  
Ownership Structures ◽  
The Impact

IAS-24 of the International Financial Reporting Standards focuses on the concept and disclosures of related party transactions (RPTs) for a reporting entity. This study examines the interrelationship between RPTs (as disclosed under IAS-24), agency theory, ownership structures and firm performance. Our sample includes nonfinancial companies indexed by the KSE-100 of the Pakistan Stock Exchange during 2006–15. To run the regression models, we determine the regression assumptions, normality, heteroskedasticity, autocorrelation and multicollinearity. We investigate the impact of different RPTs, including cash inflows and outflows, whereas other studies generally look at the impact of RPTs on firm performance in totality. The empirical analysis suggests that institutional ownership has a positive, significant impact on firm performance. Related party purchases have a significant, negative impact on performance, resulting in the expropriation of institutional ownership. RPTs that generate revenues have a significant, positive impact on performance, such that institutional ownership has a propping-up effect with respect to the related parties. In practice, institutional ownership leads to strong corporate governance and contributes to firm performance. While other studies find family ownership responsible for the expropriation effect, we argue that institutional ownership has a propping-up and expropriation effect on related parties. Our study also suggests that certain ownership structures lead to weaker corporate governance mechanisms, resulting in greater agency problems. This, in turn, badly affects company performance and leads to the exploitation of minority shareholders.

scholarly journals International ownership and firm performance in Arab economies

2020 ◽  
Vol 17 (4, Special Issue) ◽  
pp. 308-318
Author(s):  
Stefan Lutz ◽  
Karim Hegazy ◽  
Ehab K. A. Mohamed ◽  
Mohamed A. K. Basuony
Keyword(s):  
Firm Performance ◽  
Ownership Structure ◽  
Business Environment ◽  
State Ownership ◽  
Mena Region ◽  
Cross Sectional ◽  
Ownership Structures ◽  
And Performance ◽  
The Impact ◽  
Better Than

This paper aims at filling existing research by examining the impact of corporate governance and ownership structure on firm performance using cross-sectional data from companies in the MENA region for the years 2009-2013. The results indicate that higher ownership concentration is associated with higher returns. Furthermore, firms with higher international ownership share tend to perform better than those with only local private and/or state ownership. The results suggest some prevalent features with respect to ownership and performance of firms in the MENA region. Due to the volatile social and business environment, these firms operate in, they may be particularly dependent on effective ownership structures and support which may be provided by international, institutional, and large shareholders.

Corporate Governance and Firm Performance in Indian Textile Companies: Evidence from NSE 500

2020 ◽  
Vol 13 (2) ◽  
pp. 210-226
Author(s):  
Ishfaq Gulzar ◽  
S. M. Imamul Haque ◽  
Tasneem Khan
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Performance Measures ◽  
Board Independence ◽  
Board Size ◽  
Ceo Duality ◽  
Board Characteristics ◽  
And Performance ◽  
Business Practitioners ◽  
Measure Of Performance

This article endeavours to study the relationship between corporate governance and performance for a sample of 11 textile firms listed on Nifty 500 Index in India. The article examines whether the board characteristics have any impact on performance measures. The data covers the time period from 2014 to 2018. The study uses board size, board meetings, board independence as corporate governance surrogates from different dimensions along with other widely uses of independent variables to assess their impact in a panel data-based regression. The findings provide mixed results between the board characteristics and the firm performance. Board size and firm performance is statistically significant with return on assets and Tobin’s Q. Whereas, board independence, board meetings and CEO duality are not statistically significant with both accounting-based measure of performance and market-based measure of performance. The article provides empirical evidence that board independence, board meetings and CEO duality is not necessary for listed textile companies in India and would be of interest to regulatory bodies, business practitioners and academic researchers. The main value of this article is the analysis of the effect of corporate governance on performance measures on listed Indian textile industries.

Corporate governance mechanisms and firm performance in a developing country

2020 ◽  
Vol 62 (2) ◽  
pp. 147-169 ◽  
Author(s):  
Albert Puni ◽  
Alex Anlesinya
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Financial Performance ◽  
Governance Mechanisms ◽  
Board Size ◽  
Ceo Duality ◽  
Content Type ◽  
Board Committees ◽  
Discourse Practices ◽  
Corporate Governance Mechanisms

Purpose The purpose of this study is to examine the influence of corporate governance mechanisms recommended by the Securities and Exchange Commission (SEC) of Ghana on firm performance as measured by accounting-based ratios (return on assets, return on equity and earning per share) as well as market-based measure (Tobin’s Q) among listed Ghanaian companies from 2006 to 2018. These mechanisms are: board composition (board size, inside directors and outside directors), board committees (audit, remuneration and nomination), chief executive officer (CEO) duality/separation, board meetings and shareholder concentration. Design/methodology/approach The study used panel regression analysis of data from 38 listed firms in Ghana from 2006 to 2018 to test how each corporate governance variable initiated by the SEC of Ghana contributed to firm performance. Data were extracted from the annual reports of listed companies. Findings The study found that the presence of both insiders and outsiders on the corporate board improved financial performance. Similarly, board size, frequency of board meetings and shareholder concentration/ownership structure generally had a positive impact on financial performance. However, the presence of board committees generally had a negative impact on financial performance while CEO duality had no impact on financial performance. Practical implications The study contributes to the understanding of how good corporate governance practices affect firm performance for both academics and particularly Ghanaian policymakers. Originality/value This study provided new findings to bridge the gaps in the general corporate governance literature relative to the lack of consensus on financial impacts of corporate governance mechanisms. The finding contributes to knowledge by providing new and original evidence that some current corporate governance mechanisms are not effective in minimizing the agency problem in a developing setting. Furthermore, the authors anticipate that the outcomes of this research, which so far is the most comprehensive study in the Ghanaian context in terms of the coverage of corporate governance mechanisms specified by the SEC of Ghana, can significantly shape corporate governance discourse, practices and policies in Ghana, particularly and in other developing countries generally to improve financial performance and corporate sustainability.

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 INTERDEPENDENSI KEPEMILIKAN MANAJERIAL DAN KEPEMILIKAN INSTITUSIONAL SERTA PENGARUHNYA TERHADAP KINERJA KEUANGAN

2008 ◽  
Vol 7 (2) ◽  
Author(s):  
Fong Ida Melinda ◽  
Bertha Silvia Sutejo
Keyword(s):  
Firm Performance ◽  
Stock Exchange ◽  
Institutional Ownership ◽  
Negative Influence ◽  
Positive Influence ◽  
Least Square ◽  
Managerial Ownership ◽  
Significant Other ◽  
Crisis Period ◽  
The Impact

This research was explaining the influence of managerial ownership, institutional ownership, and the impact to firm performance. We use three stage least square (3SLS) model to test our hypotheses. Sample of the research is all of manufacture companies which of have managerial ownership and institutional ownership and listed on Indonesian Stock Exchange period 1997 -2006. The result was provided that managerial ownership and firm performance has positive influence but not significant. Other evidence is that institutional ownership has significant positive influence to firm performance. The research was proven that managerial ownership and institutional ownership have negative influence. Condition crisis and after crisis has effect to ownership and firm performance. Firm performance does increase when after crisis period opposite that crisis period.

scholarly journals An exploration of the effect of organisational demography on board size and leadership structure: Evidence from the Greek manufacturing sector

2018 ◽  
Vol 14 (3) ◽  
pp. 46-57
Author(s):  
Dimitrios N. Koufopoulos ◽  
Ioannis P. Gkliatis
Keyword(s):  
Stock Exchange ◽  
Manufacturing Sector ◽  
Annual Reports ◽  
Board Structure ◽  
Board Size ◽  
Board Characteristics ◽  
Leadership Structure ◽  
Research Findings ◽  
Athens Stock Exchange ◽  
The Impact

This study examines how organisational demography (organizational age, organisational size and number of years listed in the Athens Stock Exchange, ATHEX), may impact the board structure (board size, CEO duality and CEO dependence/ independence). The relationships are proposed, under the light of data collected from the annual reports of all 140 manufacturing organisations quoted in the Athens Stock Exchange. Research findings revealed a significantly positive relationship of organisational size, organisational age and number of years that a firm is listed in the Stock Exchange with board size. However, these organisational characteristics do not influence the leadership structure or dependency/independency of the Chairperson to the CEO. While many studies examining the impact of board characteristics on various organisational outputs, including performance, reputation and effectiveness, there are limited studies investigating variables that affect board characteristics and as such the study opens discussion on potential predictors of board.

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