scholarly journals Impact of Corporate Governance on Corporate Value: Research in Vietnam

2020 ◽  
Vol 11 (1) ◽  
pp. 161
Author(s):  
Nguyen Thi Thanh Phuong ◽  
Dang Ngoc Hung
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Firm Value ◽  
Direct Impact ◽  
Book Value ◽  
Research Results ◽  
Board Of Director ◽  
The Board Of Directors ◽  
The Individual ◽  
The Impact

The paper examines the impact of corporate governance (CG) on firm value (FV) of enterprises in Vietnam. We consider the GC issue from the individual aspects of each member of the Board of Directors (BOD). The research uses GLS regression model, data collected at energy enterprises listed on the stock market in Vietnam during the period 2008 - 2018, with 2937 observations. The research results have found that the size of the BOD has a direct impact on FV, while it is interesting that the Board of Directors' independence has a direct impact on FV when measured by market value, but is in an inverse relation with FV if measured at book value. In addition, BOD chairperson cum CEO has an inverse impact on FV and female BOD members do not have an impact on FV. Further, the research results also prove that an enterprise’s size is directly related with its value, whereas financial leverage is inversely related with the enterprise’s value. Empirical research results serve as a useful basis for enterprises to increase their value, thus enabling the consideration of factors of the board of director at each enterprise.

scholarly journals Corporate Governance and Economic Performance: The Limit of Short Termism

2019 ◽  
Vol 3 (4) ◽  
pp. 49-61
Author(s):  
F. D. Tommaso ◽  
A. Gulinelli
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Economic Performance ◽  
Performance Indicators ◽  
Financial Management ◽  
Firm Value ◽  
Key Performance Indicators ◽  
Common Interest ◽  
The Board Of Directors ◽  
The Impact

This article includes exploring arguments and counterarguments in the context of conducting a scientific discussion on the impact of corporate governance on a company’s financial and economic performance. The main purpose of this paper is to determine the nature of the impact of corporate governance policy on the activities of economic entities. The systematization of literary sources and approaches to problem solving has shown that there are two opposing points of view: firm value, efficiency), on the other hand, a number of scientists are convinced that there is a positive influence of the functioning of the corporate governance system on the valuation of listed companies. The work emphasizes the decisive role of the board of directors of the company in the development and adoption of the strategic direction of development of the organization. The author points out in the study the need for coordinated interaction of the board of directors with the financial management of the company and the business owners in order to increase the efficiency and profitability of the business entity. It is stated that the key economic tools for achieving and implementing the strategic plans of the company can be the key performance indicators and accordingly developed measures to achieve such success. As a result, it is justified that corporate governance should not be a set of rules and mechanisms aimed at managing and controlling companies, but rather as a process by which companies become sensitive to stakeholder rights. The spread of corporate culture, according to the author of a work aimed at protecting the common interest, is facilitated by the existence of good rules and effective authorities that control their observance. Keywords: corporate governance, financial and economic activity, board of directors, key performance indicators.

scholarly journals The Impact of Corporate Governance Characteristics on the of Financial Distress

2016 ◽  
Vol 3 (2) ◽  
pp. 162
Author(s):  
Mahdi Filsaraei ◽  
Reza Jarrahi Moghaddam
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Financial Distress ◽  
Financial Statements ◽  
Multivariate Regression Analysis ◽  
Company Stock ◽  
Governance Indicators ◽  
The Board Of Directors ◽  
Qualified Audit Opinion ◽  
The Impact

Given the importance of corporate governance for increasing the monitoring of company operations, i.e., reducing information asymmetry and increasing control over operations, in this study, we investigate some indicators of corporate governance and financial distress as one of the most important criteria in the decisions of the users of financial statements. Corporate governance Indicators that have been mentioned in this study, including the independence of the board of directors (the ratio of non-executive members), institutional investors and duality of CEO and Chairman of the Board of Directors. This study is applied research and the required information is gathered from financial statements of listed companies on the TSE. Using a sample of 82 company stock during the period 2010-2014 and multivariate regression analysis, the results of the analysis of information gathered indicates that institutional ownership reduces the financial distress. However, there was no significant relationship between board independence (proportion of outside board members) and the duality of CEO and Chairman of the Board with the financial distress. The results also indicate that financial leverage and a qualified audit opinion increases financial distress and firm size and management performance reduces it.

scholarly journals Board of directors, performance and firm value in Brazilian listed state-owned enterprises

2020 ◽  
Vol 18 (2) ◽  
pp. 1
Author(s):  
Carolina Coletta ◽  
Roberto Arruda de Souza Lima
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Board Of Directors ◽  
Firm Value ◽  
Board Structure ◽  
Agency Conflicts ◽  
Governance Practices ◽  
The Board Of Directors ◽  
Structure Index ◽  
Corporate Governance Practice

<p>This paper investigates the relationship between the board of directors' structure and firm performance and the value of Brazilian listed state-owned enterprises (SOEs), from 2002 to 2017, totaling 327 observations using an unbalanced panel data with fixed and random effects regressions. The evolution of corporate governance practices adopted by the boards is presented for this period, using a Board Structure Index (BSI). The results indicate a significant positive relation between the board's structure and firm performance, measured by ROE and ROA, and firm value, measured by Tobin's <em>q</em>. These findings are consistent with corporate governance literature, in the sense that the board's role of monitoring management reduces agency conflicts. The results also show an improvement in adopting corporate governance practice on Brazilian SOEs' boards over the last decade.</p>

Financial soundness of Islamic banks: does the structure of the board of directors matter?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Afef Khalil ◽  
Imen Ben Slimene
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Islamic Banks ◽  
Z Score ◽  
Data Set ◽  
Content Type ◽  
Additional Hypothesis ◽  
The Board Of Directors ◽  
Financial Soundness ◽  
The Impact

Purpose The purpose of this paper is to examine the Board of Directors’ characteristics and their impact on the financial soundness of Islamic banks. Design/methodology/approach Regression analysis is applied to test the impact of the Board of Directors’ characteristics on the financial soundness of Islamic banks, using a panel data set of 67 Islamic banks covering 20 countries from 2005 to 2018. The Z-score indicator is used to evaluate the Islamic banks’ soundness. To check the robustness of the results, this paper uses other dependent variables (CAMEL) than the Z-score. Findings The main results show that the presence of an independent non-executive director negatively impacts the financial soundness of Islamic banks, while the chief executive officer duality practice has a positive effect on it. Other characteristics of the Board of Directors do not significantly impact the financial soundness of Islamic banks (foreign director, institutional director, chairman with a Shari’ah degree, interlocked chairman and the Board of Directors’ size). Practical implications This study aims to fill the gaps in the literature that discuss the Board of Directors’ role in corporate governance and its impact on the financial soundness of Islamic banks. In other words, it shows the role played by the Board of Directors and improves the knowledge of the corporate governance-financial soundness relationship. Plus, managers, investors and regulators may gain evocative insights, particularly those looking to improve their Islamic banks’ soundness by restructuring their boards’ composition. Originality/value This study sheds new light on the literature on Islamic banking by clarifying the relationship between the Board of Directors and the financial soundness of Islamic banks. Contrary to previous research, this paper uses an additional hypothesis stating that a chairman with a Shari’ah degree (Fiqh Muamalt) has a positive impact on the financial soundness of Islamic banks.

Do non-staggered board elections matter to earnings quality and the value relevance of earnings and book value?

2017 ◽  
Vol 16 (1) ◽  
pp. 46-66 ◽  
Author(s):  
Shuling Chiang ◽  
Gary Kleinman ◽  
Picheng Lee
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Stock Prices ◽  
Positive Relationship ◽  
Value Relevance ◽  
Earnings Quality ◽  
Discretionary Accruals ◽  
Content Type ◽  
Book Value ◽  
The Impact

Purpose The purpose of this paper is to examine the impact of non-staggered voting for members of the board of directors on earnings quality and the value relevance of earnings and book value. Design/methodology/approach The authors used a sample of Taiwanese firms whose board was elected as a whole every three years from 2003 to 2013. The authors used multiple regression analysis to test whether board of directors elections and corporate governance affected earnings quality and the value relevance of earnings and book value. Findings The authors found that elections led to lower earnings quality, but better corporate governance led to greater earnings quality. In the presence of board elections, earnings have reduced value relevance but book value had increased value relevance. Finally, given board elections, the relative value relevance of earnings and book value on stock price was not fully moderated by strong corporate governance. Research limitations/implications The results presented here indicate the importance of better corporate governance in diffusing suspicions of management occasioned by the use of discretionary accruals in years in which board elections take place. Better corporate governance regimes led to a more positive relationship of discretionary accruals to earnings persistence, even in the presence of directorial elections. Similarly, better corporate governance regimes led to a more positive relationship between earnings per share and stock prices. Limitations include the restriction of the testing locale to Taiwan. That said, many companies around the globe use non-staggered board elections. Accordingly, these results suggest issues of importance to corporate governance advocates beyond Taiwan as well. Originality/value This study deepens the field’s understanding of the impact of corporate governance arrangements and schedules for electing board of directors’ members on issues of interest to stockholders.

scholarly journals Banking Governance in The Era of Digital Transformation

2020 ◽  
Vol 9 (2) ◽  
pp. 10-16
Author(s):  
Badr FIGUIGUI ◽  
◽  
Fouad MACHROUH ◽  
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Two Dimensions ◽  
Digital Transformation ◽  
Governance System ◽  
Blockchain Technology ◽  
Theoretical Approaches ◽  
Challenges And Opportunities ◽  
The Board Of Directors ◽  
The Impact

For nearly four decades, we have been witnessing the development of the concept of corporate governance. This concept has evolved considerably since its appearance because of its multidisciplinary nature and the high diversity of its theoretical grids. There are two main theoretical approaches. The disciplinary and cognitive approaches. Given the challenges and opportunities of digital transformation and its inevitable impact on the bank's business model, it is natural that it also impacts on its governance. This impact can be analyzed from the two dimensions of governance. First, a cognitive dimension, which concerns all the players in the governance system, particularly the board of directors. Then, a disciplinary dimension dictated by the radical transformation of the confidence relations (Board of Directors/managers) established by the blockchain technology which could call into question the notion of opportunism advocated by the agency theory as the basis of the disciplinary approach of governance. In this paper, we will explore from an unprecedented analysis of the impact of digital transformation on banking governance. This analysis will focus on the two dimensions of governance: disciplinary and cognitive. Finally, an empirical study will be presented on the digital transformation at the level of Moroccan banks which refers in particular to the cognitive aspects of governance. Keywords: corporate governance, disciplinary governance, cognitive governance, banking governance, digital transformation

scholarly journals THE IMPACT OF CORPORATE GOVERNANCE STRUCTURE ON THE EXTERNAL AUDIT FEE IN SHARIA SHARES

2021 ◽  
Vol 31 (1) ◽  
pp. 1
Author(s):  
Abdul Rasid
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Hypothesis Test ◽  
Panel Data Analysis ◽  
Internal Audit ◽  
Audit Committees ◽  
Audit Fee ◽  
The Board Of Directors ◽  
Average Size ◽  
The Impact

Introduction: This study aims to determine the impact of corporate governance structures on external fees in sharia stocks that are consistently listed in JII in 2013-2018.Methods: The number of samples in this study recorded 12 consistent sharia stocks listed in the years 2013-2018. This study uses a quantitative approach with panel data analysis method.Results: The results show that the average size of the board of commissioners is six to seven people, the average size of the board of directors is seven to eight people, the average size of the audit committees is three to four people, and the average size of the internal audit is fifteen to sixteen people. The hypothesis test shows that variables which have a significant impact on the audit fee are the size of the board of commissioners and the internal audit. Meanwhile, the size of the board of directors and the audit committees do not have a positive impact on audit fees.Conclusion and suggestion: Companies use more funding from debt than their own capital. Judging from the liquidity ratio, it shows that the company is in a liquid state, which is very capable of fulfilling obligations or debts that must be immediately paid by the company.

scholarly journals How do Competitive and Regulatory Pressures Interact with Internal Corporate Governance?: Evidence from the Cameroonian Banking Sector

2014 ◽  
Vol 9 (2) ◽  
pp. 1623-1636
Author(s):  
KUATE TALLA Idrice Roméo ◽  
KAMDEM David
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Banking Sector ◽  
Substitution Effect ◽  
Equity Capital ◽  
Competitive Pressure ◽  
Regulatory Pressure ◽  
Internal Governance Mechanisms ◽  
The Board Of Directors ◽  
The Impact

The objective of this article is to analyse the impact of both external and internal mechanisms of corporate governance on banks performance in Cameroon. The internal governance mechanisms consist of those linked with the Board of directors (its size and composition) and the ownership structure (ownership concentration, equity capital of each type of shareholder). External mechanisms consist of pressure from competitors, and regulatory pressure from the banking Commission following the adoption of equity principles or rules. Research carried out on a sample of 11 Cameroonian banks showed the effect of complementarity between the control exerted by internal stakeholders (institutional shareholders, insiders ownership, size of the Board of directors) and competitive pressure. On the contrary, a substitution effect was detected between State administrators and competitive pressure. Results obtained also revealed the substitution effect between control exercised by the Board of directors and regulatory pressure.

Does shareholder-oriented corporate governance reduce firm risk? Evidence from listed European companies

2018 ◽  
Vol 19 (2) ◽  
pp. 295-311 ◽  
Author(s):  
Leopold Djoutsa Wamba ◽  
Eric Braune ◽  
Lubica Hikkerova
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Good Governance ◽  
Systematic Risk ◽  
Principal Component ◽  
Firm Risk ◽  
Content Type ◽  
Synthetic Index ◽  
The Board Of Directors ◽  
The Impact

Purpose The purpose of this paper is to explore the impact of the mechanisms of corporate governance on the volatility of companies’ financial profitability. Design/methodology/approach For the period 2002-2014, the authors evaluate the relations linking various indices involved in corporate governance with the systematic risk supported by these companies for a sample of 355 firms domiciled in Europe. To empirically test these relationships, the authors calculated a synthetic index of corporate governance quality (QGI) based on the 53 items of assessment of the companies’ governance proposed by the database ASSET4. Following the method used by Boncori et al. (2016), the authors first reduced the number of dimensions of corporate governance by performing a principal component analysis of the sample, which resulted in the following five components: management’s shareholder commitment, shareholder rights, characteristics of the board of directors, transparency of the financial information and independence of the audit. Findings The results of the tests indicate that the synthetic index of governance that the authors have built is only significant at the 10 percent threshold. The impact of this variable on the systematic risk of the company is of the order of one-tenth of a point. The decomposition of this index into five variables shows that management’s commitment to shareholders and the effectiveness of the board of directors in carrying out its supervisory tasks are likely to reduce, but again to a limited extent, the risk borne by the company. Research limitations/implications This observation guides the future work in introducing variables that reflect the social responsibilities of the companies in the sample in order to distinguish the effects of social responsibility from those of purely shareholder-oriented governance on systematic risk. Practical implications This paper demonstrates the interest of good governance on the risk of firms and identifies certain characteristics upon which to act. Originality/value Although the relations between corporate governance mechanisms and profitability expectations have been the subject of numerous studies, few authors have examined the influence of governorship on the volatility of this profitability, particularly in Europe. To the best of the authors’ knowledge, the rare work on this topic relates to only a limited number of countries.

scholarly journals Strategic corporate governance in family business: A study on the board of directors’ roles and responsibilities

2012 ◽  
Vol 9 (2) ◽  
pp. 9-20
Author(s):  
Henrique Cordeiro Martins ◽  
Carlos Alberto Gonçalves ◽  
ose Antonio de Sousa Neto ◽  
Marcio Augusto Gonçalves ◽  
Reynaldo Maia Muniz
Keyword(s):  
Corporate Governance ◽  
Board Of Directors ◽  
Family Business ◽  
Board Members ◽  
Practical Activity ◽  
Roles And Responsibilities ◽  
The Board Of Directors ◽  
Qualitative Nature ◽  
The Impact

The goal of this article is to analyze the constitution of the directors boards, based on their attributes, and the impact of this configuration on the roles and responsibilities of the board members in Brazilian Family Businesses. A research of a qualitative nature was carried out in 10 big family companies in Brazil. The results found point to the strategic roles as being the most relevant, but as a practical activity focused on the role of control. The Board has been more active at some moments, but is inactive at others, especially, when the concentration of capital is greater in some companies than in others.

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