Corporate Governance and Company Performance: Evidence from Greece

Abstract

We investigate whether differences of corporate governance practices across companies explain variations in performance. Using data from 124 firms listed on the Athens stock exchange for the year 2007 we construct an index measuring company-specific corporate governance. Based on simple OLS and 2SLS analysis, we find that better governed companies show higher performance, measured by company valuation (Tobin’s Q) and operating performance (ROA), using data for 2004-2007. In addition, we show that some aspects of corporate governance are more important than other ones.