Effect of Corporate Governance Practices on Performance of Manufacturing firms in Ireland

Abstract

Corporate governance is a useful tool to minimize the conflicts of interests between stakeholders and management. The purpose of the study was to examine the impact of corporate governance practices on the performance of manufacturing firms in Ireland. The inferences of the study were based on the findings of the preceding studies. The study results showed that corporate governance practices have a positive effect on performance. The implementation of corporate governance standards improves the financial performance of the company as well as positively impacts the internal efficiency of the firms. Good corporate governance is fundamental for a firm as it improves company image, increases shareholders' confidence and reduces the risk of fraudulent activities. Moreover, it was established by the study that good corporate governance principles incorporate transparency, accountability, responsibility, independence and fairness. Corporate governance is the combination of mechanisms, procedures and relations utilized by different institutions to regulate and run a firm. The main purpose of better corporate governance is to increase value for investors and stakeholders in the long run. The study noted that corporate governance is a useful tool to minimize the conflicts of interests between stakeholders and management. The study recommended that manufacturing firms in Ireland ensure that corporate governance practices are effective. The firms need to build a system of rules and practices that determine how a company operates and aligns the interest of all its stakeholders. Further, it is suggested that the firms need to have a good corporate governance system that ensures it follows a sound, transparent, and credible financial reporting system Keywords: Corporate governance policies, performance, manufacturing firms, Ireland