Abstract
In this paper we examine the effect of corporate governance quality - measured by sub and general indexes calculated by the Institutional Shareholder Services (ISS) - on asymmetric information. Using a sample of 392 non financial UK companies listed in the London Stock Exchange from 2003 to 2006, we find that ISS' corporate governance sub and general indexes are negatively and significantly related with asymmetric information. Only the corporate governance quintile for takeover defence's index did not exhibit any significant relation with asymmetric information. The results suggest that the UK companies have a higher degree of compliance with the code of best practices 2003. This compliance increases the quality of corporate governance and as a result mitigates asymmetric information and contributes in solving the agency problem.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
