Determinants Of Corporate Governance Research Articles

Firm Value is Mediation Good Corporate Governance and Ownership to Asset Growth in Corporation Listed on Bursa Efek Indonesia

The purpose of this study was to determine the determinants of good corporate governance and ownership on firm value in manufacturing companies listed on the IDX for the 2019-2021 period. This study uses a quantitative method research design with a correlational approach to test the effect of independent variables and mediating variables on the dependent variable. The sample of this study were 31 manufacturing companies that have been listed on the IDX for the 2019-2021 period or for 3 years of observation. The data used in this study are secondary data obtained from the company's financial statements and the Indonesia Stock Exchange. The results of testing 11 hypotheses show that good corporate governance has a significant effect on firm value, firm value has a significant effect on asset growth and ownership has a significant effect on firm value. In addition, indirect effect testing also shows that there is no mediating influence between variables.

Key Determinants of Corporate Governance in Financial Institutions: Evidence from South Africa

The purpose of this study was to examine the key determinants of corporate governance in selected financial institutions. Using South African financial institutions as a unit of analysis, namely insurance companies and banks, the study employed a panel generalised method of moments (GMM) model using a data set for the period from 2007 to 2020, to assess key determinants of corporate governance proxies identified for the study. The study sampled 21 South African financial institutions composed of Johannesburg Securities Exchange (JSE) listed and unlisted banks and insurance companies. To measure corporate governance, the study developed a composite index employing the principal components analysis (PCA) method. The findings revealed a positive and significant association between the corporate governance index and its lagged variables. Furthermore, a significant and positive link was found between the efficiency ratio and corporate governance index and capital adequacy ratio (CAR); corporate governance index and firm size; corporate governance index and leverage ratio (LEV); and corporate governance index and return on assets (ROA). However, a negative and significant correlation was found between financial stability and the corporate governance index. The link between return on equity (ROE) and corporate governance was insignificant. A small cohort of financial institutions was excluded because it was challenging to obtain complete annual reports to extract the required data. The study was limited to only five corporate governance measures, namely board diversity, board size, board composition (independent non-executive directors and non-executive directors), and board remuneration. The findings are anticipated to persuade developing countries to pay special attention to how corporate governance is measured.

Corporate governance determinants of capital structure: Evidence from manufacturing firms on the Ghana Stock Exchange

This study examines the impact of corporate governance determinants on the capital structure of manufacturing firms listed on the Ghana Stock Exchange (GSE). Using a purposive sampling of 15 manufacturing firms, we collect secondary data for 14 years. We employ a system generalized method of moments (GMM) approach to address endogeneity issues. Apart from firms using more short-term debt financing than long-term debt, we report a significant positive relationship between managerial and institutional ownership and capital structure. There is a statistically significant and positive relationship between ownership concentration on both the short- and long-term debt ratios. Regarding company financial management, the study offers several recommendations and practical implications. Our findings have implications for improved management performance and corporate governance policies that lead to value-relevant capital structure decisions. The study also provides empirical support for the idea that firms might benefit from reduced agency costs and lower cost of capital if they implement appropriate corporate governance mechanisms. We provide support for the agency and pecking order theories. Future research could consider broader corporate governance variables and optimal capital structure.

Impact of corporate governance factors on ESG disclosure by Russian public companies

In the last decade, ESG reporting has become an integral part of corporate disclosure in Russia. However, there is limited guidance about the determinants of corporate governance that affect ESG disclosure. The paper investigates the interconnection between board of directors’ characteristics and ESG disclosure in Russian public companies. Methodologically, the study relies on the agency and stakeholder theories. Descriptive, correlation and regression analysis were used as research methods. The sample includes the panel data on 34 Russian public companies, whose shares were traded on the Moscow Exchange between 2012 and 2021. We found that board independence, board diversity, and the presence of a sustainability committee had a significant positive effect on ESG disclosure. At the same time, the impact of the board size was predominantly negative. The findings proved that ESG reporting was mostly practiced by the largest (by assets) companies, while the indicators of profitability and risk were insignificant in the context of environmental, social, and corporate governance. The obtained research results can be used by business representatives as well as by legislators and regulators to improve ESG disclosure practices in Russian public companies.

Does Corporate Governance Impact Risk Disclosure? An Empirical Analysis in the Indian Context

This study aims at identifying the determinants of corporate governance that impact corporate risk disclosure in India’s top non-financial listed companies based on market capitalisation. The analysis of the study is based on risk disclosure practices of the leading non-financial listed companies using annual reports as well as risk disclosure practices in the presence of various regulations. The risk exposure is measured using manual content analysis while the impact is analysed using multiple regression. The empirical findings reveal that the corporate risk disclosure level has improved significantly. The major corporate governance variables namely board size and ownership are insignificant to risk disclosure whereas audit committee meetings and role duality are somewhat significant. Firms having bigger size plays a major role in risk disclosure practices of companies, on the other hand, liquidity and growth of the firm do not influence risk disclosure practice. Due to the constant fallouts of companies, this paper tries to analyse the role of corporate governance practices in minimising companies’ risk exposure. The results of the study help analyse the failures in corporate governance practices that lead to companies’ poor disclosure policies.

Automated text analyses of sustainability & integrated reporting. A literature review of empirical-quantitative research

PurposeThis study aims to focus on automated text analyses (ATAs) of sustainability and integrated reporting as a recent approach in empirical–quantitative research.Design/methodology/approachBased on legitimacy theory, the author conducts a structured literature review and includes 38 quantitative peer-reviewed empirical (archival) studies on specific determinants and consequences of sustainability and integrated reporting. The paper makes a clear distinction between analyses of reports due to readability, tone, similarity and specific topics. In line with prior studies, it is assumed that more readable reports with less tone and similarity relate to increased reporting quality.FindingsIn line with legitimacy theory, there are empirical indications that specific corporate governance variables, other firm characteristics and regulatory issues have a main impact on the quality of sustainability and integrated reporting. Furthermore, increased reporting quality leads to positive market reactions in line with the business case argument.Research limitations/implicationsThe author deduces useful recommendations for future research to motivate researchers to include ATA of sustainability and integrated reports. Among others, future research should recognize sustainable and behavioral corporate governance determinants and analyze other stakeholders’ reactions.Practical implicationsAs both stakeholders’ demands on sustainability and integrated reporting have increased since the financial crisis of 2008–2009, firms should increase the quality of reporting processes.Originality/valueThis analysis makes major contributions to prior research by including both sustainability and integrated reporting, based on ATA. ATAs play a prominent role in recent empirical research to evaluate possible drivers and consequences of sustainability and integrated reports. ATA may contribute to increased validity of empirical–quantitative research in comparison to classical manual content analyses, especially due to future CSR washing analyses.

Corporate governance and price differences between dual-class shares in Korea

This paper aims to explore the corporate governance determinants of price differences between voting and non-voting shares. It discusses the impact of corporate governance on voting premium and the role of outside blockholders by examining their interaction effect with the voting premium. We find that shareholder protection is positively related to the voting premium, in particular, after the enactment of the Financial Investment Services and Capital Markets Act and IFRS. We also find that foreign blockholders' ownership is positively related to the voting premium, whereas domestic blockholders’ ownership mitigates the impact of shareholder protection on the price differences. This study provides clues to diverse extant findings relative to the value of votes. Shareholder protection is a pivotal determinant of the value of voting rights in Korea, suggesting that voting rights remain valuable only when shareholders consider them valid enough to exercise their rights. It implies that when controlling shareholders dominate the entire business group, the value of votes is more likely to be under the impact of control contests.

Determinants of Effective Corporate Governance in Publicly-Owned Enterprises (POEs): An empirical study among Central POEs in Kosovo

Determinants of Effective Corporate Governance in Publicly-Owned Enterprises (POEs): An empirical study among Central POEs in Kosovo

Role of corporate governance in asset quality of banks: comparison between government-owned and private banks

PurposeThis paper compares the impact of corporate governance determinants of asset quality between India’s public and private sector banks. The article identifies which corporate governance determinant is better utilized between the two sectors. The findings empower the banking regulatory authorities and individual bank administrators to handle asset quality in a better manner through a robust corporate governance framework. The study’s findings are also helpful for other nations to make informed judgments by countries with economic relations with India.Design/methodology/approachThe article uses a dynamic panel data analysis method on novel data to achieve the purpose of this article. Using the General Method of Moments, the authors analyze 21 public and 24 private sector banks. The data used in this study span over a decade from 2010 to 2019.FindingsAccording to the estimates, there is a significant difference in the impact made by corporate governance determinants on public sector banks vis-à-vis private sector banks. The results find that while board size has a greater impact on the asset quality of private banks, board independence has a lesser impact. Gender diversity contributes to more reduction of NPAs in private banks. The article also concludes that public banks perform better in the utilization of audit committee while private banks are better at using board meetings, CEO duality and ownership concentration.Originality/valueSeveral papers have identified the determinants of asset quality in banks in various nations. However, to the authors' knowledge, none of the papers has identified the difference in the impact of corporate governance determinants between India’s public and private sector banks separately. This article is the first to do so.

The Impact of Chief Audit Executive’s Leadership Style and Senior Management Support for Internal Audit Function on Corporate Governance Effectiveness with the Moderating Effect of Audit Committee Characteristics: Evidence from Yemen

The objective of this paper is to determine the relationship between the Chief Audit Executive's (CAE) leadership style and senior management support for the internal audit function (IAF) as determinants of IAF quality and corporate governance (CG) effectiveness in Yemeni commercial banks. This article also investigates the extent to which the characteristics of the audit committee (AC) influence the link between CAE leadership style, support senior management for IAF, and CG effectiveness. The data was acquired using questionnaires delivered to respondents in Yemeni commercial banks, of which 158 valid questionnaires were obtained for analysis. Smart PLS 3 was used to analyse the data and test the hypotheses. The PROCESS macro approach was also utilised to evaluate the influence of AC characteristics on the association between CAE leadership style, senior management support for IAF, and CG effectiveness. An affirmative substantial correlation was found between CAE leadership style and senior management support for IAF, and CG effectiveness. Furthermore, the study found that AC characteristics favourably influence the association between CAE leadership style and CG effectiveness. However, AC characteristics do not alter the association between senior management support for the IAF and CG effectiveness. The findings improve the IAF's quality of determinants to enhance CG in developing countries, such as Yemen.

Corporate Governance Compliance among the Listed Firms in Colombo Stock Exchange: Does Size Matter?

Literature is conflicting on the determinants of corporate governance, particularly relating to emerging financial markets. Therefore, this study examined whether firm size affects corporate governance compliance based on firm-level data from 2016 to 2020 for a sample of 100 firms listed on the Colombo Stock Exchange selected using the systematic random sampling technique. Firm size was measured using the natural logarithm of total assets. A corporate governance index was used to measure corporate governance compliance on 18 board related best practices. Results of three random-effects panel regression models indicated that firm size has a statistically significant positive effect on corporate governance compliance. This implies that larger firms are better motivated or capable of complying with corporate governance due to their more extensive resource. This way they can benefit from the reduced agency cost and increased attractiveness for investors. Smaller firms might have considered compliance with corporate governance as less beneficial given the higher cost of compliance. Therefore, it would be more appropriate to make policies flexible enough in the application based on the firm-specific characteristics, such as the firm size. Even though attempts have been made to assess the effect of firm size on corporate governance using firm size as a control variable, this is the first study dedicated to investigating the size effect on corporate governance compliance in the Sri Lankan context.

Pengaruh Budaya Perusahaan, Dewan Direksi, dan Kinerja Karyawan terhadap Good Corporate Governance dengan Audit Internal Sebagai Variabel Intervening pada Perusahaan Sektor Perbankan yang Terdaftar di BEI

Good Corporate Governance is the most important thing for companies, especially leaders to supervise or monitor all company operational activities. Banking is required to prioritize the implementation of optimal governance or Good Corporate Governance (GCG) during this Covid-19 pandemic era so that corporation does not cause new impacts during the pandemic. An internal audit in one of factor that impact of organizational culture on the internal control environment and organizational risk, this is because a negative organizational culture will have a negative impact on the company and the implementation of corporate governance. Various inputs should be suggested to an organization in order to be able to create a healthy organizational culture. The research carried out by the researchers has the aim of analyzing the determinants of good corporate governance in the banking sector that are included in the IDX list. Purposive sampling was used as a data collection method in this study. Data was obtained by distributing questionnaires/questionnaires to 10 banks located in Central Jakarta. Data were analyzed by SEM-PLS with bootstrapping method using smartPLS 3.0. software package. The results showed that corporate culture, board of directors, and employee performance had a significant effect on good corporate governance with internal audit as a intervening variable either partially or simultaneously.

Determinants of Good Corporate Governance in the Banking Sector in Indonesia

This study aims to analyze the factors that influence good corporate governance in the banking sector in Indonesia. These factors are Corporate Culture, Board of Directors, Employee Performance, and Internal Audit as intervening variables. Respondents in this study were employees of Banks, both State-Owned Enterprises (BUMN) and private companies listed on the Indonesia Stock Exchange in 2020. The sample selection method was purposive sampling. Based on the established criteria, 10 banks in the Central Jakarta area were selected as samples. The data were analyzed by bootstrapping using smartPLS 3.0. software package. The results of this study indicate that corporate culture, board of directors, and employee performance have an effect on good corporate governance with internal audit as an intervening variable either partially or simultaneously. has been applied to assess how employee behavior influences the setting of company priorities. Meanwhile, the Board of Directors can improve the quality of company strategies, policies, and continue to carry out company management in accordance with the interests and objectives of the company. Employee performance can pay more attention to controlling behavior so that company management can be carried out openly and able to survive in competition with other companies in order to be able to survive in intense competition and in Good Corporate Governance can focus on basic values, namely paying attention in the physical form and behavior of employees. a company in order to create better company performance.

Corporate governance determinants of asset quality in an emerging economy: evidence from Indian banks

PurposeThis paper aims to identify specific corporate governance determinants of asset quality in the Indian banking system and suggest a future course of action for research in the Indian banking industry. The results will guide other developing nations to handle poor asset quality in banks. Nations with economic interest in India can take cognisance from the results.Design/methodology/approachThe authors identify the determinants of asset quality for the Indian banks using novel data from 2010 to 2019 through a dynamic panel data approach. The authors analyse 45 public and private sector banks using general method of moments.FindingsThe results indicate that intensity of board activities, board functioning and ownership concentration are significant determinants of asset quality. Furthermore, the study hypotheses on board independence and board size are rejected as they do not significantly impact the asset quality. The authors also call for further research on the qualitative aspects of gender diversity, board independence and special committee activity for better insights.Originality/valueThis is the first study to identify specific corporate governance determinants of asset quality for the Indian banking system using a dynamic panel data approach with data spanning over ten years from 45 banks. Unlike all other studies, the authors have used both bank-specific and macroeconomic variables as control variables, making the results accurate and reliable. The authors also recognise the persistent nature of asset quality.

Earning management of oil and gas and metal and metallurgy companies in Russia

The purpose of research is to identify the relationship between the ownership and earning management on a sample of companies of the oil and gas and metal and metallurgy industries in Russia.Methodology. Panel data regression analysis was conducted to test research hypothesis. Research covers the data for 2010-2016 periods in regard to two industries – oil and gas production and refinery, ferrous and non-ferrous metallurgy. The theoretical and empirical research suggests that the ownership structure plays an important role for the company performance following the studies of Liu and Lu [1], Ali Shah, Ali Butt and Hasan [2] and Hassan [3].The originality / value of the research. This study examines the impact of the degree of government and foreign ownership, and the size of entities on corporate earning management measurement, up to our best knowledge there is limited studies conducted on this subject.Findings. According to Strukova [4], Vidyapin and Stepanov [5], Russia heavily relies on the export oriented industries like oil/gas and metal/metallurgy. Therefore, understanding of the corporate governance determinants of financial reporting becomes an important issue. The paper finds that foreign and state ownership together with size of entities are factors which reduce the effect of earning management.

How does firm ownership concentration and female directors influence tax haven foreign direct investment? Evidence from Asia-Pacific and OECD countries

ABSTRACT The literature on tax havens utilization by multinational enterprises (MNEs) has largely focused on determinants that are financial or technological in nature. We contribute to this literature by showing important corporate governance determinants for tax haven utilization by Asia-Pacific and OECD country MNEs. Theoretically, we show that ownership concentration and female board membership influence tax haven utilization. Empirically, we show negative associations between ownership concentration and female board membership and the likelihood of owning a subsidiary in a tax haven. Based on our results, we draw a number of implications for theoretical and empirical work, which also opens the door for further investigation in this area.

The Impact of Corporate Governance Determinants on Foreign Investment Attraction: An Empirical Study in Iraqi Stock Exchange

In recent years, financial markets have become an important subject. It is due to several factors. First, financial markets are essential in mobilizing national savings and channeling them into investment fields that support the national economy and achieve economic development through more efficient resource allocation. Second, many countries have helped the growth and development of financial markets and the pivotal role it plays in moving the economic growth of any country. Third, the evaluation of corporate governance in the Iraqi financial market varies in application and commitment to the principles and mechanisms of control. What is reflected over the exercise of management profits, especially by the shareholders and good corporate governance? The Corporate Governance Mechanism is one of the essential mechanisms of the knowledge economy. It has received significant international attention from international scientific and professional organizations and councils due to its role in preventing companies from being exposed to defaults and financial and administrative bankruptcy, as well as its role in maximizing the value of the company in the market and ensuring its survival and growth in the international business world. Regionally and locally.

Determinants of Good Corporate Governance (Empirical Studies on Companies Listed on The IDX)

The purpose of this study is the role of ownership concentration, firm size, and leverage in influencing good corporate governance. This research design is quantitative. The population used is 45 companies indexed LQ45 on the Indonesia Stock Exchange and with the Purposive Sampling method, obtained 17 companies with 3 years of observation, so the number of samples in this study is 51. The results show that the concentration of ownership, company size, and leverage have a significant effect. The test results show a positive and significant effect on the implementation of corporate governance partially for each variable and simultaneously for all variables.

Corporate social responsibility performance, reporting and generalized methods of moments (GMM): A structured review of corporate governance determinants and firms financial consequences

In line with the business case argument for corporate social responsibility (CSR), CSR performance and reporting should lead to positive firms’ financial outputs. As CSR issues may be linked with greenwashing behavior and self-impression management, effective corporate governance as a monitoring tool should increase CSR reporting and performance. While empirical-quantitative research on CSR extremely increased since the last decade, endogeneity concerns impair the validity of research results. This paper focuses on one of the most important techniques to include endogeneity concerns: the generalized method of moments (GMM) as dynamic panel regression. This paper summarizes the results of archival research on corporate governance determinants and firms’ financial consequences of CSR performance and reporting. The increased importance of managing and reporting on CSR issues represents the key motivation to conduct a systematic literature review. By including 131 quantitative peer-reviewed empirical studies in this field, in line with legitimacy and stakeholder theory, there are indications that 1) gender diversity positively influences CSR performance, and 2) CSR performance increases both accounting- and market-based financial performance (ROA and Tobin’s Q). A research agenda with detailed research recommendations are provided for future studies

What determines the quality of remuneration policy in financial holding companies? An analysis based on the example of the UniCredit Group

This study seeks to examine the quality of the remuneration policy (RP) and identify its main determinants within a financial holding company (FHC) – the UniCredit Group. The results show that the quality of remuneration policy in the examined FHC was low. Although the dominant bank is characterized by high remuneration policy standards, the rest of the group is not. The empirical approaches used show that remuneration policy quality was positively related to the size of the bank and the transparency index of the remuneration policy, but negatively affected by the selected corporate governance determinants.