Development Of Corporate Governance Research Articles

Development of the corporate sector of the economy: state and directions of development in public administration

The historical way of development of the corporate way of social activity as a practical need of socialization of human work and voluntary association of people for realization of joint economic affairs is considered. It is emphasized that theoretical research and well-founded legislative support for the development of corporate governance appeared later, although their directions continue to deepen. It is noted that corporatism has been actively used in foreign countries in recent years. It is noted that in modern Ukraine the corporatization of activity is concentrated in the public sector of the economy, mainly in public joint stock companies, although the efficiency of their activities does not meet expectations. It is emphasized that there is a need to strengthen state control over the development of the corporate sector of the state, increase accountability for compliance with legislation and find further ways to develop the corporate sector, which has proven its effectiveness in foreign countries. The research is aimed at finding new opportunities for the application of this method of management in the municipal sector of the economy - local communities. It is noted that the corporate organization of economic activity at the present stage is under the influence of transformational changes in society, when there is an integration of different forms of ownership. The characteristics of municipalities as natural corporations are given. The directions of legislative and normative support of formation and use of corporate way of management in the organizational and legal form - municipal corporations taking into account the form and components of communal property, and also features of corporate rights of inhabitants of territorial communities are substantiated. The tendencies and directions of development of the corporate way of managing in territorial communities are considered, the factors are defined and the measures which will promote development of the corporate sector of municipal economy and institutionalization of corporate management at this level are offered.

Bagaimana Good Corporate Governance (GCG) dalam Keberlanjutan Perusahaan?

<p>This research aimed to examine the effect of Good Corporate Governance (GCG) on firm value. Good Corporate Governance (GCG) was measured by the Corporate Governance Perception Index (CGPI). CGPI was assessed by the Indonesian Institute of Corporate Governance (IICG), an independent institute that was conducting the development of Good Corporate Governance in Indonesia. The firm value was reflected by the stock price, PBV (Price to Book Value), and Tobin’s Q. This study used ten firms as a sample consistently listed in the Indonesian Stock Exchange and followed the CGPI program during 2014-2019. The sample was determined by using purposive sampling. Analysis of data in this study used Structural Equation Modeling-Partial Least Square (SEM-PLS) with SmartPLS 3rd version. The result showed that CGPI reflected Good Corporate Governance affected firm value (stock price, PBV, and Tobin’s Q).</p>

THE EFFECTS OF CORPORATE GOVERNANCE ON THE PROFITABILITY OF COMPANIES IN THE FIELD OF PUBLIC WATER SUPPLY SERVICES IN THE REPUBLIC OF MOLDOVA

In the Republic of Moldova, in the field of public water supply services, corporate governance, from a conceptual and regulatory point of view, began to develop only in the early 2010s. The selected topic is current because corporate governance is at the early stage in this field, but, at the same time, its evolution for 10 years needs to be analyzed. This process must be monitorized to identify the most important successes or deficiencies in order to develop a set of good practices. The purpose of the research is to identify the relationship between degree of development of corporate governance and the profitability of companies in the field as well as shaping the corporate governance model. Research methods used refer to the observation of corporate and economic processes, interview, investigation, comparing, analysis of corporate legislative and regulatory documents in the field, induction, explanation and interpretation of the main indicators of corporate management. The relevant research results are: identifying the fact that there is no clear dependence between the application of corporate management and increasing the profitability of water companies; at the same time, it has been identified that the participation of employees of water companies in the company boards contributes to better profitability. The corporate governance model was configured, with the identification of deficiencies in the process of regionalization of services. Corporate governance, in the analyzed field, must be subjected of the process of continuous improvement in particular by evaluating the activity of the company’s board.

Evolution of Corporate Governance in Emerging Economies – Indian Experience

Evolution of corporate governance in India from 1850 to 2020 provides significant insights into how discontinuities in the corporate Eco system impacts corporate governance practices. Although the concept of corporate governance and monitoring board emerged in 1972 in USA and spread across the globe in 1990s, after the Cadbury Committee in UK submitted its report, the issues on the governance of joint stock companies bothered regulators and academicians, and of course, minority shareholders, much before the emergence of the term corporate governance. India saw three significant structural discontinuities from 1850 to 2020. The period 1850 to 1947 was the colonial era when Indian business groups were emerging. The managing agency system emerged during that period as an institution to address the twin challenges of capital scarcity and scarcity of managerial skills. This facilitated industrialisation and also increased concentration of ownership. 1947 to 1991 was the period when the Indian government adopted the command economy framework and implemented the same through five-year plans and the licensing system. Public sector enterprises emerged as the dominating force in the Indian economy, although private sector was allowed to operate in those sectors which were not reserved for the state sector. Obtaining a license to start a new industry or expand the existing capacity was the key to the success of a business enterprise. Managing agency system continued until 1970. Some business groups consolidated their position because they could stand at the front of the queue for obtaining the licences. In the closed economy, they operated in the sellers' market. Licensing system and closed market resulted in unrelated diversification. The change in the social structure also resulted in division in business group due to the weakening of the joint family norms. Moreover, public sector development financial institutions (DFIs) acted on the behest of political bosses, often supporting the management resulting in weak corporate governance. In 1991, the Indian government opened the India economy and the country ushered into the era of market economy. Licensing system was dismantled. During the period between 1990 and 2020, the capital market developed, New entrepreneurs entered the corporate sector. Mutual fund industry achieved high growth. FDI and FPI increased very significantly, and start-ups emerged and grew. In the year 2000, for the first time, Security and Exchange Board of India (SEBI), the capital market regulator, introduced the Code of corporate governance. Indian business survived in the competitive market. The Indian corporate governance code revised number of times in the past two decade bench-marking with global best corporate governance practices. However, Indian corporate sector being dominated by the family business, the question 'how independent are independent directors' remains. With significant increase in the shareholding of FDI and FPI in top 200 companies, the average standard of corporate governance is improving. This essay examines the evolution of corporate governance and how discontinuities impacted the evolution process. It also predicts how and why the Indian corporate governance practices are expected to improve in coming days based on the emerging trends.

Strengthening Corporate Governance of Vietnamese SOEs

State-owned enterprises (SOEs), particularly large corporations and economic groups, play a core role in the Vietnamese economy. Thus, their corporate governance is likely to exert a substantial impact on the efficiency and competitiveness of the whole economy. In this paper, we review the past reform efforts and current state of corporate governance at Vietnamese SOEs and identify key challenges they face. In doing so, we make a reference to the OECD Guidelines on Corporate Governance of SOEs, and make a comparison with the evolution of corporate governance at Chinese and Korean SOEs. We note that Vietnamese SOEs have a long way to go for improving their corporate governance. Line ministries are advised to phase out their role of exercising state ownership rights by dominating the SOE boards of directors. Separate accounting is needed for sociopolitically motivated services provided by SOEs, which is a prerequisite for better evaluation of CEO performance and holding them more accountable. Recent push for better transparency and disclosure at SOEs should be kept on. And, high priority should be given to strengthening board independence and professionalism at both SOEs and equitized, exchange-listed enterprises.

Corporate Governance and Sustainable Development: Practical Implications

Corporate Governance and Sustainable Development: Practical Implications

Resisting the Return to Managerialism: Institutionalizing the Shareholder Voice in the Monitoring Model

There are many lessons to be drawn from the sweep of history. In law, the compelling story repeatedly told is the observable co-movement of law on the one hand and economic, social and political changes on the other hand. Aberrations, however, do arise, but generally do not persist in the long term. Contemporary corporate law seems to be on the cusp of such an abnormality as legal developments and proposed reforms for corporate law are currently conflicting with the direction in which the host environment is moving. This article identifies a series of contemporary judicial and regulatory corporate governance developments that are at odds with multiple forces unleashed by today’s ownership of public companies being highly concentrated in the hands of various types of financial institutions. Our purpose is not to focus on these developments as such but to address a much larger question that lies behind them: should courts and regulators have interceded to retard the forces created by such concentration of ownership of public companies? To address this question, we travel back in time to post WWII America and the widely practiced model of managerialism when shareholders were analogous to children, seen but not heard. That model was replaced by today’s monitoring model which empowers oversight of management in the hands of outside directors whose obeisance, at least on paper, is anchored in the firm’s residual claimants, the stockholders who elect the directors. But as we discuss, the monitoring board has something of a checkered history in serving this function. We argue that from its inception, the monitoring board was incomplete because it was formed in an era where the received model was dispersed, not concentrated, ownership. We next challenge the emerging New Paradigm that is being advanced as the future model for corporate governance. We conclude the article with a set of recommendations we believe will bolster the heretofore incomplete monitoring model for corporate governance.

The Rise of International Corporate Law

Comparative corporate governance has focused either on prevailing differences across legal systems, or on spontaneous legal transplants of foreign institutions in response to global competition. This essay argues that corporate law today is not only a product of the invisible hand of the market, but also of the soft (and not-so-soft) hands of international organizations and standard setters. By tracing the emergence of international corporate law (ICL) since the Asian crisis of the late 1990s, it shows how the IMF, the OECD, the World Bank, and the United Nations, among several other international players, have helped shape legal reforms and corporate governance developments around the world. The observed influence of ICL ranges from the impulse for independent directors and the control of related-party transactions, to the growth of ESG investment factors and human rights policies. The rise of ICL responds to interjurisdictional externalities and nationalist bias of domestic regimes that have been largely neglected by prevailing theories, which failed to predict and notice the strong push for international coordination and standard setting in the field. ICL has also gone beyond merely prescribing an Anglo-Saxon model of corporate governance to also promote legal innovations that place the United States in the receiving end of international pressure. Legal implants from ICL, rather than legal transplants from a foreign jurisdiction, are an increasingly relevant force behind corporate governance change. While ICL has been influential, its efficacy and normative vision face challenges. The time has come to move beyond an exclusively comparative focus to also scrutinize the potential and limits of corporate lawmaking at the international level.

Corporate cash holdings and total factor productivity – A global analysis

Studies concerning total factor productivity (TFP) have investigated the effect of TFP on economic growth from a country-level perspective, which is a critical issue in the macroeconomics field. Few studies have examined how corporate financial decisions influence TFP from a firm-level perspective. Specifically, no extant studies have investigated how cash holdings affect firm productivity. This study utilizes data for firms in 65 countries during 1993–2017 to investigate the effect of cash holdings on TFP from a corporate perspective. The findings show that firms with higher cash holdings can enhance TFP. The results hold after considering endogenous problems, financial constraints, financial crises, corporate governance, institutional quality, and financial development as well as various robustness tests. Furthermore, we examine whether firms consistently invest their cash holdings into research and development (R&D) expenditures enhances firm productivity. The evidence indicates that higher cash holdings lead to steady increases in R&D expenditure, which improves firms’ TFP.

О перспективах развития теории и практики корпоративного управления в Российской Федерации

Reviewing the trends in the development of corporate governance and shareholder law in Russia over the past six years, including the vectors of their evolution, identified on the basis of an analysis of rule-making activities, judicial practice, and regulatory activities of companies, the author puts forward a series of interrelated proposals aimed at improving it. These include: revising the set of criteria for corporate publicity, expanding the “lineup” of types and categories of shares, reforming the doctrine of threshold participation in equity capital, dramatically improving the regulatory framework for holding companies, and improving the training of specialists in the field of corporate governance.

The Standards and Practices of Corporate Governance: Relevant Current Trends

An analysis of corporate governance practices would be impossible without understanding the corporate governance development in the context of Russian and world practices. With a certain degree of arbitrariness, the following main phases of its development can be distinguished.

Corporate Governance Development with E-voting Services

The paper discribes the method of remote voting at shareholders meetings via the Internet. The methodology of the study is based on the theory of agent costs. It means that costs associated with the exercise of control are important to investors within making investment decisions. The author considers conditions to the digitalization of voting processes: the Russian legislative framework; Internet access in the country; development of digital voting services; the provision of remote voting services by registrars and the Information Disclosure Center of JSC National Settlement Depository. The paper presents results of the analysis of the practice of using electronic voting services in Russian public companies. It has been proved that the creation of the Internet voting infrastructure has contributed to the activity growth of shareholders’ participation in Annual General Meetings. This, in turn, has a positive effect on the quality of corporate governance in these companies. The theoretical and practical significance of the study is to generalize the practice of using electronic voting technology in Russian corporations.

Information flows and topic modeling in corporate governance

PurposeMultiple disciplines such as finance, management and economics have contributed to governance research over time. However, the full intellectual structure of the governance “field” including the exchange of knowledge across disciplines and the large variety of governance topics remains to be uncovered. To appreciate the breadth of corporate governance research, it is necessary to understand the disciplinary sources from which the research stems. This manuscript focuses on the interdisciplinary underpinnings of corporate governance research.Design/methodology/approachThis paper employs bibliometric analysis to trace the evolution of corporate governance using articles included in the ISI Web of Science database between 1990 and 2015. Journals included in these categories encompass a full range of business disciplines and provide evidence of the multi-disciplinary nature of corporate governance. It also uncovers the topics treated by disciplines under the governance umbrella using a machine learning method called latent Dirichtlet allocation (LDA).FindingsCorporate governance research deals with a number of strategy-related topics. Unlike strategy topics that reside in a single discipline, corporate governance crosses disciplinary boundaries and includes contributions from accounting, finance, economics, law and management. Our analysis shows that over 80% of corporate governance articles come from outside the field of management. Our LDA solution indicates that the major topics in governance research include corporate governance theory, control of family firms, executive compensation and audit committees.Originality/valueThe results illustrate that corporate governance is far more interdisciplinary than previously thought. This is an important insight for corporate governance academics and may lead to collaborative research. More importantly, this research illustrates the usefulness of LDA for investigating interdisciplinary fields. This method is easily transferable to other interdisciplinary fields and it provides a powerful alternative to existing bibliometric methods. We suggest a number of topic areas within library and information science where this method may be applied, including collection development, support for interdisciplinary faculty and basic research into emerging interdisciplinary areas.

Features of corporate governance in Russian companies with different forms of ownership

The article examines the development of corporate governance in companies of various forms of ownership in Russia. The author summarizes and considers general approaches to the organization of corporate governance for companies of various forms of ownership and highlights the specific features of the formation of a corporate governance system in state business entity.

SOX as a window on transference of corporate governance norms across jurisdictions

This paper considers the issue of the transference of norms across jurisdictions in corporate governance contexts through the lens of an Australian case study. The paper focuses on the impacts of the United States of America (US) legislation the Sarbanes-Oxley Act 2002 (SOX) from an Australian perspective. The paper draws on a series of semi-structured interviews (n=14), with senior personnel of: accounting firms; business organisations; consumers; financial exchanges; government; institutional investors; investment banks; law firms; private investors; professional associations; and regulators. The findings from the study are that key stakeholders in Australia have taken notice of SOX and its effects in the US, but that the influence of SOX in specifically Australian contexts has been limited. The general perception in Australia seems to be that SOX has had some flaws in its inception and in its subsequent delivery in the US, but also that it has produced some positive outcomes. However, domestic factors and influences are overwhelmingly more important in shaping how financial regulation and corporate governance evolve in Australia. Therefore, it seems that SOX does not signify in any substantive way a regulatory hegemony emanating from the US that determines financial market regulation or the evolution of corporate governance in Australia.

The Conundrum of Common Ownership

The common ownership debate has become one of the most contentious issues in corporate law today. This debate is a by-product of major changes to capital market ownership structure, which have triggered concerns about the rise of institutional investors, the growth of index investing, and the rapid concentration of ownership in major international financial markets. Common ownership theory focuses on concerns about the incentives of large financial institutions holding widely diversified portfolios of shares in competing companies within a particular economic sector. Proponents of the common ownership theory argue that, even where institutional investors have relatively small ownership stakes, their collective holdings in competing companies produce anticompetitive effects. Other scholars, however, have challenged both common ownership theory and its regulatory prescriptions. Although common ownership theory began in the United States, it is now being discussed around the world. This article examines three conflicting narratives that emerge in this literature concerning institutional investors and common ownership theory. The article seeks to position these narratives within the context of the rising influence of institutional investors since the early 1990s and its relation to major international corporate governance developments. It analyzes aspects of common ownership theory in light of these contemporary corporate governance developments, and argues that drawing regulatory and policy conclusions from the current body of conflicting empirical findings on the effects of common ownership is premature.

The Dynamics of Evolution of the Corporate Governance of Chinese State-Controlled Listed Companies

The wave of reforming corporate governance has been increasingly, strong worldwide since the devastating 2008 financial, crisis. The existing theories by corporate lawyers have offered, two distinct paths for the reform. The convergence theory argues, that with the force of competition, commercial jurisdictions in the, globe will automatically converge towards a single optimal model, of corporate governance sooner or later that is featured with the, shareholder-oriented principle. On the contrary, the divergence, theory insists that the effect of path dependence, especially the, idiosyncratic political traditions or influences, is the key dynamic, force to push the evolution of corporate governance in a certain, commercial jurisdiction. With the proofs of Chinese state-controlled, listed companies (SCLCs), it is demonstrated that the, divergence theory is more convincing and pragmatic. One of the, most important implications of this understanding is that the, improvement of the corporate governance of the SCLCs relies on, the Chinese political reform to a large degree. Convergence, Divergence, Dynamics, Corporate Governance, SCLCs.

Development of Corporate Governance and the Effect of Corruption on the Nigerian Financial Institutions

Development of Corporate Governance and the Effect of Corruption on the Nigerian Financial Institutions

Special issue on recent developments in European corporate governance

Special issue on recent developments in European corporate governance

China's Corporate Governance Development and ESG Evaluation

As the past few decades have seen China become the world’s second-largest economy and Chinese multinationals take leading roles in various sectors, China’s corporate governance (CG) has evolved and brought about new methods of Environmental, Social and Governance (ESG) evaluation. This paper examines China’s CG development status through case studies of notable China companies, looks at current Chinese ESG evaluation systems designed by MSCI and local Chinese institutes, and suggests four unique factors that should be integrated into future Chinese ESG evaluation system development. This is the first of a series of papers by Lyndsey Zhang that reviews current Chinese CG development and ESG implementation, identifies opportunities and challenges through case studies, and suggests areas for improvement for Chinese companies looking to accomplish the following: become more sustainable by increasing focus on corporate purpose and ESG considerations, and position themselves as industrial leaders in both the emerging market and global economy in the next few decades. This series also looks at other emerging market countries’ economic development and CG models, and explores how China’ success can be replicated by other emerging market countries to facilitate their economic growth and CG development.