Good Corporate Governance Practices Research Articles

Pengaruh Good Corporate Governance dan Sistem Pengendalian Intern Terhadap Penyalahgunaan Aset Dengan Kualitas Audit Intern Sebagai Variabel Moderasi

This study aims to test whether good corporate governance, internal control system affects asset misappropriation with the quality of internal audits as a moderation variable. This research uses quantitative methods, namely using questionnaires. The sampling method used is a purposive sampling technique. In this study, a total sample of 105 respondents. The analysis methods in this study include descriptive statistical analysis, outer model test (measurement model), structural model test (inner model), and bootstrap hypothesis testing using Smart Partial Square (SmartPLS) path modeling method. The results of this study show that good corporate governance and internal control systems have a significant influence on asset misappropriation with the classification of pure moderation. Meanwhile, the quality of internal audits does not moderate good corporate governance and the internal control system for asset misappropriation with the classification of predictors of moderation. In bank operational practices, the more complex the risks faced by banks, the more the need for good corporate governance practices by banks. To minimize the occurrence of fraud, it is necessary to strengthen the internal control system in the form of implementing anti-fraud strategies by banks. Bank Mandiri has arranged in great detail the obligations of each position level and each head office and branch office. This is intended to minimize fraud and to protect customers.

Corporate Governance Index, Financial Performance, Access to Finance and Bankruptcy Prediction: Evidence from Sugar Sector of Pakistan

The purpose of this study is to develop a corporate governance index and to investigate the influence of corporate governance index on the financial performance of firms, access to finance and bankruptcy prediction of sugar sector listed firms on Pakistan Stock Exchange during the period 2008-18. Data of 30 sugar sector firms listed on PSX have been used for analysis. Corporate governance index is developed on the basis of 19 attributes, covering 4 broad categories: Board structure, its functionality, disclosure of information and committees of board. The fixed and random effect models have been used based on Haussmann specification test for analysis purpose. This study shows that there is a positive relationship among corporate governance based on corporate governance index and firm performance when performance is measured in term of market capitalization and it has negative relationship when performance of a firm is measured is terms of return of assets, return on equity and net profit marginal. Further corporate governance index has positive relationship with access to finance when it is measured with KZ index and SA index while there is no direct relationship observed among corporate governance index and access to finance when measured by WW index. The results of the study shows that there is positive linkage among corporate governance index and bankruptcy prediction when bankruptcy prediction is measured by Working Capital/Total Asset ratio and negative relationship with bankruptcy predictions when measured by using Retained Earnings/ Total Asset, Earnings before interest and taxes/ Total Asset, Sales/ Total Asset, Cash flow/Total debt, Net income/ Total Asset and Total debt / Total Asset ratios. Results of the study suggest that good corporate governance practices lead towards better firms financial performance and improves the chances to acquire finance.

Do age and size of companies affect female directors on boardrooms?

Gender diversity on boards is one of the attributes of good corporate governance practices. Male directors over the years have continued to dominate boards of corporate bodies. Our study is aimed at exploring the impact of older and matured companies on female directors on the boards. The study employs data of companies listed on the main floor of the Nigerian Stock Market from 2012-2016. The study segregated the sampling period into pre and post mandatory periods of the SEC code. Findings from the study revealed that throughout the periods, age of company is positive and significant. In the pre mandatory period, size of company is negatively significant. During the post mandatory and the entire sample period, size of company was found to be positively associated with female directors. This implies that fear of greater liabilities from the oversight body and public outrage have encouraged larger companies to have divergent boards in terms of gender.

Analysis of Determinants of Corporate Governance Rating (Empirical Study of Companies Listed in the CGPI Index Report 2015 – 2020)

The monetary crisis that hit Indonesia in 1998 added to the confidence of economists and company management to implement Good Corporate Governance (GCG) practices in Indonesia. The implementation of good corporate governance is expected to be able to create added value for all interested parties. This study aims to determine the effect of ownership concentration, investment opportunity, leverage, profitability, and firm size on corporate governance rating. Using annual data for the period January 1, 2015 – December 31, 2020, with Panel Data Regression analysis with the Eviews 11 tool. The panel data regression test results show that leverage, profitability, and company size as macroeconomic variables influence corporate governance rating. Meanwhile, Ownership Concentration and Investment Opportunity do not affect corporate governance rating.

Factors Affecting Corporate Governance and Its Implication on Accounting Information Quality: Indonesia Trusted Company Awardees

<p>This study aims to explain the factors affecting corporate governance and its implication on accounting information quality. Globally, there are many companies that collapsed due to misleading accounting information. Companies declares financial statements as free from errors or misstatements wherein fact it misleads financial statements users. There were 36 firm year observation being analyzed using PLS-SEM to process the available data. The results showed that audit committee and board of directors have significant effect on good corporate governance, while institutional ownership has no significant effect on good corporate governance. On the other hand, corporate governance has significant effect on accounting information quality. This is an indication that the quality of accounting information depends on the practice of good corporate governance. Strict compliance of rules and regulations lead to better governance of publicly listed companies. The originality of this research is that this is the first ever study that had focused on the awardees for mostly trusted, trusted, and fairly trusted companies listed in Indonesia Stock Exchange. </p>

Family Ownership in Indonesia, Good or Bad?

Indonesia is one of the countries that adopt the two-tier system, where there are separation functions between directors and commissioners. Indonesia is also dominated by family firms. In relation to the agency problem, the concentration of ownership by the family in the company and the existence of independent directors in the company's board of directors are two things that are importantly considered as corporate governance practices. This study aims to find out how family ownership in Indonesia influences the demands of corporate governance practices and examines how independent directors moderate those relationships. The study used 69 companies listed in the ASEAN Corporate governance Scorecard with a four-year study period from 2012 to 2015. Using the regression method of panel data, this study found that the greater the family ownership of firms in Indonesia, the smaller the company's demands to good corporate governance practices. While the independence of directors and the size of the board moderate the relationship positively.Keywords: Corporate governance, Family firms, Independent director, Agency theory

Approaches to the Application of Corporate Governance Regulations

To enhance good corporate governance practices, companies, as well as countries, have adopted and promulgated regulations and codes of best practices. To implement these regulations and practices, regulators adopt various approaches which can be broadly classified into voluntary, mandatory, and hybrid. This study examined the aforementioned approaches with particular attention to their strengths and weaknesses. The study employed a qualitative methodology using the doctrinal research method. The doctrinal method relied on primary and secondary sources. The primary sources included legislations and corporate governance codes while the secondary sources included books, e-books, journals, and articles. This methodology was deployed in appraising, interpreting, and applying these various sources of material used in the study. The study found that there are different variations and modifications to the approaches to the application of corporate governance regulations and practices. To facilitate a more efficient and effective corporate governance regime, a combination of the rule-based and principle-based approaches to the application of corporate governance is required.

Barriers of Good Corporate Governance Practices: Evidence from Emerging Economy

Corporate governance (CG) is often split among rule and principle-based methods to regulation in distinctive institutional contexts. CG practices are divergent among countries due to differences in their institutional environments. Therefore, the purpose of this study is to identify the barriers of CG practices and compliance in Pakistan. The primary data is collected from 105 Pakistan Stock Exchange (PSX) listed firms through survey questionnaire. The study employed the exploratory factor analysis (EFA) to identify the barriers of good CG practices and compliance in Pakistan.
 Using exploratory factor analysis (EFA), this study identified five major barriers, i.e. firm level barriers (lack of auditor independence, board ineffectiveness, lack of shareholders’ awareness), external barriers (political and governmental interference in business activities, weak legal control and enforcement, high levels of corruption), social barriers (strong social ties among different stakeholders, interpersonal connections among boards of directors (BoDs), education and training barriers (lack of professional education and training among stakeholders) and legal barriers (fewer voting rights) which restrain good CG practices in Pakistan.
 The study contributes to existing CG literature and highlights the barriers which hinder the good CG practices and compliance, especially in the context of Pakistan. The findings are applicable to other emerging markets especially in Asian countries due to similar socio-economic environment.

Analisis Penerapan Good Corporate Governance pada Bank Muamalat KC Bengkulu

This study aims to determine how the implementation of Good Corporate Governance at Bank Muamalat KC Bengkulu. In good corporate governance (GCG), there are principles that are implemented in the form of general implementation in every Islamic banking in Indonesia. This research was built with the belief that with the implementation of GCG in a company, the company has good management. In this study the authors used a descriptive qualitative approach. Based on the results of this study, it can be concluded that there is an important role between the implementation of GCG and the inhibiting and supporting factors in the implementation of GCG practices, where by applying the principles of GCG in accordance with sharia principles, the implementation of GCG implementation becomes focused and becomes better from year to year so that it becomes a motivation. the company in implementing and understanding GCG in general and based on sharia principles is also very important to be applied to each individual who is responsible for the tasks that have been mandated by Bank Muamalat KC Bengkulu in order to achieve the vision, mission, culture and code of ethics of the company according to Islam, as well as institutions who is supervising.

Index to degree of adhesion to good practices of corporate governance and their effect on financial performance: evidence for Chilean companies

Over recent decades, numerous financial crises have affected the global economy, which were caused by the lack of ethical values and conflicts of interest amongst the leaders of organisations. To protect organisations and their interest groups, regulators have developed norms to discourage and prohibit unethical practices through promotion of good practices of corporate governance. However, the literature on good corporate governance practices focuses mainly on developed economies without considering the challenges of developing countries. Therefore, this research proposes an index to measure the degree of adherence to good corporate governance practices in an emerging economy, like Chile, and estimate its effect on the financial performance of companies. Through a panel analysis, this research provides evidence that shows the existence of a positive and significant relationship between this index and financial performance of organisations, as well as a persistence of its benefits over time when companies adopt good practices.

The Deterioration of Financial Ratios During the Covid-19 Pandemic: Does Corporate Governance Matter?

Abstract Research background: Corporate governance plays an important role in companies’ financial performance and its true importance and relevance are revealed during an economic shock, such as the COVID-19 pandemic. In the past, research regarding corporate governance and financial variables focused solely on performance variables such as Tobin’s Q and ROA. This assessment completely ignores that corporate governance principles have a broader implication on financial variables than only performance. Purpose: Our research aimed to determine whether companies with good corporate governance practices were more resilient during the COVID-19 pandemic, measured by the deterioration of various financial variables. Research methodology: To achieve the aim, in the empirical part of the article, information on companies’ corporate governance and financial variables was collected, and based on them, correlation, regression and scatter plot analyses were conducted. Results: Our correlation, regression, and scatter plot analyses revealed that on both group and individual company levels, companies with higher levels of corporate governance would have their financial variables deteriorate significantly more compared to companies with low levels of compliance. Novelty: This is the first publication on the given topic. While few publications are assessing the impact of the pandemic on companies using corporate governance, none of these publications have focused on financial variables.

Accounting Conservatism in the Perspective of Positive Accounting Theory: A Study of Islamic Banking in Indonesia

Conservative accounting in Islamic banking is a crucial issue. This research aims to analyze the influence of executive compensation, the debt covenant, political cost, the composition of the commissioner board, the audit committee, and operating cash flow on the principle of accounting conservatism practiced in Islamic banking in Indonesia. Using data for 13 Islamic banks from 2014 to 2018 and employing panel regression, this study revealed that debt covenant, political cost, and operating cash flow significantly influence accounting conservatism. This result reconfirms the Positive Accounting Theory and Free Cash Flow Theory. However, the other three factors, i.e., executive compensation, the composition of the board of commissioners, and the audit committee were found to have no impact on accounting conservatism. From the findings, the study recommends that policy makers should improve the practice of good corporate governance in Islamic banking, thus the issue of conservative accounting methods could be minimized.

CORPORATE GOVERNANCE AS INSTITUTIONAL SECURITY TOOL COORDINATION OF THE INTERESTS OF PARTICIPANTS CORPORATE RELATIONS

The article is devoted to the problem of institutional adaptation of best practices of corporate governance while ensuring the interests of the participants of corporate relations. The main models are disclosed and the comparable characteristic of the corporate governance, which has found its progress in modern world practice. On the basis of international principal management principal management, priority principles are identified, which are prioritized under the conditions of the formation and development of the domestic corporate practice of holding associations with state participation.

E-payment Challenges: The Genesis and Remedies to the Problem

Switching between internet solutions in an organization can be challenging, mainly if it affects the core operations and running of the organizations, such as e-payment. It becomes problematic when the role of e-government is not properly considered in an organization. In this study, the school fees e-payment project of a Nigerian University and the losses incurred due to the lack of incorporation of ICT- government into the e-payment process was evaluated. This study recommends good outsourcing, corporate and ICT governance practices such as the incorporation of frameworks like the Control Objectives for Information and Related Technology (COBIT) and IT Infrastructure Library (ITIL), can be integrated to minimize such problems. This would help any University to avert likely losses.

Analisis pengaruh discretionary accrual dan discretionary expenses terhadap nilai perusahaan sektor manufaktur di Bursa Efek Indonesia dengan good corporate governance sebagai variabel moderasi

This research uses secondary data in the forms of annual reports and financial statements of manufacturing companies which are published in Indonesia Stock Exchange. There are 47 companies that are used as samples in this research, in which 5 years data are used ranging from year 2012 - 2016. This research uses multiple linear regression analysis. This research shows that discretionary accrual partially has positive influence on model 1 and negative influence on model 2 but not significant towards firm value, meanwhile discretionary expenses has positive and significant influence towards firm value. For good corporate governance practices, none of them can moderate the relationship between discretionary accrual towards firm value. On the other hand, independent commissioner composition, audit quality, institutional ownership of company's shares, and management ownership of company's shares can moderate the relationship of discretionary expenses towards firm value. The influence of discretionary accrual and discretionary expenses is simultaneously significant towards firm value with the value of determination coefficient of 26,1% on model 1. Meanwhile on model 2, the influence of discretionary accrual and discretionary expenses with good corporate governance as moderating variable is significant towards firm value with the value of determination coefficient of 83,9%.

Implementasi Prinsip Good Corporate Governance Terhadap Kinerja Karyawan Pada Bank Syariah

The purpose of this study is to analyze the application of good corporate governance (GCG) in the work of Bank BRISsyariah Indonesia employees. The application of good governance in the banking sector is very supportive for the implementation of its operational activities, if banking is the trust of the public who trust their investment managers, then very careful risk management is needed to create a positive image of banking. sector In the eyes of customers, the role of banking is also to provide confidence in collecting and saving money. This study uses a descriptive qualitative approach which aims to provide a systematic description of the implementation of good corporate governance practices at Bank BRISyariah. The purpose of data analysis is to simplify the results of data processing so that they are easy to read and interpret. Data was collected using the literature review technique. The results of this study indicate that the good governance practices implemented by Bank BRISyariah Indonesia are largely in line with the theory of good governance.

Keterkaitan Antara Transparansi Dengan Sifat Tablig Dalam Penerapan Prinsip GCG

Corporate Governance are known principles to protect business trust. The problem of developing good corporate governance practices coincided with the occurrence of financial cases involving several large companies such as Enron and WorldCom. Indonesia, where the majority of the population is Muslim, must understand the principles of good corporate governance according to sharia in running its business. The purpose of making this research is to introduce how to apply good and correct GCG principles to ensure the sustainability of company operations with the characteristics of Islamic Corporate Governance so that the company's operations are carried out according to the objectives of this research. This research refers to research from various sources, using descriptive analysis.

Corporate Governance Practices and Performance of Faith Based Health Facilities in Nyanza Region

The study sought to find out the relationship between corporate governance practices and performance of faith based health facilities in Nyanza region. The objectives of the study was guided by the following corporate governance practices; board composition, size of the board, board sub-committees, CEO duality and the frequency of the meetings. The study employed a cross-sectional survey design to establish the relationship. The study found out that 93.5% of the faith-based health facilities in the Nyanza region had sub-committees, 67.7% of the facilities had a board size of 7-8 while 74.2% of the facilities had frequency of 4 This study adopted Balance scorecard developed by Kaplan and Norton to measure organizational performance. The study found out financial perspective of performance had high correlations with corporate governance practices (R=0.621) with 38% of financial performance influenced by the corporate governance practices. Internal business processes perspectives also had high correlations with corporate governance practices however both the customers’ perspectives and innovation, learning and growth perspectives had low correlations with corporate governance practices. The study therefore concluded that the corporate governance practices affected performance of the faith based health facilities although at a varied degree. The regression analysis showed that there was a positive influence of corporate governance practice on the performance of the faith based health facilities in Nyanza region. Thus the practice of good corporate governance enhances performance of faith based health facilities. The study recommended that the secretariats of the faith based health facilities should establish a clear policies on the terms of engagement of the directors, CEO and performance appraisal of the board to check on their effectiveness. The board should also be given inductions and continuous professional trainings to equip them with new technics. For further studies, the study suggests that another study be conducted to establish the corporate governance practices and performance of health sector in Kenya.

TRANSPARENCY LEVEL OF GOOD CORPORATE GOVERNANCE AND BOARD CROSS-DIRECTORSHIP ON COMPANY VALUE

The implementation of good corporate governance practices aims to optimize the allocation of company resources to achieve the growth and welfare of company owners. In the long term, effective corporate governance can improve company performance, which benefits the shareholders and public. This research focuses on manufacturing companies listed on the Indonesia Stock Exchange from 2018 to 2019. The level of transparency of good corporate governance and cross-directorship on company value were examined. This study used historical data, and multiple regression analysis was operated to analyze the data. The results concluded that corporate governance transparency has a significant effect on company value with corporate governance practices (in accordance with KNKCG), which can help managers describe their level of transparency in implementing good corporate governance. The cross-directorships board also has an impact on company value. This role is beneficial for obtaining necessary information and resources, considering that limited resources can create competitive advantages.
 Keywords: company value, cross-directorship, good corporate governance, transparency

Board Structure as Determinant of Corporate Governance Disclosure Practices and Compliance: The Moderating Influence of CEO Power

Today’s dynamic business environment, has seen corporate transparency, financial accountability, and compliance with disclosure requirements as the basis for comprehensive company governance mechanism. The Board of a company performs a central role in ensuring good corporate governance practice. To this end, this study examines board structure as determinant of corporate governance disclosure practices of listed companies in Nigeria. The study adopted the cross-sectional and longitudinal research designs and used content analysis of corporate financial statements and a modified corporate governance disclosure checklist based on NCCG (2018) standard to examine the level of disclosures by sampled industrial goods firms for the period 2016 to 2020. Findings of the study reveal that board independence is a major determinant of corporate governance disclosure. The study also reveals that CEO power and ethnic minority diversity have positive but not significant association with corporate governance disclosure, and that CEO power weakens the positive influence of board independence on corporate governance disclosures. The study concludes that board structure is a determinant of the corporate governance disclosure practices of listed industrial goods companies in Nigeria and recommends amongst others the need to review CAMA (2020) and NCCG (2018) to strengthen board composition and independence.