Corporate Governance System Research Articles

Corporate Governance of China’s State-Owned Enterprises: A Review of Past Experiences

This study aimed to evaluate the strengths and weaknesses of corporate governance practices in China's state-owned enterprises (SOEs) based on their current state. The researchers selected 20 SOEs and surveyed 40 respondents to assess five key areas: institutional framework, information disclosure, board and supervisory board responsibility and supervision, legal guarantees for stakeholder interests, and strategic management. The findings revealed that while the interviewees generally agreed with the current state of SOE corporate governance, there were areas for improvement in all five assessed areas. Environmental, Social, and Governance (ESG) and sustainability issues were the most concerning for the respondents, whereas shareholder relations were of least concern. Regarding the impact on productivity and profitability, the sample companies exhibited average performance, suggesting room for improvement. The study recommended several optimizations to the corporate governance system, including strengthening the board of directors' authority, establishing information disclosure and stakeholder protection mechanisms, reforming the SOE supervision system, and implementing a mixed ownership structure for SOEs.

The effect of political influence on corporate social donations: Evidence from party-building reform in China

As a new exploration of corporate governance in China's non-state-owned enterprises (NSOEs), the effect of "Party Building into Articles of Association" (PBAA) in the decision-making of NSOEs has not yet been verified. Based on hand-collected data on PBAA in NSOEs, this paper investigates the impact and constraints of PBAA on decision-making in NSOEs by using the external event of corporate donations during the COVID-19 pandemic. The results show that PBAA has embedded the party organization into the corporate governance system of NSOEs, affecting the decision-making of NSOEs effectively, thus boosting the social donations of NSOEs during the epidemic period. Meanwhile, the extent of PBAA is constrained by the original level of corporate governance and entrepreneurial identification. These findings remain robust after controlling for possible endogeneity issues. In addition, further research suggests that the more detailed the content of PBAA is, the higher the probability of substantial donations in epidemic situations in NSOEs.

ADVERTISING INTENSITY, GOOD CORPORATE GOVERNANCE, DAN PENGHINDARAN PAJAK PERUSAHAAN

This research aims to examine the influence of advertising intensity and corporate governance on corporate tax avoidance. This research also tests the moderating influence of corporate governance on the relationship between advertising intensity and corporate tax avoidance. The sample used was all non-financial sector companies listed on the Indonesia Stock Exchange in the 2015–2021 period. The sampling technique used was purposive sampling, so a total of 67 companies were observed. The analysis used is panel data analysis using Stata 14 software. The results of this study show that advertising intensity has a positive effect on tax avoidance, but the proportion of independen commissioners, the proportion of female commissioners, and the moderation of the board of commissioners have no effect on tax avoidance. This research also found that there was a moderating influence from the governance element, namely board diversity, which was proxied by a female board of commissioners, which was proven to weaken the positive relationship between advertising intensity and tax avoidance. The results of this research can be used as input by the Directorate General of Taxes for evaluating improvements to company tax regulations as well as by the Komite Nasional Kebijakan Governance as material for improving regulations and implementation to create a better corporate governance system in Indonesia.

Accounting, ESG dynamics and the pandemic: when the quality of disclosure becomes crucial to sustainable success

PurposeThis study aims to investigate the quality of disclosure of a cutting-edge reporting tool – integrated reporting (<IR>) – in terms of its effectiveness to report on COVID-19 pandemic information, its ability to provide forward-looking information and risk impact implications, and its quality determinants in challenging times.Design/methodology/approachThanks to a content analysis of 247 <IR> for FY20, an integrated reporting disclosure score was developed to assess the disclosure quality provided by the sampled companies. Three research questions were tested through logistic regressions.FindingsNon-financial disclosure activities struggle to provide adequate information in terms of potential future scenarios, risk assessment and forward-looking analyses. However, companies incorporated in “Anglo-Saxon” territories drafted integrated reports of higher quality. More recently, incorporated companies have made a greater effort to measure and report COVID-19 pandemic impacts on environmental, social and governance and business activities, also increasing their risk assessment and mitigation efforts. Concerning the determinants of disclosure quality, leverage, corporate governance structures, country of incorporation and belonging to “high impact” industries all lead to a higher quality of <IR> disclosure.Originality/valueExamining in detail corporate social responsibility activities and corporate governance integrity is pivotal to orienting strategy towards sustainable trajectories: to do so, corporate reporting and disclosure practices are essential tools. In this context, corporate governance systems that emphasize board diversity are proven, even in disruptive circumstances, to play a crucial role in providing corporate reports of higher quality. High disclosure quality that goes beyond mere financial results is considered to be necessary to remain competitive strategically, socially and environmentally.

The Impact of Intellectual Capital and Corporate Governance on Bank Performance in Vietnam

Purpose – The importance of corporate governance and intellectual capital on financial performance has largely been ignored in emerging markets. The banking sector is considered to accumulate a higher level of intellectual capital and to adopt a better corporate governance system. We aim to examine the contribution of these two important aspects to the performance of Vietnam's banking sector. Design/methodology/approach – This paper utilizes data collected from the annual reports of banks in Vietnam from 2011 to 2021. The modified value-added intellectual coefficient (MVAIC) model is adopted to measure a bank's intellectual capital efficiency. In addition, the generalized method of moments is utilized to ensure the robustness of the findings. Findings – Empirical results strongly confirm that intellectual capital positively contributes to a bank's performance. In terms of corporate governance, the findings indicate that board size, board remuneration and major shareholders holding more than 20 percent of outstanding shares are the three most important factors that contribute positively to banks' performance. In addition, human capital efficiency and capital employed efficiency positively impact a bank's profit. Practical implications – Our study provides valuable evidence and implications for policymakers in managing and enhancing corporate governance and intellectual capital efficiency within the Vietnamese context, particularly in the banking sector. Originality/value – To the best of our knowledge, this is the first empirical paper conducted to examine the contribution of corporate governance and intellectual capital on banks’ performance in Vietnam.

Configuração do controle acionário, governança corporativa e valor da empresa: uma análise das empresas brasileiras

This work aims to analyze the effect of the shareholding control configuration on the effectiveness of the corporate governance system. Using regression analysis, the relationships between the type of shareholding control, the level of adoption of corporate governance practices, and firm value were explored using a sample of 160 Brazilian companies. The results indicate that a better structured corporate governance system has a positive effect on firm value, which proves its effectiveness. Furthermore, this relationship is positively moderated by majority control, and negatively by shared control. These findings indicate that shareholding control is a contingent factor on the effectiveness of adopting governance practices by firms. It is worth mentioning that firms with dispersed control exhibit greater adherence to corporate governance practices, majority control depreciates firm value, while shared and dispersed control create value. This paper contributes a categorization for shareholding control configuration and provides evidence of its key role on firm value.

Application of Blockchain in Corporate Governance: Adaptability, Challenges and Regulation in BRICS

The digital revolution has changed many facets of daily life over the past few decades. Think about how personal computers and smartphones are becoming more powerful and smaller, how the Internet has spread throughout the world and led to the emergence of new forms of social interaction, and how there is always access to massive volumes of automated algorithms processing cloud-based data that is utilised in a number of settings. Similarly, it has been observed that blockchain technology has the potential to provide clever fixes for traditional inefficiencies of corporate governance, particularly in the dynamically evolving paradigm in the emerging economics like BRICS nations i.e., Brazil, Russia, India, China, and South Africa. This paper aims to explore the possibilities of adopting blockchain technology within the arrays of internal governance mechanisms while emphasizing on the redressal to legal and regulatory challenges. The paper also critically analyzes the implication and utility of this evolved technology in the corporate governance systems of BRICS nations.

Influence of Transparency and Disclosures on the Dividend Distribution Decisions in the Firms: Do Profitability and Efficiency of Firms Matter?

The purpose of this study is to determine if the impact of transparency and disclosure (TD) levels on shareholders’ current income (dividends) is moderated by technical efficiency (te) and profitability. The study employs econometrics on panel data from 78 BSE-listed enterprises across the 2016–2020 sample period. This conclusion suggests that when TD grows, dividends tend to drop initially, but above a certain threshold level, growing TD levels lead to increased payouts. Furthermore, dividends are adversely associated with the moderating variable “te” in terms of both constant and variable return to scale. On the other hand, moderation by profitability was shown to have a substantially favourable effect on dividends. According to this study, a company’s dividend policy is influenced by its TD levels, which are controlled by its efficiency and profitability. Developing a TD index provides more information on the efficacy of the corporate governance (CG) system. The study’s distinctiveness lies in examining the relationships between transparency, disclosures, and these aspects as they relate to profitability, efficiency, and dividend distribution choices to ascertain whether the companies’ operating effectiveness and financial success matter in this circumstance. The study’s practical and policy implications relate to societal repercussions, which include encouraging more openness and responsibility in business practices, thereby increasing confidence and accountability in decisions about dividend distribution, regardless of efficiency and profitability. The study’s originality is in examining how profitability, efficiency, and dividend distribution decisions relate to transparency and disclosures to determine if companies’ operating efficiency and financial success matter in this situation.

Information asymmetry and dividend payout in an emerging market: Does corporate governance quality matter?

Numerous studies have explored the impact of information asymmetry on firms’ dividend policies. These studies have generally focused on advanced capital markets and have provided conflicting evidence on the quality of the information environment and dividend policy. Our paper, thus, tries to address this gap in current understanding by examining the connection between asymmetric information and dividend payout policies and whether this connection is moderated by corporate governance quality (CGQ) in an emerging economy, the United Arab Emirates (UAE). Using a panel sample of non-financial firms traded on the UAE stock exchanges over the period from 2009 to 2022, we document that dividend payments are negatively influenced by information asymmetry problems. We also document that the negative connection between information asymmetry and dividend policy is less pronounced in firms with strong corporate governance systems, consistent with the conjecture that such firms face lower agency and asymmetric information problems and hence pay higher dividends.

Development of management accounting functions in the corporate governance system

Problematic issues of the development of theory of management accounting in context of improving corporate governance and increasing requirements from various stakeholders to its information support are increasingly becoming the object of research by domestic and foreign scientists. The purpose of this study is to identify the trends in the development of management accounting in the conditions of digitalization of the economy, and the transformation of business processes under the influence of changes in business environment as well as justification and substantiation of the new functions of management accounting in connection with the changing requirements of corporate governance and the need to improve its information support. To achieve this goal, the methods of synthesis and analysis, abstraction, deduction and induction, comparison and systematization were used, as well as a critical analysis of existing views on the essence of management accounting, its functions and possible development scenarios, taking into account transformations in accounting science and practice observed in the third decade of the XXI century. In the process of work the results of own researches conducted and received within the framework of the scientific school of the Financial University “Accounting-analytical and control processes of economic subjects of information society” and in the course of practical activity of the authors were used. Based on the analysis of literary sources, the requirements of national and international standards in the field of both accounting and financial reporting and in sustainable development, current accounting practices and corporate governance practices, new management accounting functions have been identified and justified, the implementation of which is aimed at the formation and presentation of better quality data and information as part of corporate reporting with predictive value. The results obtained can be used by economic entities in optimizing accounting and control processes and developing internal regulations on management accounting, as well as by accounting regulatory entities and professional organizations in developing recommendations in the field of management accounting for various economic entities.

The effect of corporate governance on firm performance: perspectives from an emerging market

The aim of this research is to inspect whether Corporate Governance (CG) attributes such as Audit Meeting Frequency, Ownership Concentration, Board Meeting Frequency, Foreign Ownership, Institutional Ownership, Board Gender Diversity, Audit Committee Size, Board Size, Audit Reputation and CEO Compensation affect firms’ performance in Pakistan. This research employed the pooled least square method to estimate the association among attributed of CG and firm performance measures (Return on Asset and Tobin’s Q) by selecting the Cement Sector and Energy sector companies listed in Pakistan Stock Exchange (PSX) during 2009–2022. A substantial result is that the energy sector’s CG system does not differ from the cement sector. Tobin’s Q is lesser than ROA, suggesting the same condition as companies in the cement sector. On average, firms in the energy sector are older than the firms in the cement sector. It contradicts the result of profitability proxies of the energy sector. Being older firms, the profitability proxies show lower returns as compared to cement sector firms. Pakistan needs a uniform CG code and the need for good CG practices for specific approaches of firms. This study enhances the literature in CG domain by investigating the impact of CG processes in Pakistani firm’s performance. In Pakistan, there are studies available on the topic but the comparison between the selected two industries with such a large data set are the unique elements of the current research. In prior studies, the time interval was also short, only five years. Further, the firm performance was measured by an accounting-based tool and did not include a market-based tool for performance, as well as variables for CG were also limited.

ESG Transformation Strategy Case Analysis: Taking Sands China Limited as an Example

Sands China Limited is a comprehensive entertainment company operating in Macau. This paper evaluates the sustainable development of Sands China by analyzing its performance in environmental, social, and governance (ESG) aspects, as well as financial performance indicators. In terms of the environment, Sands China has implemented multiple measures to improve energy efficiency, reduce carbon emissions, and prioritize water resource management. In the social aspect, the company focuses on employee welfare, community development, and social responsibility, enhancing its social impact through various projects and activities. Regarding governance, Sands China is committed to establishing a transparent and responsible corporate governance system. In terms of financial performance, Sands China achieved relatively stable growth from 2017 to 2019 and addressed market challenges through cost control and risk management measures. However, the company's performance was severely impacted by the COVID-19 pandemic. To adapt to the current uncertainty, Sands China needs to embrace market changes, diversify its business, strengthen risk management, and actively explore new markets. Through these efforts, Sands China will maintain a stable development trajectory and contribute to the economic recovery of Macau.

Exploring the Role of AI in Corporate Governance: Leveraging Potential for Productivity, Efficiency, and Competitive Advantage

The role of AI in corporate governance is crucial, as companies seek to leverage their potential to increase productivity and efficiency, and AI is increasingly being used to automate processes, provide insights, and improve decision-making, thereby enabling companies to gain a competitive advantage. The importance of this research lies in highlighting the role of AI in corporate governance, analyzing the impact of this role in enterprise business development based on application to corporate governance systems, as well as identifying the basic needs of governance-based companies to make the most of AI operations. Corporate governance is one of the key tools to counter the effects of recent economic changes, the global financial crisis, and the structural deficiencies of many companies, due to sound corporate oversight and oversight, as well as to sound corporate governance practices. expertise and skills, as well as dysfunctional financing structures the inability to generate sufficient internal cash flows to meet their accrued liabilities, and a lack of transparency. Keywords: Artificial intelligence, corporate governance, technology, digital transformation.

Scoping review of impact of digital transformation on business processes

Over the past decades, and in particular since COVID-19 pandemic, digital transformation has covered more and more areas in business and management. Digital transformation poses new challenges for scientists, especially when assessing the impact of digital transformation on business processes.&#x0D; The scientific research is devoted to the analysis of existing approaches to measuring the effect of the implementation of digital transformation in the system of corporate governance in terms of compliance with the principles of sustainable development.&#x0D; This article conducted research on scientific articles from 2019 to 2023 years to demonstrate the relevance of topics in the field of digital transformation of management and business processes.&#x0D; The research method is based on a comprehensive search method using an iterative process, which is guided by the requirement to identify all relevant literature (published and unpublished) suitable to answer the main question: the impact of digital transformation on business processes.&#x0D; The key criteria for the search were words and phrases: digital transformation, business processes, management, model, processes, as well as various categories by authors, number of articles and their citations.&#x0D; The implementation strategy of modern digital technologies and initiatives should be based on a systematic approach to measurement, analysis, and improvement of the organization's business processes for sustainable development. The ways and directions of implementing digital business process tracements directly affect the effectiveness and success in general. The result suggests future opportunities in this widespread field and thereby highlights the most influential and unique research in the field.&#x0D;

SYSTEMIC-INNOVATIVE APPROACH TO CORPORATE GOVERNANCE: ASPECTS OF SUSTAINABLE DEVELOPMENT AND TIME MANAGEMENT

This paper addresses the challenges faced by transport and logistics enterprises in the context of armed conflicts and operational restrictions. It explores the significance of innovative governance and sustainable development in this context. The role of road transport enterprises in the recovery and sustainable development of the country is highlighted, along with the importance of corporate time management and the integration of sustainable development principles to achieve efficiency and sustainability in the face of challenges. Theoretical research of existing approaches to corporate governance is conducted, emphasizing the importance of innovative management and sustainable development for enterprises. It identifies the absence of an innovative-oriented corporate governance system and the necessity for a comprehensive approach that combines sustainable development, time management, and innovative practices to achieve balance in corporate governance systems within the transport and logistics sector. The objective of this work is the development of a model for an innovative-oriented corporate governance system at road transport enterprises based on the integration of sustainable development principles and effective corporate time management. The enhanced corporate governance system, within the context of transport and logistics enterprises, is designed according to external environmental factors and incorporates key aspects of corporate governance. The influence of the external environment on the construction of corporate governance systems is grounded in the examination of economic, socio-political, and environmental factors that shape strategic approaches and corporate functioning. The management object is the transport and logistics sector enterprise, which requires effective management of its activities and resources for sustainable development. The management subject includes the leadership and owners of the enterprise, responsible for strategic planning, policy development, and their practical implementation. The proposed corporate governance system, based on a systemic approach, includes essential subsystems: strategic innovative management to ensure sustainable development, environmental management, social management, economic management, innovative management, supply chain management, stakeholder engagement, and functional subsystems. Functional management encompasses overseeing different functional areas, such as finance, marketing, production, among others. Each of these subsystems has specific tasks and interconnections to facilitate effective management and achieve the strategic objectives of the enterprise. The suggested corporate governance system will assist road transport enterprises in ensuring sustainable development, optimizing resource management, and maintaining competitiveness in a dynamic external environment.

Scoping review of impact of digital transformation on business processes

Over the past decades, and in particular since COVID-19 pandemic, digital transformation has covered more and more areas in business and management. Digital transformation poses new challenges for scientists, especially when assessing the impact of digital transformation on business processes. The scientific research is devoted to the analysis of existing approaches to measuring the effect of the implementation of digital transformation in the system of corporate governance in terms of compliance with the principles of sustainable development. This article conducted research on scientific articles from 2019 to 2023 years to demonstrate the relevance of topics in the field of digital transformation of management and business processes. The research method is based on a comprehensive search method using an iterative process, which is guided by the requirement to identify all relevant literature (published and unpublished) suitable to answer the main question: the impact of digital transformation on business processes. The key criteria for the search were words and phrases: digital transformation, business processes, management, model, processes, as well as various categories by authors, number of articles and their citations. The implementation strategy of modern digital technologies and initiatives should be based on a systematic approach to measurement, analysis, and improvement of the organization's business processes for sustainable development. The ways and directions of implementing digital business process tracements directly affect the effectiveness and success in general. The result suggests future opportunities in this widespread field and thereby highlights the most influential and unique research in the field.

Legal transformation of corporate governance in joint-stock companies

The article is devoted to the study of certain novelties in the legal regulation of the order of interaction of management bodies in joint-stock companies. The article emphasizes that choosing the optimal model of corporate governance is important for the effective functioning of joint­stock companies. The article provides examples of various well-known models of corporate governance in the world. Each of them has its advantages and disadvantages. The article emphasizes the fact that for a long time in Ukraine, legislation provided for only a two-level system of corporate governance, which provided for the simultaneous functioning of the supervisory board and the executive body (board or director). In an effort to become a member of the European Union, Ukraine undertook to adapt its national legislation to legal standards acceptable in the EU, in particular in the area of corporate governance. Therefore, in 2023, the new Law of Ukraine "On Joint-Stock Companies” entered into force, the provisions of which, in particular, established, along with the two-level model of corporate governance, an alternative option - a one-level model. This model, in contrast to the two-level model, provides for the creation of a board of directors as a single body of operational management of a joint-stock company, which combines both the representative functions of shareholders and the functions inherent in the executive body of a joint-stock company&#x0D; The article examines the provisions of the Law of Ukraine "On Joint Stock Companies”, which provide for the legal status of the board of directors. The conditions and procedure for the formation of the board of directors were analyzed, and the specifics of the activity of this management body were determined. At the same time, when examining the legal status of the supervisory board, attention was drawn to the identity of the provisions of the current Law of Ukraine "On Joint Stock Companies” with the provisions of the previous law, which has already lost its validity.&#x0D; The conclusions emphasize that the Law of Ukraine "On Joint-Stock Companies” adopted in 2022 significantly changed corporate governance in terms of the introduction of an additional one- level model of corporate governance, thereby bringing the norms of national legislation closer to EU standards.

PENGARUH CORPORATE GOVERNANCE TERHADAP TRIPLE BOTTOM LINE REPORTING

The importance of the triple bottom line (TBL) concept has been debated among academicians and practitioners. The discussion about the extent of implementing these sustainable initiatives and what factor determines its reporting. Corporate governance is one of the influencing factors of TBL reporting. However, limited studies investigate corporate governance's role in TBL reporting, especially utilizing data from different continental European corporate governance systems like Indonesia. Therefore, this paper investigates the effect of the commissioner board size and gender on TBL reporting using the coal-mining industry. In addition, this study also collected the company's characteristic data and included it in the research model to maintain the model specification error. Twenty coal mining company has participated in this study. The analysis of multivariate regression is employed, and the finding indicates that there is no corporate governance role proxied by the size and gender of the commissioner's board. However, profitability is positively related to all dimensions of TBL. In addition, the TBL (social and environmental) is influenced positively by the company size. This study has practical and theoretical implications and is discussed in detail. &#x0D; &#x0D; Keywords: Triple Bottom Line, Board Of Commissioners’ Size, Existence Of Women

Transformation of the Personnel Policy of a Manufacturing Enterprise in the Corporate Governance System

Relevance. The trajectory of the organization's development in modern conditions requires managers to take an updated approach to personnel management, namely, from the perspective of human resource management. The purpose of the study is to study and analyse the implementation of personnel policy on the example of the production enterprise LLC "Hydrophob", to determine the directions of its improvement. Objectives: study of the theoretical foundations of the formation of personnel policy in the organization; evaluation of the activities of the production enterprise LLC "Hydrophob" in terms of its human resources potential; development of measures to improve the personnel policy of LLC "Hydrophob". Methodology. To solve the tasks set in the course of the study, the dialectical method of cognition of the phenomena of objective reality was used, as well as methods of analysis, synthesis, systematization of information, content analysis of data, graphical method. Results: the interrelation of the concepts of "personnel policy", "labor resources" and "labor potential" of the organization is revealed; the analysis of the effectiveness of personnel policy was carried out on the example of the production enterprise LLC "Hydrophob", which allowed to identify bottlenecks that need to be eliminated; recommendations for improving the personnel policy of the analysed organization are proposed. Conclusions. The results of the quantitative analysis of the workforce of the production enterprise LLC "Hydrophob" demonstrate a trend of growth in staffing for all groups of employees in 2022 compared to 2021, a high proportion of workers in the overall structure of the workforce. The results of a qualitative analysis of the labor resources of the analyzed enterprise allow us to conclude that there is a low proportion of young professionals in the organization; that employees have the necessary level of qualification (education); most employees have a long work experience (15-20 years) in the organization. Based on the obtained analytical results, possible directions for improving the personnel policy of the production enterprise LLC "Hydrophob" are proposed by creating a personnel reserve using internal and external sources.

Review of Reforming Financial Systems: A Focus on Nigerian Economic Development

Unique besides utmost thought-provoking debates of modern history is whether financial development affects economic growth or a consequence of economic activity. There are for-going reforms in the sector in Nigeria, therefore the expediency of a look in the need for reforms in Nigeria. A fact as to know how reforms are curbing the traditional handicaps of the financial sector is thus minimized in Nigeria. Modalities put in place to enhance banks’ corporate governance and internal systems suggests that the predictions for the financial sector to accomplish cost-effectively and pragmatically, whereas decreasing volatility in the system. The study takes on an analytical appraisal methodology for its exploration. The study consequently, proposes that the existing transformations remain appraised besides unrelenting in a methodical routine, for suitable focusing of funds for speculation as well as dynamic resolutions. Exertions ought to be concerted on the relationships of the region with tutoring financial statement then wherever monetary improvement seems too pathetic. Moreover, innovation of the financial sector regarding mechanisms had better be the crucial focus for the ruling classes. A counter-factual criticism instrument has a duty to also be incorporated in the financial sector aimed at correcting the financial prolific province.