The Emerging Market for European Corporate Governance: The Relationship between Governance and Capital Expenditures, 1997-2005

2007 ◽  
Author(s):  
Rob Bauer ◽  
Robin Braun ◽  
Gordon L. Clark
Keyword(s):  
Corporate Governance ◽  
Emerging Market ◽  
Capital Expenditures ◽  
The Relationship ◽  
European Corporate Governance

Accounting conservatism, corporate governance and political connections

2017 ◽  
Vol 25 (2) ◽  
pp. 288-318 ◽  
Author(s):  
Nor Farizal Mohammed ◽  
Kamran Ahmed ◽  
Xu-Dong Ji
Keyword(s):  
Corporate Governance ◽  
Emerging Market ◽  
Political Influence ◽  
Ordinary Least Squares ◽  
Accounting Conservatism ◽  
Political Connections ◽  
Board Independence ◽  
Political Connection ◽  
Content Type ◽  
The Relationship

Purpose The purpose of this paper is to examine the relationship between accounting conservatism, corporate governance and political connection in listed firms in Malaysia where political influence plays a significant role in the capital market and in many business dealings. Design/methodology/approach By utilizing 824 firm-year observations comprising large listed companies over a period of four years from 2004, this study uses ordinary least squares regression models to investigate the relationship between accounting conservatism, corporate governance and political connections in Malaysia. Multiple measures of conservatism developed by Basu (1997) and Khan and Watts (2009) are employed. Findings The results show evidence of accounting conservatism (bad news being recognized earlier than good news) in Malaysia. Further, the results reveal that better corporate governance structure in terms of board independence is positively associated with accounting conservatism while management ownership is negatively associated with it. However, political connection has a negative moderating effect on the positive relationship between accounting conservatism and board independence. The results also suggest political connections have a positive association with firm’s future performance. Originality/value This study is the first in investigating the effect of political connections on accounting conservatism in Malaysian context and how political connections negatively affect the monitoring role of the corporate boards. By directly measuring political connection and controlling for various corporate governance mechanisms and firm-specific attributes, this study contributes to enhance the authors’ understanding of the political influence in financial reporting quality and firm performance in an emerging market setting.

scholarly journals Governança Corporativa Induz Melhor Desempenho e Inibe Alavancagem: Evidência da Indústria Brasileira de Petróleo & Gás

2015 ◽  
Vol 1 (2) ◽  
Author(s):  
Vládia Geane Moura Silva ◽  
Joséte Florencio dos Santos ◽  
Moisés Araújo Almeida
Keyword(s):  
Corporate Governance ◽  
Capital Structure ◽  
Emerging Market ◽  
Panel Data Analysis ◽  
Oil Industry ◽  
Data Set ◽  
Governance Practices ◽  
Three Stage Least Squares ◽  
Oil Gas ◽  
The Relationship

Purpose. This study analyzes the oil industry, gas and biofuels in order to identify associations between corporate governance practices with capital structure, risk and performance.Methodology. These data were verified through 3SLS models (Three-Stage Least Squares). For this, we used a data set composed of 19 companies, for a panel data analysis in the period 2005-2009.Findings. The results suggest a negative association between leverage and corporate governance company level, supporting the substitution hypothesis, according to which the leverage works as a governance substitute. Also they did not reject the hypothesis that the greater the governance practices, greater market performances and accounting of these companies, as well as reduces the market risk.Limitations. The main limitation of this research is the sample size, 19 companies, with particular focus on an industry, reducing the generalizability of the results.Originality/Value. This study sought to contribute to the understanding of the relationship between corporate governance, capital structure, performance and risk; specifically for the oil, gas and biofuels in Brazil, an important and understudied emerging market.

The nexus between corporate governance and intellectual capital in Vietnam

2020 ◽  
Vol 14 (5) ◽  
pp. 637-650 ◽  
Author(s):  
Ngoc Phu Tran ◽  
Loan Thi-Hong Van ◽  
Duc Hong Vo
Keyword(s):  
Corporate Governance ◽  
Intellectual Capital ◽  
Emerging Market ◽  
Value Added ◽  
Content Type ◽  
Listed Firms ◽  
Manufacturing Enterprises ◽  
Data Limitations ◽  
Negative Effect ◽  
The Relationship

Purpose This paper aims to examine the relationship between corporate governance and intellectual capital in the context of Vietnam. In this paper, corporate governance is proxied by various characteristics, including board size, a number of independent members in the board, board remuneration, major shareholder holding more than 20 per cent of the outstanding shares and duality of the CEO. In addition, intellectual capital is measured using the modified value-added intellectual coefficient model (MVAIC). Design/methodology/approach The study uses data of 45 Vietnamese listed firms during 2011-2018. The MVAIC model is used incorporating four components, namely, human capital, structural capital, capital used and relational capital. In addition, GMM regression technique is used in this paper. Findings Empirical findings from this paper indicate that key characteristics of corporate governance, except for board remuneration, may provide a negative effect on the efficient use of intellectual capital. Research limitations/implications Intellectual capital emerges as a new field of research that has not been widely examined in emerging countries such as Vietnam. As such, there have not been many studies focusing on understanding intellectual capital and its role in the performance of enterprises. Further studies can evaluate the relationship between intellectual capital and corporate performance, capital structure, corporate value and social responsibility. This study is limited to listed companies in Vietnam because of data limitations in an emerging market. Studies in the future should extend the sample and/or compare differences between manufacturing enterprises and financial institutions, or between countries. Practical implications Findings from this paper provide a valuable framework for executives, managers and policymakers in managing corporate governance and intellectual capital within the Vietnamese context. Originality/value To the best of the authors’ knowledge, this is the first empirical study that has been conducted to examine the relationship between corporate governance and intellectual capital in the context of Vietnam.

Corporate Governance and Voluntary Disclosure: A Synthesis of Empirical Studies

2020 ◽  
Vol 8 (2) ◽  
pp. 117-138
Author(s):  
Rupjyoti Saha ◽  
K. C. Kabra
Keyword(s):  
Corporate Governance ◽  
Voluntary Disclosure ◽  
Emerging Market ◽  
Empirical Studies ◽  
Practical Importance ◽  
Empirical Literature ◽  
Future Research ◽  
Explanatory Variables ◽  
Legal Enforcement ◽  
The Relationship

Voluntary disclosure (VD) is considered potentially important for efficient functioning of the capital market as it communicates firms’ performance and governance to shareholders and potential investors, which boost their confidence. This article attempts to provide a brief conceptual framework of VD and corporate governance (CG), and also reviews the empirical literature dealing with relationship between them. To this end, the article uses systematic electronic literature search method, which takes into account 65 empirical studies published over the period 1998–2018. An investigation of empirical findings points to some factors that may have contributed toward the apparent inconsistent findings observed to date. In particular, the article focuses on two intervening factors for variation of results—such as CG system and measurement of explanatory variables. The findings suggest that studies mostly from Anglo-Saxon system (ASS) show complementary relationship between different attributes of CG with VD, whereas in case of communitarian system, studies mostly depict an insignificant impact of CG attributes on VD except for few studies showing their positive/negative impact on VD. However, in case of emerging market system (EMS), some studies show substitutive relationship between board independence (BI) and VD while other CG attributes such as board size (BS), (GD), and audit committee independence (ACI) in most of the studies complement VD supporting the resource-based perspective. Furthermore, the association of ownership structure (OS) and role duality (RD) with VD is mixed. Another factor, which is considered to be added to variation of results, is measurement of explanatory variables whereby albeit studies employed same concepts, operational definition of variables intervenes into the relationship between CG and VD. The findings of this article provide some deeper insights about the complementary and substitutive relationships between CG and VD by integrating diverse empirical findings under different research contexts. Future research can extend to analyze some other institutional factors like investors’ protection rights and legal enforcement, which might also have played some role in influencing the relationship between CG and VD. Furthermore, it is also evident from the review that BS and BI are the most commonly studied CG attributes in relation to VD, whereas attributes like GD and ACI, despite their theoretical relevance and practical importance are least studied in relation to VD, thus signaling the need to focus on these attributes in future studies.

scholarly journals Does D&O insurance matter for stock price crash risk? Evidence from an Asian emerging market

2019 ◽  
Vol 3 (1) ◽  
pp. 34-46
Author(s):  
Ming-Te Lee ◽  
Kai-Ting Nien
Keyword(s):  
Corporate Governance ◽  
Stock Price ◽  
Emerging Market ◽  
Insurance Coverage ◽  
Crash Risk ◽  
Governance Mechanisms ◽  
Content Type ◽  
Corporate Governance Mechanisms ◽  
The Relationship

Purpose The purpose of this paper is to address the opposing views of the relationship between directors’ and officers’ liability insurance (D&O insurance) and stock price crash risk in a major Asian emerging stock market. Design/methodology/approach This paper finds an endogenous relationship between D&O insurance and stock price crash risk. Hence, the two-stage least squares regression analysis is used to address the endogeneity issue when the relationship is examined. Moreover, this paper further controls the quality of other corporate governance mechanisms to investigate whether D&O insurance still has an effect on stock price crash risk. Findings The effect of D&O insurance coverage is significantly negatively related to firm-specific stock price crash risk in Taiwan. More importantly, even when the quality of other corporate governance mechanisms is controlled, the negative relationship between D&O insurance coverage and firm-specific stock price crash risk remains significant. The evidence supports that D&O insurance serves as an effective external monitoring mechanism, strengthens corporate governance, and thus reduces stock price crash risk. Originality/value Emerging Asian markets suffer a dearth of research on the relationship of D&O insurance coverage and the firm-specific stock price crash risk. Investigating the relationship in Taiwan, the present study fills the research void. The findings show that D&O insurance plays an important role in reducing stock price crash risk of Taiwanese firms even when other corporate governance mechanisms are in place.

scholarly journals Executive compensation and corporate performance: Evidence from Jordanian commercial banks

2018 ◽  
Vol 14 (2) ◽  
pp. 38-44 ◽  
Author(s):  
Majd Iskandrani ◽  
Hadeel Yaseen ◽  
Asma’a Al-Amarneh
Keyword(s):  
Corporate Governance ◽  
Executive Compensation ◽  
Commercial Banks ◽  
Ceo Compensation ◽  
Corporate Performance ◽  
Stock Exchange ◽  
Emerging Market ◽  
Primary Data ◽  
The Impact ◽  
The Relationship

The wave of the recent financial crisis has reawakened interest in corporate governance as well as the relationship between executive compensation and corporate performance. Notably, corporate governance has been presented as a mechanism to absorb fiscal crisis faced in emerging economies. The principal aim of this study is to investigate the relationship between CEO compensation and corporate performance among commercial banks operating in a small emerging market, namely Jordan. Primary data were collected for a sample of 13 Jordanian commercial banks listed at Amman Stock Exchange (ASE) during the period of 2010 -2016. The findings of this paper suggest that corporate performance measured by return on equity (ROE) and return on assets (ROA) has no influence on CEO compensation. Furthermore, this paper examines the impact of a firm’s size on the relationship between CEO compensation and corporate performance. The results reveal a significant relationship between executive compensation and firm’s performance among the smaller sample firms.

scholarly journals When does corporate governance matter? Evidence from across the corporate life-cycle

2015 ◽  
Vol 41 (7) ◽  
pp. 673-691 ◽  
Author(s):  
Thomas O'Connor ◽  
Julie Byrne
Keyword(s):  
Corporate Governance ◽  
Life Cycle ◽  
Firm Value ◽  
Emerging Market ◽  
Small Sample ◽  
Content Type ◽  
A Value ◽  
Corporate Life Cycle ◽  
Two Measures ◽  
The Relationship

Purpose – The purpose of this paper is to explore the relationship between corporate governance and firm value at different stages of the corporate life-cycle. Design/methodology/approach – The authors use two measures, commonly employed in the literature, to differentiate between “immature” and “mature” firms, and estimate separate governance-value regressions for each set of firms. Findings – The findings suggest that it is differences in the resource/strategic governance functions, which manifest in young firms which result in differences in value across firms, all else equal. The authors find no relationship between governance and firm value for older firms. Hence, differences in the monitoring aspect of governance between mature firms are not rewarded with a value premium. Research limitations/implications – The findings imply that the strategic and resource roles of governance are “must haves” for firms since firms that score highly on these fronts are valued more highly. In contrast, differences in the monitoring aspect of governance are not rewarded, suggesting that effective monitoring is not a necessity, but rather a “nice to have”. The analysis is limited to a small sample of emerging market firms, and it would be of interest to extend this analysis to a larger and broader sample of firms. Originality/value – The findings suggest that corporate governance is not valued at all stages of the corporate life-cycle.

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