Code Compliance Study 2017 - Analysis of the Declarations of Conformity with the German Corporate Governance Code (Version May 2015)

2017 ◽  
Author(s):  
Johannes Beyenbach ◽  
Marc Steffen Rapp ◽  
Christian Strenger ◽  
Michael Wolff
Keyword(s):  
Corporate Governance ◽  
Corporate Governance Code ◽  
Code Compliance ◽  
Code Version

scholarly journals Compliance with the German Corporate Governance Code: Can the heterogeneous implementation be explained?

2019 ◽  
Vol 2019 (101 (157)) ◽  
pp. 167-200
Author(s):  
Karsten Eisenschmidt ◽  
Ute Vanini
Keyword(s):  
Corporate Governance ◽  
Peer Group ◽  
Empirical Studies ◽  
Influence Factors ◽  
Family Influence ◽  
Institutional Setting ◽  
Future Research ◽  
Agency Conflicts ◽  
Corporate Governance Code ◽  
Code Compliance

Starting with the Cadbury code in 1992, various national and international Corporate Governance (CG) codes have been issued all over the world. So far, empirical studies have revealed mixed results concerning the effects and outcomes of code implementation and thus supported the hypothesis of a ‘one system does not fit all’ approach in CG. Therefore, this paper empirically analyses influence factors on compliance with the German Corporate Governance Code for a large sample of 306 listed firms in 2015. We chose German companies because of the specific institutional settings in Germany, e.g., the strong influence of founder families on a firm’s management or the relevance of debt financing. It is assumed that the country-specific institutional setting limits the transferability of results of US and UK studies. Thus, we used the German setting to derive relevant influence factors on Code compliance. In addition, we applied a more sophisticated measure of Code implementation than previous studies. Overall, we find a significant positive effect of ownership dispersion and firm size on Code compliance, whereas the other influence factors, e.g., family influence or the supervisory board’s size, reveal the right direction of impact but not the required level of statistically significance. In contrast to institutional theory, we find a negative although statistically insignificant impact of the strength of foreign investors’ influence on Code compliance. Overall, our results indicate that the institutional setting is not decisive for Code compliance. Instead, we assume that the main rationale for Code compliance is not the reduction of agency conflicts but the alignment with peer group practices as indicated by the variable company size. Future research should investigate the peer effects on the level of Code compliance in detail.

scholarly journals The German corporate governance code and its adoption by listed SMEs – just another ‘Procrustes bed’?

2016 ◽  
Vol 14 (3) ◽  
pp. 494-503
Author(s):  
Thomas Steger ◽  
Markus Stiglbauer
Keyword(s):  
Corporate Governance ◽  
Financial Crisis ◽  
Significant Influence ◽  
Positive Impact ◽  
Stock Exchange ◽  
Operating Performance ◽  
Jel Classification ◽  
Company Size ◽  
Corporate Governance Code ◽  
Code Compliance

The discussion of companies’ compliance with corporate governance standards and codes has widely neglected the situation of small and medium-sized enterprises (SMEs). Accordingly, the authors examine a sample of 151 SMEs listed on the Frankfurt Stock Exchange in 2006 (before the financial crisis) and 2012 (after the financial crisis) and, thus, required to declare whether they comply with the recommendations of the German Corporate Governance Code or not. While code compliance seems to be quite homogenous comparing different branches, the authors found that company size has a positive impact on code compliance. With regard to a remarkably high number of recommendations a lot of companies do not comply to, company size might be a major problem, why the existing GCGC does not fit very well to the situation of SMEs. This is why, most remarkably, code compliance does not exert any significant influence on either market reaction or on operating performance of SMEs. Keywords: corporate governance, SMEs, Germany, firm performance. JEL Classification: G3, G34, M10, L25

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