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This paper aims to review empirical research on the relationship between institutional ownership (IO) and board governance (85 studies).

Based on agency and upper echelons theory, the heterogeneous monitoring function of specific types and the nature of institutional investors on board composition, compensation and chief executive officer (CEO) characteristics will be focused.

The author found that most studies have referred to archival studies, analyzed the impact of board governance on IO, focused on CEO characteristics, neglected IO heterogeneity and advanced regression models to address endogeneity concerns. In line with the theoretical framework, the relationship between total IO and board governance is heterogeneous. However, specific types such as foreign, dedicated and pressure-resistant institutions represent active monitoring tools and push for increased board governance.

The author provided useful recommendations for future research from a content and methodological perspective, e.g. the need for analyzing the impact of IO on sustainable board governance and other characteristics of top management team members, e.g. the chief financial officer.

As many regulatory bodies implemented regulations to promote shareholder rights and board governance, this literature review highlights the connections of both corporate governance mechanisms. Managers should conduct a careful and timely investor analysis and change the composition and compensation of the board of directors in line with institutional investors’ preferences.

This analysis makes useful contributions to prior research by focusing on IO and board governance, whereas the author structured the heterogeneous variables and results within the structured literature review. The authors guides researchers, regulatory bodies and business practice in this corporate governance topic.

This paper aims to analyze the impact that sustainable board governance has on corporate social responsibility (CSR) on the European capital market because of the current debate of future European regulations on the topic.

Based on a legitimacy and stakeholder theoretical framework, the author conducts a structured literature review and includes 86 quantitative peer-reviewed empirical (archival) studies on board gender diversity, sustainability board expertise and sustainability-related executive compensation and their impact on CSR variables.

Gender board diversity represents the most important variable in this literature review. The included categories of sustainable board governance positively influence both the total CSR and environmental outputs.

A detailed analysis of sustainable board governance proxies is needed in future archival research to differentiate between symbolic and substantive use of CSR. In view of the current European reform initiatives on sustainable corporate governance in line with the EU Green Deal project, future research should also analyze the interactions between the included sustainable board governance variables and their contributions to CSR.

As both stakeholder demands’ on CSR outputs and CSR washing have increased since the financial crisis of 2008–2009, firms should be aware of a substantive integration of sustainability within their boards of directors (e.g. because of composition and compensation) to increase their CSR efforts and long-term firm reputation.

This analysis makes useful contributions to prior research by focusing on sustainable board governance as a key determinant of CSR outputs on the European capital market. The European Commission’s future evidence-based regulations [e.g. the corporate sustainability reporting directive (CSRD) and the corporate sustainability due diligence directive (CSDD)] should be promoted.

The study explores extant knowledge on the nature of the relationship between internal and external corporate governance mechanisms, particularly board characteristics and audit quality, respectively, while also investigating how the relationship varies across geographies.

The extant knowledge is synthesized using a meta-analysis, which is conducted using a sample of 56 empirical studies from publications of varying grades. The studies span over 25 years (1996–2021) and cover 147 empirical samples (343,787 firm-year observations) across more than 20 countries. The dependent variable is audit fees, and the independent variable captures 12 different measures of board characteristics.

Overall, the results reveal a positive association between board characteristics and audit fees, indicating complementarity between governance mechanisms. Effect size analysis shows board characteristics, like size and independence, are positively associated with audit fees. However, heterogeneity is noted for some characteristics, and further analysis by geography (developed vs emerging countries) explains the heterogeneity.

This study helps multiple stakeholders like firms, shareholders, boards, regulators and policymakers in designing and strengthening governance frameworks.

Both governance and auditing literature benefit from identifying specific board characteristics that drive audit quality consistently across different institutional settings and samples. Heterogeneity analysis helps improve the understanding of contradictions documented in prior literature.

This meta-analysis is the first to explore the interplay between internal and external corporate governance mechanisms, with a focus on board characteristics and audit quality. The study provides valuable insights on how different governance mechanisms influence each other while highlighting, for the first time, how the interaction between governance mechanisms varies by a country's level of development.

The purpose of this paper is to investigate the extent of voluntary disclosures in UK higher education institutions’ (HEIs) annual reports and examine whether internal governance structures influence disclosure in the period following major reform and funding constraints.

The authors adopt a modified version of Coy and Dixon’s (2004) public accountability index, referred to in this paper as a public accountability and transparency index (PATI), to measure the extent of voluntary disclosures in 130 UK HEIs’ annual reports. Informed by a multi-theoretical framework drawn from public accountability, legitimacy, resource dependence and stakeholder perspectives, the authors propose that the characteristics of governing and executive structures in UK universities influence the extent of their voluntary disclosures.

The authors find a large degree of variability in the level of voluntary disclosures by universities and an overall relatively low level of PATI (44 per cent), particularly with regards to the disclosure of teaching/research outcomes. The authors also find that audit committee quality, governing board diversity, governor independence and the presence of a governance committee are associated with the level of disclosure. Finally, the authors find that the interaction between executive team characteristics and governance variables enhances the level of voluntary disclosures, thereby providing support for the continued relevance of a “shared” leadership in the HEIs’ sector towards enhancing accountability and transparency in HEIs.

In spite of significant funding cuts, regulatory reforms and competitive challenges, the level of voluntary disclosure by UK HEIs remains low. Whilst the role of selected governance mechanisms and “shared leadership” in improving disclosure, is asserted, the varying level and selective basis of the disclosures across the surveyed HEIs suggest that the public accountability motive is weaker relative to the other motives underpinned by stakeholder, legitimacy and resource dependence perspectives.

This is the first study which explores the association between HEI governance structures, managerial characteristics and the level of disclosure in UK HEIs.

This paper aims to examine whether board governance mechanisms and ownership structure play a role in foreign investors’ decisions when buying shares in Saudi listed companies

Foreign investment in the Saudi capital market started in 2015 and reached a peak in 2019, with corporate governance regulations having been updated in 2017. The authors tested the proposed relationships using hand collected data for all Saudi non-financial firms in 2019.

This study found that it does not play a role in attracting foreign investment in the Saudi capital market. Foreign investors also seem to avoid firms with concentrated ownership that either have high government or director ownership; however, accounting and market variables show significant impact on foreign investors' decisions. The outcomes of this study provide empirical evidence that current foreign investors in the Saudi stock market do not place enough merit on board governance and their investment decisions tend to depend on share performance. Thus, the results show that the current governance changes and capital market regulations in Saudi Arabia may not have been sufficient to stimulate the inflow of institutional foreign investment to the country to date, but rather they have attracted individual retail foreign investors.

This empirical study is one of only a small number of studies to investigate the impact of internal corporate governance on foreign ownership in developing countries and the first in the Saudi context. In fact, most previous governance research in Saudi Arabia focused on how board governance and ownership structure influences firm performance. A review of the prior studies found that only Badawi et al. (2019) examined the determinants of foreign ownership among Saudi listed firms. Thus, the present investigation extends that study by examining the role of board governance in attracting foreign investors.

This paper aims to report the results of an investigation into the effect of aggregate and individual corporate governance factors on the financial performance of state-owned enterprises (SOEs) in Kenya.

The paper uses balanced panel data regression analysis on a sample of 45 SOEs in Kenya for a four-year period (2015–2018).

The panel data analysis results show that board meetings, board skill and gender diversity individual provisions of corporate governance are significantly and positively associated with capital budget realization ratio (CBRR). Moreover, the study finds that aggregate corporate governance disclosure index, board sub-committees, board size and independent non-executive directors are positive but insignificantly related to CBRR.

The current study is based on secondary data, other methods of knowledge inquiry such as interviews and questionnaires may provide additional insights on the effectiveness of corporate governance on financial performance.

Overall, the results imply that corporate governance influences the performance of SOEs in Kenya. The results suggest that Mwongozo Code of Corporate Governance provisions should be changed to increase the number of women representations on board and the number of directors with doctoral qualifications because of their positive impact on the financial performance of SOEs in Kenya. Also, policymakers with remit over SOEs should re-evaluate why other corporate governance appear not to have an impact with a view of making the necessary changes.

The paper contributes to the dearth of literature on the efficacy of corporate governance on the financial performance of SOEs in developing countries.

The purpose of the study is to examine how Non-Executive Directors (NEDs) in the English National Health Service (NHS) commissioning bodies experienced their role and contribution to governance.

Semi-structured interviews were conducted with a purposive sample of 31 NEDs of Primary Care Trusts (PCTs) and 8 Clinical Commissioning Group (CCG) NEDs. Framework analysis was applied using a conceptualisation of governance developed by Newman, which has four models of governance: the hierarchy, self-governance, open systems and rational goal model.

NEDs saw themselves as guardians of the public interest. NEDs’ power is a product of the explicit levers set out in the constitution of the board, but also how they choose to use their knowledge and expertise to influence decisions for, as they see it, the public good. They contribute to governance by holding to account executive and professional colleagues, acting largely within the rational goal model. CCG NEDs felt less powerful than in those in PCTs, operating largely in conformance and representational roles, even though government policy appears to be moving towards a more networked, open systems model.

This is the first in-depth study of NEDs in English NHS local commissioning bodies. It is of value in helping to inform how the NED role could be enhanced to make a wider contribution to healthcare leadership as new systems are established in the UK and beyond.

Robert C. Pozen, Chairman Emeritus of MFS Investment Management and a long-time scholar of corporate governance, has proposed a model of professional board directorship that responds to the three main factors he believes underpin ineffective board decision making: the large size of boards; the lack of specific industry expertise; and inadequate director time commitment. The paper aims to discuss these issues.

The authors critically evaluate the efficacy of Pozen's proposed corporate governance model, addressing the three main factors underpinning ineffective board decision making.

A professional board consisting of retired executives with industry-specific expertise is vulnerable to a groupthink mentality, as well as to the availability of such individuals for board directorship seats. Moreover, while industry-specific expertise is a desired attribute of an independent board director, there are other attributes that firms are looking for, including international, regulatory/governmental, risk, technology, and marketing expertise. Lastly, Pozen's recommendations to reduce board size to seven members, as well as increasing the number of hours that independent directors spend on board-related activities (and commensurate compensation received), should be seriously considered as potential value-adding, corporate governance improvements.

The authors critically evaluate a corporate governance model that, based on director-related issues arising from the recent global financial crisis, has resurrected the concept of a “professional board” of directors. The authors utilize state-of-the-art academic literature from the fields of corporate governance and organizational behavior to evaluate the merits and de-merits of the proposed corporate governance model, and present their findings (and recommendations) for improvements in corporate governance practices.

This paper aims to focus on governance theories and practice variables in Not-For-Profit Service Organizations. The research answers two questions: what the prevalent governance practices of Not-for-Profit Service Organizations (NPSO) are, and whether there is a crossover among NPSO governance practices and For-Profit-Organization theories in the literature.

A questionnaire to the 285 organizations within the defined parameters obtained a 18 percent response. Data were collected regarding the boards' predominant roles in the organizations' governance activities, the top executives' predominant roles in the organizations' operations and their interrelationship with the boards, and the boards' most common meeting agenda topics.

The findings prove that governance models in NPSO are mostly driven by Agency Theory (52 percent of the sample). Stewardship and Resource Dependence Theories also contribute to existing governance models (28 percent), while some of the organizations have developed Hybrid Models (20 percent) drawing from the various theories.

The limited number of organizations participating in the research does not allow a generalization. However the diversity of organization types and sizes within the scope do provide a panoramic view of the not-for-profit service sector.

Having proved that there is a crossover of governance practices among For-Profit and Not-for Profit Organizations, this research opens the door to the evaluation of many other existing or potential crossovers in governance and other management elements.

This research is novel in its approach to look for similarities rather than differences between For-Profit and Not-for-Profit Organizations. The approach allows both sectors to learn from each other and seek for fresh improvement alternatives.

This study aims to investigate the impact of corporate governance compliance, governance reforms and board attributes on operating liquidity of Pakistani listed non-financial firms. The study further tests how these relationships vary in the pre- and post-corporate governance reforms.

Fixed-effect regression model is used on 10 years panel data from 2007 to 2016 for a sample of 170 firms listed on the Pakistan Stock Exchange. Two-stage least squares model is used for addressing the endogeneity problem.

The findings reveal that governance compliance and governance reforms negatively affect operating liquidity. Among the board attributes, board meetings, directors’ remuneration, board foreign diversity and board gender diversity are significantly related to operating liquidity. Further exploration indicates that internal governance mechanisms are less effective to safeguard shareholders from expropriation during weak external governance. This suggests that strong external governance is inevitable to the effectiveness of internal governance mechanisms. Overall, the study findings support the agency theory.

The findings provide valid recommendations to policymakers interested in safeguarding the investors to focus on macro-level governance for making the micro-level governance effective. Further, the results provide the executives with an insight to improve the compliance level with the code of corporate governance.

Unlike prior studies, this study examines the impact of corporate governance compliance and novel board attributes – directors’ attendance at board meetings, number of board committees, directors’ remuneration and board foreign diversity on operating liquidity. Further, the study subdivides its sample period into pre- and post-corporate governance reforms to examine how external governance influences internal governance effectiveness.