Search results

1 – 10 of over 18000
Article
Publication date: 28 September 2023

Bhavna Mahadew

The purpose of this study is to provide for critical literature on the legal aspects of corporate governance and their application in Mauritius. The drawbacks of having the…

Abstract

Purpose

The purpose of this study is to provide for critical literature on the legal aspects of corporate governance and their application in Mauritius. The drawbacks of having the principles in the form of a non-binding code are discussed, and a case is made to consider their enshrinement in laws such as the Companies Act 2001 to render them legally enforceable for the good health of companies in Mauritius.

Design/methodology/approach

A doctrinal legal methodology has been adopted to assess the effectiveness of the principles of the 2016 Code of Corporate Governance of Mauritius. Legislations, legal texts, case law and regulations are used to conduct this assessment. In addition, a black-letter approach is taken while discussing the enshrinement of the principles in the Companies Act 2001 of Mauritius. The doctrinal methodology is further supported by a qualitative analysis of the principles of corporate governance based on existing legal literature, which emphasises their relevance and importance.

Findings

The principles of the 2016 Code of Corporate Governance are no doubt a progress over the former 2004 Code in various aspects, aligning the Code with the requirements of the OECD. However, there are still certain loopholes that have been highlighted. In addition, the extent to which these principles are reflected in the Companies Act, which is the primary legislation for companies, has been found to be lacking and inadequate.

Originality/value

This paper is, to the best of the author’s knowledge, the first legal literature concerning the Mauritian legal framework on corporate governance. This is relevant because the country has recently experienced corporate collapses, which could arguably have been avoided with the application of the principles of corporate governance. As such, the paper will present a case study that can be used as a reference for future research on the enforceability and justiciability of these principles.

Details

International Journal of Law and Management, vol. 66 no. 1
Type: Research Article
ISSN: 1754-243X

Keywords

Article
Publication date: 15 June 2023

Yuveshna Gowry, Teerooven Soobaroyen and Ushad Subadar Agathee

This study aims to explore the quality of corporate governance disclosure under an “apply and explain” regime in the context of an emerging economy (Mauritius), following a…

Abstract

Purpose

This study aims to explore the quality of corporate governance disclosure under an “apply and explain” regime in the context of an emerging economy (Mauritius), following a transition from the traditional “comply or explain” approach within the national code of corporate governance.

Design/methodology/approach

The research relies on a content analysis of corporate governance disclosure in 86 annual reports of companies listed on the Stock Exchange of Mauritius for the financial periods 2018–2019 and 2019–2020, one-way analysis of variance tests and draws on the typology of corporate governance explanations developed by Shrives and Brennan (2015), focusing on specificity, location and comprehensiveness dimensions. This paper draws on legitimacy theory and the concepts of substantive and symbolic disclosures to guide the interpretation of the findings.

Findings

From a specificity point of view, the disclosure index revealed significant variations, with the highest score being four times the lowest score. With regards to location and comprehensiveness, only around half of companies are making optimum use of a corporate governance report and providing explanations by principles. This paper also illustrated how some firms provided symbolic disclosures. Overall, there are disparities in the application of the code by companies, reflected in a blend of substantive and symbolic disclosures to maintain their legitimacy.

Originality/Implications

This study examines “apply and explain” disclosures in a emerging economy in contrast to the “comply or explain” approach studied so far in the literature. Merely professing a “well intended” shift to the “apply and explain” approach does not necessarily lead to improvements in the quality of corporate governance disclosures. Companies, governance professionals and regulatory bodies could formulate disclosure guidance to better underpin the implications of the “apply and explain” approach.

Details

Corporate Governance: The International Journal of Business in Society, vol. 23 no. 7
Type: Research Article
ISSN: 1472-0701

Keywords

Article
Publication date: 1 June 2015

Nermeen F. Shehata

– This paper aims to discuss and compare the corporate governance codes in Gulf Cooperation Council (GCC) countries.

2911

Abstract

Purpose

This paper aims to discuss and compare the corporate governance codes in Gulf Cooperation Council (GCC) countries.

Design/methodology/approach

The development of corporate governance codes in the GCC is considered using an analytical approach.

Findings

Efforts and initiatives are underway in the GCC towards improving the corporate governance environment and coping with international developments. Although most GCC codes are comprehensive compared to those of other Middle East North Africa (MENA) countries, and are similar to international codes, as with almost all countries in the region, there is room for development. Updated codes that address the unique nature of these countries could enhance corporate governance.

Research limitations/implications

This comparison between GCC corporate governance codes provides opportunities to empirically compare the corporate governance status in these countries through indices or checklists based on the current comparison.

Practical implications

The research facilitates future evaluations of corporate governance in Gulf countries. In other words, different stakeholders, including investors and analysts, can utilise this paper during decision-making. Moreover, comparing GCC codes to others in the MENA region would help to assess the GCC’s position in the region regarding these codes, and also alert firms to corporate governance reforms occurring in the region.

Originality/value

The paper analyses the corporate governance codes issued in the GCC, which represents a group of countries with similar characteristics that are thus studied separately from other MENA countries, and compares the corporate governance codes issued for non-financial listed companies.

Details

Corporate Governance, vol. 15 no. 3
Type: Research Article
ISSN: 1472-0701

Keywords

Article
Publication date: 20 July 2012

Peter Franck and Stefan Sundgren

The purpose of this paper is to assess whether ownership concentration, leverage and demand for equity financing is associated with internal corporate governance quality. The…

2153

Abstract

Purpose

The purpose of this paper is to assess whether ownership concentration, leverage and demand for equity financing is associated with internal corporate governance quality. The paper focuses on dimensions of governance quality that are related to financial reporting quality.

Design/methodology/approach

The authors measure internal governance quality by an indicator variable that takes on higher values depending on whether a company has an audit committee, has a sufficient number of audit committee meetings during the year, has financial expertise on the audit committee, has an internal auditing function, a risk management function, a code of conduct and whistle blower provisions in the code of conduct. The sample consists of 91 Swedish listed companies of which 39 companies had to follow the Swedish Corporate Governance Code. The development of hypotheses is based on agency theory. Ordered logistic regressions are used to test the hypotheses.

Findings

The paper finds a strong negative association between leverage and the internal governance quality score for companies that do not have to follow the Corporate Governance Code. The paper also finds a positive association between the governance quality score and dispersed ownership among companies that have to follow the code.

Research limitations/implications

The negative association between leverage and governance quality is opposite to the typical agency theory prediction. A number of other studies have also documented negative or insignificant associations with leverage in related settings. The research suggests there is a demand to develop theories related to leverage and the implementation of governance characteristics beyond the typical agency theory based predictions.

Practical implications

The results raise the question whether lenders more actively directly or indirectly should influence the governance quality of borrowers.

Originality/value

Based on the conjecture that governance quality increases with the number of governance elements, the paper studies a governance score that is built up by several elements of good corporate governance. Furthermore, the authors study a setting dominated by voluntary choices of governance quality, which makes it possible to study supply effects.

Details

Managerial Auditing Journal, vol. 27 no. 7
Type: Research Article
ISSN: 0268-6902

Keywords

Article
Publication date: 27 May 2014

Abdifatah Ahmed Haji

This paper examines the impact of corporate governance attributes and ownership structure patterns on corporate performance of Malaysian listed companies following the revised…

2161

Abstract

Purpose

This paper examines the impact of corporate governance attributes and ownership structure patterns on corporate performance of Malaysian listed companies following the revised code on corporate governance in 2007. To provide an insightful assessment on the revised code's implications on firm performance, data before (2006) and after (2009) the revised code in 2007 were analyzed.

Design/methodology/approach

The study involves analyses of 170 observations in a two-year period, 2006 and 2009. The sample of the study was selected on the basis of a stratified random sampling procedure to allow a representative sample of the various sectors listed on Bursa Malaysia. Based on data extracted from the annual reports of 2006 and 2009, corporate performance was captured using accounting performance indicators (return on assets and return on equity). In addition to descriptive analyses, multiple regression analysis was used to assess the influence of the governance and ownership structure attributes on firm performance.

Findings

The findings revealed a decreasing trend of the financial performance of the sample companies over the two-year period which this study attributes to the recent global financial meltdown. In terms of corporate governance compliance, the results showed that there were cases of non-compliance of the basic requirements of the corporate governance code in Malaysia even after the revised code in 2007. In addition, the multiple regression results showed that only board meetings had significant negative association with firm performance following the revised code. None of the other variables had significant impact on firm performance before and after the revised code. Firm size and leverage, as control variables, however, showed significant association with firm performance.

Practical implications

Given the lack of non-compliance by some of the sample companies in Malaysia to some basic requirements such as the required percentage of independent directors on corporate boards and the insignificance of governance attributes in enhancing performance, this study suggests that the revised code needs reinforcement, at best, or even an overhaul change to suit more to the Malaysian business environment.

Originality/value

In distinction from most prior studies, this study provides ex-ante and ex-post examination of the relationship between corporate governance and firm performance, following changes in the regulatory environment. Such analysis is expected to have some practical implications in indicating whether recent regulatory changes are practiced in the corporate environment. This study draws evidence from Malaysia in adding to our understanding on whether changes in regulatory frameworks enhance firm performance.

Details

International Journal of Commerce and Management, vol. 24 no. 2
Type: Research Article
ISSN: 1056-9219

Keywords

Article
Publication date: 7 August 2017

Mirgul Nizaeva and Ali Uyar

The purpose of this paper is to comparatively analyze the corporate governance codes of transition economies, particularly five Eurasian Economic Union (EAEU) members (i.e…

Abstract

Purpose

The purpose of this paper is to comparatively analyze the corporate governance codes of transition economies, particularly five Eurasian Economic Union (EAEU) members (i.e. Russia, Belarus, Kazakhstan, Kyrgyzstan and Armenia). Specifically, the convergence or divergence of these countries’ corporate governance codes among themselves as well as relative to the best practices of the UK Corporate Governance Code (UK Code) and the OECD Principles of Corporate Governance are investigated.

Design/methodology/approach

Initially, the existing literature on corporate governance with special focus on transition countries is reviewed. Afterwards, benchmarking the international best practices, based on main chapters and contents, the corporate governance codes of all countries in the sample are analyzed.

Findings

The paper finds that even though some principles of the corporate governance codes of the countries in the sample differ in some aspects, they do converge to some extent. However, high misalignments between the UK Code and the OECD Principles and the codes of selected countries in some aspects were found.

Research limitations/implications

The conclusion and implications of the study characterize the corporate governance of selected developing countries; thus, they might not be generalizable to other countries.

Practical implications

The codes of the countries in the sample should be revised, and more specifications regarding the stakeholder, board structure, its subcommittees, independence, diversity and transparency issues need to be addressed.

Originality/value

The paper comprehensively analyzes the contents of corporate governance codes of transition countries; from both practical and academic point of view, it was important gap that needed to be fulfilled.

Details

Corporate Governance: The International Journal of Business in Society, vol. 17 no. 4
Type: Research Article
ISSN: 1472-0701

Keywords

Article
Publication date: 5 October 2012

Andreas G. Koutoupis

This study focuses on the evaluation of the introduction of international corporate governance codes such as Combined Code (UK) and King Report III (SA) in the Greek publicly…

696

Abstract

Purpose

This study focuses on the evaluation of the introduction of international corporate governance codes such as Combined Code (UK) and King Report III (SA) in the Greek publicly listed enterprises. This research is based on a case study analysis of six publicly listed enterprises (three of them are traded in the high capitalization index and another three in the medium‐low capitalization index of the Athens Stock Exchange). The main purpose of this paper is to examine the extent of international corporate governance codes impact in the relevant local laws and regulations, as well as the adopted best practices.

Design/methodology/approach

Qualitative research is carried out to address the research topic, using primary and secondary data. The primary source of this study is the professional experience of the author in the field of corporate governance within publicly listed enterprises, whereas secondary sources are the international corporate governance codes, Greek corporate governance laws, regulations and best practices, books, working papers and published articles.

Findings

Although certain parts of international governance codes requirements have been applied by a number of Greek publicly listed enterprises, there is a long way to go to achieve best practice. The reason for this is the typical, however not substantial application of international governance codes requirements.

Originality/value

Research is proved to be very useful as it describes a gap analysis in the application of international governance codes in the areas of corporate governance, internal and external auditing, as well as the regulators therefore making it easier to identify potential areas for improvement.

Details

International Journal of Organizational Analysis, vol. 20 no. 4
Type: Research Article
ISSN: 1934-8835

Keywords

Article
Publication date: 11 September 2009

Fidelis Ogbuozobe

This paper (which is Part 1 of 2) seeks to explore the development and implementation of good corporate governance in the financial services industry in Nigeria.

Abstract

Purpose

This paper (which is Part 1 of 2) seeks to explore the development and implementation of good corporate governance in the financial services industry in Nigeria.

Design/methodology/approach

The paper reflects upon the identification of current problems and official legislative responses in Nigeria and tests the policy and theory against actual responses and practices.

Findings

With the collapse of such mega companies as Enron in the USA and the near‐collapse symptoms observed in such a relatively big company as Cadbury Nigeria, such research as this, on the issue of compliance or otherwise with corporate governance practices by organizations, could not have been undertaken at a more appropriate time than now. Considering the ever‐increasing scope and complexity of the subject, which cannot be covered by a single project, the particular focus here is on the impact of the Companies and Allied Matters Act (1990) and the Insurance Act (2003) on the Boards of insurance companies in Nigeria. In other words, do the said statutes contain sufficient provisions and sanctions to ensure effective performance by Boards of insurance companies in Nigeria?

Originality/value

While this research paper may not claim to fill this gap completely, it is hoped that it will create sufficient awareness to serve as a springboard for effective entrenchment and enforcement of corporate governance practices in the Nigerian financial services industry (including insurance) in particular and the economy in general.

Details

International Journal of Law and Management, vol. 51 no. 5
Type: Research Article
ISSN: 1754-243X

Keywords

Article
Publication date: 12 September 2016

Andrews Owusu and Charlie Weir

The purpose of this paper is to investigate the impact corporate governance, measured by a governance index, on the performance of listed firms in a developing economy, Ghana. It…

1159

Abstract

Purpose

The purpose of this paper is to investigate the impact corporate governance, measured by a governance index, on the performance of listed firms in a developing economy, Ghana. It also evaluates the effect of the introduction of a code of corporate governance on compliance rates across Ghanaian firms as well as assessing the impact of the code’s introduction on firm performance for the study period 2000-2009.

Design/methodology/approach

The paper develops a Ghanaian corporate governance index (GCGI) containing 33 provisions to measure corporate governance quality during the pre-code and the post-code sub-periods. The authors use a panel data analytical framework and fixed effects regressions to analyse the governance-performance relationships.

Findings

After controlling for endogeneity, the authors find a statistically significant and positive relationship between the GCGI and firm performance. The analysis shows evidence of a statistically significant increase in the degree of compliance with the Ghanaian Code from the pre-2003 sub-period to the post-2003 sub-period. The authors also find that the introduction of the code has led to improved firm performance. However, not all elements of corporate governance appear to have a significant effect on firm performance.

Research limitations/implications

One limitation of this study is the development of a corporate governance index. The binary coding used to construct the GCGI may not reflect the relative importance of the different corporate governance provisions. This means that all elements included in the index are given equal weighting. Future research may assign weights to each of the corporate governance provisions but this may have the disadvantage of making subjective judgements relative to the importance of each corporate governance provision recommended by the Ghanaian Code.

Practical implications

These results have important implications for both policy makers and companies. For policy makers, it is encouraging for the development of a code of corporate governance to regulate firms rather than enforcing rigid laws that may not be value relevant. For companies, the improvement in compliance with a code of corporate governance can provide a means of achieving improved performance.

Originality/value

This paper adds to the limited evidence on the governance-performance relationship in developing economies and in particular it analyses the role of a governance index. It is also the first paper to compare the pre- and the post-code governance index-performance relationship in an African or developing country.

Details

Journal of Applied Accounting Research, vol. 17 no. 3
Type: Research Article
ISSN: 0967-5426

Keywords

Article
Publication date: 2 February 2015

Anne Galander, Peter Walgenbach and Katja Rost

– The aim of this study is to apply the concept of social norm dynamics to explain how corporate governance soft law is enforced.

3672

Abstract

Purpose

The aim of this study is to apply the concept of social norm dynamics to explain how corporate governance soft law is enforced.

Design/methodology/approach

Using data of German listed stock companies and of economic media coverage between 2001 and 2010, the authors observe the complex relationship between sanctions and behavior in the social context of corporate governance soft law.

Findings

The authors find the public discussion of normative demands related to corporate governance issues increases if firms do not comply with the German Corporate Governance Code. The authors show that groups of actors, such as DAX companies, represent the addressees of normative demands, i.e. targets of expectations about what is appropriate and what is not. The authors also find that normative demands tend to be personalized, as public discussion is greater when initiated by a specific individual or firm. Finally, the authors demonstrate that social control in terms of public sanctioning positively influences a firm’s compliance with the soft law whereby negative statements (disapproval) outweigh the effects of positive statements (approval).

Originality/value

We corroborate the social character of normative demands in the context of corporate governance soft law, and contribute to a better understanding of why soft law can work, despite it having no legally binding force. The results of our study suggest that sanction mechanisms in the context of social norms underpin the strength of soft law as an alternative to, or extension of, hard law.

Details

Corporate Governance, vol. 15 no. 1
Type: Research Article
ISSN: 1472-0701

Keywords

1 – 10 of over 18000