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Article
Publication date: 5 October 2018

Andreas Koutoupis, Michail Pazarskis and George Drogalas

The purpose of this paper is to examine the role of internal audit with respect to Auditing Corporate Governance Statements based on a practical approach. Moreover, it…

Abstract

Purpose

The purpose of this paper is to examine the role of internal audit with respect to Auditing Corporate Governance Statements based on a practical approach. Moreover, it examines the application of internal control best practices in the Athens publicly listed firms based on a series of related statements.

Design/methodology/approach

The authors conducted all large and medium capitalization publicly listed companies via a research questionnaire which forms a basis of a descriptive research analysis. The methodology is based on the best worldwide acceptable practices as represented by the Committee of Sponsoring Organizations internal control – integrated framework, as well as the relevant laws and regulations and best practices with respect to Corporate Governance Statements.

Findings

The research concludes that internal auditors limit their role in verifying compliance with the relevant laws and regulations rather than adopt a consulting role toward the improvement of the content and quality of Corporate Governance Statements information. Also, it contributes to the corporate governance research by verifying that the effectiveness of internal controls contributes to sound corporate governance practices.

Practical implications

Internal auditors depending on the organization they serve may adopt different roles regarding Corporate Governance Statements preparation, review and audit such as consultative which may add value to the quality of Corporate Governance Statements.

Originality/value

It is the first research regarding quality characteristics of the Corporate Governance Statements and the role of internal audit in Greece, and it provides the basis for further research among European Union countries.

Details

Corporate Governance: The International Journal of Business in Society, vol. 18 no. 5
Type: Research Article
ISSN: 1472-0701

Keywords

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Book part
Publication date: 19 May 2009

H. Kent Baker and Gary E. Powell

We survey top managers of Fortune 1000 companies to learn if industry practitioners agree with the findings of academic research on specific corporate governance issues…

Abstract

We survey top managers of Fortune 1000 companies to learn if industry practitioners agree with the findings of academic research on specific corporate governance issues. We focus on board composition and size, executive/director compensation and ownership, firm performance, and other issues. The results suggest that the views of responding managers appear at odds with other empirical evidence provided in the literature on the majority of the issues examined. In addition, respondents are often unable to offer an opinion about whether they agree or disagree with specific corporate governance issues.

Details

Corporate Governance and Firm Performance
Type: Book
ISBN: 978-1-84855-536-5

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Article
Publication date: 4 November 2020

Noorul Azwin Md Nasir and Hafiza Aishah Hashim

This paper aims to review the performance of corporate governance practices in Malaysia from the beginning of the 21st century until recently. This paper also highlights…

Abstract

Purpose

This paper aims to review the performance of corporate governance practices in Malaysia from the beginning of the 21st century until recently. This paper also highlights the history of corporate governance practices in Malaysia and the country’s financial statement fraud situation.

Design/Methodology/Approach

Malaysia is a multi-ethnic society that requires managing corporations and firms collectively. Hence, corporate governance practices and good practices are compelled to fit society’s uniqueness. This paper used the survey findings generated from the Corporate Governance Watch Report (CG Watch Report) by the Credit Lyonnais Securities Asia and the Asian Corporate Governance Association from the year 2002 to the year 2018 and discussed the corporate governance performance related to financial statement fraud in Malaysia. The market ranking survey oversees five categories of corporate governance scores: rules and regulations, enforcement, political/regulatory environment, adoption of International Generally Accepted Accounting Principle and corporate governance culture

Findings

The findings reported that firms in Malaysia have benefited from good laws and regulations through corporate governance reforms.

Practical Implications

This study’s findings are relevant to regulators, board members, shareholders, potential investors, analysts and others to produce more informative timely comparisons. Future research should consider analysing and comparing the corporate governance performance in Malaysia with the corporate governance performance of other countries in Asia.

Originality Value

This study summarized the findings generated from a periodical CG Watch Report from the year 2003 to 2018. This study also underlined the actions of responsible agencies and regulatory bodies determined to have a decent corporate governance practice in Malaysia, especially in minimizing financial statement fraud occurrence in the country.

Details

Journal of Financial Crime, vol. 28 no. 3
Type: Research Article
ISSN: 1359-0790

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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.

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3488

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

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Article
Publication date: 28 June 2011

Dilek Demirbas and Andrey Yukhanaev

The main aim of this paper is to examine the role of the board of directors in Russia with specific attention to their independence, employee relations and ability of…

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3609

Abstract

Purpose

The main aim of this paper is to examine the role of the board of directors in Russia with specific attention to their independence, employee relations and ability of successful adaptation of the international standards.

Design/methodology/approach

The authors used a survey questionnaire to provide an empirical example from a transition economy to the corporate governance literature by exploring the attitudes of the 55 board directors from 30 listed companies on the Russian Trading System (RTS) Stock Exchange.

Findings

The respondents recognise the board of directors as an important instrument of efficient and good corporate governance practice. More surprisingly, they are also in favour of employee representatives on the board of directors and agree that board size and composition should be enhanced by employee representatives on the board.

Research limitation/implications

Even though 200 questionnaires were distributed and the response rate was 28 per cent, the authors know that they cannot generalise results for all directors of 1,414 listed companies on the Russian Trading System Stock Exchange from this level of response. In addition, questions might have some elements of subjectivity.

Practical implications

Policy makers in Russia should continue reforms in Russian corporate governance to improve transparency and accountability to adopt international standards and to attract foreign capital.

Originality/value

This study is one of the most comprehensive studies to explain the role of directors of listed companies in corporate governance throughout a survey questionnaire in Russia. The authors believe that the study contributes to the literature in two ways: theoretically by examining the attitudes of Russian listed company directors in the literature and empirically by conducting a survey among listed companies' directors to evaluate the attitudes of boards of directors, and employee relations in Russia.

Details

Employee Relations, vol. 33 no. 4
Type: Research Article
ISSN: 0142-5455

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Book part
Publication date: 23 June 2005

Duncan Green and Cameron Graham

In Canada, companies are focusing on corporate governance as an ethical response to accounting scandals and the resulting crisis of confidence. Although, many aspects of…

Abstract

In Canada, companies are focusing on corporate governance as an ethical response to accounting scandals and the resulting crisis of confidence. Although, many aspects of corporate governance remain free from strict regulation, we examine the voluntary changes in the disclosures of the largest Canadian companies. We attempt to understand, through disclosure theory, discourse analysis, and structuration theory, the quality of these corporate governance disclosures. We recognize that much of the disclosure is opportunistic as companies state that they have not only complied with the non-compulsory Canadian guidelines, but have also met and exceeded the requirements of U.S. regulators. This is an important finding that supports the notion that Canadian companies do not need rules and regulations. Instead, a culture of governance is developing at the boards of large companies that encourages voluntary change. Whether this is enough to prevent future accounting scandals is a question for future research.

Details

Corporate Governance: Does Any Size Fit?
Type: Book
ISBN: 978-1-84950-342-6

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Article
Publication date: 6 March 2017

Xiaochang Yan

The purpose of this paper is to study the influences of corporate governance on intellectual capital disclosures in chief executive officers’ (CEOs’) statements in annual reports.

Abstract

Purpose

The purpose of this paper is to study the influences of corporate governance on intellectual capital disclosures in chief executive officers’ (CEOs’) statements in annual reports.

Design/methodology/approach

Index score, word count and overall tone of CEOs’ intellectual capital disclosures are calculated to represent the extent, amount and tone of these disclosures, respectively. With a sample of 78 FTSE 100 companies, this paper uses content analysis and empirical analysis to examine the impacts of board size, board composition and shares concentration on the above three measures of CEOs’ intellectual capital disclosures, controlling for company size, profitability and leverage ratio.

Findings

Empirical results demonstrate a significant positive relationship between board composition and the extent, amount and tone of CEOs’ intellectual capital disclosures and a significant negative relationship between shares concentration and the amount of these disclosures.

Originality/value

This paper focuses on the impacts of corporate governance on CEOs’ intellectual capital disclosures. It also groundbreakingly measures the tone of CEOs’ disclosures.

Details

Nankai Business Review International, vol. 8 no. 1
Type: Research Article
ISSN: 2040-8749

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Article
Publication date: 2 January 2009

Brenda A. Porter

The purpose of this paper is to distinguish between corporate accountability and corporate governance, explore the development of corporate accountability and examine the…

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5238

Abstract

Purpose

The purpose of this paper is to distinguish between corporate accountability and corporate governance, explore the development of corporate accountability and examine the role of the tripartite audit function in securing this accountability.

Design/methodology/approach

A normative approach has been adopted and the research is based, primarily, on an examination of relevant literature.

Findings

Society facilities the growth of economic entities by providing them with resources. As their command over resources increases, these entities gain significant economic, social and political power and accountability is demanded of their managers as a check on possible abuse of this power. Historically, as companies have increased their power in society, those to whom and that for which their managers are held accountable have been extended. Today, the managers of large public companies are considered to be accountable to society as a whole for a wide range of corporate activities. The discharge of corporate accountability traditionally relied on the preparation and audit of accountability reports (financial statements). However, from the 1990s, responding to the increasing severity of the impact on society of unexpected corporate failures – and continued failures – responsible corporate governance was added as an accountability requirement. Further, as the activities for which companies are accountable have been extended (paralleling the growth of their “power” in society), so corporate responsibility information has featured as an element in their accountability reports. As these changes have occurred, the importance of the tripartite audit function in securing corporate accountability has come to be recognised and its members – the company's external and internal auditors and its audit committee – have become increasingly multi‐disciplinary in nature.

Originality/value

The paper explores the questions of why corporate accountability arises and how it is discharged. It explains the relationship between corporate governance and accountability and the role of the audit function in securing corporate accountability. It also provides insights into changes occurring in the audit function and how these might develop.

Details

Managerial Auditing Journal, vol. 24 no. 2
Type: Research Article
ISSN: 0268-6902

Keywords

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Article
Publication date: 1 September 2009

Adibah Jamaluddin, Nor’Azam Mastuki and Asyaari Elmiza Ahmad

This paper examines the effect of corporate governance reform on the value relevance of equity book value and earnings by employing the Ohlson’s (1995) Valuation Model…

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1198

Abstract

This paper examines the effect of corporate governance reform on the value relevance of equity book value and earnings by employing the Ohlson’s (1995) Valuation Model, and it is based on the methodology developed by Davis‐Friday et al. (2006). The sample consists of Main Board companies listed on Bursa Malaysia from 1999 to 2001 in order to investigate the effect during and after the issuance of the Malaysian Code on Corporate Governance (MCCG) as a measure of corporate governance reform. The findings generally indicate that equity book value and earnings are value relevant in assisting investors to value firms’ equity. Findings of this study, nonetheless, show that the regulatory change experienced by the country did not have an impact on the valuation of equity book value and earnings. This, thus, suggests that most of the Malaysian companies may not have met the intended purpose of MCCG, but merely conformed to the minimum requirement. In summary, the findings of this study provide evidence that the equity book value and earnings reported in the financial statement is value relevant in valuing Malaysian firms’ equity.

Details

Journal of Financial Reporting and Accounting, vol. 7 no. 2
Type: Research Article
ISSN: 1985-2517

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Article
Publication date: 16 October 2009

Kevin Campbell, Magdalena Jerzemowska and Krzysztof Najman

The purpose of this paper is to analyse the reasons for non‐compliance by Polish listed companies with elements of the Polish code of corporate governance Best Practices

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1736

Abstract

Purpose

The purpose of this paper is to analyse the reasons for non‐compliance by Polish listed companies with elements of the Polish code of corporate governance Best Practices in Public Companies 2005.

Design/methodology/approach

Based on 250 publicly available compliance statements filed in 2005 by companies listed on the Warsaw Stock Exchange (WSE) content analysis is used to classify the explanations provided for non‐compliance with those corporate governance principles that attract high levels of non‐compliance.

Findings

The data analysis reveals that, despite a high level of overall compliance, three out of 50 code principles attract high levels of non‐compliance. These principles concern the independence of supervisory board members, the composition of supervisory board committees and the appointment of auditors. The most contentious principle concerns the independence of supervisory board members, due to the presence of many majority‐owned companies on the Warsaw Stock Exchange.

Practical implications

The paper sheds light on the operation of the “comply or explain” approach to corporate governance in Poland and provides suggestions for improving the level and quality of compliance with the revised corporate governance code Best Practices for WSE Listed Companies, applicable from 2008 onwards.

Originality/value

The paper provides an empirical investigation of the reasons given by Polish companies for non‐compliance with the most controversial corporate governance principles. It highlights a tendency for some companies to report compliance that is conditional, suggesting that reported compliance under‐represents the true level of compliance. We suggest that establishing a monitoring committee tasked with evaluating the quality of explanations for non‐compliance and reducing ambiguities in the wording of code principles will improve the quality of Polish corporate governance in the long term.

Details

Corporate Governance: The international journal of business in society, vol. 9 no. 5
Type: Research Article
ISSN: 1472-0701

Keywords

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