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

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Article
Publication date: 5 June 2017

Michail Nerantzidis and Anastasios Tsamis

The purpose of this study is to review the prior empirical studies that investigate the corporate governance (CG) determinants and provide a synopsis, and explore the main…

Abstract

Purpose

The purpose of this study is to review the prior empirical studies that investigate the corporate governance (CG) determinants and provide a synopsis, and explore the main factors that drive the level of CG disclosure in the Greek context.

Design/methodology/approach

The authors perform an extensive review of the relevant literature and identify 24 papers that use various potential factors. Afterwards, the authors construct two different GC indices to investigate these potentials, and the authors conduct multiple regression analysis to identify and explain these determinants.

Findings

The empirical analysis shows that large Greek listed firms are more likely to disclose more CG information in the CG statement. In addition, the analysis shows statistically significant association with performance-related variables (such as Tobin’s Q and liquidity) and CG-related variables (such as independent members, board meetings and women on board).

Research limitations/implications

The results of the study support theoretical arguments that Greek listed firms disclose CG information not only to fulfill task-related requirements but also to be perceived as social and legitimate.

Originality/value

To the best of the authors’ knowledge, this is the first study that provides a synopsis of the prior literature in CG determinants, while it goes one step further by using the majority of the potential factors that have been used so far. Moreover, this study uses a multi-theoretical framework to address theoretical development, an approach that generates an outline of fruitful directions for future research.

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Corporate Governance: The International Journal of Business in Society, vol. 17 no. 3
Type: Research Article
ISSN: 1472-0701

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Article
Publication date: 4 April 2016

Michail Nerantzidis

The purpose of this paper is to look inside the “black box” in corporate governance (CG) measurement, and shed some light on how to construct a transparent, reliable and…

Abstract

Purpose

The purpose of this paper is to look inside the “black box” in corporate governance (CG) measurement, and shed some light on how to construct a transparent, reliable and valid index, considering equally both the academics and practitioners’ perspectives.

Design/methodology/approach

A synthesized literature review is presented and a CG index is developed combining the strengths of three different methodologies: the Delphi method, the classical test theory (CTT) and the analytic hierarchy process (AHP). This approach helps authors to break the process into separate steps and to select the appropriate techniques to support their decision regarding the norms, the criteria, the variables and the weights that someone should use to construct a CG index.

Findings

The authors’ analysis indicates that a well-designed CG index requires a combination of research methods to identify the best options to solve several methodological issues in index construction. For the application of this multi-methodology in Greece, the authors used two equal and independent samples to explore the different perspectives regarding the importance of the index criteria and sub-criteria. This process provides evidence that the opinion of academics and practitioners in Greece tend to converge. Moreover, it is found that this multi-methodology produces the highest variation in CG scores and ranking orders, as opposed to a traditional approach, in measuring CG disclosure, an important issue with econometric implications.

Research limitations/implications

The limitations of this study are associated with the methods used.

Practical implications

This paper provides practical implications for investors and commercial vendors. For the former, it highlights the need to be more cautious and/or suspicious when they use CG ratings, meaning that they should comprehend the base of the ratings models, and for the latter, it demonstrates the importance of enhancing the transparency in CG indices construction.

Originality/value

The value of the paper lies in improved understanding of the methodological issues in constructing CG indices. This is quite interesting because this approach could serve as a roadmap for other researchers.

Details

Corporate Governance, vol. 16 no. 2
Type: Research Article
ISSN: 1472-0701

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Article
Publication date: 8 October 2018

Ioannis Tampakoudis, Michail Nerantzidis, Demetres Soubeniotis and Apostolos Soutsas

The purpose of this study is twofold: First, to assess the economic impact of Mergers and Acquisitions (M&As) on European acquiring firms from the beginning of the sixth…

Abstract

Purpose

The purpose of this study is twofold: First, to assess the economic impact of Mergers and Acquisitions (M&As) on European acquiring firms from the beginning of the sixth merger wave onward. And second, to investigate the effect of CG mechanisms such as board size, voting rights and anti-takeover provisions (ATPs) on acquirers’ gains, along with a set of control variables.

Design/methodology/approach

For the purpose of the study, the authors use a sample of 349 completed M&As across all business sectors between European firms from 01/01/2003 to 31/12/2017. Abnormal returns are estimated by applying an event study methodology, and the effects of CG mechanisms are assessed with univariate and multivariate cross-sectional regressions.

Findings

The authors present evidence that acquirers realize significant positive excess returns upon the announcement of M&As. The authors find past profitability to be a strong indicator of value creation, while most of the traditional firm-specific and deal variables fail to interpret the results. The authors’ analysis indicates that the examined CG measures have a significant effect on acquirer’s gains. More specifically, the authors find that boards in excess of eight directors are negatively related to announcement-period abnormal returns. In contrast, the wealth effects for acquiring firms are positively related to shareholders’ voting rights and/or to the number of ATPs. The estimated coefficients of all three CG mechanisms are statistically significant across alternative model specifications.

Research limitations/implications

A clear implication is that the existence of certain CG mechanisms leads to value-enhancing strategic decisions for European acquirers. In terms of policy direction, the authors’ findings assist practitioners and/or national and transnational institutions in perceiving the efficacy of certain CG practices.

Practical implications

This study indicates that Corporate Governance Statements (CGSs) fail to provide adequate information to investors to understand in-depth the CG mechanisms that companies apply. Thus, the authors recommend that CGSs should provide not only narrative information but also information that may generate value for shareholders and other stakeholders as well. Such information should be qualitative and/or quantitative in nature and be made available to market participants to support their decision-making.

Originality/value

To the authors knowledge, this is the first study that investigates the effect of CG on the economic impact of M&As for European acquirers, using three widely examined CG mechanisms, namely, the board size, the voting rights and the ATPs. The authors’ empirical findings form the basis for further examination of the linkage between M&As and CG, with the intention of establishing the appropriate CG framework that will ensure shareholder wealth creation. This line of research could produce new insights in the field, allowing investors and policymakers to appreciate the benefits of effective CG.

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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Article
Publication date: 8 February 2021

Petros Lois, George Drogalas, Michail Nerantzidis, Ifigenia Georgiou and Eleni Gkampeta

This study aims to investigate the factors associated with the implementation of risk-based internal audit (RBIA).

Abstract

Purpose

This study aims to investigate the factors associated with the implementation of risk-based internal audit (RBIA).

Design/methodology/approach

As a first step, a literature review of the relevant literature is performed and five potential factors related to the implementation of RBIA are identified. Based on that, this paper constructs a questionnaire survey sent out to 185 internal auditors, executives and accountants in Greece to receive 90 responses during the period of November 2019–January 2020. Multiple regression analysis is conducted to identify the factors related to the implementation of RBIA.

Findings

This paper shows that there is a statistically significant positive relationship between the implementation of RBIA and: the provision of risk management training, an active audit committee role and the establishment of a formalized risk management system.

Practical implications

The results have important implications for internal auditors, chief executive officers and accountants who wish to enhance internal audit effectiveness and the accuracy and quality of financial information.

Originality/value

Empirical studies on the factors related to the implementation of RBIA are rare. This is the first study to create empirical variables based on a thorough review of the relevant literature to empirically investigate the factors that are related to the implementation of RBIA in an emerging economy. By focusing on the Greek context, this study also sheds light to other countries with similar corporate governance systems, thus providing insights to settings where the Type II agency problem exists (La Porta et al., 1999).

Details

Corporate Governance: The International Journal of Business in Society, vol. 21 no. 4
Type: Research Article
ISSN: 1472-0701

Keywords

Content available
Article
Publication date: 18 January 2021

Gabriel Eweje, Alfonsina Iona, Maggie Foley and Michail Nerantzidis

Abstract

Details

Corporate Governance: The International Journal of Business in Society, vol. 21 no. 6
Type: Research Article
ISSN: 1472-0701

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Article
Publication date: 14 October 2020

Michail Nerantzidis, Michail Pazarskis, George Drogalas and Stergios Galanis

This study reviews post-2009 literature on public sector internal auditing (IA) and addresses three interrelated research questions (RQ): How is research on the public…

Abstract

Purpose

This study reviews post-2009 literature on public sector internal auditing (IA) and addresses three interrelated research questions (RQ): How is research on the public sector IA being developed? What are the focus and criticisms of the literature on public sector IA? What is the future of public sector IA research?

Design/methodology/approach

We adopt a systematic literature review approach and analyze 78 peer-reviewed journal articles published between 2010 and 2019. We evaluate five criteria to identify the development of public sector IA research (RQ1), namely level of government, academic discipline, number of countries, geographic areas and MSCI country classification. Similarly, we use four criteria to present the focus and criticisms of the literature (RQ2), namely, type of organizational respondent, research instrument, theories and research theme examined. Finally, we use two criteria to propose new directions for future research (RQ3), namely, the directions resulted from RQ1 and RQ2 and the directions highlighted by the 10 most cited studies in the IA literature (i.e. out of the 78 papers identified).

Findings

We find an increase of publications up to 2017, most of which are single country–focused, particularly on emerging markets. Moreover, we note that IA has been studied at all government levels, most often at the local government level. Although we identify multiple research themes examined in the literature, most studies emphasize “governance” and “operational effectiveness” using quantitative analysis, without reference to any theory. By analyzing these key features, we critically interpret the challenges as well as the skepticism that may surface by researchers. Finally, considering implications from this stream of research and analyzing the most influential studies, we recommend new avenues for investigation such as comparative studies among countries and different markets that provide further evidence on the international and regional levels and studies on the effect of cultural, institutional and demographical characteristics in IA.

Practical implications

Our results will help researchers, practitioners and consultants to identify the key issues related with IA.

Originality/value

This study is the first to provide a systematic literature review on public sector IA. Furthermore, it develops insights, critical reflections and avenues for future research in this field.

Details

Journal of Public Budgeting, Accounting & Financial Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1096-3367

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Article
Publication date: 23 September 2019

Ioannis Tampakoudis, Michail Nerantzidis, Demetres Subeniotis, Apostolos Soutsas and Nikolaos Kiosses

The purpose of this paper is to investigate the wealth implications of bank mergers and acquisitions (M&As) in the unique Greek setting given the triple crisis phenomenon…

Abstract

Purpose

The purpose of this paper is to investigate the wealth implications of bank mergers and acquisitions (M&As) in the unique Greek setting given the triple crisis phenomenon – banking, sovereign debt and economic crises – that prevailed after the global financial crisis.

Design/methodology/approach

The study examines bank M&As and bank transactions over the period from 1997 to 2018, as well as government-assisted M&As during the crisis. The wealth effects of bank M&As are assessed using both univariate and multivariate frameworks.

Findings

Findings show a neutral crisis effect on the valuation of M&As upon their announcement. However, the authors provide conclusive evidence that M&A completions are value-destroying events for acquiring banks during the crisis, far worse than in the pre-crisis period. Greek banks also fail to create value from government-assisted mergers. The results suggest that the financial stability and the prevention of further deepening of the Greek crisis with possible contagion effects were achieved at the expense of shareholders and taxpayers.

Originality/value

To the authors’ knowledge, this is the first study that examines the impact of the Greek triple crisis on the wealth effects of bank M&As and bank transactions. Also, the study provides first evidence with regard to the economic impact of government-assisted M&As in the European context.

Details

International Journal of Managerial Finance, vol. 16 no. 2
Type: Research Article
ISSN: 1743-9132

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Article
Publication date: 5 May 2015

Michail Nerantzidis

This paper provides evidence regarding the efficacy of the “comply or explain” approach in Greece and has three objectives: to improve our knowledge of the concept of this…

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Abstract

Purpose

This paper provides evidence regarding the efficacy of the “comply or explain” approach in Greece and has three objectives: to improve our knowledge of the concept of this accountability mechanism, to elevate auditors’ potential role in the control of corporate governance (CG) statements and to contribute to the discussion about the reform of this principle; a prolonged dialogue that has been started by European Commission in the light of the recent financial crisis.

Design/methodology/approach

The approach taken is a content analysis of CG statements and Web sites of a non-probability sample of 144 Greek listed companies on the Athens Stock Exchange for the year 2011. Particularly, 52 variables were evaluated from an audit compliance perspective using a coding scheme. From this procedure, the level of compliance with Hellenic Federation of Enterprises (SEV) code, as well as the content of the explanations provided for non-compliance, were rated.

Findings

The results show that although the degree of compliance is low (the average governance rating is 35.27 per cent), the evaluation of explanations of non-compliance is even lower (from the 64.73 per cent of the non-compliance, the 40.95 per cent provides no explanation at all).

Research limitations/implications

The research limitations are associated with the content analysis methodology, as well as the reliability of CG statements.

Practical implications

This study indicates that companies on the one hand tend to avoid the compliance with these recommendation practices, raising questions regarding the effectiveness of the SEV code; while on the other, they are not in line with the spirit of the CG code, as they do not provide adequate explanations. These results assist practitioners and/or policy-makers in perceiving the efficacy of the “comply or explain” approach.

Originality/value

While there is a great body of research that has looked into the compliance with best practices, this study is different because it is the first one that rates not only the degree of the compliance with the code’s practices but also the content of the explanations provided for non-compliance. This is particularly interesting because it adds to the body of research by providing a new approach in measuring the quality of the “comply or explain” principle in-depth.

Details

Managerial Auditing Journal, vol. 30 no. 4/5
Type: Research Article
ISSN: 0268-6902

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Article
Publication date: 14 September 2015

Michail Nerantzidis, John Filos, Anastasios Tsamis and Maria-Eleni Agoraki

The purpose of this paper is to examine the extent of Combined code (2010) impact in the Greek soft law (SEV code, 2011) and the adoption of an overlapping set (between…

Abstract

Purpose

The purpose of this paper is to examine the extent of Combined code (2010) impact in the Greek soft law (SEV code, 2011) and the adoption of an overlapping set (between the two codes) of best practice provisions in Greece.

Design/methodology/approach

Content analysis was conducted to examine the similarities between the UK’s Combined code (2010) and the Greek SEV code (2011). Moreover, a sample of 219 Greek listed companies’ annual reports was analyzed, and their compliance with a specific number of provisions was evaluated.

Findings

Through analyzing the content of both codes, it was found that from the total 64 provisions of the SEV code (2011), 45 were matched to at least one of the Combined codes (2010). From these 45 provisions, 26 were characterized as “in spirit” influence and 19 as “in letter”. Based on this evidence, 22 overlapping practices were selected to investigate the compliance and a quite low rate was revealed, an average percentage of 30.46 per cent. These findings indicate that while exogenous forces trigger the development and adoption of a code in Greece, in line with the UK’s, the endogenous forces tend to avoid the compliance with that “exogenous practices”. Moreover, the results support the idea that the Greek national code should be reshaped to fit the different country’s characteristics.

Research limitations/implications

The research limitations are associated with the content analysis methodology, as well as the reliability of corporate governance (CG)statements.

Originality/value

This study contributes to understanding in a more comprehensive manner the impact of Combined Code (2010) in Greek soft law. More specifically, based on a previous case study, this paper extends the seven analyzed factors of Koutoupis’ (2012) research to the total CG provisions of both codes. However, it goes further and develops a coding scheme to rate the level of compliance of the overlapping provisions.

Details

International Journal of Law and Management, vol. 57 no. 5
Type: Research Article
ISSN: 1754-243X

Keywords

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