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Article
Publication date: 6 June 2016

Mohamed H. Elmagrhi, Collins G. Ntim and Yan Wang

The purpose of this study is to investigate the level of compliance with, and disclosure of, good corporate governance (CG) practices among UK publicly listed firms and…

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Abstract

Purpose

The purpose of this study is to investigate the level of compliance with, and disclosure of, good corporate governance (CG) practices among UK publicly listed firms and consequently ascertain whether board characteristics and ownership structure variables can explain observable differences in the extent of voluntary CG compliance and disclosure practices.

Design/methodology/approach

This study uses one of the largest data sets to-date on compliance and disclosure of CG practices from 2008 to 2013 containing 120 CG provisions drawn from the 2010 UK Combined Code relating to 100 UK listed firms to conduct multiple regression analyses of the determinants of voluntary CG disclosures. A number of additional estimations, including two stage least squares, fixed-effects and lagged structures, are conducted to address the potential endogeneity issue and test the robustness of the findings.

Findings

The results suggest that there is a substantial variation in the levels of compliance with, and disclosure of, good CG practices among the sampled UK firms. The authors also find that firms with larger board size, more independent outside directors and greater director diversity tend to disclose more CG information voluntarily, whereas the level of voluntary CG compliance and disclosure is insignificantly related to the existence of a separate CG committee and institutional ownership. Additionally, the results indicate that block ownership and managerial ownership negatively affect voluntary CG compliance and disclosure practices. The findings are fairly robust across a number of econometric models that sufficiently address various endogeneity problems and alternative CG indices. Overall, the findings are generally consistent with the predictions of neo-institutional theory.

Originality/value

This study extends, as well as contributes to, the extant CG literature by offering new evidence on compliance with, and disclosure of, good CG recommendations contained in the 2010 UK Combined Code following the 2007/2008 global financial crisis. This study also advances the existing literature by offering new insights from a neo-institutional theoretical perspective of the impact of board and ownership mechanisms on voluntary CG compliance and disclosure practices.

Details

Corporate Governance, vol. 16 no. 3
Type: Research Article
ISSN: 1472-0701

Keywords

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 the two…

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

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: 11 June 2018

Michael Price, Charles Harvey, Mairi Maclean and David Campbell

The purpose of this paper is to answer two main research questions. First, the authors ask the degree to which the UK corporate governance code has changed in response to both…

3804

Abstract

Purpose

The purpose of this paper is to answer two main research questions. First, the authors ask the degree to which the UK corporate governance code has changed in response to both systemic perturbations and the subsequent enquiries established to recommend solutions to perceived shortcomings. Second, the authors ask how the solutions proposed in these landmark governance texts might be explained.

Design/methodology/approach

The authors take a critical discourse approach to develop and apply a discourse model of corporate governance reform. The authors draw together data on popular, corporate-political and technocratic discourses on corporate governance in the UK and analyse these data using content analysis and the historical discourse approach.

Findings

The UK corporate governance code has changed little despite periodic crises and the enquiries set up to investigate and make recommendation. Institutional stasis, the authors find, is the product of discourse capture and control by elite corporate actors aided by political allies who inhabit the same elite habitus. Review group members draw intertextually on prior technocratic discourse to create new canonical texts that bear the hallmarks of their predecessors. Light touch regulation by corporate insiders thus remains the UK approach.

Originality/value

This is one of the first applications of critical discourse analysis in the accounting literature and the first to have conducted a discursive analysis of corporate governance reports in the UK. The authors present an original model of discourse transitions to explain how systemic challenges are dissipated.

Details

Accounting, Auditing & Accountability Journal, vol. 31 no. 5
Type: Research Article
ISSN: 0951-3574

Keywords

Article
Publication date: 12 March 2018

Samza Fatima, Tom Mortimer and Muhammad Bilal

This paper aims to analyse a current theme of international interest regarding the increasing role of institutional investors in corporate governance. The role of institutional…

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Abstract

Purpose

This paper aims to analyse a current theme of international interest regarding the increasing role of institutional investors in corporate governance. The role of institutional investors is getting elevated in world’s corporate market day by day due to their large shareholdings and having expertise in investment matters. However, their role and importance has not yet been accepted and explored in Pakistan. Therefore, this paper fills this gap and explores their role in Pakistan’s corporate governance by using a comparative study as to the role of institutional investors in the UK’s corporate governance. This paper identifies the failures of corporate governance in Pakistan and explores how institutional investors can help to overcome these issues.

Design/methodology/approach

This research paper uses a comparative approach based on documentary analysis. It conducts a comparative study of the role of institutional investors and the related code of corporate governance in Pakistan with that of the UK. It analyses the existing studies and the data relating to the role of institutional investors in Pakistan’s corporate governance and formulate recommendations to enhance the role of institutional investors for the betterment of corporate governance practices in Pakistan.

Findings

This paper finds that the role of institutional investors in Pakistan’s corporate governance is under-developed and the fund industry is immature. Though there is a considerable scope for them to work in Pakistan’s business market and play their role in the development of corporate governance in the listed companies of Pakistan. For this purpose, the guidance can be taken form the “Combined Code of the UK”. A number of recommendations have been formulated through which the role of institutional investors can be enhanced for the development of corporate governance practices in the business market of Pakistan.

Originality/value

This paper analyses the role of institutional investors in Pakistan to formulate recommendations through which this role may be enhanced for the development of corporate governance principles and practices in Pakistan. This paper fills a gap in the existing literature relating to the role of institutional investors in Pakistan, as there is a dearth of research in Pakistan concerning this issue. Further, it contributes to the on-going debate on the increasing role of institutional investors in corporate governance more widely.

Details

International Journal of Law and Management, vol. 60 no. 2
Type: Research Article
ISSN: 1754-243X

Keywords

Article
Publication date: 12 March 2018

Mubashir Hassan Qurashi

The purpose of this study is to compare the corporate governance (CG) codes of Pakistan, India and Bangladesh with the CG guide of United Nations (UN) and to identify the similar…

Abstract

Purpose

The purpose of this study is to compare the corporate governance (CG) codes of Pakistan, India and Bangladesh with the CG guide of United Nations (UN) and to identify the similar points of these codes with the requirements of Combined Code (CC) that are not included in the CG guide of UN.

Design/methodology/approach

This study is based on the qualitative data, while content analysis is used for the analysis. For this exploratory research, different documents have been reviewed and consulted and qualitative data are collected from those. A multiple case study approach is adopted because the codes of three countries (four CG codes used for the analysis) have been reviewed.

Findings

This study has presented that the Pakistani and Bangladeshi (issued by Bangladesh Enterprise Institute) CG code has approximately 77 per cent convergence (40 out of 52), Indian CG code has 50 per cent convergence (26 out of 52), whereas the Bangladeshi (issued by Bangladesh Security and Exchange Commission) CG code has approximately 41 per cent convergence (21 out of 52) to CG guide of UN. Seven similar points to CC have been found out in all four or few of the codes that were used in this study.

Originality/value

This study has explored the convergence of CG codes of Pakistan, Bangladesh and India with the CG guide of UN. Furthermore, this study has highlighting the similar mechanisms presented in CC and the codes of selected countries so international investors get clear information about the quality of these codes and take informed investment decision.

Details

International Journal of Law and Management, vol. 60 no. 2
Type: Research Article
ISSN: 1754-243X

Keywords

Article
Publication date: 10 May 2011

Arad Reisberg

The Stewardship Code, the first of its kind for the Financial Reporting Council, seeks to encourage better dialogue between shareholders and company boards. Given the UK market's…

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Abstract

Purpose

The Stewardship Code, the first of its kind for the Financial Reporting Council, seeks to encourage better dialogue between shareholders and company boards. Given the UK market's role as a governance paragon, the code principles will be critical to practices of good stewardship taking root globally. But this new Code raises concerns, for example, as to how to treat non‐UK investors who collectively now hold upwards of 40 percent of the country's equity market. Would they voluntarily adhere to the code, and, if not, how relevant or effective would the code be? The purpose of this paper is to shed light on these topical questions.

Design/methodology/approach

The paper focuses on stewardship as an important criterion for assessing the performance of larger shareholders (i.e. institutional shareholders). Section 2 explains the concept of “stewardship”. It also outlines its growing importance. Section 3 introduces the Stewardship Code, tracks back its genesis, focusing, in particular, on the underlying themes and the major principles and guidance in the Code. Section 5 then critically assess the Code, looking in particular at major possible obstacles. Finally, implications from the preceding discussion are drawn in Section 6.

Findings

Section 4 reveals a hidden truth (the “stewardship spectrum”), i.e. in practice, companies operate in an ever‐changing business world, a more rapidly changing business practice with more pressures and complexity and with more diverse “players” and conflicting interests at play. It is submitted that this hidden truth effectively poses a challenge to the success of the Code.

Originality/value

This paper is geared towards providing the reader with critical tools to assess the likely impact of the Code.

Details

Journal of Financial Crime, vol. 18 no. 2
Type: Research Article
ISSN: 1359-0790

Keywords

Article
Publication date: 23 October 2007

Morrison Handley‐Schachler, Linda Juleff and Colin Paton

The purpose of this paper is to overview the goals of corporate governance in the financial services sector from a theoretical perspective. This sector has experienced some high

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Abstract

Purpose

The purpose of this paper is to overview the goals of corporate governance in the financial services sector from a theoretical perspective. This sector has experienced some high profile corporate scandals, including BCCI, Barings Bank, and Equitable Life. Yet the UK's Combined Code on Corporate Governance does not give any special prominence to the corporate governance issues involved in this important and idiosyncratic business area.

Design/methodology/approach

First, the broad parameters of corporate governance are discussed, from a theoretical perspective. From this particular characteristics are derived applicable to the financial services sector. These issues are examined and the extent to which they have been addressed by contemporary academic or policy‐related studies is considered, and also how they are related to the activities of the main bodies responsible for external oversight.

Findings

The main attention of this paper is banks and a key issue arising is that the typical structure of their balance‐sheets – high leverage, and a mismatch in their assets and liabilities, mean that it is imperative that they keep lenders' confidence, and imply a wider duty of care for bank directors. External regulators (FSA) and auditors have vital oversight functions, which should encourage sound governance practices. One avenue of future research would be to assess the effectiveness of compliance in the UK, given that financial companies have obligations concerning both FSA requirements and Combined Code provisions.

Originality/value

Some key issues pertaining to corporate governance in financial services are addressed, highlighting their significance, to encourage further investigation by academics and practitioners in the field.

Details

Corporate Governance: The international journal of business in society, vol. 7 no. 5
Type: Research Article
ISSN: 1472-0701

Keywords

Article
Publication date: 17 July 2007

Michael Jeffrey

This paper introduces the reader to the London Stock Exchange's Alternative Investment Market (AIM) and seeks to identify those companies listed that would be in the broad apparel…

853

Abstract

Purpose

This paper introduces the reader to the London Stock Exchange's Alternative Investment Market (AIM) and seeks to identify those companies listed that would be in the broad apparel sector.

Design/methodology/approach

The paper gives a numerical value of the stability/success of those companies by using the QuiScore rating system and capital gearing.

Findings

The paper considers the progress made by the companies in this sector on corporate governance looking at the extent of their moves towards the provisions of the combined code.

Originality/value

The paper sets out areas for further research in this field to extend this study and broaden the knowledge on secondary market development.

Details

Journal of Fashion Marketing and Management: An International Journal, vol. 11 no. 3
Type: Research Article
ISSN: 1361-2026

Keywords

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