Indian Journal of Corporate Governance

This paper examines the relationship between corporate sustainability reporting and firms profitability of Indian and South Korean companies. For calculating the disclosure score of sustainability performance, content analysis technique is employed based on the reporting format of Global Reporting Initiatives. The study sample consists of 28 listed non-financial firms from India and 26 listed non-financial firms from South Korea over a period of 6 years (2010–2015). Using the disclosure scores, regression analysis is used to examine the association between sustainability reporting/performance and firm performance. The regression results indicate that, for South Korean firms, the association is positive and significant. However, in Indian context, the impact of sustainability performance is negative. Further, the relative impact of sustainability reporting is found to be significantly more in South Korea as compared with India.

The present empirical investigation is an addition to the existing extant literature available on the issue of initial public offering (IPO) which sees its inherent anomaly of underpricing by linking it to some of under-researched dimensions of corporate governance in the emerging economy of India. This study incorporates about 443 Indian IPO firms with their board composition and ownership retained by promoter group post IPO being primary variables of focus which are obtained from respective prospectuses of such firms. Like many previous studies, this study also keeps signalling theory as base, and findings show that only interlocking of directors among all the board variables has a significant and negative relation with underpricing. Significant relation of ownership concentration in hands of promoter group with underpricing shows that it is considered as a signal by investors assisting them in gauging safety of their minority interests. Findings show that too high insiders’ ownership alignment of interest between promoters and minority holders turn into risk of entrenchment by initial investors, that is, promoters as perceived by investors.

Disclosure through corporate annual reports is intended to enhance transparency and reduce information asymmetry during public issues. Ritter (1991) revealed that there is something fishy in the financial reports of the companies coming out with public issues. Earnings management has been recognised as a foremost contributor to such misleading financial reports. The short term overperformance of initial public offerings (IPO) of companies increases the expectations of potential investors and leads to a subsequent decline of performance in long run leaving the investors in distraught. The observed phenomenon is omnipresent and thus affects the investors across the globe. The present article empirically investigates the presence of earnings management in IPOs in India. The study is based on Modified Jones Model, the best known model to measure accruals earnings management. Preliminary results exhibit that earnings management in Indian IPOs is much higher than in developed countries. The study further discovers that the earnings performance of IPO companies is abnormally higher in IPO year as compared with post-offer period. Both the results taken together reinforce that post-issue earnings performance is a derivation of issue year earnings management in India.

This article seeks to examine challenges affecting the ethical philosophy of senior management at South Africa’s national oil and gas company. South Africa’s economy has been downgraded to junk status due to mismanagement of public funds in public enterprises. Government parastatals have come under major scrutiny in recent years for transgressing the code of good conduct prescribed by the King Report. The article presents a conceptual exploration of corporate governance challenges and is underpinned by diffusion of responsibility and moral hypocrisy which has roots in social psychology. Social psychology can be used as an overlap for strategy and institutional concepts, which encourages new ways of addressing corporate responsibility. The research reveals the impact on state enterprises financial stability when senior management diffuses responsibility and is not prosecuted or held accountable under the constitutional Act 108 of 1996. The article highlights one of the many corporate responsibility transgressions by state-owned enterprises who should be responsible for building the economy rather than destroying public value.

This article aims to investigate the impact of corporate governance through board size, female directors, family duality and director ownership on firm’s profitability in Bangladesh. It’s a quantitative study on 110 manufacturing firms listed in Dhaka Stock Exchange. Multivariate pooled Ordinary Least Square (OLS) regressions are applied on 512 sample-year observations from the year 2013 to 2017 to test the hypotheses in the study. On one side, the results reveal that larger board size and female directors on board are positively associated with firm’s profitability, which in turns helps to enhance firm’s profitability. On the other side, it is also found in the results that percentage of shares held by the directors and family duality are negatively related to firm’s profitability and thus reduces firm performance. The outcomes of this study advocate the policymakers to formulate a policy by addressing the percentage of shares held by the directors to be kept at a certain level.

Corporate Governance (CG) refers to a system in which corporations are directed and controlled. The governance structure specifies the distribution of rights and responsibilities among different participants in the corporation and specifies the rules and procedures for making decisions in corporates. Governance provides the structure through which corporations set and pursue their objectives, while reflecting the context of the social, regulatory and market environment. Governance is a mechanism for monitoring the actions, policies and decisions of corporations. Governance involves the alignment of interests among the stakeholders. CG is an umbrella term. In its narrower sense, it describes the formal system of accountability of corporate directors to the owners of companies. In its broader sense, the concept includes the entire network of formal and informal relationships involving the corporate sector and the consequences of these relationships on society in general. The center objective of the paper is to create linkages between firm performance and governance practice in the listed SOEs in India. The present paper makes an attempt to compare the various CG variables of the listed SOEs for a period of five years ie 2012-13 to 2016-17. A detailed analysis of the 42 listed State Owned Enterprises (SOEs) in terms of board size, board meetings, board committees, board composition, independent directors, firm age, gender diversity has been compared. Finally conclusions are drawn from empirical analysis.