Models of Corporate Governance Applied to Businesses in the Iberian Peninsula Stock Markets

This paper proposes to analyse models of corporate governance applied to businesses listed in the stock markets of the Iberian Peninsula, namely the ones of Lisbon and Madrid. The corporate governance subject is becoming increasingly important for businesses as it is difficult to manage the interests of every economic agents related to an organization. The corporate governance is characterized by a system in which organizations are managed and controlled with the objective to promote efficiency and competitiveness of businesses. This study is intended to examine the following issue: what are the determinants that may influence the choice of corporate governance models adopted by listed businesses within the Iberian Peninsula? To establish the determinants of the choice of model were selected nine variables that have differentiating characteristic between the models of corporate governance used by corporations in Portugal and Spain. Testing nine possible determinants, the sample employed consists of several businesses listed on the Iberian stock indexes PSI-20 and IBEX-35, over the years 2009 to 2011. The data was obtained through analysis of single annual and consolidated accounts from annual reports, including corporate governance reports. The statistical analysis was carried using the logistic regression model. The variables found to significantly influence the choice of corporate governance model in our study were: the sector of activity and firm size, contributing therefore to the justification of the choice of models of corporate governance adopted by Iberian businesses. Key-Words: Corporate governance models, PSI-20, IBEX-35, Portugal, Spain, logistic regression model. Acknowledgement: This work is funded by FEDER funds through the Operational Programme for Competitiveness Factors COMPETE and by National Funds through FCT Foundation for Science and Technology under the project with the reference PEst-C/CJP/UI4058/2011 WSEAS TRANSACTIONS on BUSINESS and ECONOMICS Ana Sardinha, Humberto Ribeiro, Raquel Alves E-ISSN: 2224-2899 801 Volume 11, 2014