Understanding Firm Value and Corporate Governance
نویسنده
چکیده
An impressive volume of careful empirical studies finds evidence that the strength of firms’ corporate governance tends to be positively correlated with their financial performance; that is, firms that score higher on some measure of governance tend to outperform those which score worse. These findings are a puzzle insofar as we expect those who decide how a firm is organized, including its corporate governance, to do so in a manner that maximizes firm value subject to the relevant constraints. If the governance we observe is constrained optimal, then why, in equilibrium, should any correlation— positive or negative—exist between it and firm performance? This paper offers an answer. In doing so, the paper also makes predictions about the correlation between firm size and strength of governance, provides new explanations for the correlation between firm size and executive compensation, and provides insights into why empirical estimates of managerial incentives are often deemed too low.
منابع مشابه
Investigating the Interactive Effect of Corporate Governance and Corporate Social Responsibility on the Firm Value in the Tehran Stock Exchange
The purpose of this study is to investigate the effect of corporate governance (CG), corporate social responsibility (CSR) and their interactive effect on the value of companies listed on the Tehran Stock Exchange. For this purpose, the data of 194 companies listed on this stock exchange, which was selected using a systematic elimination method, from 2011-2017 were collected and analyzed using ...
متن کاملFirm Size as a Moderator between Corporate Governance and Risk-Taking in Malaysian Banks
This study investigates the moderating effect of firm size in the relationship between corporate governance (board size, board independence and ownership concentration) and banks’ risk-taking (insolvency risk and credit risk). Secondary data (annual reports) was collected from a sample of 21 Malaysian commercial banks covering the 2005–2014 accounting period. An empirical model using pooled ord...
متن کاملA Blessing in Disguise: Corporate Governance, Firm Value, and Competition
We develop simple models in which corporate governance affects the financing and the production level of firms. In this paper, better corporate governance implies governance under which a smaller firm value can be expropriated by the manager, ceteris paribus. We assume that the potential expropriation can occur after production. In the single firm model, we investigate how corporate governance ...
متن کاملتاثیر راهبری شرکتی بر رابطه ی بین اجتناب از مالیات و ارزش شرکت
بر مبنای ادبیات موجود، دو دیدگاه دربارهی رابطهی بین اجتناب از مالیات و ارزش شرکت وجود دارد. دیدگاه اول، دیدگاه ارزشآفرینی است که معتقد است فعالان بازار سرمایه برای فعالیتهای اجتناب از مالیات ارزش قائلاند و آن را فعالیتی ارزشآفرین میدانند. دیدگاه دوم، دیدگاه تئوری نمایندگی است که معتقد است ماهیت غیرشفاف و پیچیدهی فعالیتهای اجتناب از مالیات به مدیریت اجازه میدهد تا با پنهان سازی اخبار ب...
متن کاملCash Holdings and Corporate Governance –
In this paper, we provide new and complementing international evidence on the relation between cash holdings, corporate governance, and firm value. Our sample consists of a crosssection of 1,875 firms from 46 countries in 2007. We construct eight different measures of firm-level corporate governance based on 64 individual governance attributes provided by Governance Metrics International (GMI)....
متن کامل