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Corporate Governance in Brazil
Abstract
Corporate governance is an issue of growing importance in developing economies, as many firms pass through significant transformations due to the combined forces of sociopolitical changes, technological progress and economic trends toward globalization. These elements, along with the structural characteristics of developing economies such as less developed capital markets and governmental interventionism, draw a picture for corporate governance practices that may, in some aspects, be fundamentally different from the practices found in European or North American contexts. In this paper we review and discuss the state of corporate governance practices in Brazil, focusing on how the governance structure of Brazilian firms has been subjected to important changes in the recent past and how even more changes are expected to happen.
... Listed companies in BRICS have a concentrated ownership structure controlled by the family or state. The ownership structure in Brazil is highly concentrated and consists of family-owned business groups, state-owned entities, and affiliates (Rabelo and Vasconcelos 2002). In Russia, state-owned entities control pyramid corporate ownership structures by controlling golden shares, 4 issuing non-voting shares, and maintaining the single ownership of multiple companies (Abramov et al. 2017). ...
... After state-owned enterprises, family-controlled companies, affiliates, and pyramid ownership structures are prevalent in Brazil. In Brazil, 6 half of the companies have ultimate family owners who use pyramids in their ownership structures (Rabelo and Vasconcelos 2002). Brazil's capital market has undergone considerable development in the past two decades; however, the number of companies without a single controlling shareholder has grown only marginally (Crisóstomo et al. 2020). ...
Abusive transactions with related parties are more common in a concentrated ownership structure. Previous studies have debated that the fallout of concentrated corporate ownership (i.e. sizable corporate conglomerates and corporate enterprises owned by business families or the government of the state) is high in a relatively close market. Despite the adoption of the Anglo–US model in BRICS (Brazil, Russia, India, China, and South Africa) for improving transparency, accountability, and fairness, the rate of corporate failure involving abusive related party transactions has been high. This study examines differences in related party transactions (RPT) regulatory strategies among BRICS with respect to international standards (Anglo–US model) and local conditions. The study analyses to what extent BRICS nations have adopted the Anglo–US model by comparing the RPT regulatory framework with the convergence towards the Anglo–US model, divergence from the Anglo–US model, and unfolding of a new construct in BRICS. Overall, the study finds Brazilian and Russian RPT legislation the least convergent towards the Anglo–US model and RPT legislation in India, China, and South Africa fully convergent towards the Anglo–US model. BRICS have shown persistence or resistance towards the Anglo–US RPT legal transplantation. In certain aspects, BRICS have made a concerted effort to regulate abusive RPTs suitable to their local conditions. However, RPT legislation in BRICS nations has failed to address some major governance problems caused by concentrated ownership structures (monitoring of RPTs in pyramidal companies, same RPT thresholds for group and non-group companies, dominance of controlling shareholders on independent directors’ appraisal of RPTs, and the lack of adequate disclosure requirements for RPTs).
... Brazilian context Brazilian corporate governance system is similar to that of Continental European countries. This system differs significantly from Anglo Saxon countries (USA and United Kingdom) as it is characterized by highly concentrated ownership structures and weaker legal protection of creditors and minority shareholders (Aldrighi and Mazzer Neto, 2007;Silveira, 2015;Cris ostomo and de Freitas Brandão, 2019;Rabelo and Vasconcelos, 2002). Analogous to the rest of civil-law-based nations, in Brazil, lower investor protection has led to the predominance of companies owned by controlling blockholders (Cris ostomo and de Freitas Brandã, 2019). ...
... Controlling groups are represented by the state, local family-owned business groups and affiliates of multinational corporations (Rabelo and Vasconcelos, 2002;Silveira, 2015). FBs, the most common form of organization in the country, also have a strong presence in business groups. ...
Purpose
This paper aims to analyze the contribution of the external director to the governance of family businesses (FBs) in different generations. The authors aim to support the literature regarding the heterogeneity of these companies, showing that the generation of the primary decision-maker is an essential factor that differentiates the FBs from each other. These differences have numerous impacts in governance structures as boards' role and composition.
Design/methodology/approach
The authors hypothesized that the main contribution of external directors to FB controlled by family members of the first generation is to provide resources to the company's survival. As it evolves and the later generations begin to participate as owners and managers, dealing with specific agency problems associated with this type of organization becomes essential. Four activities found in literature were tested: control of parental altruism and intrafamily divergences and provision of resources and external relations. Quantile regression (QR) was applied based on the dependent variables' characteristics, which show a strongly asymmetric distribution for all the models proposed.
Findings
The QR techniques and ordinary least squares (OLS) showed statistically significant results for the agency's activities when comparing the first and the second generations. The contribution of the external director in this context is to overcome the challenges associated with the beginning of sharing ownership and management. The resource provision and the establishment of the relations proved to be more critical in third-generation FBs. At this stage, the directors provide the needed resources for these companies' survival in an increasingly dynamic and complex environment.
Research limitations/implications
Among this work's limitations, the authors highlight the lack of a variable that captures the life cycle in which the company is. They believe that the inclusion of this control factor would bring more robust results to the analysis. Besides, they point to the condensation of the countless activities performed by external directors to just four. This generalization fails to capture the other duties and contributions of this director in the family organizational environment.
Practical implications
This study aims to provide guidelines so that external directors of FBs understand more clearly the needs of the companies in which they operate, whether from the first, second or third generation onward. The contribution of this director may be different for each type of organization. By understanding the weaknesses and concerns inherent to each generational stage, the external director can focus his efforts on adopting actions that effectively contribute to organizational performance.
Originality/value
In Brazil, most studies focus on the effects of board's composition and structure on financial results. In these papers, the data is usually secondary, found on companies' websites. The authors step further in this paper by analyzing primary data from privately held companies, which in Brazil is challenging to access. So, they believe they are surpassing the analysis traditionally found in the literature on the composition of boards of directors in terms of scope and methodology.
... O sistema jurídico seguido pelo Brasil é o de civil law, o que levanta questões sobre a proteção dos acionistas no país, bem como a concentração do capital social das empresas no mercado. Seguindo a literatura, a estrutura de propriedade brasileira é considerada como altamente concentrada, com importantes desajustes entre acionistas majoritários e minoritários (VALADARES; LEAL, 2000;RABELO;VASCONCELOS, 2002;LAZARINNI, 2011;MATOS, 2017). A partir disso, entende-se neste trabalho que a aplicação de direitos de voto diferenciais, bem como a possibilidade de formação de pirâmides, sejam importantes instrumentos para desassociar a propriedade do controle no Brasil. ...
... O sistema jurídico seguido pelo Brasil é o de civil law, o que levanta questões sobre a proteção dos acionistas no país, bem como a concentração do capital social das empresas no mercado. Seguindo a literatura, a estrutura de propriedade brasileira é considerada como altamente concentrada, com importantes desajustes entre acionistas majoritários e minoritários (VALADARES; LEAL, 2000;RABELO;VASCONCELOS, 2002;LAZARINNI, 2011;MATOS, 2017). A partir disso, entende-se neste trabalho que a aplicação de direitos de voto diferenciais, bem como a possibilidade de formação de pirâmides, sejam importantes instrumentos para desassociar a propriedade do controle no Brasil. ...
A teoria da complexidade, aliada à aplicação do estudo de redes, tem sintonia com a teoria econômica da Escola Austríaca,formando os três grandes pilares desta análise. Utilizando estes conceitos, procura-se entender a estrutura de capital de duas formas: pela ótica da produção e do sistema financeiro, tendo como inspiração a divisão do conhecimento desenvolvida por Hayek e a do capital por Lachmann. Para avançar nessa discussão, o trabalho é dividido em três partes. A pesquisa apresenta, primeiramente, questões teóricas relacionadas à teoria da complexidade e à estrutura do capital austríaca. Na parte aplicada desse trabalho, buscou-se retratar duas facetas da estrutura do capital, tendo-se consciência de que não são as únicas formas de representação. A primeira é a estrutura produtiva, retratada por meio das relações entre as atividades produtivas a partir da ideia de conhecimento compartilhado, mediante o uso da classificação de ocupações. Encontrou-se que na economia brasileira as atividades mais centrais têm predominância de ocupações de baixa sofisticação, enquanto as mais sofisticadas estão na periferia, dificultando o fluxo de conhecimento. Além disso quando apenas as ocupações sofisticadas são consideradas, os caminhos na rede são mais longos, indicando que as conexões com maior conhecimento são mais esparsas. A segunda contribuição aplicada, procurou tratar a estrutura financeira, compreendida por intermédio dos vínculos de propriedade, formando padrões complexos. A estrutura dessas relações reflete o controle financeiro e os big players. No Brasil, a estrutura financeira é altamente concentrada, organizada em pirâmides, em que instituições relacionadas ao governo e do setor do setor financeiro são as detentoras do controle efetivo.
... The property relationships between firms represent an opportunity to examine how the structure of the entire economical system affects each company. 15 The literature emphasizes the separation between ownership and control. The owners with cash-flow rights (shareholders) have the right to receive dividends. ...
... 40 Despite being the eighth economy in the world, Brazil is only seventeenth in the worldwide market capitalization, in the stock exchange rank of the Brazilian Securities, Commodities and Futures Exchange (BM&FBOVESPA). It is well known that Brazilian ownership structure is concentrated, with important conflicts between majority and minority shareholders (see [15], [16], [17], [18], and 45 [19]). As a consequence, different agency problems might appear. ...
The aim of this work is to detect how the Brazilian financial ownership is distributed and who are the owners of control. By using ownership relations between the firms listed in the Brazilian stock market, ownership and control networks are constructed. Indirect ownership and control are also obtained. Suitable centrality measures and the assortativity coefficient allow to assess the structure of the connections between nodes, by discovering the hidden patterns of control in the Brazilian market.
... ε is term an error term that is examined as firm-specific effects on the firm performance. Rabelo and Vasconcelos, (2002) describes the position of corporate governance in Brazil. ...
The research reviews a large corpus of literature on BRIC countries to investigate the relationship between corporate governance and business performance. The study's main goal is to compare corporate governance practices implemented by BRIC enterprises. The study addressed the issues that BRIC nations encountered while implementing corporate governance practices, as well as the causes for such challenges. According to the literature, company law, financial stability, competitiveness, business culture, and financial development are reasons for inconsistency in BRIC corporate governance practices. The underlying relationship between corporate governance and firm performance was found inconsistent as a result of continued development in corporate governance practices in BRIC nations which is endorsed from industrialized nations in order to attract external finance and to decrease the cost of capital.
... While these studies are germane, their outcomes may not apply to Africa. For instance, Rabelo and Vasconcelos (2002) argue that corporate governance practices used in developed countries are not directly applicable in developing economies because of political, economic, technological and cultural differences. This implies creating corporate governance models considering each developing country's conditions that are not directly borrowed from developed countries. ...
Purpose
Corporate governance and its training in universities have become an essential addition to the educational curriculum. Despite its expansion, students still need help to grasp some concepts, affecting their academic performance. This paper examines the expected influence of gender and school libraries on comprehending corporate governance concepts in Ghanaian universities.
Design/methodology/approach
With the culturo-techno-contextual approach (CTCA) as the underlying theory, the study sampled 1050 undergraduate students from the selected Ghanaian public universities. The study adopted a quantitative approach, and the data were analysed using descriptive statistics and ANOVA.
Findings
The results show a statistically significant difference between male and female Ghanaian students in their understanding of corporate governance concepts, with the mean figures suggesting that males slightly understand corporate governance concepts more than females. The results also show a statistically significant difference among Ghanaian students studying using school libraries of varying quality in their understanding of corporate governance.
Originality/value
This study's novelty stems from examining the corporate governance curriculum in a developing country from the perspectives of gender and school library. Adopting the CTCA components in analysing school libraries and gender further evidences the study's novelty.
... Notably, it is challenging for African countries to maintain good corporate governance due to lack of effective regulatory frameworks, institutional frameworks, transparency, and market discipline (Rossouw, 2005). Hence, while firms in developed countries have good corporate governance (Kuchta-Helbling & Sullivan, 2002), firms in developing countries have poor corporate governance (Rabelo & Vasconcelos, 2002). ...
While the resource-based theory argued that financial slack derives firm performance, agency
theory asserted that it harms firm performance. Moreover, the pecking order and corporate finance
theories argued that the well-functioning financial system eliminate the agency problems and
asymmetric information; and could shape the corporate governance of firms, thereby facilitate the
proper use of firms' internal finance. But existing literature completely overlooked this issue. This
study thus investigated the interaction effects of the banking sector and the stock market
development on slack performance nexus by using African sample firms. The result confirmed that
financial development eliminates the adverse effects of high available slack on firm performance
but create an undesirable impact of low available slack on firm performance. Conversely, financial
development weakens the favorable effect of high potential slack on firm performance but aggravate
the adverse effects of low potential slack on firm performance.
... This was one of the findings in a study about corporate governance practices in developing countries the case for Kenya. The conclusion was arrived based political, economic, technological and cultural differences (Rabelo & Vasconcelos, 2002). Furthermore, Kimosop (2011) recommends in the study of relationship between corporate governance and financial performance of 41 licensed Insurance companies in Kenya that the regulator should draw minimal requirements for corporate governance in the insurance industry to serve as guideline for the insurance firms; this will improve the financial performance of these firms. ...
... Economic, political and cultural differences exist between developed and developing countries (Bokpin and Ishaq, 2009;Adegbite, 2010;Baydoun et al., 2013). Rabelo and Vasconcelos (2002) argue that factors such as economic trends toward globalisation and structural characteristics of developing countries (under-developed capital markets and government interventionism) will make the CG model different from that found in European or North American contexts. The lack of skilled human resources suggests that companies in developing economies may experience difficulties attracting those with accounting or finance backgrounds to their audit and other governance committees. ...
The role that corporate governance (CG) plays in contributing to firm performance enhancements has been widely acknowledged. However, the conduit through which CG is able to affect firm performance is an emergent theme. This paper re-examines the relationship between corporate governance (CG) and firm performance via means of causal mediation analysis using financial reporting quality (FRQ) as a mediator. The study samples 104 companies listed on the respective stock markets of nine sub-Saharan African countries, and collects annual reports data spanning over a period of 2007 to 2019 for analysis using causal mediation. The study finds that a causal relationship exists between CG and firm performance, albeit through the transmission mechanism of FRQ. Again, the study finds that CG positively affects firm performance both directly and indirectly through the mediation of FRQ. The study is useful in highlighting for mangers and CG practitioners attention, an important channel through which CG would favourably affect firm performance, being FRQ. The current study is unique, in that it is the first panel multi-cross-country investigation within Africa to introduce FRQ in the study of the relationship between CG and firm performance. It therefore extends the agency theory by employing FRQ as a mediating variable in the CG—firm performance nexus within the African context.
... Economic, political and cultural differences exist between developed and developing countries (Bokpin and Ishaq, 2009;McGee, 2009;Adegbite 2010;Baydoun et al. 2012). Rabelo and Vasconcelos (2002) argue that factors such as economic trends toward globalisation and structural characteristics of developing countries (under-developed capital markets and government interventionism) will make the CG model different from that found in European or North American contexts. The lack of skilled human resources suggests that companies in developing economies may experience difficulties attracting those with accounting or finance backgrounds to their audit and other governance committees. ...
This paper investigates the level of corporate governance quality (CGQ) of firms in sub-Saharan Africa and the factors that determine this CGQ as a build-up of the study of Waweru (Waweru, Managerial Auditing Journal 29:455–485, 2014). The study’s sample comprises 104 companies listed on the respective stock markets of nine sub-Saharan African countries. The data are collected from annual reports from 2007 to 2019, a total of 1108 firm-year observations. Both static and dynamic panel data models are used in the analyses. The study established that the CGQ of firms in Sub-Saharan African capital markets is weak thus disputing the findings of Waweru (Waweru, Managerial Auditing Journal 29:455–485, 2014). The study also concludes that IFRS adoption, asset tangibility, ownership concentration, audit quality, firm size and national regulatory quality are the most consistent predictors of CGQ of firms in sub-Saharan Africa. The other determinants of CGQ include listing tenure, business operating tenure, leverage, firm growth opportunities and macroeconomic misery index. The novelty of this study stems from its consideration of a larger cross-country panel dataset from sub-Saharan Africa to extend the work of Waweru (Waweru, Managerial Auditing Journal 29:455–485, 2014). Again, the study’s introduction of the economic misery index and regulatory quality variables as determinants of CGQ extends the agency theory by demonstrating how macroeconomic factors and the quality of the national regulatory environment can influence governance at the firm level.
... The situation is more prevalent in developing countries where large concentration of ownership is more evident while the stock markets are weak. In those countries there is a higher degree of economic uncertainties coupled with weak legal controls and investor protection, and frequent government intervention; all resulting in poor performance (Rabelo and Vasconcelos, 2002). Based on the above discussion, the first research hypothesis is as follows: ...
It investigates the Effects of Corporate Governance on Bank Financial Performance
... In addition to these studies that focus on the structured CG principles compliance reports, there are other studies related to the CG principles in the literature. For example, Shleifer and Vishny (1997), La Porta et al. (1999), Sarkar and Sarkar (2000), Claessens and Fan (2002), Rabelo and Vasconcelos (2002), Demira g and Serter (2003) investigate the relationship between the CG principles and ownership structure. Besides, Chatjuthamard et al. (2022) uncover the relationship between the CG principles and chief executive officer (CEO) power that is a significant issue in terms of the BoD size and structure. ...
Purpose
This paper aims to determine priority issues in the corporate governance (CG) principles to increase CG rating notes of publicly traded companies.
Design/methodology/approach
This study defines the priority issues for publicly traded companies that should be focused to increase the CG rating notes. In this context, this study considers the companies in Borsa Istanbul CG index (XKURY), use data for 2018, 2019, 2020, and applies machine learning algorithms.
Findings
Overall, importance of each CG principle changes for the CG rating notes; first five CG principles in terms of significance have a total of 43.6% importance for the CG rating notes; following a straight-line approach in completing deficiencies of the CG principles cannot help increase the CG rating notes. Hence, empirical results highlight the impact of the most significant CG principles in terms of the CG rating notes that should be focused on by publicly traded companies so that CG ratings can be increased.
Research limitations/implications
This study uses Turkey data and considers publicly traded companies in the XKURY index. The main cause of this condition is that consolidated data of compliance report format for all publicly traded companies cannot be obtained.
Practical implications
The publicly traded companies can increase the CG rating notes by considering the results of this study while focusing on priority issues in the CG principles.
Social implications
The study determines the most important CG principles that companies can focus on, highlights the importance of usage of machine learning algorithms in determining the most influential CG principles in terms of the CG rating notes and reflects on the difficulties for gathering consolidated CG principles compliance reporting data for all publicly traded companies. Hence, societies can have better companies that are ruled more efficiently and corporately by increasing their compliance with the CG principles.
Originality/value
To the best of the authors’ knowledge, this is the first empirical study that determines the priority issues to increase the CG rating notes of publicly traded companies based on the new CG principles compliance reporting scheme in Turkey. Following this aim, machine learning algorithms, which can present better results with regard to most of the econometric models, are used in this study.
... However, Claessens and Fan (2002) observe that after the Asian Financial Crisis in the late nineties, several Asian governments have been introducing an Anglo-American model of corporate governance because the government found that due to the family dominated ownership pattern capital has been being misallocated and the signaling effect of stock prices and other market forces were not functioning. On the other hand, Rabelo and Vasconcelos (2002) observe that due to the unique political and economic situation in the developing countries it becomes difficult for them to imitate a western model of corporate governance. ...
... However, Claessens and Fan (2002) observe that after the Asian Financial Crisis in the late nineties, several Asian governments have been introducing an Anglo-American model of corporate governance because the government found that due to the family dominated ownership pattern capital has been being misallocated and the signaling effect of stock prices and other market forces were not functioning. On the other hand, Rabelo and Vasconcelos (2002) observe that due to the unique political and economic situation in the developing countries it becomes difficult for them to imitate a western model of corporate governance. ...
This study seeks to examine the performance of the current code of corporate governance in Bangladesh after eight years of its promulgation in 2006 and also examines the scope for a mandatory model of corporate governance instead of the current one since the existing literature suggests the underperformance of the current code. The study uses a likert scale questionnaire method providing scope for respondents' personal observations. It covers a wide range of stakeholders such as managers, directors, regulators, auditors, legal professionals and small investors so that the true reflection on the performance of the code could be found. The study finds that there is a general consensus among the respondents that the current voluntary code of Bangladesh is not fulfilling the desired expectation regarding investor protection, disclosure and auditor independence. The study also finds that the judiciary of Bangladesh lacks capability to provide protection to the investors in cases of shareholder abuse. The respondents have agreed that a mandatory model of corporate governance would provide better transparency and protection. This paper adds to the existing literature by broadening the scope for further research on the performance of the corporate governance code and related issues in Bangladesh and countries with similar perspective.
... political, economic and technological factors(Mensah 2002;Rabelo &Vasconcelos, 2002;. Therefore, this section will review previous studies that have been conducted regarding CG in developing countries in general and those in the countries of the Middle East and North Africa (MENA) in particular, in order to provide a deeper understanding and a comprehensive presentation of CG in these countries. ...
The thesis critically evaluates the corporate governance (CG) phenomenon in Libya
as a case study, specifically in the Libyan banking sector (LBS), in order to
investigate whether is it implemented or not. To achieve the research objectives, four
sub-questions are studied under the main question, including which factors influence
the actual implementation of CG and the level of compliance of Libyan Commercial
Banks (LCBs) with the Libyan Corporate Governance Code (CGC) 2010 for banks,
together with an investigation of factors that may hinder LCBs’ efforts to adopt
effective CG practices and an exploration of the strategies of the Central Bank of
Libya (CBL) to overcome these issues. The research involved a qualitative approach
through intensive fieldwork with in-depth interviews and documentation reviews in
order to collect the required data, within the framework of agency, stakeholder and
new institutional theories of CG. Six LCBs were selected as representative of the
Libyan Banks, in addition to the CBL. The results of the findings reveal that the
implementation of the CG Code 2010 in LCBs is still in the early stages. The
weakness of supervision and absence of training, as well as lack of knowledge, are
the main challenges to LCBs in complying with good CG practices. Furthermore,
institutional factors have played a major negative role in hindering progress in
complying effectively with the CGC, including political stability, together with legal
and regulatory, social, and cultural factors. The political stability factor has an
impact on both legal and regulatory aspects and on the CBL and their follow-up and
supervision. The findings also reveal that there is an absence of the CG, audit, and
risk management committees that represent important principles of CGC.
... Developing countries are different from developed countries in several ways: their markets are less mature, are far less regulated, there is far more economic uncertainty, and institutions have not been properly developed, more political interventions and the presence of individual biases. Significant differences are available in the corporate governance practices of developed and developing economies (Rabelo and Vasconcelos, 2002). ...
The purpose of this study is to develop a single variable, which would be a combination of internal and external qualitative attributes influencing the governance of firms listed on the Pakistan Stock Exchange from 2006 to 2019. A single set of Governance Index was developed, which was the combination of board composition, board leadership structure and ownership structure by foreign investors, financial institutions and block holders. Firms have been selected from thirteen different sectors of the Pakistan Stock Exchange excluding the financial sector. The results of the study showed that the governance index which aggregates three sets of governance attributes, is significantly and negatively related to systematic risk. However, governance index significantly and positively related to earning risk. Previously many studies have explored the relationship between different governance attributes and firm performance, and these studies have produced a mixed set of results. A small number of studies have investigated the relationship between governance attributes and firm risk. In addition, most of these studies are limited to the financial sector. The current study uses a broad agency framework to extend work on firm risk and governance attributes in developing markets such as Pakistan.
... The role of corporate governance and in particular the board of directors cannot be underestimated in a developing country like Ghana where investor protection is weak (Klapper & Love, 2004). Ghana, a developing country is characterised by economic uncertainties, a weak legal system, weak investor protection, an illiquid stock market and recurring government interventions (Rabelo & Vasconcelos, 2002). Recently, the country has been ranked by Forbes Magazine as the ninth worst-management economies in the world (Fisher, 2011), suggesting that firms operating in such economic environment performance may be negatively affected. ...
This paper examines whether and how firm performance is influenced by board practices in Ghana. The analysis shows that chief executive officer (CEO) duality has a negative impact on firm performance, evidence that supports agency theory’s position. Further analysis shows that the smaller Ghanaian board size appears to be optimal because it has a positive impact on firm performance. However, the larger non-executive director representation on the board has no impact on firm performance. Overall, these results suggest that the Ghanaian firms should be encouraged to separate the role of CEO and the board chair positions, have a board size of between eight and nine, and make good use of non-executive directors’ time in the board decision process if they are to achieve better performance.
... Greenbury Report (1995), Hampel Report (1998) Until recently, the issue of corporate governance had gained minimal attention in the developing world. However, the increasing globalization of the world economy and the adoption of IMF/ World Bank-led economic reforms, coupled with recent financial scandals in the West, are now driving the surging interest in corporate governance practices in several developing countries such as Ghana, Malaysia, UAE and Nigeria (Adelegan, 2001;Rabelo and Vasconcelos, 2002;Ahunwan, 2002;Reed, 2002;Gugler et al., 2003;Shamsul Nahar, 2004;Che Haat et al., 2008;Mohd Ghazali, 2010). In Nigeria specifically, as in most developed countries, observance of the principles of corporate governance has been secured through a combination of voluntary and mandatory mechanism. ...
This study presents empirical evidence regarding the relationship between corporate
governance and performance of a panel of twenty banks over the period of 2006- 2009. The
sample of the study was drawn from the annual reports of banks listed on the Nigeria Stock
Exchange over the period under review. Panel data regression models was developed and
various balance-and-check tests such as Jarque-Bera, Hausman specification test, white
heteroscedasticity test, and correlation analysis were undertaken in order to provide best
estimate for the model. In addition, descriptive statistics such as Mean, standard deviation,
minimum, median, maximum, skewness and kurtosis were obtained in order to describe the
characteristics of the variables. The findings from the study shows that contrary to
expectations, proportion of non executive directors on the board was negatively significant in
explaining corporate performance of banks, while ownership concentration and directors
ownership were statistically insignificant in explaining performance. These results can
perhaps be attributed to regulatory Lapses on the part of the regulatory agencies, particularly
the CBN given the fact that the CBN code of corporate governance came into force to
enhance sound corporate governance practices in the banking sector after many years of
corporate governance abuses . There is therefore the need for regulatory agencies to be more
proactive in enforcing the codes so as to achieve the desire goals for which the codes are
enacted.
Keywords: Corporate governance, performance, bank
... Greenbury Report (1995), Hampel Report (1998) Until recently, the issue of corporate governance had gained minimal attention in the developing world. However, the increasing globalization of the world economy and the adoption of IMF/ World Bank-led economic reforms, coupled with recent financial scandals in the West, are now driving the surging interest in corporate governance practices in several developing countries such as Ghana, Malaysia, UAE and Nigeria (Adelegan, 2001;Rabelo and Vasconcelos, 2002;Ahunwan, 2002;Reed, 2002;Gugler et al., 2003;Shamsul Nahar, 2004;Che Haat et al., 2008;Mohd Ghazali, 2010). In Nigeria specifically, as in most developed countries, observance of the principles of corporate governance has been secured through a combination of voluntary and mandatory mechanism. ...
This study presents empirical evidence regarding the relationship between corporate
governance and performance of a panel of twenty banks over the period of 2006- 2009. The
sample of the study was drawn from the annual reports of banks listed on the Nigeria Stock
Exchange over the period under review. Panel data regression models was developed and
various balance-and-check tests such as Jarque-Bera, Hausman specification test, white
heteroscedasticity test, and correlation analysis were undertaken in order to provide best
estimate for the model. In addition, descriptive statistics such as Mean, standard deviation,
minimum, median, maximum, skewness and kurtosis were obtained in order to describe the
characteristics of the variables. The findings from the study shows that contrary to
expectations, proportion of non executive directors on the board was negatively significant in
explaining corporate performance of banks, while ownership concentration and directors
ownership were statistically insignificant in explaining performance. These results can
perhaps be attributed to regulatory Lapses on the part of the regulatory agencies, particularly
the CBN given the fact that the CBN code of corporate governance came into force to
enhance sound corporate governance practices in the banking sector after many years of
corporate governance abuses . There is therefore the need for regulatory agencies to be more
proactive in enforcing the codes so as to achieve the desire goals for which the codes are
enacted.
Keywords: Corporate governance, performance, banks
... Corporate governance theory concerns the relationship between shareholders and the firm's management. The ownership structure and the diverse relationships between a company and its complex network of stakeholders affect firms' behavior (Rabelo & Vasconcelos, 2002). From the point view of the individual companies, sound corporate governance practices should result in better financial opportunities, lower cost of capital, facilitation of the provision of funds in international financial markets, the better chance of overcoming crisis periods and increased liquidity (Nilsson, 2007). ...
The growth of Indian companies in recent years has led to a change in the nature of the economy which attracted outsider investors from developed countries who demanded robust corporate governance practices from Indian companies which made regulators and competitors gave a great effort to restructure corporate governance. Therefore, this paper aims to investigate the effect of corporate governance practices on firms’ performance, with a special reference to the Indian tourism sector. The study uses a panel dataset of 39 hotels listed on Bombay Stock Exchange (BSE) for the period from 2013/2014 to 2015/2016. The ordinary least square regression model is run for estimating the results. Findings show that board directors’ size and audit committee’s size negatively impact the performance of Indian hotels, while board directors’ composition and diligence, the audit committee’s composition and diligence, and foreign ownership positively affect the performance of Indian hotels measured by accounting proxies. Results also reveal that board directors’ size, audit committee’s size, and foreign ownership positively impact the Indian hotels’ performance measured by marketing proxies, whereas board directors’ composition; board directors’ diligence; audit committee’s composition; and audit committee’s diligence have a negative impact on the performance of Indian hotels.
... Subsequently, King I adopted most of the CG disclosure reforms in the 1992 U.K. Cadbury report (King Committee, 1994). More so, unlike most emerging countries, King I also demonstrated an appreciation of the presence of differences that rise to the need for CG between developed and emerging nations Rabelo & Vasconcelos, 2002). Therefore, in addition to asking firms to report to shareholders, King I also required firms to separately report to other stakeholders. ...
In making corporate governance (CG)‐related disclosure, firms may solely focus on shareholders or may broaden their scope of disclosure to serve other stakeholders as well. This study examines whether there are differences in the disclosure of shareholder and stakeholder CG practices. Based on a hand‐collected dataset of 1,110 firm years in South Africa and a disclosure index using 72 CG provisions from the King III report of CG, we find that the disclosure of stakeholder CG practices is higher than that of shareholder CG practices. Our evidence suggests that foreign ownership, institutional ownership, racial diversity, and gender diversity increase total voluntary disclosure. In contrast, chief executive officer (CEO) age decreases total voluntary disclosure. Also, although foreign ownership, institutional ownership, gender diversity, and racial diversity increase both shareholder and stakeholder CG disclosures, CEO age has a negative relationship with both shareholder and stakeholder CG disclosures. Further, board size reduces shareholder disclosure but not stakeholder disclosure. Our results further indicate that, ceteris paribus, the extent of shareholder CG disclosure relative to stakeholder CG disclosure is (a) lower with board size, gender diversity, and racial diversity and (b) higher with the level of institutional ownership. Our findings are robust across a raft of econometric techniques.
... Like all countries, the GCC countries require effective corporate governance for many reasons, such as weak legal controls and investor protection; weak illiquid stock markets; government intervention; economic uncertainty; and high concentration of ownership (Rabelo and Vasconcelos, 2002;Dalwai et al., 2015). Accordingly, the GCC countries have begun developing their own corporate governance systems codes using international best VOL. 12 NO. 4 2018 j JOURNAL OF ASIA BUSINESS STUDIES j PAGE 553 practices as well as corporate governance principles. ...
Purpose
This study considers data for listed companies in Bahrain Bourse to determine if companies practice earnings management (EM). Further, the effect of a set of corporate governance characteristics on EM practices is examined.
Design/methodology/approach
The EM level was measured using discretionary accruals )DA( calculated using the Modified Jones (1995) Model. The study sample consisted of 20 companies listed during the period 2011–2015. Panel regression model was used to test the study hypotheses and achieve the study aims.
Findings
EM is negatively correlated with board size, confirming that a larger board is associated with a lower level of EM practices. Further, board independence is positively correlated with EM, suggesting that the larger the number of independent directors, the higher the level of EM practices. In addition, internal ownership is positively related to EM, confirming that the higher level of internal ownership increases EM practices. CEO duality does not appear to have any effect on EM in Bahrain Bourse. More interestingly, the findings reveal that companies practice EM through income-increasing DA.
Research limitations/implications
Financial data and data related to other corporate governance characteristics are lacking.
Practical implications
The results of this study provide empirical support for the development of new regulations and amendments and necessary corrective decisions regarding the effectiveness of applying corporate governance code in Bahrain Bourse. More specifically, this study reveals an urgent need for new amendments to restrict EM practices in Bahrain Bourse.
Originality/value
This study enriches the EM literature by covering Bahrain as an Asian country, which has not been sufficiently examined in relation to this topic. Further, this study provides a clear picture of the level of EM practices in Bahrain Bourse to multiple parties.
... Like all countries, the GCC countries require effective corporate governance for many reasons, such as weak legal controls and investor protection; weak illiquid stock markets; government intervention; economic uncertainty; and high concentration of ownership (Rabelo and Vasconcelos, 2002;Dalwai at el., 2015). Accordingly, the GCC countries have begun developing their own corporate governance systems codes using international best practices as well as corporate governance principles. ...
Research purpose-This study considers data for listed companies in Bahrain Bourse to determine if companies practice earnings management (EM). Further, the effect of a set of corporate governance characteristics on EM practices is examined. Design/methodology/approach-The EM level was measured using discretionary accruals)DA(calculated using the Modified Jones (1995) Model. The study sample consisted of 20 companies listed during the period 2011-2015. Panel regression model was used to test the study hypotheses and achieve the study aims. Findings-EM is negatively correlated with board size, confirming that a larger board is associated with a lower level of EM practices. Further, board independence is positively correlated with EM, suggesting that the larger the number of independent directors, the higher the level of EM practices. In addition, internal ownership is positively related to EM, confirming that the higher level of internal ownership increases EM practices. CEO duality does not appear to have any effect on EM in Bahrain Bourse. More interestingly, the findings reveal that companies practice EM through income-increasing DA. Research limitations/implications-Financial data and data related to other corporate governance characteristics are lacking. Practical implications-The results of this study provide empirical support for the development of new regulations and amendments and necessary corrective decisions regarding the effectiveness of applying corporate governance code in Bahrain Bourse. More specifically, this study reveals an urgent need for new amendments to restrict EM practices in Bahrain Bourse. Originality/value-This study enriches the EM literature by covering Bahrain as an Asian country, which has not been sufficiently examined in relation to this topic. Further, this study provides a clear picture of the level of EM practices in Bahrain Bourse to multiple parties.
... The characteristic of companies in Brazil is almost the same as companies in Indonesia. Brazil is a developing country and the most companies there is publicly opened companies with dominations of family-related ownership (Rabelo and Vasconcelos, 2002). Thus, we argue that the IGOV model is the best measure to asses Indonesian manufacturing companies' corporate governance quality with certain modifications, such as a question about Generally Accepted Accounting Principles (GAAP) is modified into a question about conformity to Indonesian GAAP We use a nominal scale of 1 to answer "yes" and 0 to answer "no". ...
This study aims to investigate whether corporate governance affects earnings management and if so whether such effect is moderated by age, gender, and educational background of board of directors. Using Moderated Regression Analysis, this study examines a sample of 55 companies listed in the Indonesia Stock Exchange for the period of 2005 to 2009. The results show that corporate governance negatively affects earnings management. Further analyses reveal that the association is moderated by age, gender, and educational background of board of directors.
... Like all countries, the GCC countries require effective corporate governance for many reasons, such as weak legal controls and investor protection; weak illiquid stock markets; government intervention; economic uncertainty; and high concentration of ownership (Rabelo and Vasconcelos, 2002;Tsamenyi et al., 2007;Dalwai at el., 2015). Accordingly, the GCC countries have begun developing their own corporate governance systems codes using international best practices as well as corporate governance principles. ...
Research purpose-This study considers data for listed companies in Bahrain Bourse to determine if companies practice earnings management (EM). Further, the effect of a set of corporate governance characteristics on EM practices is examined. Design/methodology/approach-The EM level was measured using discretionary accruals)DA(calculated using the Modified Jones (1995) Model. The study sample consisted of 20 companies listed during the period 2011-2015. Ordinary least squares (OLS) was used with panel data to test the study hypotheses and achieve the study aims. Findings-EM is negatively correlated with board size, confirming that a larger board is associated with a lower level of EM practices. Further, board independence is positively correlated with EM, suggesting that the larger the number of independent directors, the higher the level of EM practices. In addition, internal ownership and CEO duality do not appear to have any effect on EM in Bahrain Bourse. More interestingly, the findings reveal that companies practice EM through income-increasing DA. Research limitations/implications-Financial data and data related to other corporate governance characteristics are lacking. Practical implications-The results of this study provide empirical support for the development of new regulations and amendments and necessary corrective decisions regarding the effectiveness of applying corporate governance code in Bahrain Bourse. More specifically, this study reveals an urgent need for new amendments to restrict EM practices in Bahrain Bourse. Originality/value-This study enriches the EM literature by covering Bahrain, which has not been sufficiently examined in relation to this topic. Further, this study provides a clear picture of the level of EM practices in Bahrain Bourse to multiple parties.
... The coordination of the work of internal and external auditors and enhancing good CG via BOD's oversight of management performance and financial reporting processes have also emerged over the years. (see Abbott et al., 2004;Spira, 2002;Allegrini and Greco, 2013;Muniandy and Hillier, 2015;Bliss et al., 2007;Assenso-Okofo et al., 2011;Samaha et al., 2012Samaha et al., , 2015. 2 Undeveloped capital markets, government interventionism, the absence of norms and values of business standards and weak legal system are the characteristics of most developing countries (Rabelo and Vasconcelos, 2002;Tsamenyi et al., 2007;Aboagye-Otchere et al., 2012). 3 The Listing Regulations terms of reference for ACs include: to recommend to BOD on the appointment and remuneration of external auditors; to review auditors' evaluation of the internal controls and accounting system; to review and discuss audited accounts with management, and to review the scope and effectiveness of internal audit procedure. ...
This paper examines the perception of firms’ major ‘agency stakeholders’ – external auditors, investors and senior management – of Ghanaian listed companies on the roles, responsibilities and desirable characteristics of an effective corporate audit committee (AC). Employing a survey approach to this study, the paper documents that ‘agency stakeholders’ in Ghana associate the role and responsibilities of AC more with firms’ internal audit function and processes than any other unit which AC has oversight responsibilities. It also demonstrates that corporate stakeholders do not attach the same level of importance to the roles, responsibilities and characteristics of AC. The paper, therefore, highlights the need for stakeholders to be aware of and consider the new dynamics of AC functions and processes with equal importance to promote effective practice.
... The coordination of the work of internal and external auditors and enhancing good CG via BOD's oversight of management performance and financial reporting processes have also emerged over the years. (see Abbott et al., 2004;Spira, 2002;Allegrini and Greco, 2013;Muniandy and Hillier, 2015;Bliss et al., 2007;Assenso-Okofo et al., 2011;Samaha et al., 2012Samaha et al., , 2015. 2 Undeveloped capital markets, government interventionism, the absence of norms and values of business standards and weak legal system are the characteristics of most developing countries (Rabelo and Vasconcelos, 2002;Tsamenyi et al., 2007;Aboagye-Otchere et al., 2012). 3 The Listing Regulations terms of reference for ACs include: to recommend to BOD on the appointment and remuneration of external auditors; to review auditors' evaluation of the internal controls and accounting system; to review and discuss audited accounts with management, and to review the scope and effectiveness of internal audit procedure. ...
Legal literature in the past has often debated whether concentrated corporate ownership (i.e. sizeable corporate conglomerates and corporate enterprises owned by business families or the government of a State) in a relatively close market leads to a high volume of related party transactions between the corporations in the respective market. The emerging economies attract substantial foreign investment due to the rapid growth of their markets and the presence of large publicly listed companies. Concentrated ownership structures in these countries tend to result in the expropriation of resources by controlling shareholders for their personal enrichment. There has been a high corporate failure rate due to related party transactions, despite the adoption of regulatory reforms that promote transparency, accountability, and fairness. Listed companies in the BRICS countries are marked by concentrated ownership structures controlled by either a family or the State. Although there are differences in ownership structures as well as indications of agency problems in the United States and the United Kingdom, the BRICS countries have adopted the same legal strategies to prevent unfair or abusive related party transactions in their respective countries, such as the appointment of independent directors, independent audit committees, CEO duality, and disclosure requirements. This study seeks to conduct cross-country comparative research to assess the ways in which the BRICS countries have regulated related party transactions. Each of the BRICS countries has adopted different monitoring mechanisms to prevent abusive related party transactions, which will be examined in the course of this research.
In analyzing societies, cultures or economies, collective mindsets play an important role. They tell us about the spiritual construction and the knowledge stocks of a given society, culture or economy, how this knowledge stock is translated into action orientations, how these orientations change over time and how different they are in various cultures.
The most relevant empirical studies about Brazilian economic elites and management date back to the 1960s and 1970s. These focus on the recruitment, ethnical and social origins as well as on the capitalistic mentality e.g. mindset of Brazilian managers in the industrial sector. They focused on the influence of the industrial elite on the Brazilian’s economic development in the context of growing industrialization.
As Corporate governance refers to how and for what reason corporations are regulated and determines who is motivated and accountable and who takes decisions, It is therefore considered as a toolkit that helps management and the board to address the complexities of managing a business more effectively. Corporate governance ensures that companies have effective decision-making and management mechanisms in place to ensure a healthy stakeholder interest (shareholders, staff, vendors, consumers and the community). This research study aims at finding the impact of corporate governance on firm performance. The variables used in this research study are board independence, board size and CEO duality for independent variables and for the dependent variable it is return on equity (ROE) and return on assets (ROA) which are used in order to comprehend corporate governance. Methodology: There has been a use of quantitative research method that in order to analyze the information via secondary data collection from a panel data collected from 2015 to 2019 from specific financial institutions in Malaysia based on quota sampling method for data collection, which are analyzed with the software Eviews. Result & Findings: the first findings of the study demonstrated that board size as a significant impact on return on equity (ROE) in the Malaysian banking sector and that board independence and CEO duality do not have a significant impact on return on equity (ROE) in Malaysian banking sector. The second findings of the study indicates that board size and CEO duality have significant impact on return on assets (ROA) and that board independence does not have a significant impact on return on assets (ROA) in Malaysian banking sector. Therefore, this research study is going to be helpful in order to understand the real meaning and impact of an effective corporate governance as this research focuses on the plain comprehension of governance that companies, shareholders of companies and also other interested stakeholders shall be taking in terms of understanding the board composition which is probably going to have a significant impact on the company business
em>The purpose of this study is to analyze the degradation of companies in the LQ45 index. The population of this study is companies listed on the LQ45 index from February 2019 to July 2019. Total populations are 45 companies. The research sample used purposive sampling of 3 companies. The data is sourced from audited company financial statements downloaded from the Indonesia Stock Exchange website. The analytical method used is a horizontal analysis method that is comparing financial statements for several periods. The models studied are NOPLAT, FCF, ROIC, and CFI from DCF methods. Based on the NOPLAT analysis, all three companies were able to create net operational profits. Based on the FCF analysis, only PT Waskita Beton Precast Tbk. revenue’s that able to support its business development activities. Based on the ROIC and CFI analysis, only PT Elnusa Tbk. tended to be stable in providing funds to pay debtholders and stakeholders.</em
Purpose
The purpose of this study is to investigate the impact of audit committee (AC) characteristics, such as AC size, AC independence and gender diversity on firm risk in the context of an emerging market.
Design/methodology/approach
The sample data includes 102 nonfinancial Pakistan Stock Exchange listed firms from 2004 to 2018. Firm risk is measured through three proxies, namely, idiosyncratic risk, total risk and capital expenditure. Along with this, profitability, leverage, market-to-book ratio, firm age, net property plant and equipment (NPPE) and surplus cash are used as control variables. The Housman test is used to select the best model from the fixed-effect model and the random effect model to conclude the findings.
Findings
According to the study's findings, AC characteristics have a negative and significant relationship with idiosyncratic risk. In addition, a gender-diverse AC has a significant negative relationship with capital expenditure. In connection with total risk, AC characteristics fail to shows any significant relationship. Among the control variables, the results show that profitability stand for return on asset (ROA) and NPPE have a significant negative relationship, whereas market-to-book value has a significant positive relationship with both idiosyncratic and total risk.
Practical implications
The study's findings offer policymakers, managers and investors guidance. This study will provide new insights to the Pakistani Government, stock market, companies and accounting and auditing regulators in terms of understanding the determinants influencing risk management activities. Furthermore, this study will assist financial institutions in making credit decisions. In addition, this study provides policymakers, such as the stand for Securities and Exchange Commission of Pakistan (SECP), with guidelines for developing policies that strengthen the board governance mechanism.
Originality/value
This study investigates the impact of AC characteristics on corporate risk, which is rarely discussed in emerging economies.
Governance in the food system has become a key topic of discussion in light of the 2007-08 food price crisis. Of special importance has been the shift to include the role that non-state actors are likely to play in achieving food security under global environmental change (GEC). This paper aims to compare private sector food system governance trends in two emerging economies, Brazil and South Africa. It focuses on practices around adaptation, an area largely neglected in climate change discussion, yet a critical factor in coping with the societal consequences of GEC. This study identifies several processes, particularly within the retail sector, that could indicate normative mechanisms through which ‘good governance’ can be translated into practice.
This paper reviews the literature on corporate governance in extreme institutional environments, including both formal and informal institutions. We focus on three main areas of research: corporate governance in an international context, banking and corporate governance, and governance in entrepreneurship and innovation. We document some classic papers in each of these areas and explain how the papers in this special issue contribute to the development of these areas of research. We discuss recommendations for policy and practice and offer suggestions for future research.
Purpose
This study aims to examine the impact of corporate governance mechanisms on financial and non-financial aspects of firm performance in medium and large-scale manufacturing firms in Ethiopia.
Design/methodology/approach
The cross-sectional survey and simple random sampling methods are adopted while the data collection is through a questionnaire that covers five corporate governance indicators consisting of the board independence, board effectiveness, shareholders role, internal audit effectiveness (IAE) and disclosure and transparency. The dimensions of firm performance were indicated by six firm performance indicators of customer and market (CM), internal process (IP), differentiation, efficiency, competitive position (CP) and financial (organizational) performance (OP). The covariance-based structural equation modeling (SEM) with the maximum likelihood parameter estimation technique was used to perform the data analysis.
Findings
A significant positive relationship has been found between the independence of the board of directors and firm performance (especially with respect to differentiation, OP, CP and IP). However, the board of directors’ effectiveness showed an unexpected result, significant negative effect on differentiation, OP, CP, CM and IP. The study also indicates a positive significant effect of disclosure and transparency on differentiation, CP and OP. However, the coefficient on the CM construct of firm performance is negative and significant. A significant negative linkage has also been revealed between IAE and two constructs of performance: differentiation and CP. One of the important findings of the study is that shareholders’ role has a significant positive impact on both board characteristics (board independence and board effectiveness) and firm performance (differentiation, efficiency, CP and OP).
Research limitations/implications
The study has two potential limitations. First, in comparison to prior studies, this study is based on a small sample size which limits the generalizability of the findings. Different scholars have suggested (Anderson and Gerbing, 1984, 1988; Iacobucci, 2010; Hair et al. , 2019) that SEM requires a large sample size to test the hypothetical model. Thus, future research can further investigate the link between corporate governance and firm performance by using a larger sample size to achieve more reliable results. Second, the current study used a quantitative approach only, but prior studies (e.g. Ahrens and Khalifa, 2013) suggest a qualitative approach to more investigate and reach a very conclusive idea on corporate governance. The approach is currently receiving growing popularity in the literature.
Practical implications
The findings of the study would have measurable implications for different stakeholders who are in the position of supporting or regulating manufacturing firms. First, the findings give a clue about how a firm can design a good corporate governance system. Second, managers of the firm can get a hint or tip from the result that might help as input for designing strategies. Finally, it might help policymakers to understand and think about the very crucial role of active participation of shareholders in curtailing/reducing agency cost and enhancing firm performance apart from (beyond) the conventional corporate governance mechanisms (board of directors, internal audit, disclosure and transparency).
Originality/value
This study seeks to extend and contribute to the current literature in several ways. First, in contrast to previous studies, this study used both financial and non-financial performance measures and thereby providing new empirical insights relating to the non-financial performance measures. Second, this study provides a new result that the role of shareholders has a direct significant positive impact on board characteristics (i.e. board independence and board effectiveness) and firm performance. Finally, this study has come with a new insight that disclosure and transparency is a major driver of firm performance.
Purpose – This study aims to assess the effect of director board and audit committee attributes and
ownership structure on firm performance. In general, resource dependency and agency theories have
underlined the superior performance of firms equipped with stronger Corporate Governance (CG) versus those
of deficient governance. Concurrently, the study delineated the provisions of ownership structure provision,
specifically foreign ownership and institutional ownerships, thus describing the component denoting the
structural significance in explicating firm performance.
Design/methodology/approach – The current study implemented an empirical approach involving the
construction of extensive CG measures thus, subjected to 81 non-financial firms listed on the Amman Stock
Exchange spanning the period of 2014–2018.
Findings – The current study identified the positive and significant relationship between the board of
directors and audit committee characteristics with the firm performance measures tested, namely, return on
equity (ROE) and Tobin’s Q. In terms of ownership structure, both foreign and institutional ownerships
yielded a significant and positive relationship with ROE. Meanwhile, Tobin’s Q led to an insignificant and
negative relationship between both ownership types and firm performance measures.
Practical implications – The analytical outcomes substantiate the possibility of enhanced performance
shown by growing global firms because of the implementation of CG mechanisms, specifically because of the
practices resulting in minimised agency costs.
Originality/value – The current study offers novel evidence detailing the impact of CG effectiveness
towards performance and its implementation in emerging markets following the minimal amount of scholarly
efforts on the topic. It is a timely contribution towards the current understanding of the relationship linking
governance and performance for the purpose of ensuring the adoption and imposition of a strong corporate
governance code by the government.
Purpose
This paper aims to map the evolution of research in business ethics from 1991 to 2018. It aims to identify the major themes and how they have evolved. It also aims to identify gaps in the literature for recommending future research agenda.
Design/methodology/approach
This study uses co-word network analysis. Co-word network analysis is a bibliometric technique used to objectively identify research themes via article keywords. The study examines articles from 1991 to 2018, which is a span encompassing a greater number of articles than previous bibliometric studies in business ethics. This time span was split into four periods and major research themes were identified for each period to map the changes in research agendas in the business ethics discipline over time.
Findings
The findings point to increasing maturation of the discipline, a slight decline in ethical decision-making research, a rise in research at the intersection of leadership and ethics and exponential growth in studies on corporate social responsibility. Ethical issues in business-to-business contexts are understudied. Research in environmental disclosures and leadership is expected to grow in the future.
Originality/value
This is the first study in business ethics to use keywords for analyzing the evolution of a discipline. This study encompasses more articles than any other study in business ethics. Finally, this is the only study to use co-word network analysis to study business ethics literature.
The cost of failure of a single corporate has a fatal impact on the economy. In addition to the macroeconomic conditions leading to corporate collapse, management is responsible for developing and implementing a sound system of risk management and internal control in order to avoid such collapses. As a result, discussions on governance and risk have reached an unprecedented level for academics and practitioners. Moreover, risk exposure and management are increasingly becoming the foremost functions of modern business enterprises. However research that integrates corporate governance and risk has been limited. This study examines therefore the impact of corporate governance practices on corporate risk of listed companies in the Colombo Stock Exchange in Sri Lanka. The Board structure, Board Independence and Board procedures were considered as independent variables, whereas, corporate risk as dependent variable. The corporate risk represented the financial, operational and market risks faced by the companies. Furthermore the study used data from a sample of 64 listed companies for 5 years from 2014 to 2018 and employ panel regression to uncover the relationship that exists between these variables. The independent sample t-tests was used to test whether there was a statistically significant difference exist between the corporate governance practices of distress and non-distress companies. The results show that the corporate governance practices of distress companies was significantly lower than that of non-distress companies. The findings of the regression results suggest that Board independence was significantly and negatively impact on corporate risk. However, Board structure and Board procedures have no significant impact on corporate risk. The study therefore, concludes that the increased representation of independent non-executive directors of the board contributed to the significant decrease of corporate risk.
Esta pesquisa analisou a relação entre dimensões de governança corporativa (GC) e assimetria informacional entre gestores e investidores. Foram analisadas 81 empresas brasileiras e 98 americanas, listadas no Ibrx100 e no S&P100, respectivamente, durante o período de 2012 a 2016. Evidenciou-se que a GC, de forma geral, relaciona-se negativamente à assimetria informacional no cenário brasileiro, mas não no americano. Para melhor compreender esse resultado, a GC foi analisada por suas dimensões isoladamente, o que demonstrou que nos Estados Unidos as práticas de gestão relacionam-se à menor assimetria informacional, enquanto que no Brasil as práticas relacionadas as estratégias de integração relacionam-se à menor assimetria informacional. Desta forma, estes resultados sugerem que diferentes mecanismos de GC tem diferentes implicações em cenário brasileiro e americano, o que contribui no sentido de orientar gestores a adequar práticas de GC ao contexto de seu país, de modo a minimizar a assimetria informacional de maneira eficaz.
This study investigates the board directors and their effect on company performance in emerging markets, particularly in the United Arab Emirates (UAE). Our findings robustly confirm that the UAE has adopted a board structure similar to that of Western countries. The results indicate the positive effects of leadership structure, board composition and audit committee independence on company performance. This is the first study to demonstrate that board structure is an important determinant in reducing agency problems and leading to improved company performance in unique ownership structures in emerging markets, such as exist in the UAE. It is also the first study to explore the board structure-firm performance relationship using a system-generalised method of moment’s estimator for the UAE market. The regulatory and policy implications suggested in this research are significant, not only for the UAE but also for application to other emerging markets. In this context, clear insights are provided for policymakers, regulators, managers, investors, and researchers involved in emerging markets.
During the period 2000-2017, Brazil had a mostly positive economic growth experience. Despite suffering an economic slowdown during the late 2000s, Brazil was considered as one of the leading countries in the Latin American region. In social terms, Brazil also showed improvements. Data on unemployment, minimum wages and inequality were promising, showing that nearly 30 million people entered the middle class, minimum wages in 2017 were 2.2 times higher than in 2000 and the Gini index decreased from 58.4 in 2000 to 53.3 by 2017. These improvements can be attributed to the equality-promoting social programmes. However, all these positive changes did not seem to end social conflicts. By the year 2011, 161 social conflicts were registered, positioning Brazil as a country with a medium level of violence (PNUD & Fundación UNIR, 2011). According to the UNDP, 7% of all Latin American conflicts happened in Brazil. Moreover, homicide rates were on a rise, despite the country's efforts to improve its living standards. Therefore, the paradox between economic growth and social conflict was present in Brazil. This paper aims to explain the paradox by analysing Brazil's Federal States and regions. Our findings indicate that the excess concentration of economic acitivity in particular regions, generated discomfort with the State. In addition, corruption was studied, as it is a factor that increases and worsens social inequality in terms of income (Ferreira & Martins, 2014). We conclude that the paradox is indeed present in Brazil, though from a slightly different perspective.
Abstract
Purpose – The purpose of this paper is to study the relationship between culture, corporate governance (CG) variables and corporate risk reporting practices of listed companies in Nigeria and South Africa, two large African economies at the south of the Sahara.
Design/methodology/approach – The study uses 500 firm-year observations for the period of 2013–2017 for firms listed on the Lagos and Johannesburg Stock Exchanges. Descriptive analysis was performed to provide the background statistics of the variables examined. This was followed by regression analysis, which constitutes the main data analysis.
Findings – The results indicate that power distance is negatively associated with the corporate risk disclosure (CRD). This implies that organizations where power distance is high are characterized by lower CRD and vice versa. From the analysis, two factors, namely, institutional ownership and profitability, were found to explain sample firms’ risk disclosure practices as they are positively and statistically related to CRD.
Originality/value – This study is one of the few to measure the influence of culture and CG on CRD in Sub-Sahara Africa. Understanding the drivers for firms to disclose risk-related information may assist regulators and standards setters in promoting both the spread and the improvement of such disclosures through the issuance of CG codes and reporting guidelines.
Keywords Culture, Nigeria, South Africa, Financial reporting, Risk disclosure
Corporate governance has received a lot of attention after the 2008 global credit crunch that culminated into bank failures and worldwide economic crises. In many developing countries, disclosures and the compliance with the corporate governance codes of best practices existing in such countries have become necessary due to ever increasing foreign investors who rely upon the financial reports of companies in those countries before having huge economic and financial investments in them. In the case of Ghana, following the enactments of the 2002 corporate governance code by the SEC, many codes of best practices have emanated while there have been calls for a single code by various regulators and stakeholders. While full compliance with the codes and its enforcement by the SEC is being canvassed for, corruption which has persisted and continues to grow has been single out as the major bane within the Ghanaian system. This paper, however, contributes to a body of knowledge and existing literatures while giving a lucid picture as to the corporate governance developments in Ghana in the past, the present and the future. It discusses the issue of compliance with the codes of best practices and the challenges being faced in a developing economy such as Ghana. It argues that while the socio-cultural problem of corruption persists, it is onerous on the government to fight through good governance, effective legal system , proper enforcement by the regulators and citizenship enlighten.
We investigate if agency theory effectively explains agency conflict in the context of a developing country namely, Pakistan. Utilising data from 26 semi-structured interviews, we found that in Pakistan, there is no variation in risk preferences of principals (minority shareholders) and agents (majority shareholders). We also found that remuneration packages and board independence are not effective tools for governing owner managers in Pakistan. Thus, policy makers must shift their focus from soft internal governance mechanisms of appropriate remuneration and board independence. We propose for a rigorous external audit function, and appointment of independent directors and external audit firms by regulator.
Good corporate governance is considered a building block of success for microfinance institutions (MFIs) as it is presumed to help them in achieving their social and financial goals. This paper analyzes the corporate governance and financial performance relationship for MFIs in Asia. We make use of a panel dataset involving 173 MFIs in 18 Asian countries for the period 2007–2011. We construct a corporate governance index based on seven measures pertaining to board size and composition, CEO characteristics, and ownership type. We then estimate the two-way relationship between this index and each of five different financial performance indicators. To address the likely simultaneity between corporate governance and financial performance, we adopt a two-stage least squares estimation approach with instrumental variables. Our results confirm the endogenous nature of corporate governance and financial performance. We conclude that profitability and sustainability of MFIs improve with good governance practices and conversely that more profitable and sustainable MFIs have better governance systems.
STOCK PRICE RESPONSE TO EARNINGS ANNOUNCEMENTS: DEVELOPED VERSUS EMERGING ECONOMIES
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Ahmed M. Al-Baidhani
DOI:10.22495/cocv15i4art3
Abstract
This study aims to evaluate the usefulness and relevance of accounting earnings disclosures, as the key determinant of stock price changes. The main objective is to examine whether earnings response coefficient (ERC) behaviour could explain more fully the stock price changes, as to the reason why the stock price change is not equal to the number of announced earnings. The study is done with data sets from five countries of the Organization for Economic Co-operation and Development (OECD) group and Malaysia. The analysis is then grouped into developed markets: Japan, UK, Sweden, and Switzerland; and emerging markets: Malaysia and Mexico, for the period 2001-2014. Two measures of abnormal returns are regressed against the size of the announced earnings. The first regression uses measures from individual events. The second regression uses a new measure; that is, from portfolios made out of all observations sorted by size of earnings into ten portfolios for each country and combination of countries. The portfolio method used was aimed at controlling possible idiosyncratic-errors-in-variables problem using individual event measures. The results using individual-event measures resulted in reasonable ERC sizes with high R2 explanatory power, a little higher than those reported in prior studies on other countries. Importantly, portfolio-based ERC is very close to the magnitude of the earnings in some tests, which supports the famous value relevance theory in accounting. This finding is new to this literature.
Keywords: Earnings Announcements, Share Prices, Earnings Response Coefficient, Emerging Economies, Developed Economies, Earnings Relevance, Portfolio Method.
JEL Classification: G12, G14, G21
Received: 23.04.2018
Accepted: 14.06.2018
Published online: 26.06.2018
How to cite this paper: Al-Baidhani, A. M. (2018). Stock price response to earnings announcements: Developed versus emerging economies. Corporate Ownership & Control, 15(4), 29-45. http://doi.org/10.22495/cocv15i4art3
Purpose
The purpose of this paper is to investigate the association between online financial disclosure (OFD) and firms’ performance in the Gulf Cooperation Council (GCC).
Design/methodology/approach
Extensive literature review was carried out and a checklist of 90 items (71 for content and 19 for presentation) was developed to measure the level of OFD by the firms that are listed in financial sectors of the GCC Bourses.
Findings
The findings show that the overall OFD in GCC is 77 percent. The results indicate a positive association between OFD and firms’ performance.
Practical implications
The study recommends that regulatory bodies should develop a guideline of disclosing information through the internet in order to enhance the corporate transparency and performance among the GCC listed companies leading to reasonable economic decision making.
Originality/value
Additionally, the study contributes to financial reporting and performance literature relating to the GCC countries.
In its twenty years of existence, Brazil's private pension system has accumulated assets over 70 billion dollars. There is a growing concern about the role priva te pensions can play in the Brazilian economy. It is hoped that they can contribute in three important aspects: (a) financing economic development, (b) growth of domestic capital markets, and (c) dilution of the property structure. This study will try to draw from the experience of industrialized countries some perspectives related to the growth and performance of pension funds in emerging markets.
Our theory of costly contracts emphasizes that contractual rights can be of two types: specific rights and residual rights. When it is costly to list all specific rights over assets in the contract, it may be optimal to let one party purchase all residual rights. Ownership is the purchase of these residual rights. When residual rights are purchased by one party, they are lost by a second party, and this inevitably creates distortions. Firm 1 purchases firm 2 when firm 1's control increases the productivity of its management more than the loss of control decreases the productivity of firm 2's management.
State ownership pyramidal groups, family trust and a minor role for banks and other financial institutions in the corporate
governance of both large and small enterprises are the structural features of Italian capitalism today. This paper offers
a critical analysis of state ownership by analysing the evolution of Italian corporate governance since the Second World War.
It concludes that full or majority state ownership of corporations can be effective in separating ownership and control during
stages of powerfully accelerating growth and when shifts in the sectoral balance are needed; that state-owned enterprises
must not be burdened with ‘special social objectives’; and that the system is bound to degenerate without a functioning political
market to guarantee democratic changes of parties and power and if the ‘mission’ culture of public managers is eroded.
The political economy of trade policy has largely neglected popular election. When legislatures determine protection, politicians supply tariffs that are demanded by their constituents. A model of this political market is specified and tested with data related to the McKinley Tariff of 1890. An index of the extent to which tariff protection accrued to individual congressional districts is applied, along with demand and supply variables, to three questions: Did representatives supply tariffs to their districts as the model predicts? Did they vote in accordance with the district tariff interest in the roll-call vote on the McKinley Tariff? Did electors reward representatives for the district tariff protection in a manner consistent with a political market model? Empirical estimations based on the model provide answers that are generally affirmative and appear to be inconsistent with the traditional view that the Republic defeat in 1890 was a result of the McKinley Tariff. Copyright 1991 by MIT Press.
We present data on ownership structures of large corporations in 27 wealthy economies, making an effort to identify ultimate controlling shareholders of these firms. We find that, except in economies with very good shareholder protection, relatively few of these firms are widely-held, in contrast to the Berle and Means image of ownership of the modern corporation. Rather, these firms are typically controlled by families or the State. Equity control by financial institutions or other widely-held corporations is less common.
Using a sample of forty-nine countries, the authors show that countries with poorer investor protections, measured by both the character of legal rules and the quality of law enforcement, have smaller and narrower capital markets. These findings apply to both equity and debt markets. In particular, French civil law countries have both the weakest investor protections and the least developed capital markets, especially as compared to common law countries. Coauthors are Florencio Lopez-de-Silanes, Andrei Shleifer, and Robert W. Vishny. Copyright 1997 by American Finance Association.
Do well-functioning stock markets and banks promote long-run economic growth? This paper shows that stock market liquidity and banking development both positively predict growth, capital accumulation, and productivity improvements when entered together in regressions, even after controlling for economic and political factors. The results are consistent with the views that financial markets provide important services for growth and that stock markets provide different services from banks. The paper also finds that stock market size, volatility, and international integration are not robustly linked with growth and that none of the financial indicators is closely associated with private saving rates. Copyright 1998 by American Economic Association.
We present data on ownership structures of large corporations in 27 wealthy economies, making an effort to identify the ultimate controlling shareholders of these firms. We find that, except in economies with very good shareholder protection, relatively few of these firms are widely held, in contrast to the Berle and Means image of ownership of the modern corporation. Rather, these firms are typically controlled by families or the State. Equity control by financial institutions or other widely held corporations is far less common. The controlling shareholders typically have power over firms significantly in excess of their cash flow rights, primarily through the use of pyramids and participation in management. * Harvard University. We are grateful to Alexander Aganin, Carlos Berdejo-Izquierdo, David Grossman, Bernardo Lopez-Morton, Tatiana Nenova, Ekaterina Trizlova and David Witkin for help with assembling the data, to Lucian Bebchuk, Marco Becht, Mihir Desai, Oliver Hart, Louis Kaplow, Ren Stulz, Robert Vishny, Luigi Zingales, and two anonymous referees for advice, and to the NSF for financial support. In their 1932 classic, "The Modern Corporation and Private Property," Adolph Berle and Gardiner Means called attention to the prevalence of widely held corporations in the United States, in which ownership of capital was dispersed between small shareholders, yet control was concentrated in the hands of managers. For at least two generations, their book fixed the image of the modern corporation as one run by professional managers unaccountable to shareholders. The book stimulated an enormous "managerialist" literature on the objectives of such managers, including the important work of Baumol (1959), Marris (1964), Penrose (1959), and Williamson (1964), as well as Galbr...
Drawing on recent theories of control allocation and on the results of a farsearching empirical research project, Italian corporate governance is analyzed and interpreted. With control oriented financial institutions, takeovers and fiduciary duties lacking, separation between ownership and control is guaranteed by a mix of state ownership, pyramidal groups and implicit rules, namely family relations and coalitions among owners sharing common interests or values. The results are shown to be a limited degree of separation, a high stability of control, which spurs entrepreneurs' commitment and investments, and obstacles to the mobility of control, which hamper growth and restructuring and limit people's opportunities. An interpretation is provided of why the disadvantages have outweighed the advantages only since the end of the '60s and why small companies have succeeded in overcoming some of the drawbacks better than large companies. The first tentative steps to reform the system are assessed.
This paper tests the hypothesis that the future distribution of payoffs provided by a common stock depends upon whether ownership of the stock also conveys control over the firm's activities. For 26 firms that had two classes of common stock outstanding, the class with superior voting rights traded at a premium relative to the other class. However, in four firms where the ownership structure of the firm also included a class of voting preferred stock, the class of common with superior voting rights traded at a significant discount relative to the class of common with inferior voting rights. The analysis suggests that there are both benefits and costs of corporate control.
This paper provides a framework for addressing the question of when transactions should be carried out within a firm and when through the market. Following Grossman and Hart, we identify a firm with the assets that its owners control. We argue that the crucial difference for party 1 between owning a firm (integration) and contracting for a service from another party 2 who owns this firm (nonintegration) is that, under integration, party 1 can selectively fire the workers of the firm (including party 2), whereas under nonintegration he can "fire" (i.e., stop dealing with) only the entire firm: the combination of party 2, the workers, and the firm's assets. We use this idea to study how changes in ownership affect the incentives of employees as well as those of owner-managers. Copyright 1990 by University of Chicago Press.
In many developing countries with emerging stock markets, banks are fearful of stock market development because they think that stock markets will reduce the volume of their business. This article empirically analyzes the effects of stock market development on firms' financing choices using data from thirty developing and industrial countries from 1980 to 1991. The results imply that initial improvements in the functioning of a developing stock market produce a higher debt-equity ratio for firms and thus more business for banks. In stock markets that are already developed, further development leads to a substitution of equity for debt financing. By contrast, in developing stock markets, large firms become more levered as the stock market develops, whereas small firms do not appear to be significantly affected by stock market development. Copyright 1996 by Oxford University Press.
This paper focuses on cross-industry differences in the pattern of corporate ownership in the Italian manufacturing and mining sectors. The authors draw attention to factors responsible for the diffusion of ownership. The paper relies on econometric estimates which confirm the role played by economies of scale, R&D intensity, and specialization of human capital in shaping corporate ownership structures. More importantly, the econometric findings point out that the internal fund allocation function extensively performed by large, diversified business groups significantly distorts the pattern of corporate ownership. Specifically, in low-tech industries where economies of scale are negligible and human capital is unspecialized, when a considerable share of output is attributable to firms controlled by groups whose core activities demand substantial wealth, the ownership share held by unrestricted residual claimants turns out to be well above the value one would otherwise expect. The opposite phenomenon occurs in high-tech, scale-intensive industries. (c) 1996 Academic Press Limited Copyright 1996 by Oxford University Press.
This essay summarizes my own personal view of what corporate governance is about. I" argue that it makes sense to discuss corporate governance only in an incomplete contract world. " In this world, the notion of corporate governance is intrinsically related to the definition of the" firm. In this respect, I review the shortcomings of the existing definitions of the firm and the" possible applications of the idea that the firm is a specific investments" introduced by" Rajan and Zingales (1997a and 1997b). I conclude discussing the limitations of the incomplete" contracts approach to corporate governance.
This paper analyzes the inefficiencies that might arise in the ownership structure chosen at the initial public offering stage. We show that, contrary to what is commonly believed, the desire of initial owners to maximize their proceeds leads them to choices that, although privately optimal, may be socially inefficient. This distortion tends to be in the direction of excessive incidence of controlling shareholder structures and excessive divestment of cash flow rights. Our analysis has far-reaching policy implications for dual class stock, stock pyramiding, sale of control rules, and public offerings of minority shares. Among its positive implications, our analysis suggests reasons for the substantial differences in the incidence of control blocks across different countries.
This study is a sequel to the Singh and Hamid's monograph (IFC Technical Paper No. 1) on corporate financing patterns and structures in nine industrializing economies. Singh and Hamid's was the first large scale research on this subject and it yielded quite unexpected results. The two authors found that developing country corporations rely in general very heavily (a) on external funds and (b)on new issues of shares to finance their growth of net assets. These results are extremely surprising as they are opposite to that which most economists would expect. They also suggest almost the reverse of the "pecking order" pattern of finance found in advanced economies whereby the latter mostly use retained profits to finance their investment needs; if more finance is required, they have recourse to bank or long-term debt, and only as a last resort go to the stock market. The present study extends the Singh and Hamid analysis in three ways: (a) it establishes the robustness of their results on much bigger corporate samples for each country; (b) it provides a more systematic comparison of corporate financial patterns in industrial and semi-industrial countries; (c) it sets out a theory to explain why developing country corporations use equity capital so extensively to finance the growth of their net assets.
We analyze the pricing of 63 block trades between 1978 and 1982 involving at least 5% of the common stock of NYSE or Amex corporations. These blocks are typically priced at substantial premiums to the post-announcement exchange price. We argue that the premiums, which average 20%, reflect private benefits that accrue exclusively to the blockholder because of his voting power. The premiums paid by both individual and corporate block purchasers increase with firm size, fractional ownership, and firm performance. Individuals pay larger premiums for firms with greater leverage, lower stock-return variance, and large cash holdings.
This article surveys research on corporate governance, with special attention to the importance of legal protection of investors and of ownership concentration in corporate governance systems around the world. Copyright 1997 by American Finance Association.
This paper examines whether financial development facilitates economic growth by scrutinizing one rationale for such a relationship; that financial development reduces the costs of external finance to firms. Specifically, we ask whether industrial sectors that are relatively more in need of external finance develop disproportionately faster in countries with more developed financial markets. We find this to be true in a large sample of countries over the 1980s. We show this result is unlikely to be driven by omitted variables, outliers, or reverse causality. (JEL O4, F3, G1) A large literature, dating at least as far back as Joseph A. Schumpeter (1911), emphasizes the positive influence of the development of a country's financial sector on the level and the rate of growth of its per capita income. The argument essentially is that the services the financial sector provides -- of reallocating capital to the highest value use without substantial risk of loss through moral hazard, adverse ...
Corporate Governance', NBER Working Paper Series No Cambridge, MA), forth-coming in the New Palgrave Dictionary of Economics and Law
- L Zingales
Zingales, L.: 1997, 'Corporate Governance', NBER Working Paper Series No. 6309 (National Bureau of Economic Research, Cambridge, MA), forth-coming in the New Palgrave Dictionary of Economics and Law. Escola de Administração de Empresas de São Paulo – EAESP/FGV, Av. 9 de Julho 2029, São Paulo-SP 01313-902, Brazil, E-mail: frabelo@fgvsp.br fvasconcelos@fgvsp.br Corporate Governance in Brazil
On Corporate Governance in Italy: Issue, Facts and Agenda', Nota di Lavoro 10.96, Research Department, Bank of Italy, Rome, mimeo. Barca, F. and S. Trento: 1997, 'State Ownership and the Evolution of Italian Corporate Governance
- F Barca
Barca, F.: 1996, 'On Corporate Governance in Italy: Issue, Facts and Agenda', Nota di Lavoro 10.96, Research Department, Bank of Italy, Rome, mimeo. Barca, F. and S. Trento: 1997, 'State Ownership and the Evolution of Italian Corporate Governance', Industrial and Corporate Change 6(3), 533–559.
Alternative Investments by Pension Funds
- F M Rabelo
Padrão de Financiamento das Empresas Privadas no Brasil', Texto para Discussão No. 653, IPEA, Brasília (DF). Secretaria Geral de Apoio à Desestatização-SD.: 1997, Privatizações no Brasil
- Rodrigues Júnior
- G M Melo
23 (63.99) 99.85 (99,85) An Executive of the Group not member the Family
- Patrimonial Ltda
Patrimonial
Ltda.
36.23
(63.99)
99.85
(99,85)
An Executive of
the Group not
member the
Family
7,86
(3.97)
) 100 (100) Family 4
- Hejoassú Adm
- Ltda
Hejoassú
Adm.
Ltda.
0.10
(0.10)
36.31 (36.31)
42.75
(42.75)
100
(100)
Family
4.20 (4.20)
95.80 (95.80)
99.90 (99.90)
56.87 (56.87)
43.13
(43.13)
51.17
(51.17)
17.48 (17.48)
21.29 (21.29)
Former executive of Banco do Brasil, a state owned bank sponsor of Previ, a pension fund shareholder of Embraer
- Maria João
- Stefanon
João Maria Stefanon
Former executive of Banco do Brasil, a state
owned bank sponsor of Previ, a pension fund
shareholder of Embraer.
Market Participações Morro Vermelho Ltda
- Camargo Corrêa
Camargo
Corrêa S.A.
Market
Participações
Morro
Vermelho Ltda.
18.24
(51.89)
27.11
(14.53)
3.65
(6.26)
Executive of the group Fernanco C. M. Lisbôa Executive of the group Renato Baiardi Executive of the group Luiz Fernando Villar Executive of the group
- R Aluizio
- Araujo
Aluizio R. Araujo
Executive of the group
Fernanco C. M. Lisbôa
Executive of the group
Renato Baiardi
Executive of the group
Luiz Fernando Villar
Executive of the group.
Engineer works on the Strategic Management Area
- Paulo Cesar De Souza
- Lucas
Paulo Cesar de Souza Lucas
Engineer works on the Strategic Management
Area. Coordinated the development of projects at
Embraer.
Cunha President of Ultra Group, a local business group
- Paulo Guilherme Aguiar
Paulo Guilherme Aguiar Cunha
President of Ultra Group, a local business
group.
Maranhão Neto Director of Business Development and Project Implementation of Gerasul. Director of TRACTEBEL Brasil Ltda, a foreign firm shareholder of Gerasul
- Methodio Gil De
Gil de Methodio Maranhão Neto
Director of Business Development and
Project Implementation of Gerasul. Director
of TRACTEBEL Brasil Ltda, a foreign firm
shareholder of Gerasul.
Pension fund representative (Previ) Mário Celso Petraglia Executive of Inepar, a local business group shareholder of Tele Norte Leste
- Wilson Pumar
- De Paula
Wilson Pumar De Paula
Pension fund representative (Previ)
Mário Celso Petraglia
Executive of Inepar, a local business group
shareholder of Tele Norte Leste.
Main Executive of Jereissati Group (La Fonte/Iguatemi), which is a shareholder of Tele Norte Leste
- Carlos Francisco
- Ribeiro Jereissati
Carlos Francisco Ribeiro Jereissati
Chairman of the Board and President of
Tele Norte Leste. Main Executive of
Jereissati Group (La Fonte/Iguatemi), which
is a shareholder of Tele Norte Leste.
Member of other Boards.
Unibanco Holdings S.A. Market Market Foreign Bank Foreign Bank Arby's Brasil S
- Unibanco União
- De S A Bancos
UNIBANCO UNIÃO DE BANCOS BRAS S.A.
Unibanco Holdings S.A.
Market
Market
Foreign Bank
Foreign Bank
Arby's Brasil S.A.
(Affonso Ferreira Family)
Cunha Filho Executive of Odebrecht Group, a local business group
- Alvaro Fernandes
Alvaro Fernandes Da Cunha Filho
Executive of Odebrecht Group, a local
business group.
Foundation) Fundação Itaúsa (Foundation) 56
- Fundação Market
- Itaubanco
Market
Fundação Itaubanco
(Foundation)
Fundação Itaúsa
(Foundation)
56.69 (33.72)
13.73 (46.83)
21.24 (13.48)
8.00 (4.58)
10.06 (3.54)
32.94 (69.51)
Lyrio – Vice Chairman Executive of the group
- Rony Castro
Rony Castro O. Lyrio – Vice Chairman Executive of the group.
Foreign Bank Market Itaucorp S.A. Another Local Business Group O. E
- S A Itaúsa Investimentos Itaú
Itaúsa Investimentos Itaú S.A.
Foreign Bank
Market
Itaucorp S.A.
Another Local Business
Group
O. E. Setúbal S.A.
Fazenda Paraíso Ltda.
Sistema Financeiro e a Retomada do Crescimento Econômico
- C A Rocca
- M E Silva
- A G Carvalho
Rocca, C. A., Silva, M. E. and Carvalho, A. G. (1998), " Sistema Financeiro e a
Retomada do Crescimento Econômico ", Relatório de Pesquisa, FIPE – USP.
Do Bradesco Others 46
- Caixa Bene-Ficente Dos Func
Caixa Bene-
Ficente dos
Func. Do
Bradesco
Others
46.72
(23.35)
6.98
(3.36)
Market Foreign Bank Ipiranga Comercial Química S
- Ipiranga Petroquímica
IPIRANGA PETROQUÍMICA S.A.
Market
Foreign Bank
Ipiranga
Comercial
Química S.A.
6.46
(6.46)
6.67 (6.67)
86.87
(86.87)
58.53 (58.53)
41.47
(41.47)