Corporate Governance as an Antidote to Corruption in Emerging Markets

Windsor, Duane

doi:10.1007/978-3-642-44955-0_17

Cited by 6 publications

(4 citation statements)

References 54 publications

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“…Furthermore, countries with a low level of corruption enjoy a sound governance system that is transparent and accountable (Farazmand, 2017). Companies operating in countries with a low level of corruption publish transparent CSR reports, whereas when the level of corruption is high in a country, companies are less likely to engage in sustainability (Lattemann et al , 2009; Uyar et al , 2022b; Windsor, 2014).…”

Section: Empirical Literature Review and Hypothesis Developmentmentioning

confidence: 99%

Public governance, corporate governance and excessive ESG

Kuzey¹,

Al‐Shaer²,

Karaman³

et al. 2023

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Purpose Growing social concerns and ecological issues accelerate firms’ environmental, social and governance (ESG) engagement. Hence, this study aims to advance the existing literature by focusing on the interplay between institutional and firm governance mechanisms for greater ESG engagement. More specifically, the authors investigate whether public governance stimulates excessive ESG engagement and whether corporate governance moderates this relationship. Design/methodology/approach Using a sample of 43,803 firm-year observations affiliated with 41 countries and 9 industries, the authors adopt a country, industry and year fixed-effects regression analysis. Findings The authors find that public governance strength via its six dimensions stimulates excessive ESG engagement. This implies that firms in countries with strong voice and accountability, political stability, government effectiveness, regulatory quality, rule of law and control of corruption are more motivated for ESG engagement. Furthermore, corporate governance negatively moderates the relationship between all public governance dimensions (except political stability) and excessive ESG engagement. This implies that public governance and corporate governance are substitutes for encouraging firms to commit to ESG. Further tests reveal that whereas these results in the baseline analyses are valid for developed countries, they are not valid in emerging markets. Research limitations/implications The findings support the interplay between institutional and agency theories. In countries with strong (weak) institutional mechanisms, corporate governance becomes weak (strong) in inciting greater stakeholder engagement. This implies that the public governance mechanism alleviates agency costs, rendering internal mechanisms of corporate governance noncompulsory for ESG engagement. Practical implications The findings suggest that emerging countries need to reinforce their institutions for greater accountability, regulatory quality and control of corruption, which will have a domino effect on firms in addressing stakeholder expectations. The results also advise emerging country firms to augment their internal monitoring mechanisms for greater stakeholder engagement, such as structuring boards and establishing corporate social responsibility mechanisms, committees and policies. Originality/value This study contributes to the recent literature investigating the role of corporate governance mechanisms in excessive ESG engagement. The study also explores whether public governance is associated with greater ESG involvement and provides a comprehensive analysis of the association between six indicators of public governance quality and excessive ESG practices in developed and emerging economies.

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Section: Empirical Literature Review and Hypothesis Developmentmentioning

confidence: 99%

Public governance, corporate governance and excessive ESG

Kuzey¹,

Al‐Shaer²,

Karaman³

et al. 2023

View full text Add to dashboard Cite

show abstract

“…Since CG reforms have become part of development goals, the IMF and WB have significantly enhanced their monitoring of CG in emerging economies, emphasising not only adoption, but also more recently the use of scorecard assessments to motivate reforms (International Finance Corporation, 2014). Early instances of pressures to implement codes have been linked to conditionalities in country-level funding and debt agreements (Siddiqui, 2010;Adegbite et al, 2013;Windsor, 2014;Hopper et al, 2017). However, the emphasis seems to have shifted to a gradual and more subtle embedding of practices via a route of 'normative' pressures and the concomitant popularity of governance indicators, indices and ratings (e.g., as part of environmental, social and governance -ESG metrics).…”

Section: What We Can One Surmise From Existing Studies and Cases?mentioning

confidence: 99%

Do corporate governance codes matter in Africa?

Areneke,

Khlif,

Kimani

et al. 2022

Research Handbook on Corporate Board Decision-Making

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Africa is often depicted in the literature as the 'patron late to the party' on account of her low uptake of corporate governance codes. Notwithstanding, countries that have an existing corporate governance code continue to exhibit weak corporate accountability and governance practices. This prompted a critical analysis based on a detailed review of published articles and existing codes in the African multiple-contexts. Our findings reveal that the efficacy of many codes remains very limited in terms of pragmatic outcomes whilst firms in countries that have adopted codes continue to face uneven performance and poor accountability. We conclude by urging for an understanding of the reasons underlying such results. We recommend an Africanled re-think (independence, ownership, board processes) of existing codes to make them more aligned with the governance needs of African firms and their complex sociocultural background. We call for further research to illuminate Africa's actual governance experiences and necessities.

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“…According to Windsor (2014), successful, effective and efficient governance and anticorruption actions hinge on the personal integrity of business directors and executives. Maria, et.al (2009) asserted that initiatives of private companies towards the best practices of corporate governance like ethical leadership, employee commitment to the company code of conduct, fairness in procurement, marketing, production and human resource management can really improve the organizational environment against corruption.…”

Section: Best Anti-corruption Practicesmentioning

confidence: 99%

“…The UN Global Compact (UNGC) anti-corruption principal (principal 10) tells us "Business should work against corruption in all its forms, including extortion and bribery" (Windsor, 2014). The large multinational companies having a recognizable brand, millions of consumers across the globe, are responsible to implement maximum ethical standards and best polices against bribery and corruption.…”

Section: Best Anti-corruption Practicesmentioning

confidence: 99%

Corruption as Business Challenge in Pakistan

Khan

Réthi

Szegedi

2018

ESJ

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Corruption is a curse for any country, as it negatively affects the economic activities and drags the whole society to worst conditions by increasing the poverty and social inequities. Recently the most critical factor for doing business in Pakistan is corruption. In order to give a comprehensive picture of corruption in Pakistan this article (1) critically analyses the literature regarding corruption, its impact on society and the business environment specifically in Pakistan, (2) focuses on business-related factors of corruption, (3) presents various anti-corruption initiatives of Pakistani companies and foreign good examples. Based on our research this study emphasizes that the government should take corrective actions and strengthen institutions and should work in collaboration with the private and civil sector to control the uprising corruption problems. Awareness against corruption in business sphere and general public is very much needed and implementing possible anti-corruption tools, companies can positively contribute to the fight against corruption and Pakistan's economic and social development.

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Corporate Governance as an Antidote to Corruption in Emerging Markets

Cited by 6 publications

References 54 publications

Public governance, corporate governance and excessive ESG

Public governance, corporate governance and excessive ESG

Do corporate governance codes matter in Africa?

Corruption as Business Challenge in Pakistan

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