Corporate governance in developing economies   the case of Egypt

Bremer, Jennifer; Elias, Nabil

doi:10.1504/ijbge.2007.015210

Cited by 43 publications

(26 citation statements)

References 1 publication

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Nevertheless, Bremer and Elias (2007) evaluated the progress of corporate governance in Egypt and they concluded that Egypt has several integral factors that hinder the development of corporate governance in Egypt: family-owned or closely held corporations dominate the Egyptian private sector, inefficient and corrupt ridden SOE still play a major role in the Egyptian economy, lack of independence of the board, and abysmal low levels of corporate governance disclosures.…”

Section: Research-article2015mentioning

confidence: 99%

Environmental Factors Influencing Corporate Governance

Isukul

Chizea

2015

Sage Open

View full text Add to dashboard Cite

With the enthronement of democratic governance in Nigeria, there is the expectation that democracy would strengthen political institutions, regulatory institutions, and governance effectively, and by so doing, create an enabling environment for good corporate governance practices to thrive. This research uses data from World Bank Governance indicators for three countries, Nigeria, South Africa, and Egypt, and examines how institutional quality has changed from 1996 to 2012. The research methodology used in investigating this research is a cross-country research analysis. The findings of this research reveal that the adoption of democratic institutions has not significantly increased the institutional quality of political and regulatory institutions in Nigeria. On the contrary, there has been an increasing trend of political instability and violence; however, there appears to be significant improvement in freedom of the press, democracy has allowed pressed freedom to thrive.

show abstract

Section: Research-article2015mentioning

confidence: 99%

Environmental Factors Influencing Corporate Governance

Isukul

Chizea

2015

Sage Open

View full text Add to dashboard Cite

show abstract

“…Furthermore, investigating the Egyptian context is identified as a useful chance to illuminate the prevalence of earnings management, along with its determinants, in an emerging market (namely, a newlyestablished capital market displaying prominent growth). This is because, when compared to developed countries, Egypt"s accounting environment, given the country"s status as an emerging market, reflects numerous points of difference.These differences include the following: firstly, relatively ineffective corporate governance (Bremer and Ellias, 2007); secondly, an elevated level of conformity regarding financial accounting to taxation (Farag, 2009); and thirdly, as described by Moore (1995), a relatively inconsequential part played by the capital market in raising capital. By contrast, the converse for each of these points is true for developed markets such as the US and the UK, including effective corporate governance, a limited level of conformity regarding financial accounting to taxation, and comparatively high importance of the capital market (Defond and Hung, 2004;Myring, 2006).…”

Section: Dr Wael Mostafamentioning

confidence: 99%

“…Nevertheless, when comparing developed countries such as the US and the UK to Egypt, a fundamental distinction is that the latter"s corporate governance environment contains no obligatory regulations which are backed up by legal force. Instead of this, Egypt"s corporate governance environment is based on regulation and the encouragement of responsible and transparent business activities which conform to stakeholder interests, which, for Bremer and Ellias (2007), is ultimately an admission of ineffective corporate governance. Critically, this has been shown to accentuate the problem of earnings management within the Egyptian context, a problem which is pervasive, problematic and actively practised in Egypt (Kamel and Elbanna, 2010) when comparatively examined against developed markets.…”

Section: Motivation For Studying the Egyptian Contextmentioning

confidence: 99%

الأداء المالى للشرکات و أدارة الأرباح: بالتطبیق على مصر (باللغة الإنجلیزیة)

مصطفي¹

2018

مجلة الاسکندریة للبحوث المحاسبیة

View full text Add to dashboard Cite

The present study examines the relation between firms" financial performance and earnings management in an emerging market; namely, Egypt.We examine the association between firms" financial performance and earnings management from three perspectives. First, we investigate whether a firm"s financial performance affects earnings management. Second,we examine whether firms with ineffective financial performance engage in earnings management practices more than firms with effective financial performance. Third, we test whether firms with ineffective financial performance manipulate their earnings to report greater earnings. Earnings management is captured by discretionary accruals. Cash flows from operations are used to indicate the level of a firm"s financial performance, thus allowing the categorisation of the sample group of Egyptian firms into two sub-samples: firstly, those characterized by low cash flows (demonstrating ineffective financial performance, i.e. underperforming or low performing firms); and secondly, those characterized by high cash flows (demonstrating effective financial performance, i.e. high performing firms). We use the ordinary least square regression model of the relation between discretionary accruals and a firm"s financial performance to examine whether a firm"s financial performance affects earnings management.To assess whether firms with ineffective financial performance are more prone to manage earnings than their higher performing counterparts,we employ a contextual model (of the relation between discretionary accruals and a firm"s financial performance) with a dummy variable approach that allows parameter shifts for underperforming firms. Finally, to test for income increasing accruals by underperforming firms, we test whether discretionary accruals are positive and significantly greater for underperforming firms than those for high performing firms. The results show that, first, earnings management is negatively associated with a firm"s financial performance. Second, underperforming firms are engaged in more earnings management practices than their high performing counterparts. Third, underperforming firms have positive and considerably greater discretionary accruals than their effectively performing counterparts to elevate their reported earnings in order to hide their low financial performance. Overall, these results suggest that an Egyptian firm"s financial performance may serve as a fundamental determinant of its likelihood of engaging in earnings management. Moreover, these results suggest that listed Egyptian firms utilize earnings management practices opportunistically as a way to conceal their ineffective/poor financial performance. Given the current weakness of investor protection and legal enforcement in Egypt, these results encourage policymakers to improve considerably corporate-governance mechanisms in Egypt. This study contributes to the limited research on earnings management in emerging markets, and specifically, Egypt.

show abstract

“…Strong investor protection creates an environment that deters managers from opportunistic behavior, reduces the risk of mismanagement, and increases shareholders' confidence and their willingness to participate in the capital markets (DeFond & Hung, 2004). Companies from developing economies with weak financial transparency and governance will find it difficult to raise capital and attract foreign investors (Bremer & Elias, 2007). In essence, improved governance creates a signaling effect which demonstrates to citizens, the private sector, and investors that the government is serious about reform (Saidi, 2004).…”

Section: Investor Protectionmentioning

confidence: 99%

Corporate governance, investor protection, and firm performance in MENA countries

Hasan

Kobeissi

Song

2014

Middle East Development Journal

View full text Add to dashboard Cite

The literature on development finance and corporate finance in emerging markets is, to date, primarily focused on the impact of country-level investor protection and differences in legal systems on firm value across countries. This paper extends the literature by investigating the relationship between firm-level governance and performance while controlling for country-level governance and other relevant variables within the context of the Middle East and North Africa (MENA) region. Evidence shows a strong and significant positive relationship between good corporate governance -such as higher investor protection and lower managerial entrenchmentand firm value. We also find that the positive effects of property rights on firm performance are more pronounced for firms with higher managerial entrenchment. In addition, the positive effects of property rights on firm performance are additionally more significant for firms with higher managerial entrenchment and higher cash holding. Finally, the positive effects of property rights on firm performance are additionally more significant for firms with higher managerial entrenchment and lower dividend payout.

show abstract

Corporate governance in developing economies the case of Egypt

Cited by 43 publications

References 1 publication

Environmental Factors Influencing Corporate Governance

Environmental Factors Influencing Corporate Governance

الأداء المالى للشرکات و أدارة الأرباح: بالتطبیق على مصر (باللغة الإنجلیزیة)

Corporate governance, investor protection, and firm performance in MENA countries

Contact Info

Product

Resources

About