Insider Ownership, Corporate Governance and Corporate Performance

The basic purpose of this article is to ferret out whether there exists any association amongst board characteristics, insider ownership and firm-specific characteristics (firm size and age) in relation to Indian corporates listed on Bombay Stock Exchange (BSE). A total of 15 measures including several proxies and modulations has been contrived, which reflect the composition, independence, diligence as well as functioning period of corporate boards. Empirical investigation has been performed using one-way Analysis of Variance (ANOVA) and Welch ANOVA under Robust Tests of Equality of Means (including post-hoc tests) on the sample of top Indian firms ranked on the basis of market capitalisation. The present research findings involve the use of several modulations and formulations in the spectrum of board characteristics regarding the testing of board governance in India. Findings of the study have contributed to the extant corporate governance literature by deprehending significant relationships between board, insider ownership structures and firm-specific characteristics that would guide the policymakers to devise suitable policies for Indian corporate boards in future.

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“…Notes 1. See Berkman et al (2005), Phani, Reddy, Ramachandaran and Bhattacharya (2005) and Kumar and Singh (2013…”

Section: Limitations and Scope For Future Researchmentioning

confidence: 99%

Corporate Boards, Insider Ownership and Firm-Related Characteristics: A Study of Indian Listed Firms

Sarpal

Singh

2013

Asia-Pacific Journal of Management Research and Innovation

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“…RoA is an accounting-based performance measure and is included in several studies for its robustness (Demsetz & Villalonga, 2001). Phani, Reddy, Ramachandran, and Bhattacharyya (2006) have compared the results of various empirical studies and also statistically tested the relative merits of using RoA. According to them, even in situations where the worst performing companies are included in the sample for econometric testing, RoA tends to provide robust result in spite of RoA suffering from an inherent bias due to historical valuation of assets.…”

Section: Methodsmentioning

confidence: 99%

Corporate Governance and Firm Performance: An Exploratory Analysis of Indian Listed Companies

Roy

2014

Jindal Journal of Business Research

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In this article we propose to study whether firm level good corporate governance (CG) leads to better firm performance, leading to higher value creation. Limited evidence exists concerning the impact of CG practices on firm level performance or valuations in the Indian context. This study attempts to fill this gap. Our motivation is to explore the linkage between good CG practices and firm performance in Indian listed companies. We use a panel of 58 top Indian listed companies in terms of market capitalisation (BSE 100 and NSE 100), over the five year period from 2007–08 to 2011–12 for our analysis. Our measurement analysis starts with a broad sample of 37 structural indicators of CG relating to directors, boards committees, audit considerations, ownership and capital structure characteristics and our defined set of control variables. We have used two measures of firm performance, Market to Book Value Ratio (MTBVR) and Return on Asset (RoA). We use principal component analysis to identify the underlying dimensions of CG and determine which indicators are associated with each factor. We conclude that firm performance, measured by RoA, results in R-square of 43.7 per cent, and is significantly influenced by the 7 factors. Firm performance, measured by MTBV Ratio, results in R-square of 34.5 per cent, and is significantly influenced by the 8 factors.

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“…According to Phani, Reddy, Ramachandran and Bhattacharyya (2002) 2) Does firm size influence the relationship between insider ownership and capital structure?…”

Section: Problem Statementmentioning

confidence: 99%

The Effects of Insider Ownership Capital Structure of Main Board Listed Companies

Lai¹,

Ling²,

Chelliah³

2017

REM

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In this paper, researcher tends to discuss the "internal control protects shareholders from agency problem". (Teall, 2007). Small firms usually are higher in insider ownership than outsider control. When a firm expands the business through public listing, the ownership will distribute ownership opportunity to the public. In Malaysia, when go to public listing, the 30% shares must hold by bumiputra. If there are non-bumiputra companies, the companies will gather 30% shares from outsiders who are bumiputra to meet the listing requirement.

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Insider Ownership, Corporate Governance and Corporate Performance

Cited by 13 publications

References 22 publications

Corporate Boards, Insider Ownership and Firm-Related Characteristics: A Study of Indian Listed Firms

Corporate Boards, Insider Ownership and Firm-Related Characteristics: A Study of Indian Listed Firms

Corporate Governance and Firm Performance: An Exploratory Analysis of Indian Listed Companies

The Effects of Insider Ownership Capital Structure of Main Board Listed Companies

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