Corporate governance practices and comprehensive income

López-Quesada, Erika, Camacho-Miñano, María-del-Mar and Idowu, Samuel Olusegun (2018) Corporate governance practices and comprehensive income. Corporate Governance: The international journal of business in society. ISSN 1472-0701

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Official URL: https://www.emeraldinsight.com/doi/full/10.1108/CG...

Abstract

Purpose
The purpose of this paper is to analyze the effect of corporate governance practices on firms’ financial performance, as measured by comprehensive income (CI).

Design/methodology/approach
Using a sample of 237 firms from the Standards & Poor (S&P) 500 index during the years 2004-2009, multivariate statistical analyses are conducted to confirm the authors’ main hypothesis.

Findings
The results indicate that having high levels of corporate governance culture has a positive impact on a measure of firms’ financial performance, namely, CI. Furthermore, they indicate a positive correlation between a higher percentage of external directors and financial performance, and a negative relationship between number of board meetings and financial performance.

Originality/value
The main contribution of this research is that good corporate governance strategies deliver superior financial performance for businesses in terms of CI. This serves as a method of value creation, which is the ultimate goal of a business. In addition to the use of CI as an indicator of financial performance, a unique measure of corporate governance level is tested.

Item Type: Article
Additional Information: From Crossref via Jisc Publications Router
Uncontrolled Keywords: Financial performance, Corporate governance, Board of directors, Financial reporting
Subjects: 300 Social sciences > 330 Economics
Department: Guildhall School of Business and Law
SWORD Depositor: Pub Router
Depositing User: Pub Router
Date Deposited: 16 Mar 2018 14:47
Last Modified: 16 Mar 2018 14:47
URI: http://repository.londonmet.ac.uk/id/eprint/1353

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