The objective of this paper is to examine the relationship between minority shareholders' rights and audit quality. Specifically, this paper examines the influence of minority shareholders' with at least 10% holdings on clients' demand for strong monitorin particularly in terms of high audit quality. The sample comprises the top 100 listed firms on the Borsa Istanbul (BIST) for 2014 and 2015. The finding of this paper is aligned with the propositions of the agency theory that minority shareholders with at least 10% holdings improve clients' demand for high audit quality. The findings of this paper have some implications for future studies on the role of minority shareholders to monitor management activities. This paper calls for future studies in the area of accounting and finance to introduce and operationalize a new measurement of Type II agency cost in order to better understand the agency conflicts within this unique market as well as the state of the minority shareholders on the BIST.

As the equity capital has begun to surface as an essential corporate finance mechanism in emerging markets, regulations providing adequate protection for the interests of minority shareholders and investors will enable companies to access global equity capital. Turkey. as an official candidate for European Union (EU) membership, must introduce a code of corporate governance ensuring the protection of investors, particularly minority shareholders to encourage them to partake in capital markets. Consequently, this code will ease the access of Turkish companies to equity capital. Turkey has made substantial improvements in promoting the interests of shareholders and investors by focusing on the absence of an equity culture in Turkey. The application of provisions of EU capital market and company laws in Turkish law will assist in creating a legal framework for protecting minority interests. The purpose of this study is to make a contribution to the attempts to develop a corporate governance structure to protect the interests of minority shareholders and investors, which is a main requirement for developing a Turkish equity culture.