Corporate governance and efficiency in the Electricity Sector using Data Envelopment Analysis: a study in the brazilian stock market

Abstract

Different Corporate Governance mechanisms have been suggested to minimize agency problems between managers and shareholders, and between controlling and minority shareholders. The aim of this study is to analyze the corporate governance mechanisms result in greater efficiency for Brazilian stock companies in the electricity sector, in 2007-2009. The hypothesis to be verified is that the lower the voting concentration and the dependence of the council, and the greater the cash flow concentration, the greater the performance of the company will be. The analyzed sample involved thirty-three companies, fourteen being classified into one of the levels of CG (Level 1, Level 2 or New Market) and the remainder being members of the traditional market. To measure the efficiency of the companies, the non-parametric DEA (Data Envelopment Analysis) method was used, and to relate the efficiency with the governance variables, we adopted regression analysis of panel data. The results demonstrated that the use of CG mechanisms positively influences business efficiency, but not in the expected magnitude. It was found that the cash flow concentration is positively related to the efficiency of firms, supporting the governance literature. For future work, the use of other input and output variables is suggested.

Does the efficiency of corporate governance and intellectual capital affect a firm's financial distress? Evidence from Egypt

“…The results are consistent with the previous empirical evidence (e.g. Peixoto et al , 2011; Ferreira et al , 2013; Oteng-Abayie et al , 2018). They point out that “on average” DMUs do not operate at the optimum level of technical efficiency.…”

“…They point out that “on average” DMUs do not operate at the optimum level of technical efficiency. For instance, Peixoto et al (2011) referred that the average efficiency of CG in 2007 was 0.848, which decreased to 0.699 in 2009. Ferreira et al (2013) indicated a 16 percent decrease in the efficiency average of CG during the study period.…”

“…The empirical findings support the positive effects of smaller board size and a higher percentage of ownership concentration on bank efficiency. Peixoto et al (2011) demonstrate that a firm's efficiency is associated with good government, attributable to the significant positive association between the governance index and the DEA efficiency score. Oteng-Abayie et al (2018) also investigate the impact of CG mechanisms on the technical efficiency scores of rural and community banks (RCB) in Ghana.…”

“…Many researchers and practitioners have tried to assess the quality of CG and the various submechanisms related to CG as crucial determinants of achieving high performance and reducing the probability of financial distress (e.g. Lee and Yeh, 2004; Wang and Deng, 2006; Black et al , 2006; Lin et al , 2009; Peixoto et al , 2011; Kocmanova and Simberova, 2012; Ferreira et al , 2013; Lima and Sanvicente, 2013; Matic and Papac, 2014; Makki and Lodhi, 2014; Achim and Borlea, 2014; Shahwan, 2015; Murhadi et al , 2018; Oteng-Abayie et al , 2018). For instance, Daily and Dalton (1994) investigate the association between a company's CG and a firm's default risk (distress risk).…”

Influência Da Governança Corporativa E Da Intangibilidade No Desempenho Das Maiores Empresas Brasileiras

“…Por meio da Figura 2, com relação ao desempenho financeiro (ROA) depreendese que as empresas listadas no Novo Mercado estão associadas com as empresas com nível médio-baixo de desempenho financeiro, enquanto as empresas que não se encontram listadas nos níveis de governança corporativa (Outros) associam-se com as companhias com alto nível de desempenho financeiro. Os resultados contrariam os achados de Macedo e Corrar (2012) que identificaram a governança corporativa como vetor de maior desempenho financeiro, assim como Peixoto et al (2011).…”