Corporate Governance and Public Reprimand

Embong, Zaini; Radzi, Ruhaznawati Md

doi:10.17576/ajag-2017-08si-15

Cited by 3 publications

(6 citation statements)

References 30 publications

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“…Berdasarkan peraturan yang dikeluarkan oleh Bursa Malaysia, Keperluan Penyenaraian menjadi salah satu ketetapan penting bagi melindungi pelabur, memastikan ketelusan dan mengekalkan tadbir urus yang tinggi agar para peserta pasaran(market player) boleh mengambil bahagian dalam pasaran dengan yakin. Selaras dengan ini, Bursa Malaysia melihat sebarang pelanggaran terhadap Keperluan Penyenaraiannya adalah satu kesalahan yang serius dan tindakan penguatkuasaan diambil untuk melindungi pelabur serta mengekalkan integriti pasaran (Zaini & Ruhaznawati, 2017).…”

Section: Pengenalanunclassified

Penguatkuasaan Bursa Malaysia Terhadap Pelanggaran Syarat Penyenaraian Syarikat Patuh Syariah

Sulaiman

Zaki

2019

LJMS

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The enforcement action taken by Bursa Malaysia against listed companies in breach of the Listing Requirements is the most effective method of educating investors in the capital market. The objective of the study is to study the enforcement relationship with the characteristics of corporate governance in the Shariah-compliant companies listed on Bursa Malaysia. 10 samples of Shariah-compliant companies that are subject to regulatory violations are used in analyzing the relationship of enforcement actions with the characteristics of corporate governance ie the Board and the Audit Committee. The aspects studied are the size of the Board, Board Members Independence, Frequency of Board meetings, independence and expertise of Audit Committee Members. The findings show that the Board Size and independence show the results of the analysis which are not in line with the findings of previous studies and best practices recommendations. While the results of the analysis for the Frequency of Meetings are positive and parallel as the previous study findings and best practice recommendations. This means that the frequent meetings of the Board will create a low risk for the company to make a violation of the Listing Requirements. In addition, the results of the analysis to show the effectiveness of the structure of the Audit Committee ie the independence and expertise of the Audit Committee members. Abstrak Tindakan penguatkuasaan yang diambil oleh Bursa Malaysia terhadap syarikat tersenarai yang melanggar Syarat-syarat Keperluan Penyenaraian adalah satu kaedah yang paling berkesan bagi mendidik para pelabur dalam pasaran modal. Objektif kajian adalah untuk mengkaji hubungan penguatkuasaan dengan ciri-ciri tadbir urus korporat di syarikat-syarikat patuh syariah yang tersenarai di Bursa Malaysia. 10 sampel syarikat patuh syariah yang dikenakan tindakan di atas pelanggaran peraturan digunakan dalam menganalisis hubungkait tindakan penguatkuasaan dengan ciri-ciri tadbir urus korporat iaitu Lembaga Pengarah dan Jawatankuasa Audit. Aspek-aspek yang dikaji ialah saiz Lembaga Pengarah, Kebebasan Ahli Lembaga Pengarah, Kekerapan mesyuarat Lembaga Pengarah, kebebasan dan kepakaran Ahli Jawatankuasa Audit. Hasil dapatan kajian mendapati saiz dan kebebasan Lembaga Pengarah menunjukkan hasil analisis yang tidak selari dengan dapatan kajian terdahulu dan cadangan amalan terbaik (best practices). Manakala hasil analisis bagi kekerapan mesyuarat adalah positif dan selari seperti dapatan kajian terdahulu dan cadangan amalan terbaik (best practices). Ini bermakna kekerapan mengadakan mesyuarat Lembaga Pengarah akan mewujudkan risiko yang rendah untuk syarikat membuat pelanggran terhadap Syarat-syarat Penyenaraian. Selain itu, hasil keputusan analisis bagi menunjukkan hubungkait keberkesanan struktur ahli-ahli Jawatankuasa Audit.

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Section: Pengenalanunclassified

Penguatkuasaan Bursa Malaysia Terhadap Pelanggaran Syarat Penyenaraian Syarikat Patuh Syariah

Sulaiman

Zaki

2019

LJMS

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“…Prior literature suggests that stronger enforcement of stock exchange regulations has a significant impact on the valuation of a company and the stock price of the company in the market (Kwan and Lau, 2011). Although enforcement actions or reprimands do not affect the company directly, they can cause the market to react negatively towards the company when they are made known to the public by the authorities (Embong and Rudzi, 2017). Past studies show that stock prices react negatively to the imposition of enforcement actions (Hitz et al, 2020;Abedifar et al, 2019;Sampath et al, 2018;Voon et al, 2008;Chen, et al, 2005).…”

Section: Introductionmentioning

confidence: 99%

“…Past studies show that stock prices react negatively to the imposition of enforcement actions (Hitz et al, 2020;Abedifar et al, 2019;Sampath et al, 2018;Voon et al, 2008;Chen, et al, 2005). Although enforcement actions affect both the company and the market in a negative way, they are seen to be the most effective measures by which to protect the interests of all parties involved, especially shareholders (Embong and Rudzi, 2017). Furthermore, strict enforcement and robust regulations can prevent a crash in stock prices (Abedifar et al, 2019).…”

Section: Introductionmentioning

confidence: 99%

“…This study makes two contributions to the literature in the area of the imposition of public reprimands on companies. Firstly, owing to the limited research on the imposition of public reprimands in developing countries (Embong and Rudzi, 2017), this study contributes to addressing this lack by examining the effect of public reprimands on stock price reactions in a developing country, namely, Malaysia. Furthermore, owing to the mixed evidence from prior studies on the relationship between the imposition of public reprimands and stock price reactions, this study explores this relationship more deeply by using event study analysis and abnormal returns (AR) analysis to complement the findings reported by previous studies.…”

Section: Introductionmentioning

confidence: 99%

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The effect of the imposition of a public reprimand on the stock price of companies in Malaysia

Zainudin¹,

Hashim²,

Ismail³

2021

JFC

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Purpose This paper aims to examine the effect of the imposition of public reprimands on the underlying stock prices of companies in Malaysia. Design/methodology/approach Data on 148 companies that received public reprimands during the period from 2007 to 2013 were collected from the Bursa Malaysia website to analyse the market reactions to the imposition of public reprimands. Findings Based on a market model of abnormal returns, the empirical result showed that the imposition of a public reprimand had a negative impact on a company’s stock price. Moreover, when a market model of average abnormal returns (AAR) was used, the result indicated that companies that had received a public reprimand had a negative AAR value. Research limitations/implications The findings from this study have implications for shareholders in making their investment decisions because they can switch their investments to other companies and markets after a company in which they are interested or have made an investment has received a public reprimand. Originality/value There is limited research on the imposition of public reprimands and the effect that it has on companies in developing countries. Hence, this study contributes to research in this area by providing evidence on the effect of public reprimand on stock price reactions in the context of a developing country, namely, Malaysia.

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“…In other words, for good governance to have impact on investors' confidence, firm needs to communicate its good governance practices. Research on corporate governance thus far focuses on consequences of corporate governance including firm's performance (Nazli Anum 2010;Lakshan & Wijekoon 2012;Swedan & Ahmed 2019), disclosure (Gao & Kling 2012) as well as misconduct (Rezaee 2005) and enforcement action (Embong & Md Radzi 2017). Despite abundance of empirical research into the consequences of good governance, findings on the board characteristics association on firm value are still inconclusive.…”

Section: Introductionmentioning

confidence: 99%

Board Characteristics, Investors’ Confidence and Firm Value: Malaysian Evidence

Lim

Hashim

Embong

2019

AJAG

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This study aims to investigate the association between board characteristics and firm value taking into consideration the role of investors' confidence. The subject of corporate governance is still of interest to researchers and practitioners due to its importance and the complexities surrounding it. This is because there are many elements that may interplay with corporate governance in influencing the value of firms. Despite abundance of research on the effect of board characteristics on firm's value, the empirical evidences are still inconclusive. One of the consequences of having good governance as evidenced by many empirical research is the higher firm value. The agency theory explains this relationship such that good governance reduces agency cost, increasing investors' confidence on the firm, hence its value. This explanation indicates that the influence of good governance on the firm's value could be due to its effect on investors' confidence. This study extends the understanding on the relationship between corporate governance and firm value by investigating the role of investors' confidence on this relationship. Companies listed on Main Board of Bursa Malaysia are selected as sample using proportionate stratified random sampling method. The results demonstrate that CEO duality and board independence significantly related to firm value consistent with prior studies. The analysis on the role of investors' confidence in the relationship between board characteristics and firm value indicates that investors' confidence plays significant role in the relationship between CEO duality and firm value. The results provide input to firms on factors that contribute to firm value and to relevant authority on the important aspect of corporate governance.

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Corporate Governance and Public Reprimand

Abstract: Public reprimand is a form of enforcement actions taken by Bursa

Cited by 3 publications

References 30 publications

Penguatkuasaan Bursa Malaysia Terhadap Pelanggaran Syarat Penyenaraian Syarikat Patuh Syariah

Penguatkuasaan Bursa Malaysia Terhadap Pelanggaran Syarat Penyenaraian Syarikat Patuh Syariah

The effect of the imposition of a public reprimand on the stock price of companies in Malaysia

Board Characteristics, Investors’ Confidence and Firm Value: Malaysian Evidence

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