Corporate governance, external market discipline and firm productivity

Tian, Gloria Yuan; Twite, Garry J.

doi:10.1016/j.jcorpfin.2010.12.004

Cited by 133 publications

(108 citation statements)

References 45 publications

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“…With these exceptions, sensitivities and elasticities to market‐based performance measures do not depend fundamentally on corporate governance measures. Although inconsistent with US results, these findings are not unexpected given the substitutability of internal and external governance mechanisms (Tian and Twite ) and institutional differences observable across the two markets.…”

Section: Resultscontrasting

confidence: 80%

Corporate Governance and the CEO Pay–Performance Link: Australian Evidence

2013

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We examine the influence of corporate governance mechanisms, namely blockholdings and board structure, on CEO pay–performance sensitivity in listed Australian firms. Results highlight blockholders' role in shaping observed pay–performance associations and their impact varying with their independence and relative magnitude of ownership. Monitoring blockholders increase the sensitivity of long‐term at‐risk pay to performance, better aligning manager and shareholder interests. However, consistent with a shorter investment horizon, insider blockholders increase (decrease) the responsiveness of cash bonuses (long‐term at‐risk pay). Finally, consistent with them affording less‐effective monitoring, larger boards raise (lower) the sensitivity of known pay (long‐term at‐risk pay) to performance.

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Section: Resultscontrasting

confidence: 80%

Corporate Governance and the CEO Pay–Performance Link: Australian Evidence

2013

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“…We exclude these financial and utility firms because they are heavily regulated (Tian & Twite, 2011), and this may impact differently on their disclosure practices. The financial data are collected from DataStream.…”

Section: Data and Sample Selectionmentioning

confidence: 99%

The simultaneous disclosure of shareholder and stakeholder corporate governance practices and their antecedents

Gyapong

Afrifa

2018

Int. J Fin Econ

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In making corporate governance (CG)‐related disclosure, firms may solely focus on shareholders or may broaden their scope of disclosure to serve other stakeholders as well. This study examines whether there are differences in the disclosure of shareholder and stakeholder CG practices. Based on a hand‐collected dataset of 1,110 firm years in South Africa and a disclosure index using 72 CG provisions from the King III report of CG, we find that the disclosure of stakeholder CG practices is higher than that of shareholder CG practices. Our evidence suggests that foreign ownership, institutional ownership, racial diversity, and gender diversity increase total voluntary disclosure. In contrast, chief executive officer (CEO) age decreases total voluntary disclosure. Also, although foreign ownership, institutional ownership, gender diversity, and racial diversity increase both shareholder and stakeholder CG disclosures, CEO age has a negative relationship with both shareholder and stakeholder CG disclosures. Further, board size reduces shareholder disclosure but not stakeholder disclosure. Our results further indicate that, ceteris paribus, the extent of shareholder CG disclosure relative to stakeholder CG disclosure is (a) lower with board size, gender diversity, and racial diversity and (b) higher with the level of institutional ownership. Our findings are robust across a raft of econometric techniques.

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“…For example, Low (2009) demonstrates that executive stock options can substitute for the absence of external disciplinary devices to induce managers to take more risk. Likewise, Tian and Twite (2010) suggest that product market competition, an external governance measure, can substitute for (poor) internal governance. 12.…”

Section: Fundingmentioning

confidence: 99%

Which governance characteristics affect the incidence of divestitures in Australia?

Nguyên

Rahman

2014

Australian Journal of Management

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International audienceEvent studies indicate that divestitures create shareholder value. However, managers are generally disinclined to execute a divestiture due to their inherent preferences for growing the firm’s assets. Governance structures can play a significant role in restraining this agency conflict. Using a sample of divestitures carried out by Australian firms over a recent 10-year period, we find that board compensation and ownership concentration increase the likelihood of a divestiture. In addition, board compensation has a stronger effect in firms that are more likely to divest, while larger boards inhibit divestitures in firms that are less likely to divest. Our analysis involves a propensity score matching method. We show that poor matching can lead to large biases and inconsistencies

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Corporate governance, external market discipline and firm productivity

Cited by 133 publications

References 45 publications

Corporate Governance and the CEO Pay–Performance Link: Australian Evidence

Corporate Governance and the CEO Pay–Performance Link: Australian Evidence

The simultaneous disclosure of shareholder and stakeholder corporate governance practices and their antecedents

Which governance characteristics affect the incidence of divestitures in Australia?

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