Evasive shareholder meetings and corporate fraud

Gam, Yong Kyu; Gupta, Paramita; Im, Jieun; Shin, Hojong

doi:10.1016/j.jcorpfin.2020.101807

Cited by 17 publications

(15 citation statements)

References 35 publications

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“…Evidence from the extant literature shows a link between effective corporate governance mechanisms and the likelihood of fraud. Sabbaghi (2016) reports that corporate governance affects fraud risk, and Gam et al (2021) show a positive link between evasive corporate governance and corporate fraud. A few studies found that some companies could use effective corporate governance mechanisms to bolster their reputation after the fraud was detected.…”

Section: Impact Of Corporate Governance On Fraudmentioning

confidence: 99%

Elucidating corporate governance’s impact and role in countering fraud

Kassem

2022

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Purpose This paper aims to highlight the role and impact of corporate governance in combating fraud by drawing on insights from the literature, identify gaps in the literature and suggest new directions for future research. Design/methodology/approach The paper is based on a comprehensive general literature review using multiple search engines and databases. Findings This paper finds that effective corporate governance can help reduce fraud risk, prevent fraud and detect fraud, particularly corporate fraud, insider fraud and asset diversion. Some companies use corporate governance mechanisms to bolster their reputation following fraud detection. Ineffective corporate governance increases fraud risk, provides the opportunity for perpetrating fraud and reduces the likelihood of fraud detection. The paper sheds light on several governance mechanisms that could help in mitigating fraud risk, as reported in the literature. The paper categorises these governance mechanisms into four broad governance aspects, including board leadership and the role of ethics; (b) board characteristics, composition and structure; ownership structure; accountability. The paper proposes a guide summarising these broad fundamental governance aspects, including specific anti-fraud controls and examples of how organisations could enhance ethical cultures and the tone at the top. Originality/value To the best of the author’s knowledge, this is the first paper to elucidate the role of corporate governance in countering fraud and develop guidance in this area. The proposed guidance could be helpful to businesses leaders, policymakers, researchers and academics alike.

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Section: Impact Of Corporate Governance On Fraudmentioning

confidence: 99%

Elucidating corporate governance’s impact and role in countering fraud

Kassem

2022

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“…It was concluded that lobbying with indigenous people leads to a more successful outcome because these indigenous lobbyists have the necessary connection with specific regulatory bodies or legislative bodies. Gam et al (2021) conducted a study on fraud detection in companies. They showed that when a company abruptly changes its policy to convene an annual general meeting on certain dates, the company is more likely to commit fraud.…”

Section: Theoretical Foundations and Hypothesis Developmentmentioning

confidence: 99%

“…Gam et al (2021) conducted a study on fraud detection in companies. They showed that when a company abruptly changes its policy to convene an annual general meeting on certain dates, the company is more likely to commit fraud.…”

Section: Theoretical Foundations and Hypothesis Developmentmentioning

confidence: 99%

The effect of corporate lobbying on fraud and money laundering

Salehi

Norouzi

2022

JMLC

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Purpose This study aims to assess the effect of corporate lobbying power on fraud and money laundering in listed firms on the Tehran Stock Exchange. For the study, the information of 173 firms is assessed during 2013–2020, and a total number of 1,384 year-companies are analysed. Design/methodology/approach In this paper, the Beneish model is used for fraud detection, and the clause of the auditor’s report on money laundering is used for the variable of money laundering. The multivariate regression, Logistic regression, the fixed effects of panel data, additional random effects tests, Hausman, least generalised squares and T + 1 are used by using the Stata Software. Findings The obtained results indicate a direct and significant relationship between lobbying and fraud and lobbying and money laundering. Suppose the board members of firms are among the parliament members or the government cabinet (politicians) and/or major shareholders affiliated with state-owned and/or quasi-governmental institutions. In that case, the likelihood of corporate lobbying will be increased. Originality/value The outcomes of the current study give great insight to developing countries due to the high volume of money laundering to reduce such a financial crime.

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“…To raise more capital by attracting new investors, many companies manipulate their financial statements (Chen et al 2019). Fraudulent financial reports have caused significant losses to shareholders in both developed countries (Cotton 2002;Dibra 2016) and emerging economies (Li and Wu 2007;Jia et al 2009;Li and Wu 2010). Analyzing specific elements of corporate governance, several studies have provided empirical support for a positive relationship between the weak corporate governance of firms and financial fraudulent actions (Beasley 1996;Farber 2005;Chen et al 2006;Rezaee and Kedia 2012;Yang et al 2017;Gam et al 2021).…”

Section: Literature Reviewmentioning

confidence: 99%

Economic and Non-Economic Variables Affecting Fraud in European Countries

Ahmad

Ciupac-Ulici

Beju

2021

Risks

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Fraud is one of the most harmful phenomena, because it leads to collapse of organizations, causes economic downfall of countries, and destroys faith in a country’s capital markets. The impact of fraud is complex and has varying degrees depending on political and financial institutional structures of a country. In this paper, we investigate the combined effect of economic and non-economic variables on fraud using a sample of 41 developed, in transition, and developing European countries. The data cover the period July 2014–December 2020. Panel data techniques of pooled estimation and the dynamic panel data/generalized method of moments (DPD/GMM) is used, keeping in view the endogeneity perspective. Nevertheless, two-way impacts of fixed effect model estimation—cross-sectional and time-based (panel) effects (alternatively)—are used for analyzing the relationship among the given variables, based on Hausman specification test results. Empirical results of panel data extended REM and FEM approaches with country-specific cross-sectional effects showing that political stability, economic freedom, poverty, and GDP significantly affect fraud proliferation. Political stability is appraised to be the most scoring determinant of fraud incidence in a country.

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Evasive shareholder meetings and corporate fraud

Cited by 17 publications

References 35 publications

Elucidating corporate governance’s impact and role in countering fraud

Elucidating corporate governance’s impact and role in countering fraud

The effect of corporate lobbying on fraud and money laundering

Economic and Non-Economic Variables Affecting Fraud in European Countries

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