Evidenciação do Contexto Econômico na Relação entre Governança Corporativa e Volatilidade das Ações nas Companhias Abertas Brasileiras

Abstract

Objective: to analyze how the economic context affects the relationship between corporate governance and stock market volatility of Brazilian public companies listed on B3 S.A. - Brasil, Bolsa, Balcão (B3), from 2010 to 2018.Method: based on quantitative, descriptive, and documentary research, the stock market volatility on an annual basis was used as a metric for volatility (dependent variable); internal mechanisms (ownership and control structure, number of members of the administrative and fiscal council) and external mechanisms (B3 governance levels, American Depositary Receipt, and free float) such as corporate governance proxies (independent variable of interest); and control variables (Gross Domestic Product - GDP and others).Originality/Relevance: there is no consensus regarding the way that corporate governance practices affect stock market volatility, when considering the economic context in which the country finds itself, given that different proxies can cause different effects before the market (Li et al., 2013; Litov et al., 2006).Results: it was found that, in general, internal mechanisms have a significant influence in relation to stock market volatility only when analyzed together with the variation in GDP. The external mechanisms, on the other hand, did not show significant influence in relation to the stock market volatility.Theoretical / Methodological Contributions: the discussion about the interaction of corporate governance practices with the volatility in the stock market prices of Brazilian companies is broadened, as well as the different approaches to decision-making when analyzing the internal and external mechanisms of corporate governance in the Brazilian economic contex.

Do Internal Corporate Governance Practices Influence Stock Price Volatility? Evidence from Egyptian Non-Financial Firms

“…Also in Jordan, Alawin (2014) investigated the impact of ownership structure measured in terms of the percentage of ownership by top owners, percentage of ownership by foreigners, percentage of ownership by individuals, and percentage of ownership by institutions on stock price volatility for firms listed in the Amman stock exchange, where it was found that the percentage of ownership by top owners showed a significant positive impact on volatility. Machado et al (2021) examined the impact of internal and external CG mechanisms on stock market volatility in Brazil, in addition to the moderating impact of GDP on the relationship between CG mechanisms and stock market volatility for companies listed on B3 SA Brasil Bolsa Balcao. The internal CG mechanisms included ownership and control structure, as well as the number of members of the administrative and fiscal council.…”