Sound Corporate Governance and Financial Performance: Is There a Link? Evidence from Manufacturing Companies in South Africa, Nigeria, and Ghana

Mensah, Lord; Bein, Murad A.

doi:10.3390/su15129263

Cited by 14 publications

(6 citation statements)

References 99 publications

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“…Simultaneously, within a certain range, the larger social welfare consumption, such as lower charity investment and employee benefits, can lead to lower costs and higher profits. Eventually, in some cases, the governance will cause some negative effects on corporate profitability [10]. Additionally, the ROA can be impacted by ESG positively, which is consistent with Xu and Liu (2023), but not significantly due to though higher ESG can partly represent better sustainability, it is not that obvious in the short term [7].…”

Section: Discussionsupporting

confidence: 74%

The Correlation Between Corporate Profitability and ESG Ratings: Samples from Forestry and Paper Industry

Zou

2024

Advances in Economics, Business and Management Research

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Recently, the sustainability and social responsibility of business operation have become more and more important in the criteria to evaluate the value of a company, which cause the environmental, social, and governance (ESG) scores to be valued. This study examined the impact of the ESG score and profitability of the year before on the profitability of Chinese forestry companies, which is weighed by EBIT and ROA, with regression to determine that does ESG score will affect the profitability of forestry corporations or not. The findings suggest that the scores have a significant correlation with the EBIT while all of the scores do not show a significant effect on the ROA. At the same time, the findings also show that the ROA is affected by the ROA in the year before extremely significant, while the influence of the EBIT in the year before to the EBIT in one year later is not as obvious as the effect of the previous ROA generated to the later one.

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Section: Discussionsupporting

confidence: 74%

The Correlation Between Corporate Profitability and ESG Ratings: Samples from Forestry and Paper Industry

Zou

2024

Advances in Economics, Business and Management Research

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“…In several countries, including Australia, the United States, and the United Kingdom, regulations mandate that publicly traded companies hold annual shareholder meetings (Mensah & Bein, 2023). The board meetings encompass a wide range of topics, making a higher meeting frequency crucial for effective governance (Salloum et al, 2014).…”

Section: Board Meetings and Financial Decisionsmentioning

confidence: 99%

“…An important characteristic of the robust two-step GMM is its utilisation of the Hansen test to determine the exogeneity of variables (Mensah & Bein, 2023).…”

Section: Model 3: the Effect Of Corporate Governance On Debt Financingmentioning

confidence: 99%

“…Does corporate governance have an impact on internally generated financing, equity financing, and debt financing? Previous research has extensively examined the influence of corporate governance on various financial aspects, such as financial performance (Al-Ahdal et al, 2020;Goel, 2018;Mensah & Bein, 2023), dividend policy (Subramaniam & Devi, 2011;Zagonel et al, 2018), earnings management (Lin et al, 2016;Mulyadi & Anwar, 2015), debt service obligation and capital structure (Kieschnick & Moussawi, 2018;Javaid et al, 2023). However, to the best of our knowledge, no studies have specifically explored the impact of corporate governance on financial decisions, which are crucial in addressing agency problems faced by shareholders and corporate management.…”

Section: Introductionmentioning

confidence: 99%

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The Impact of Corporate Governance on Financial Decision-making: Evidence from Non-financial Institutions in the Australian Securities Exchange

Leviticus Mensah,

Richard Arhinful,

Murad Abdurahman Bein

2024

aamjaf

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The objective of this study was to examine the impact of corporate governance on the financial choices of non-financial companies operating in the Australian Securities Exchange. A purposive sampling technique was employed to select a total of 113 firms representing 14 sectors listed in the Australian Securities Exchange during the period from 2008 to 2021. The findings of the study revealed a positive and significant relationship between the size of the board, gender diversity among board members, board member affiliation and board compensation with the financial decisions of the corporations. Additionally, the study identified that the presence of experienced and non-executive board members had a negative and significant impact on internally generated funding. Furthermore, it was observed that board gender diversity, board size, board member affiliation and board compensation displayed a positive and significant association with debt financing, internally generated financing and equity financing. Most organisations displayed a preference for internal and debt financing over equity funding. Aligning governance with financial decisions enhances firms’ cost of capital. Governance quality affects capital market access, debt and equity costs. Effective governance leads to favourable financing terms.

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“…We sourced our data from Thomson Reuters Eikon DataStream, a reputable data provider widely utilized for similar research purposes (Amin & Cek, 2023;Arhinful & Radmehr, 2023;Mensah & Bein, 2023). Data from DataStream is renowned for its reliability and accuracy.…”

Section: Sample and Datamentioning

confidence: 99%

The Impact of Financial Leverage on the Financial Performance of the Firms Listed on the Tokyo Stock Exchange

Arhinful,

Radmehr

2023

Sage Open

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Japan is widely regarded as one of the world’s most developed nations. The country’s electronics industry, in particular, is consistently ranked among the global leaders in innovatiion. Industries such as automotive, construction, electronics, metal, and telecommunications, companies have traditionally leaned more heavily on debt financing for both their day-to-day operations and investment endeavors, rather than relying on equity financing. In Japan, debt financing is favored as cost-effective source of capital compared to equity financing. The study selected 257 automotive, construction, electronic, metal, and telecommunications companies between 2000 and 2021. To find the effect of financial leverage on financial performance, the study used the random effect and the GMM to estimate the effect of the firms’ leverage on financial performance. The study found that interest coverage has a positive and statistically significant effect on ROA, ROE, and Tobin’s Q. The study discovered that cash coverage has a positive and statistically significant effect on ROE. The study found that debt service obligations have a negative and statistically significant effect on financial performance.

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Sound Corporate Governance and Financial Performance: Is There a Link? Evidence from Manufacturing Companies in South Africa, Nigeria, and Ghana

Cited by 14 publications

References 99 publications

The Correlation Between Corporate Profitability and ESG Ratings: Samples from Forestry and Paper Industry

The Correlation Between Corporate Profitability and ESG Ratings: Samples from Forestry and Paper Industry

The Impact of Corporate Governance on Financial Decision-making: Evidence from Non-financial Institutions in the Australian Securities Exchange

The Impact of Financial Leverage on the Financial Performance of the Firms Listed on the Tokyo Stock Exchange

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