Corporate Governance in Brazilian Companies: The Influence of the Founder in the Financial Decisions

Part of the CSR, Sustainability, Ethics & Governance book series (CSEG)


All over the world, corporate governance is adopting a new process of leadership and simultaneously propagating responsible governance for the welfare of stakeholders. This research has allowed us to identify new directions for future research. It examines the influence of several contextual factors in the framework of the financial decisions, where company has the right to have a transparent accountability, based on the influence of the founder, dispersion and type of ownership, size, economic sector and environment.

The aim of this research is to analyse the influence of the founder in the financial decisions based on the comparability of the level of indebtedness among Brazilian companies managed by its founder and those managed by professionals.

The methodology focuses the theoretical analysis on the literature review about Corporate Governance and Corporate Finance. The empirical analysis is based on econometric analysis supported on the multiple regression model and fixed effects method. The sample includes 356 non-financial Brazilian companies, with accounting data from the period 2004–2009, on a total of 2136 observations.

The results find supporting evidence that lower debt in those companies of the sample in which the founder is the manager of the company and, in contrast, bigger indebted level of the professional manager. Further findings confirm a reduction of the investment level in businesses run by its founder, as well as, their preference for using equity. The founder has quite peculiar biases relation with decision making process. Generally, the founder has a personal need and his or her own interest, is based on the entrepreneurship decisions.


Corporate Governance Total Asset Capital Structure Chief Executive Officer Free Cash Flow 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.



The authors wish to thank José Ángel Pérez López of Universidad de Seville (Spain), David Crowther (UK) and anonymous referee for improvements on the research from the International CSR, Sustainability, Ethics & Governance Conference of the Global Corporate Governance Institute. Current version is a publication supported by the Project PEst-OE/EGE/UI4056/2014 UDI/IPG, finance by the Fundação para a Ciência e Tecnologia. The authors belong to the Centro de Investigação de Contabilidade e Fiscalidade. We thank MackPesquisa CI. FMP. 192/2013 from Universidade Presbiteriana Mackenzie for supporting this research.


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Copyright information

© Springer International Publishing AG 2017

Authors and Affiliations

  1. 1.Mackenzie Presbyterian UniversitySao PauloBrazil
  2. 2.Guarda Polytechnic Institute & UDI-IPG & CICF-IPCAGuardaPortugal

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