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Corporate Governance Mechanisms and Firm Performance

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Abstract

The objective of the firm is to maximize the wealth of the shareholders, and hence the firm value, and various corporate governance mechanisms are put in place to achieve this objective. In this light, the current chapter aims to analyze if the various governance mechanisms are effective in enhancing firm value (and thus, shareholders’ wealth) measured with Tobin’s Q ratio.

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Fig. 4.1

Notes

  1. 1.

    After the demise of Arthur Andersen and guided by the current literature the Big-Four audit firms represents four audit firms: Ernst and Young (E and Y), Deloitte and Touche (D and T), Klynveld Peat Marwick Goerdeler (KPMG), and Pricewaterhouse Coopers (PwC) (Sikka, 2009).

  2. 2.

    The tendency of the insiders to get entrenched to the firm with the increase in share ownership and start pursuing their self-interests. Thus, the firm value declines with the increase in the insider ownership.

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Appendices

Appendices

See Appendixes 4.1, 4.2, 4.3 and 4.4.

Appendix 4.1 Regression model analyzing the impact of product market competition on ROA
Appendix 4.2 Regression model analyzing the impact of audit quality on ROA
Appendix 4.3 Regression model analyzing the impact of board monitoring on ROA
Appendix 4.4 Regression model analyzing the impact of ownership structure on ROA

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Singh, S., Singla, M. (2022). Corporate Governance Mechanisms and Firm Performance. In: Corporate Governance Mechanisms and Firm Performance. India Studies in Business and Economics. Springer, Singapore. https://doi.org/10.1007/978-981-19-2460-6_4

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