Apr'21
The IUP Journal of Corporate Governance
Focus
The first paper, "The Impact of Ownership Structure on the Financial Performance of Indian Corporate Sector" by Ruchita Verma, Dhanraj Sharma and Priyanka, considered 40 companies listed on the National Stock Exchange (NSE) for the period of seven years, i.e., 2013-14 to 2019-20. The objective of the study is to examine the influence of ownership structure on the accounting-performance of the Indian corporate sector. Variables considered for the study are backed by appropriate substantiation from the literature. The authors employed panel data regression in their study. They observed significant positive relationship between foreign ownership and financial performance (ROA and ROCE) of Indian firms. The study also held that there is a positive impact of liquidity ratio and a negative effect of the leverage ratio and firm size.
The second paper, "Corporate Governance in Banking: A Systematic Literature Review" by Ranajee, Saumita Roy, Sreya Roy Chowdhury and Prashant Dixit, has extensively conducted a literature review on corporate governance in banking institutions. The authors have expressed their concern over the need to focus on corporate governance in the banking sector by capturing the data from 311 studies from the Scopus data base. They have employed Systematic Literature Review (SLR), bibliometric analysis, and network analysis in order to achieve their research objective/s. The discrepancies in the existing literature and research trends, based on influential journals and authors concerning the corporate governance in banking, are identified and discussed.
The third paper, "Corporate Governance: Literature Review on Agency Costs and Pieces of Evidence on Different Perspectives" by authors Shubhi Agarwal and Archna Singh, has made an attempt to ascertain the link between the tools of corporate governance and agency costs. The authors have covered various aspects of ownership structure and firm structure in this review paper. The period of study is from 2004 to 2019. The authors, through their literature review, have provided possible solutions that address the questions around the agency theory and agency costs. Shortcomings and directions for future research are discussed.
Consulting Editor
The Impact of Ownership Structure on the Financial Performance of Indian Corporate Sector
The aim of the study is to investigate the effect of ownership structure on the accounting-based performance of the Indian corporate sector. The study employs panel data regression for establishing an association between ownership and firm's performance on a sample of 40 companies listed on the National Stock Exchange (NSE) for the period of seven years, i.e., 2013-14 to 2019-20. By using cross-sectional time-series Feasible Generalized Least Squares (FGLS) regression, it is observed that foreign ownership and government ownership have a positive impact on the financial performance (ROA and ROCE), while directors' ownership exerts a negative effect on ROA and ROCE. The study found a positive impact of liquidity ratio and a negative effect of the leverage ratio and firm size. The study did not find an association between institutional ownership and corporate ownership with financial performance. This study contributes to the existing financial literature and will benefit the shareholders and other stakeholders in better understanding the ownership structure and its implication on accounting-based financial performance. This study employs a range of ownership structure measures, instead of focusing on a single measure. Furthermore, different types of panel data regression techniques are used in the study.
Corporate Governance in Banking: A Systematic Literature Review
Banking is a responsible business based on trust and fairness. Corporate governance in banking institutions becomes crucial in navigating through the uncertain world we live in. This topic has piqued the attention of a wide variety of scholars around the world, and it has gained momentum in recent years. The aim of this study is to identify the key contributors, key areas, current trends, and potential research directions. The paper uses a systematic literature review methodology, as well as bibliometric and content analysis, to examine 311 studies from the Scopus database. Citations and PageRank are used to classify the most influential papers as well as the most influential contributors. A co-citation network was developed to see the conceptual framework of this research area. The study identifies research discrepancies, and seven actionable research paths are proposed for the future.
Corporate Governance: Literature Review on Agency Costs and Pieces of Evidence on Different Perspectives
This paper intends to review different pieces of literature that try to establish a link between the tools of corporate governance and agency costs. Tools of corporate governance play a key role in reducing agency costs. The paper focuses on reviewing the literature on ownership structure, firm structure, board structure, and remuneration structure extensively. The paper reviews many aspects of ownership structure as well as firm structure, i.e., institutional ownership, non-institutional ownership, managerial ownership, firm age, and firm size. The works of literature have cited many way outs as strong institutional ownership, managerial ownership, board size, frequency of board meetings, board independence, board composition, board ownership, remuneration structure, and firm age as well as size can be beneficial in eliminating agency costs. The paper uses a descriptive research design. A lottery system of random sampling is used while selecting different kinds of literature reviews of ownership as well as remuneration structure. The paper takes the 2004-2019 time period for reviewing literature. The period is selected based on convenience sampling. The extensive review of literature will enlighten the research scholars as well as academicians in understanding the problem of agency and how tools of corporate governance will help in reducing agency costs.