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Corporate Governance Mechanisms
and Firm Performance: A Survey of Literature
- - Manpreet Singh Gill, T Sai Vijay and Subhash Jha
The literature on corporate governance identifies three prominent corporate governance
mechanismsboard, disclosures and ownership structure. However, there is no unanimity among the researchers about the
effect of these mechanisms on corporate performance. The attempt is to survey the literature on the
relationship between corporate governance mechanisms and firm performance. One finds that while literature agrees
on the positive relationship between disclosure and firm performance, it is inconclusive on the
relationship between board characteristics and firm performance. Similar is the case of the relationship between
ownership structure and firm performance. One also finds that most of the work in this regard was done in the
context of developed countries.
© 2009 IUP. All Rights Reserved.
The Cadbury Code Reforms
and Corporate Performance
- - Phillip J McKnight,
Nikolaos T Milonas,
Nickolaos G Travlos and Charlie Weir
This paper investigates the impact of adopting the Cadbury Committee's Code of Best Practices on
the corporate performance of UK firms. The findings show improved corporate performance by companies
which adopted the Code. Regarding the specific recommendations of the Code, splitting the positions of the
Chairman of the Board and CEO does not result in improved corporate performance. The establishment of an
internal audit and/or remuneration committee is positively associated with corporate performance, while the
presence of a key executive director in such committees is negatively associated with corporate performance. There
is a negative relation between corporate performance and the proportion of non-executive directors, but
a positive relation between corporate performance and the square of the proportion of non-executive directors.
© 2009 IUP. All Rights Reserved.
Corporate Governance
and Indian FMCG Industry
- - Hitesh J Shukla
The present study aims at examining the governance practices prevailing in the prominent companies of
the Indian Fast Moving Consumer Goods (FMCG) sector within the Indian regulatory framework. The study
also aims at assessing the substance and quality of reporting of the corporate governance practices in
annual reports. The study includes four renowned companies in the FMCG sectorHindustan Unilever Ltd., ITC
Ltd., Nestle (India) Ltd. and Tata Tea Ltd. For this purpose, parameters include the statutory and
non-mandatory requirements stipulated by the revised Clause 49 of the listing agreement, as prescribed by the Securities
and Exchange Board of India (SEBI) and relative amendments in the Companies Act, 1956. It has been
observed that among the four renowned FMCG companies, ITC scored the highest points, followed by Tata Tea,
HUL and Nestle. ITC, Tata Tea and HUL figured in the criteria of Very Good and Nestle figured in the criteria
of Good.
© 2009 IUP. All Rights Reserved.cf
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