Corporate Governance and Industrialization in Brazil: An Historical Approach

-- Rodrigo Zeidan and Joaquim Rubens Fontes Filho

The main goal of the paper is to analyze the history of modern Brazilian companies through the ownership and capital structure dimensions, with the goal of justifying the relatively quick process of transition of many Brazilian companies towards a dispersed ownership structure since the 1990s. The paper shows that the relevant features in the historical analysis of the shift towards the relevance of corporate governance in Brazil are: changes in industrialization policies, retained profits and government funding as the major source for investments, and a culture of personalization of the figure of the controller/entrepreneur/founder.

© 2012 IUP. All Rights Reserved.

Ownership Change and Deterioration of Performance in Post-IPO Period: A Panel Data Analysis of Indian Firms

-- Sanjiv Mittal and Manas Mayur

The study investigates the relationship between changes in insider’s ownership around Initial Public Offering (IPO) and post-IPO performance deterioration of Indian firms. The univariate analysis shows that the performance of Indian public firms deteriorates significantly in post-IPO period. The relationship between ownership and performance is then analyzed through a multivariate analysis of panel data. The results show that the change in ownership is responsible for the deterioration in post-IPO performance.

© 2012 IUP. All Rights Reserved.

Portfolio Flows and Governance in Corporate India

-- Arunima Haldar and S V D Nageswara Rao

This paper is an attempt to find out the factors affecting the investment by foreign portfolio investors in India. Considering firm-level variables, the paper tries to find out the importance of corporate governance factors in foreign portfolio investment in India, based on the annual governance data (March 2008) and foreign portfolio investment data (March 2009) of BSE 500 companies. Estimating the multiple regression equation by using ordinary least squares technique, the paper reveals that the foreign portfolio investment is significantly affected by financial returns as well as corporate governance factors.

© 2012 IUP. All Rights Reserved.

Investor Relations on the Internet: An Empirical Study of Indian Listed Companies

-- Neha Patel

In recent years, many publicly traded companies have started using Internet as a new channel to inform current and potential investors about their performance, which has resulted in firm benefits such as enhanced market exposure, increased analyst coverage and institutional following. This paper investigates the extent to which Indian listed companies use the Internet for Investor Relations (IR) purposes. To achieve this goal, a website investigation of the 50 Indian companies listed on the National Stock Exchange (NSE) and which constitute a part of S&P CNX Nifty is carried out. The objective of the paper is to identify the stage Indian listed companies are in as regards the Internet usage for disclosing information to their investors. To fulfill the same, the websites of select 50 companies have been extensively studied and analyzed on six broad premises, namely, website content, navigation, usage of multimedia devices, site interactivity, timeliness and regulatory entanglement issues. The results suggest that Indian companies have been able to take only partial advantage of Internet and have badly failed in fulfilling the parameters pertaining to usage of multimedia devices and interactivity.

© 2012 IUP. All Rights Reserved.

Social Movements, CSR and Industrial Growth: An Indian Experience

--Jaya Srivastava

Over the last few decades the magnitude of activities of organized business has increased in size. With this increase in the activities of business enterprises, the imprint on the environment is also becoming indelible. The effects of such intense business activity have created instances of strife between the society and industry. As a result, the organizations have tried to embrace Corporate Social Responsibility (CSR) activities in an attempt to reach out to the society, but in some cases it has not helped. In fact some people argue that the emergence of CSR has been a reaction of business to growing social resentment against them. This paper discusses a few prominent social movements that highlight how the social community has risen against industrial activity to register its protest and to protect its local ecosystem. The discussion in the paper reveals that a voluntary CSR code may not be enough to ensure that the rights of indigenous people on local resources are protected. The government will have to make strict laws to deal with issues related to land acquisition, protection of tribal rights and safeguard of the environment.

© 2012 IUP. All Rights Reserved.