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Board Composition and Performance
in Indian Firms: A Comparison
-- Dipanjan Kumar Dey and Yogesh Kumar
Chauhan
The paper attempts to understand the relationship between board composition and performance in
Indian firms. Here, Indian firms have been classified into four groups—Public Sector Undertakings (PSUs),
stand-alone firms, private business group affiliated firms, and subsidiaries of foreign firms. The paper analyzes
the relationship between the study and independent variables, using a multiple regression model. Results
indicate that the larger boards are less effective in Indian firms, except in the case of PSUs. Board size is becoming
an insignificant variable in determining the performance of Indian PSUs. Surprisingly, board independence
is insignificant across all categories in India, as per the results of this study, which calls for detailed studies
in this area.
© 2009 IUP. All Rights Reserved.
Corporate Governance in Brazil: Landmarks,
Codes of Best Practices, and Main Challenges
-- Alexandre Di Miceli da Silveira and Richard
Saito
The paper provides a qualitative and in-depth discussion of corporate governance in Brazil. It is divided
into five sections—historical perspective and corporate governance landmarks, main recommendations of
the two Brazilian codes of best practices,
Bovespa's Novo Mercado, current level of compliance of
Brazilian firms with main local and international recommendations, and issues and challenges facing
corporate governance in Brazil. Based on empirical evidence from recent researches, three qualitative conclusions
are drawn. Firstly, Brazilian codes of best practices have been useful in educating corporate players on
`good governance practices'. However, a few companies already adopt most part of these recommendations, and
a even smaller number of companies publicly disclose their level of compliance with any code. Secondly,
given the totally voluntary nature of compliance with such codes (not even a `comply or explain' approach
is required), the evaluation of the corporate governance quality of local firms is still a challenge to
outsiders. Finally, given both the outstanding performance of local stock markets and the Initial Public Offering
(IPO) boom from 2004 to 2007, the market did not really test the quality of corporate governance practices of
the listed companies, including the practices of companies listed at Novo Mercado, the most demanding listing category. This should happen in the coming years.
© 2009 IUP. All Rights Reserved.
Corporate Governance and Shareholder Litigation
-- Georgi Kalchev
The paper studies the probability for shareholder litigation and how corporate governance
characteristics and other factors explain it. Shareholder litigation results from failure of corporate governance. Thus,
a better quality of corporate governance is hypothesized to decrease the probability of litigation.
Corporate governance index is constructed, based on principal components, which is found to be a significant
predictor of shareholder litigation.
© 2009 IUP. All Rights Reserved.cf
Case Study
Ethical Values of the Murugappa Group:
A Case Study
-- S Subramanian
Modern business corporations have well-defined and documented ethical value systems in place. Ethical
problems arise when these value systems are not followed in practice. This study analyzes the value system of
the Murugappa Group in vogue. For this purpose, the paper identifies four important stakeholders of the
business entity—shareholders, employees, government and the society. The analysis, using the case study
approach, shows that the Murugappa Group indeed practices its espoused values and, hence, behaves as an ethical firm.
© 2009 IUP. All Rights Reserved.
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