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Article
Publication date: 13 July 2020

Maria Aluchna, Jyoti Devi Mahadeo and Bogumił Kamiński

The purpose of the paper is to advance the understanding of the links between the presence of independent directors (IDs) on boards and the company value in the specific context…

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Abstract

Purpose

The purpose of the paper is to advance the understanding of the links between the presence of independent directors (IDs) on boards and the company value in the specific context of concentrated ownership. The authors apply the framework of agency theory to identify the monitoring effect of IDs in two legal systems – common law and civil law.

Design/methodology/approach

The authors test formulated hypotheses using a unique sample of 50 Mauritian and Polish companies listed during the years 2007 to 2015, amounting to a total of 394 observations adopting the fixed effect panel model.

Findings

The results of the panel model show a negative relationship between independent directors on boards and company value. Specifically, the effect remains negative for companies operating in the civil law system, whereas the stronger protection offered by common law offsets the effect of concentrated ownership, resulting in a non-correlation between independent directors on board and firm value.

Originality/value

This study expands the understanding of the value added by independent directors, addressing their monitoring role in the unfavorable context of concentrated ownership. It also reveals that different legal frameworks of civil law and common law may impact the monitoring performed by independent directors.

Details

Corporate Governance: The International Journal of Business in Society, vol. 20 no. 6
Type: Research Article
ISSN: 1472-0701

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Article
Publication date: 16 November 2012

Teerooven Soobaroyen and Jyoti Devi Mahadeo

The purpose of this study is to examine whether the expectations and requirements contained within the corporate governance code have an impact on how accountability is perceived…

4461

Abstract

Purpose

The purpose of this study is to examine whether the expectations and requirements contained within the corporate governance code have an impact on how accountability is perceived, understood and practiced by company board members in an emerging economy (Mauritius).

Design/methodology/approach

The paper relies on 24 semi‐structured interviews of board members in listed and non‐listed companies and also analyses the accountability implications present in the local code of corporate governance and relevant reports. The analysis is informed by the typologies of board accountability and process developed by Roberts in 2001 (socialising, individualising, sovereign and complementary) and is complemented by Pettigrew and McNulty's 1995 notions of minimalist and maximalist boards.

Findings

From a state which can largely be associated to the notion of sovereign governance and a minimalist board, the findings reveal a substantive change in the type of board accountability but it is one which privileges an individualising form of board interactions. A move to a more empowered “maximalist” board is also noted. Notwithstanding, the paper uncovers specific issues with the INED as an accountability mechanism in that there is much fuzziness on his/her role and motivations and whether INEDs can conceivably contribute to a socialising form of board accountability.

Originality/value

The paper responds to calls for more qualitative research on how boards actually operate in emerging economies, at a time when an increasing number of countries have adopted corporate governance requirements drawn primarily from the Anglo‐American model. This paper contributes to the literature by providing empirical evidence on corporate board processes and dynamics in non‐Western contexts.

Details

Qualitative Research in Accounting & Management, vol. 9 no. 4
Type: Research Article
ISSN: 1176-6093

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Article
Publication date: 21 March 2016

Teerooven Soobaroyen and Jyoti Devi Mahadeo

– The purpose of this paper is to analyse changes in community disclosures by listed companies in Mauritius.

1536

Abstract

Purpose

The purpose of this paper is to analyse changes in community disclosures by listed companies in Mauritius.

Design/methodology/approach

The authors carried out a quantitative and qualitative assessment of annual report disclosures over the period 2004-2010. In particular, the authors consider the influence of a corporate governance code and a government intervention to first persuade and subsequently mandate corporate social responsibility investment (known as a “CSR Levy”).

Findings

From a predominantly limited and neutral form of communication, narratives of community involvement morph into assertive and rhetorical statements, emphasising commitment, permanency and an intimate connection to the community and a re-organisation of activities and priorities which seek to portray structure and order in the way companies deliver community interventions. Informed by Gray et al.’s (1995) neo-pluralist framework and documentary evidence pertaining to the country’s social, political and economic context, the authors relate the change in disclosures to the use of corporate impression management techniques with a view to maintain legitimacy and to counter the predominant public narrative on the insufficient extent of community involvement by local companies.

Research limitations/implications

The authors find that community disclosures are not only legitimating mechanisms driven by international pressures but are also the result of local tensions and expectations.

Originality/value

This study provides evidence on forms of “social” – as opposed to environmental – disclosures. Furthermore, it examines a unique setting where a government enacted a legally binding regime for greater corporate social involvement.

Details

Accounting, Auditing & Accountability Journal, vol. 29 no. 3
Type: Research Article
ISSN: 0951-3574

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Book part
Publication date: 1 January 2008

Teerooven Soobaroyen and Jyoti Devi Mahadeo

Purpose of this paper – This study investigates compliance with the corporate governance code in an African developing economy (Mauritius).Methodology/approach – We examine the…

Abstract

Purpose of this paper – This study investigates compliance with the corporate governance code in an African developing economy (Mauritius).

Methodology/approach – We examine the annual reports of 41 listed companies to assess the extent of compliance with the code and to analyze the wording of compliance statements. We also carry out in-depth semi-structured interviews with selected company directors to understand the reasons for compliance (or non-compliance).

Findings – Initial findings indicate a reasonable level of compliance with the more visible requirements of the code but noteworthy non-compliance also emerges, particularly in relation to the low number of company boards being chaired by independent directors, to uncertainties on the actual operation of board committees, and to the widespread non-disclosure of directors’ remuneration. Furthermore, compliance statements were found to be vague, ambiguous, or even inconsistent with the extent of compliance disclosed in the reports. We believe these are indications that many of the companies are adhering selectively with the code to project an image of symbolic compliance. Our in-depth follow-up interviews with directors largely confirm this behaviour of selective compliance.

Research implications – We suggest that the pursuit of legitimacy as an operational resource – rather than efficiency-led rationales – emerges as a potential theoretical explanation for the adoption of the corporate governance code in Mauritius.

Originality /value of paper – We bring evidence on how the corporate governance code is being understood and rationalized in a developing economy. We rely on a combination of annual report disclosures, compliance statements, and interview data to investigate corporate governance compliance.

Details

Corporate Governance in Less Developed and Emerging Economies
Type: Book
ISBN: 978-1-84855-252-4

Available. Content available
Book part
Publication date: 1 January 2008

Abstract

Details

Corporate Governance in Less Developed and Emerging Economies
Type: Book
ISBN: 978-1-84855-252-4

Available. Content available
Article
Publication date: 20 February 2017

444

Abstract

Details

Accounting, Auditing & Accountability Journal, vol. 30 no. 2
Type: Research Article
ISSN: 0951-3574

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