Original scientific paper
https://doi.org/10.1080/1331677X.2022.2101016
Index to degree of adhesion to good practices of corporate governance and their effect on financial performance: evidence for Chilean companies
José Navarrete Oyarce
Hugo Moraga Flores
Juan Gallegos Mardones
Abstract
Over recent decades, numerous financial crises have affected the global
economy, which were caused by the lack of ethical values and
conflicts of interest amongst the leaders of organisations. To protect
organisations and their interest groups, regulators have developed
norms to discourage and prohibit unethical practices through promotion
of good practices of corporate governance. However, the literature
on good corporate governance practices focuses mainly on
developed economies without considering the challenges of developing
countries. Therefore, this research proposes an index to measure
the degree of adherence to good corporate governance practices in
an emerging economy, like Chile, and estimate its effect on the financial
performance of companies. Through a panel analysis, this
research provides evidence that shows the existence of a positive
and significant relationship between this index and financial performance
of organisations, as well as a persistence of its benefits over
time when companies adopt good practices.
Keywords
Corporate governance; financial performance; Chile; adhesion to good practices
Hrčak ID:
304274
URI
Publication date:
31.3.2023.
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