University of St.Gallen
research platform alexandria
search publications
browse publications
by person
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
 
by year

Corporate Governance and Firm Value: International Evidence

abstract In this paper, we investigate the relation between firm-level corporate governance and firm value based on a large and previously unused dataset from Governance Metrics International (GMI) comprising 6,663 firm-year observations from 22 developed countries over the period from 2003 to 2007. Based on a set of 64 individual governance attributes we construct two alternative additive corporate governance indices with equal weights attributed to the governance attributes and one index derived from a principal component analysis. For all three indices we find a strong and positive relation between firm-level corporate governance and firm valuation. In addition, we investigate the value relevance of governance attributes that document the companies’ social behavior. Regardless of whether these attributes are considered individually or aggregated into indices, and even when “standard” corporate governance attributes are controlled for, they exhibit a positive and significant effect on firm value. Our findings are robust to alternative calculation procedures for the corporate governance indices and to alternative estimation techniques.
   
type journal paper
   
keywords Corporate Governance, Firm Valuation, Minimum Standards, Principal Component Analysis, Corporate Social Responsibility
   
language English
kind of paper journal article
date of appearance 1-2011
journal Journal of Empirical Finance
publisher Elsevier (Amsterdam)
ISSN 0927-5398
ISSN (online) 1879-1727
DOI 10.1016/j.jempfin.2010.10.003
volume of journal 18
number of issue 1
page(s) 36-55
review double-blind review
   
citation Ammann, M., Oesch, D., & Schmid, M. (2011). Corporate Governance and Firm Value: International Evidence. Journal of Empirical Finance, 18(1), 36-55, DOI:10.1016/j.jempfin.2010.10.003.