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Do Firms Decouple Corporate Governance Policy and Practice?
Author(s) -
Ananchotikul Nasha,
Kouwenberg Roy,
Phunnarungsi Visit
Publication year - 2010
Publication title -
european financial management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.311
H-Index - 64
eISSN - 1468-036X
pISSN - 1354-7798
DOI - 10.1111/j.1468-036x.2010.00545.x
Subject(s) - corporate governance , lagging , listing (finance) , shareholder , accounting , business , test (biology) , economics , finance , medicine , paleontology , pathology , biology
We test whether Thai listed firms with higher levels of good governance policy adoption are less likely to violate listing rules and laws designed to protect shareholders. Our results suggest that firms on average implement, substantively as opposed to symbolically, recommended governance policies, as violations occur less frequently among firms with higher governance policy adoption scores. However, we also find evidence of symbolic governance among a small group of ‘talk‐only’ firms that issue statements about governance while lagging in the adoption of policies related to shareholder rights and the board of directors.