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The effect of corporate governance on firm performance: a case of Turkey

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  • Yunus Emre Akdogan
  • Melek Acar Boyacioglu

Abstract

Good corporate governance system minimises the misconduct risks of the authority to decide about the company contribute to the fall of capital costs and therefore has a positive effect on the economic activities of the company. Moreover, it is expected that these positive results reflect on the stock prices by ensuring the efficient market condition. In this context, the presence of any relation between application level of corporate governance principles and performances of the companies listed on the Istanbul Stock Exchange (ISE) National 100 Index has been tested. In this framework, corporate governance rating, which represents the application level of the companies to the corporate governance principles, has been performed. Afterwards, it has been investigated whether application level of corporate governance principles has an effect on return on asset, return on equity and stock return assessing firm performance through the multiple hierarchical regression analysis. As a result of the study, it has been revealed that a significant and positive relationship exists between the companies' application level of the corporate governance principles and return on asset and return on equity.

Suggested Citation

  • Yunus Emre Akdogan & Melek Acar Boyacioglu, 2014. "The effect of corporate governance on firm performance: a case of Turkey," International Journal of Critical Accounting, Inderscience Enterprises Ltd, vol. 6(2), pages 187-210.
    • Handle: RePEc:ids:ijcrac:v:6:y:2014:i:2:p:187-210
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    Citations

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    Cited by:

    1. Emmanuel Chuke Nwude & Musa Sani Zakirai & Comfort Amaka Nwude, 2023. "Ownership Structure and Bank Performance in Emerging Market Economy: Evidence From Nigerian Listed Deposit Money Banks," SAGE Open, , vol. 13(4), pages 21582440231, December.
    2. Wang PeiZhi & Muhammad Ramzan, 2020. "Do corporate governance structure and capital structure matter for the performance of the firms? An empirical testing with the contemplation of outliers," PLOS ONE, Public Library of Science, vol. 15(2), pages 1-25, February.
    3. Olawole, A., 2023. "Corporate Governance Attributes and Audit Report Lag in Nigerian Listed Commercial Bank," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 7(7), pages 1569-1582, July.
    4. Etienne Ndemezo & Charles Kayitana, 2018. "Corporate Governance, Corporate Entrepreneurship and Firm Performance: Evidence from the Rwandese Manufacturing Industry," Indian Journal of Corporate Governance, , vol. 11(2), pages 103-121, December.
    5. Berna Doğan Başar & Ahmed Bouteska & Burak Büyükoğlu & İbrahim Halil Ekşi, 2021. "The effect of corporate governance on bank performance: evidence from Turkish and some MENA countries banks," Journal of Asset Management, Palgrave Macmillan, vol. 22(3), pages 153-162, May.

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