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Corporate Governance and Risk Bundling: Evidence from Indian Companies

Author

Listed:
  • Pankaj Kumar Gupta

    (Jamia Millia Islamia University, New Delhi, India)

  • Prabhat Mittal

    (University of Delhi, New Delhi, India)

Abstract

Corporate Governance has acquired a significant place in the national economies globally. Quality of governance impacts the business confidence index and resource mobilizations in the global marketplace. In various countries there is a conventional dominance of promoters or majority shareholders on the board of companies which implicates various propensities of risks and forms of risk cultures, making the problem of governance typical and critical for the regulators. Our paper examines the risk behaviour of firms in context of CG practices and creates distinct bundles of companies with specific risk cultures. Using a sample of 10 years' panel data of 84 companies listed on the National Stock Exchange in India (NSE) for selected risk and CG variables, we measure the influence of CG measures on the risk propensity and behaviour and based on combinations of selected CG practices formulated the risk bundles. Based on the derived bundles of risk behaviour, regulators and policymakers can make informed decisions.

Suggested Citation

  • Pankaj Kumar Gupta & Prabhat Mittal, 2020. "Corporate Governance and Risk Bundling: Evidence from Indian Companies," European Journal of Business Science and Technology, Mendel University in Brno, Faculty of Business and Economics, vol. 6(1), pages 37-52.
    • Handle: RePEc:men:journl:v:6:y:2020:i:1:p:37-52
    DOI: 10.11118/ejobsat.2020.004
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    More about this item

    Keywords

    corporate governance (CG); risk propensity; board structure; board process; CG variables;
    All these keywords.

    JEL classification:

    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • K2 - Law and Economics - - Regulation and Business Law
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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