IDEAS home Printed from https://ideas.repec.org/a/spi/joabfr/v12y2021i2p26-31id438.html
   My bibliography  Save this article

The Effect of Strengthened Corporate Governance on Firm Performance in the United States

Author

Listed:
  • Dishant Pandya
  • Ian Andrew Van Deventer

Abstract

In response to the accounting scandals of the late 1990s, regulators adopted changes to corporate governance rules in 2003 in an effort to restore investor confidence in the stock market. The purpose of this study is to determine whether the changes to board leadership structure imposed on U.S. companies affected firm performance as measured by operating return on assets. This study was conducted with a sample of 857 publicly traded companies listed on the New York Stock Exchange and 11,632 firm-year observations over the period from 1997 to 2012. Using a difference-in-difference estimator and multivariate analysis, we found a positive and significant indication that changes to board leadership structure improved the long-run performance of firms that were previously insider controlled. The results of this study indicate that some firms were not ideally structured prior to 2003 when the changes in corporate governance rules took effect for publicly traded companies listed on the New York Stock Exchange.

Suggested Citation

  • Dishant Pandya & Ian Andrew Van Deventer, 2021. "The Effect of Strengthened Corporate Governance on Firm Performance in the United States," Journal of Accounting, Business and Finance Research, Scientific Publishing Institute, vol. 12(2), pages 26-31.
    • Handle: RePEc:spi:joabfr:v:12:y:2021:i:2:p:26-31:id:438
    as

    Download full text from publisher

    File URL: http://scipg.com/index.php/102/article/view/438/520
    Download Restriction: no
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spi:joabfr:v:12:y:2021:i:2:p:26-31:id:438. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Marina Taylor (email available below). General contact details of provider: http://scipg.com/index.php/102/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.