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The Quality of Explanations for Deviation from Principles of Corporate Governance. An Introduction

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  • Koładkiewicz Izabela

    (Kozminski University, Department of Entrepreneurship, Management Study Center, 59 Jagiellońska St., 03–301 Warsaw, Poland)

Abstract

Purpose: The purpose of this paper is to summarize studies aiming to define matters related to the quality of explanations found in corporate governance statements published by listed companies. Another important aspect of the conducted analysis is the identification of various dimensions of explanation quality. Methodology: The character of the conducted research is that of an overview of literature devoted to the subject. Apart from scientific articles, it covers European Union regulations, regulations characteristic of countries selected for the analysis (member states of the European Union), and applied solutions aimed at guaranteeing the desired quality of explanations for deviation included in corporate governance statements that are in the centre of attention. Findings: The conducted analysis organizes the current knowledge concerning actions aimed at improving the quality of explanations for deviation from principles of corporate governance. Without a doubt, the primary pillar consists of the level of information and its quality, as found in explanations for shareholders. It is this quality that determines if the shareholder understands the processes occurring in the realm of corporate governance in the company. Research limitations: The conducted analysis should be treated as an introduction to related research issues. It should be stressed that research into explanations provided by companies is still in the process of development, and the number of publications devoted to this topic is still modest. Practical implications: The study fits in the research into the phenomena of the “comply or explain” mechanism as applied in practice, which according of many researchers, continues to be poorly investigated. In terms of the directions for further research, there are promising topics including e.g. identification of factors that may translate into the quality of such statements (e.g. ownership structure, identity of shareholders), the role that should be played by institutions involved in developing CG codes (i.e. their successive versions), and the involvement of the board of directors/ supervisory board in the evaluation process. Originality: The present paper identifies the key factors perceived as determining the quality of corporate governance statements. In addition to that, it outlines new avenues for further investigation.

Suggested Citation

  • Koładkiewicz Izabela, 2017. "The Quality of Explanations for Deviation from Principles of Corporate Governance. An Introduction," Journal of Management and Business Administration. Central Europe, Sciendo, vol. 25(3), pages 34-54, September.
    • Handle: RePEc:vrs:jmbace:v:25:y:2017:i:3:p:34-54:n:4
    DOI: 10.7206/jmba.ce.2450-7814.202
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    References listed on IDEAS

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