Title: Corporate governance and firm performance in an emerging economy context: new evidence from India

Authors: Nidhi Bansal; Anil K. Sharma

Addresses: Department of Management Studies, Indian Institute of Technology Roorkee, Roorkee, Uttarakhand, 247667, India ' Department of Management Studies, Indian Institute of Technology Roorkee, Roorkee, Uttarakhand, 247667, India

Abstract: The new Companies Act of India 2013 has laid emphasis on the role of an audit committee and remuneration committee in Indian firms. Considering these changes, the present study examines the relationship between corporate governance mechanisms and firm performance of Indian firms listed publicly on the National Stock Exchange CNX-500 during the period 2004-2013; including two relatively underexplored variables - audit committee and remuneration committee. The results are cross-checked for the period of the post-enactment of the new Companies Act, that is, 2014-2018. In order to investigate the relationship, panel feasible generalised least squares method is applied. The major findings of the study suggest that promoter shareholding, the frequency of audit committee meetings, and audit committee independence have a significant and positive impact on the performance of firms. These new findings would be useful for organisations similar to the ones considered in the study in other lower-middle income economies or small and medium enterprises which are not listed on stock exchanges.

Keywords: corporate governance; audit committee; remuneration committee; firm performance; emerging economies; India.

DOI: 10.1504/IJCM.2019.100850

International Journal of Comparative Management, 2019 Vol.2 No.2, pp.123 - 147

Received: 21 Aug 2018
Accepted: 21 Mar 2019
Published online: 18 Jul 2019 *