Title: The effects of corporate governance attributes and code amendments on the performance of Malaysian trading and services firms

Authors: Abdelkader Laallam; Fardous Alom; Azhar Mohamad

Addresses: Department of Finance, International Islamic University Malaysia, Kuala Lumpur, Malaysia ' Ministry of Civil Aviation and Tourism, Bangladesh Secretariat, Dhaka, Bangladesh ' Department of Finance, International Islamic University Malaysia, Kuala Lumpur, Malaysia

Abstract: This study aims to investigate the impact of corporate governance attributes and code amendments of 2012 on the performance of 162 trading and services listed firms in Bursa Malaysia. A corporate governance index score adopted from the Taylor model and formulated based on the MCCG best practices is used to measure the corporate governance attributes level. Return on assets (ROA), return on equity (ROE) and market return measurement (Tobin's Q) are used in this study. A panel data test has been conducted followed by post hoc test in order to assess the changes in firm's performance throughout the period 2010-2014. The findings show a positive significant relationship between corporate governance attributes and firm performance for accounting and market-based proxies. While the relationship between the corporate governance amendment (CGA) and accounting based firm performance proxies ROA and ROE turns out to be negatively significant with market-based firm performance proxy TQ.

Keywords: corporate governance index; CGI; corporate governance amendments; CGA; Malaysian Code on Corporate Governance; MCCG; return on assets; ROA; return on equity; ROE; Tobin's Q; Malaysia; code amendments; firm performance.

DOI: 10.1504/IJEBR.2017.081772

International Journal of Economics and Business Research, 2017 Vol.13 No.1, pp.72 - 94

Received: 05 Mar 2016
Accepted: 19 Sep 2016

Published online: 15 Jan 2017 *

Full-text access for editors Access for subscribers Purchase this article Comment on this article