International Journal of Corporate Governance (6 papers in press)

Regular Issues

• Influence of corporate culture on earnings management  
  by Pradip Banerjee  
  Abstract: The study investigates the association of corporate culture and earnings management. The study utilizes the culture score developed by Li et al. (2021). Using the text analysis of the question-and-answer (QA) section of earnings conference call transcripts they quantify culture score. Employing a large sample of 40,736 firm-year observations of US firms between 2001 and 2018, the study documents a negative and significant contemporaneous association between culture and earnings management. We also show that culture positively affects future firm performance through the mediating channel of earnings management. The results are robust after controlling for several potential biases and endogeneity concerns. The top management of a firm sets an organizational culture that improves the governance of the firm and, in turn, benefits the organization. Thus, our results speak directly to internal management, as well as other stakeholders including, policymakers, standard-setters, lenders, and regulators.
  Keywords: corporate culture; accrual earnings management; real earnings management; firm performance.
  DOI: 10.1504/IJCG.2025.10070473
   
  
• Impact of bankruptcy law on foreign investments in distressed firms: evidence from a quasi natural experiment  
  by Geeta Singh, Rajesh Pathak 
  Abstract: We examine the influence of bankruptcy law on the foreign institutional shareholders in Indian firms. Using a sample of 15268 firm-year observations from 2003 to 2023, we employ Tobit and Logit regression models within the difference-in-difference framework to investigate the impact of the Insolvency and Bankruptcy Code (IBC) of 2016 and financial distress on the shareholding of the foreign institutional investors (FIIs). We report that introduction of the IBC leads to reduction in the intensity and propensity of equity holding of FIIs. Further, this decrease is more pronounced in the distressed firms. Our study offers insights to the policy makers and regulators to identify ways to attract FIIs, post the implementation of IBC since better creditors’ rights create conducive regulatory environment for creditors, it could repel the equity investors, especially outside foreign investors.
  Keywords: foreign institutional investors; FIIs; bankruptcy law; insolvency and bankruptcy code; IBC; financial distress; India.
  DOI: 10.1504/IJCG.2025.10073058
   
  
• Corporate director skill diversity and environmental disclosure  
  by Anju P. Tom, Sudershan Kuntluru, Ajit Dayanandan 
  Abstract: The study investigates whether corporate director skill diversity impacts environmental disclosure in India. In 2020, the capital market regulator, the Securities and Exchange Board of India (SEBI), introduced regulations under the SEBI (listing obligations and disclosure requirements) framework, mandating companies to report the skill sets of each director of the board in their annual reports. We hand-collected directors’ skill data from the annual reports for the period 2019–2020 to 2021–2022. First, we compiled a comprehensive list of all skills reported by the companies, eliminating duplicates and consolidating similar categories, resulting in 17 unique skill categories. Using a dataset of 348 Indian companies from 2020 to 2022, the period following the mandatory directors’ skill disclosure requirement, we find that director skill diversity exhibits a significant positive impact on environmental disclosures in India. The research findings provide direct evidence for improving environmental disclosures and achieving sustainable development.
  Keywords: director skill set; board skill set; board diversity; environmental disclosure; India.
  DOI: 10.1504/IJCG.2025.10073209
   
  
• Beyond challenges and monetary compensation: human resource behaviours leading to firm's growth  
  by Yaoyao Tang, Emmanuel Paulino, Ronald P. Romero 
  Abstract: This study examined the relationship between human resource behaviours and firm growth in IT enterprises in Beijing, China. Specifically, it evaluated the effects of innovative working behaviour, organisational citizenship, and employee resilience on firm growth. Using cluster sampling, 220 managers from selected IT enterprises responded to a survey questionnaire. Multi-regression analysis revealed that innovative working behaviour and organisational citizenship positively impact firm growth, while employee resilience showed no significant effect. The findings highlight the importance of employees ability to generate innovative ideas, perform beyond formal responsibilities, and adapt to change in driving firm success. Interestingly, resilience did not translate into measurable growth benefits, suggesting its role may be indirect or context-dependent. This study is unique in applying multiple regression to assess the combined effects of these behaviours on firm growth and is the first in China to explore how human resource behaviours influence organisational performance.
  Keywords: China; employee resilience; ER; firm growth; innovative working behaviour; IWB; IT industry; multi-regression analysis; organisational citizenship.
  DOI: 10.1504/IJCG.2025.10073224
   
  
• Does board independence, ownership structure, and group affiliation impact the acquiring companies announcement returns in India?  
  by Reena Nayyar, Sanjay Dhamija, Shikha Bhatia 
  Abstract: The study evaluates the impact of board independence, ownership concentration, and business group affiliation on the acquiring companies’ announcement returns in India. The analysis is conducted through standard event study methodology and cross-sectional regression analysis. The results indicate that the independent board of directors fails to obviate the conflict of interest between the controlling and the minority shareholders in mergers and acquisitions pursued by business-group-affiliated, Indian acquiring companies, with promoters as the dominant shareholders. Thus, the results corroborate the entrenchment theory and negate the applicability of monitoring theory in the Indian M&A context. The study adds to the existing literature on M&As, corporate governance, and business groups by analyzing how the critical interactions between board independence, ownership concentration, and business group affiliation impact the value creation in M&As in India. The study offers implications for the regulator, the Securities and Exchange Board of India (SEBI).
  Keywords: mergers and acquisitions; M&As; corporate governance; board independence; ownership concentration; business groups; India.
  DOI: 10.1504/IJCG.2025.10073225
   
  
• Income smoothing in Vietnamese listed firms: do related party transactions make a difference?  
  by Tran Trung Kien  
  Abstract: This study examines the relationship between related party transactions (RPT) and income smoothing (ISM) behaviour by using a sample of Vietnamese-listed firms in the period of 20152018. The author predicts a positive relationship between RPT and ISM because RPT can be considered a tool to apply earnings manipulation measured through ISM. By using the ordinary least square (OLS) regression method, the positive relationship between RPT and ISM is found. Besides, several robustness tests are conducted, and the research findings are confirmed. This study will help the regulator better understand how RPT relates to the stock market and what regulatory changes can be made to utilise the benefits of RPT in developing nations.
  Keywords: emerging market; income smoothing; related party transactions.
  DOI: 10.1504/IJCG.2025.10073268