A Study on the Impact of Corporate Governance on Firm Valuation

Authors

  • Subir Sen

DOI:

https://doi.org/10.33516/rb.v45i3-4.20-31p

Keywords:

Corporate Governance, Risk Metrics, Valuation, Firm Performance, Credit Score.

Abstract

Existing literature on corporate governance is of the opinion that poor governance invariably destroys value; however, evidences on the impact of good governance on value creation remains inconclusive. Does the market then reward firms that practices good corporate governance? In this paper, we analyze firms comprising Nifty-50 over a 10 year time-frame from (2005–2015) to provide insights in the Indian context. While, the basic parameters of governance were not found to have any significant impact on performance, the advanced ones had tested positive. This confirms that there is a threshold level beyond which a firm’s value increases with an increase in governance score. Further, it was also revealed that the threshold level itself rises over time as corporate climate matures.

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Published

2020-01-01

How to Cite

Sen, S. (2020). A Study on the Impact of Corporate Governance on Firm Valuation. Research Bulletin, 45(3-4), 20–31. https://doi.org/10.33516/rb.v45i3-4.20-31p

Issue

Volume 45, Issue 3-4, October 2019-January 2020

Section

Articles
Crossref
Scopus
Google Scholar
Europe PMC

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