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The Nexus of Corporate Governance and Financial Performance Evidence from London Stock Exchange

Author(s):

Hussein Ahmad Bataineh , University of Jordan ; MuhibUllah, Quaid-e-Azam University; Syed Sikandar Wali, Islamia College

Keywords:

Agency Theory, Corporate Governance, Financial Performance, London Stock Exchange, Corporate Governance Index

Abstract

The aim of the present paper is to assess the impact of corporate governance on the financial performance of firms listed on the London Stock Exchange. A sample of 64 companies is analysed using univariate and multivariate techniques. The results provide some support for corporate governance practices to enhance performance. Most notably, the overall effect of corporate governance on firm performance is positive. Higher values of the Corporate Governance Index estimated by the Institute of Directors were associated with superior accounting and market performance. The results are in line with the existing empirical studies and agree with the agency theory.

Other Details

Paper ID: IJSRDV8I110004
Published in: Volume : 8, Issue : 11
Publication Date: 01/02/2021
Page(s): 21-26

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