Corporate Governance Structure and Corporate Risk-Taking: Evidence of Malaysian Agriculture Sector
1
조회
0
다운로드
2
인용
0
참고문헌
키워드
초록
Purpose: This study explores the role of corporate governance structure and corporate risk-taking of on Malaysian agriculture sector. Despite its importance in mitigating climate change, the agricultural sector also faces global competition, market liberalisation, rapid technological advances and the starter of stricter quality and safety procedures, all of w hich require f irms t o take g reater r isks. Design/methodology/approach: This study explores this relationship by applying generalised least square (GLS), random effect methodologies (REM). The sample of this study uses panel data from 2015 to 2021. Findings: The findings report a negative relationship between corporate governance structure and corporate risk-taking using a sample of firms from an emerging market. Research limitations/implications: The effects of these results for management practice and recommendations for further research were examined. The limitation of this study provides a sample of study using a limited number of agricultural firms in Malaysia. Originality/value: While this empirical study used a single industry-focused sample, most previous studies have focused on multiple industries. A key feature of this study is the analysis of how corporate governance structures affect the risk appetite of Malaysian agribusinesses.
Abstract
Purpose: This study explores the role of corporate governance structure and corporate risk-taking of on Malaysian agriculture sector. Despite its importance in mitigating climate change, the agricultural sector also faces global competition, market liberalisation, rapid technological advances and the starter of stricter quality and safety procedures, all of w hich require f irms t o take g reater r isks. Design/methodology/approach: This study explores this relationship by applying generalised least square (GLS), random effect methodologies (REM). The sample of this study uses panel data from 2015 to 2021. Findings: The findings report a negative relationship between corporate governance structure and corporate risk-taking using a sample of firms from an emerging market. Research limitations/implications: The effects of these results for management practice and recommendations for further research were examined. The limitation of this study provides a sample of study using a limited number of agricultural firms in Malaysia. Originality/value: While this empirical study used a single industry-focused sample, most previous studies have focused on multiple industries. A key feature of this study is the analysis of how corporate governance structures affect the risk appetite of Malaysian agribusinesses.
참고문헌 (115)
- Abbott, L. J., "Audit Committee Characteristics and Restatements", Auditing : A Journal of Practice & Theory, 23(1), pp.69~87 (2004)[DOI]
- Adams, R. B., "Women in the boardroom and their impact on governance and performance", Journal of Financial Economics, 94(2), pp.291~309 (2009)
- Ahmad, H. H., "The performance and corporate risk-taking of firms : evidence from Malaysian agricultural firms", Journal of Agribusiness in Developing and Emerging Economies, 12(5), pp.791~808 (2021)
- Ahmad, H. H., "Effects of Institutional Investors' Activism on Corporate Risk-Taking Activities", International Journal of Advanced Research in Economics and Finance, 4(1), pp.18~37 (2022)
- Akbar, S., "Board structure and corporate risk taking in the UK financial sector", International Review of Financial Analysis, 50, pp.101~110 (2017)
- Alhajri, M. O., "Factors associated with the size of internal audit functions : evidence from Kuwait", Managerial Auditing Journal, 32(1), pp.75~89 (2017)[DOI]
- Amer, M., "Audit Committee Characteristics and Firm Performance : Evidence from Egyptian Listed Companies", Proceedings of 6th Annual American Business Research Conference (2014)
- Amihud, Y., "The effects of beta, bid-ask spread, residual risk, and size on stock returns", The Journal of Finance, 44(2), pp.479~486 (1989)[DOI]
- Anderson, R. C., "Board characteristics, accounting report integrity, and the cost of debt", Journal of Accounting and Economics, 37(3), pp.315~342 (2004)[DOI]
- Anderson, R. C., "Board composition : balancing family influence in S&P 500 firms", Administrative Science Quarterly, 49(2), pp.209~237 (2004)
- Arifah, S., "Performance of Indonesian State Owned Enterprises, Managerial Performance vs. Financial Performance", Global Business and Finance Review, 28(4), pp.132~152 (2023)
- Ashbaugh, H., "Corporate governance and the cost of equity capital", SSRN Electronic Journal (2019)[DOI]
- Ashbaugh-Skaife, H., "The effect of SOX internal control deficiencies on firm risk and cost of equity", Journal of Accounting Research, 47(1), pp.1~43 (2009)[DOI]
- Assenga, M. P., "The impact of board characteristics on the financial performance of Tanzanian firms", Corporate Governance : The International Journal of Business in Society, 18(6), pp.1089~1106 (2018)
- Fraudulent financial reporting: 1987-1997, an analysis of US public companies, "Beasley, M.", COSO, ~ (1999)
- Bedard, J., "The effect of audit committee expertise, independence, and activity on aggressive earnings management", Auditing : A Journal of Practice & Theory, 23(2), pp.13~35 (2004)[DOI]
- Bell, A., "Explaining fixed effects : random effects modelling of time-series cross-sectional and panel data", Political Science Research and Methods, 3(1), pp.133~153 (2015)
- Berger, A. N., "Executive board composition and bank risk taking", Journal of Corporate Finance, 28, pp.48~65 (2014)
- Bernile, G., "Board diversity, firm risk, and corporate policies", Journal of Financial Economics, 127(3), pp.588~612 (2018)
- Bozec., Y., "Corporate governance quality and the cost of capital", International Journal of Corporate Governance, 2(3-4), pp.217~236 (2019)[DOI]
- Bradley, M., "Does board independence reduce the cost of debt", Financial Management, 44(1), pp.15~47 (2015)[DOI]
- Brick, I. E., "Board monitoring, firm risk, and external regulation", Journal of Regulatory Economics, 33(1), pp.87~116 (2008)
- Byun, H. -Y., "The implied cost of equity capital and corporate governance practices", Asia-Pacific Journal of Financial Studies, 37(1), pp.139~184 (2008)
- Carcello, J. V., "Audit committee composition and auditor reporting", The Accounting Review, 75(4), pp.453~467 (2000)[DOI]
- Carcello, J. V., "Factors associated with US public companies' investment in internal auditing", Accounting Horizons, 19(2), pp.69~84 (2005)
- Chen, D., "CEO tenure and risk-taking", Global Business and Finance Review, 19(1), pp.1~27 (2014)
- Chen, K. C. W., "Legal protection of investors, corporate governance, and the cost of equity capital", Journal of Corporate Finance, 15(3), pp.273~289 (2019)[DOI]
- Cheng, Z., "Board independence, state ownership and stock return volatility in Chinese enterprises since reform", Corporate Governance : The International Journal of Business in Society, 18(2), pp.220~232 (2018)
- Cheng, S., "Board size and the variability of corporate performance", Journal of Financial Economics, 87(1), pp.157~176 (2008)[DOI]
- Chizema, A., "Mutual funds, tunneling and firm performance : evidence from China", Review of Quantitative Finance and Accounting, 55(1), pp.355~387 (2020)[DOI]
- Claessens, S., "Corporate governance and development", World Bank Research Observer, 21(1), pp.91~122 (2006)[DOI]
- Cole, C. R., "An empirical examination of stakeholder groups as monitoring sources in corporate governance", Journal of Risk and Insurance, 78(3), pp.703~730 (2011)
- Core, J. E., "Mandatory disclosure quality, inside ownership, and cost of capital", European Accounting Review, 24(1), pp.1~29 (2015)[DOI]
- Da, Z., "CAPM for estimating the cost of equity capital : Interpreting the empirical evidence", Journal of Financial Economics, 103(1), pp.204~220 (2012)[DOI]
- Dalton, D. R., "The fundamental agency problem and its mitigation : independence, equity, and the market for corporate control", Academy of Management Annals, 1(1), pp.1~64 (2007)
- Davidson, R., "Internal governance structures and earnings management", Accounting and Finance, 45(2), pp.241~267 (2005)[DOI]
- Demidenko, E., "The ethics of enterprise risk management as a key component of corporate governance", International Journal of Social Economics, 37(10), pp.802~815 (2010)[DOI]
- Edogbanya, A., "The relationship between audit and risk management committees on financial performance of non-financial companies in Nigeria : A conceptual review", Mediterranean Journal of Social Sciences, 6(3), pp.206~206 (2015)[DOI]
- Elmoatasem Abdelghany, K., "Disclosure of market risk or accounting measures of risk : An empirical study", Managerial Auditing Journal, 20(8), pp.867~875 (2005)[DOI]
- Embong, Z., "Firm size, disclosure, and cost of equity capital", Asian Review of Accounting, 20(2), pp.119~139 (2012)[DOI]
- Fama, E. F., "Agency problems and the theory of the firm", Journal of Political Economy, 88(2), pp.288~307 (1980)[DOI]
- Fama, E. F., "Separation of ownership and control", The Journal of Law and Economics, 26(2), pp.301~325 (1983)
- Fama., E. F., "The capital asset pricing model : Theory and evidence", Journal of Economic Perspectives, 18(3), pp.25~46 (2004)[DOI]
- Francoeur, C., "Gender diversity in corporate governance and top management", Journal of Business Ethics, 81(1), pp.83~95 (2008)
- Gujarati, D. N., "Basic Econometrics" (2004), Gary Burke
- Hamza, H., "Does investment deposit return in Islamic banks reflect PLS principle", Borsa Istanbul Review, 16(1), pp.32~42 (2016)[DOI]
- Hatane, S. E., "Does internal corporate governance mechanism control firm risk? Evidence from Indonesia's three high-risk sectors", Corporate Governance : The International Journal of Business in Society, 19(6), pp.1362~1376 (2019)
- Heflin, F., "Blockholders Ownership and Market Liquidity", The Journal of Financial and Quantitative Analysis, 35(4), pp.621~633 (2000)[DOI]
- Hsu, H. -H., "Board composition, grey directors and corporate failure in the UK", The British Accounting Review, 46(3), pp.215~227 (2014)[DOI]
- Ittner, C. D., "The influence of the board of directors on risk management maturity and firm risk taking", Accounting and Finance Journal, 2(1), pp.45~50 (2015)
- Jensen, M. C., "Theory of the firm : Managerial", Journal of Financial Economics, 3(4), pp.305~360 (1976)[DOI]
- Jensen, M., "Theory of the firm : Managerial behaviour, agency costs, and ownership structure", Journal of Financial Economics, 3(4), pp.305~360 (1976)
- Jensen., M. C., "The modern industrial revolution, exit, and the failure of internal control systems", The Journal of Finance, 48(3), pp.831~880 (1993)[DOI]
- Ji, A. E., "The impact of board size on firm-level capital Investment efficiency", International Journal of Economics and Finance, 8(10), pp.110~120 (2016)[DOI]
- Kangogo, D., "Adoption of climate-smart agriculture among smallholder farmers : Does farmer entrepreneurship matter", Land Use Policy, 109, pp.105666~ (2021)
- Kercher, K.-L., "A study of board remuneration committees: Structure and effectiveness", PhD, pp.2013
- Khorramnia, K., "Toward malaysian sustainable agriculture in 21st century", IOP Conference Series: Earth and Environmental Science, 18(1), pp.012142~ (2014), IOP Publishing
- Kim, K. -H., "CEO duality leadership and firm risk-taking propensity", Journal of Applied Business Research(JABR), 24(1), pp.27~41 (2008)[DOI]
- Klein, A., "Audit committee, board of director characteristics, and earnings management", Journal of Accounting and Economics, 33(3), pp.375~400 (2002)[DOI]
- Koerniadi, H., "Corporate governance and risk-taking in New Zealand", Australian Journal of management, 39(2), pp.227~245 (2014)
- Koirala, S., "Corporate governance reform and risk-taking : Evidence from a quasi-natural experiment in an emerging market", Journal of Corporate Finance, 61, pp.101396~ (2020)
- Lau, J., "Corporate governance and chief executive o fficer d ismissal following poor performance : Australian evidence", Accounting & Finance, 49(1), pp.161~182 (2009)[DOI]
- Lazim, R. M., "Adoption of IR4. 0into agricultural sector in Malaysia : Potential and challenges", Advances in Agricultural and Food Research Journal, 1(2) (2020)[DOI]
- Levi, M., "Director gender and mergers and acquisitions", Journal of Corporate Finance, 28, pp.185~200 (2014)
- Li, H., "Corporate risk and corporate governance : Another view", Managerial Finance, 39(3), pp.204~227 (2013)[DOI]
- Lintner, J., "The Valuation of Risk Assets and the Selection of Risky Investments in Stock Portfolios and Capital Budgets", The Review of Economics and Statistics, 47(1), pp.13~37 (1965)
- Lipton, M., "A modest proposal for improved corporate governance : Business source", Business Lawyer, 42(1), pp.59~78 (1992)[DOI]
- Lotfi, S., "The analysis of the relationship between board of director composition and risk management in the firms listed in Tehran stock exchange", Interdisciplinary Journal of Contemporary Research in Business, 5(8), pp.336~349 (2013)
- Mak, Y. T., "Size really matters : Further evidence on the negative relationship between board size and firm value", Pacific Basin Finance Journal, 13(3), pp.301~318 (2005)[DOI]
- Maletta, M., "Audit evidence planning : an examination of industry error characteristics", Auditing : A Journal of Practice & Theory, 15(1), pp.71~86 (1996)
- Mathew, S., "Board composition and risk-taking in UK firms", Journal of Marketing Research, 29(1), pp.65~93 (2013)
- Mathew, S., "Corporate governance and firm risk", Corporate Governance : The International Journal of Business in Society, 18(1), pp.52~67 (2017)
- McNulty, T., "Boards of directors and financial risk during the credit crisis", Corporate Governance : An International Review, 21(1), pp.58~78 (2013)
- Corporate governance and risk: A study of board structure and process, "McNulty, T.", ACCA, ~, pp.Research Report, 129 (2012)
- Menon, K., "The use of audit committees for monitoring", Journal of Accounting and Public Policy, 13(2), pp.121~139 (1994)[DOI]
- Mitton, T., "A cross-firm analysis of the impact of corporate governance on the East Asian financial crisis", Journal of Financial Economics, 64(2), pp.215~241 (2002)[DOI]
- Mohd-Sanusi, Z., "Screening process of Shariah-compliant companies : The relevance of financial risk management", International Journal of Economics and Management, 9(1), pp.177~195 (2015)
- Moumen, N., "Board structure and the informativeness of risk disclosure : Evidence from MENA emerging markets", Advances in Accounting, 35, pp.82~97 (2016)[DOI]
- Muhammad, H., "Corporate governance and firm risk-taking : the moderating role of board gender diversity", Meditari Accountancy Research, 31(3), pp.706~728 (2023)
- Muhammad, H., "Corporate governance and firm risk-taking : the moderating role of board gender diversity", Meditari Accountancy Research, 31(3), pp.706~728 (2023)
- Nakano, M., "Board size and corporate risk taking : Further evidence from Japan", Corporate Governance : An International Review, 20(4), pp.369~387 (2012)
- Nambiappan, B., "Malaysia : 100 years of resilient palm oil economic performance", Journal of Oil Palm Research, 30(1), pp.13~25 (2018)
- Ng, T. H., "Is the risk management committee only a procedural compliance? An insight into managing risk taking among insurance companies in Malaysia", The Journal of Risk Finance, 14(1), pp.71~86 (2013)
- NGO, D. N. P., "Relationship between the audit committee and earning management in listed companies in Vietnam", The Journal of Asian Finance, Economics and Business, 8(2), pp.135~142 (2021)
- Nguyen, P., "Corporate Governance and Risk-taking : Evidence from Japanese Firms", Pacific Basin Finance Journal, 19(3), pp.278~297 (2011)[DOI]
- Nodeh, F. M., "Mediating risk taking on relationship between board structure determinants and banks financial performance", Asian Social Science, 11(23), pp.96~106 (2015)[DOI]
- Norwani, N. M., "Corporate governance failure and its impact on financial reporting within chosen companies", International Journal of Business and Social Science, 2(21), pp.205~213 (2011)[DOI]
- Pathan, S., "Strong boards, CEO power and bank risk-taking", Journal of Banking and Finance, 33(7), pp.1340~1350 (2009)
- Pfeffer, J., "The External Control of Organizations: A Resource-Dependence Perspective" (1978), Harper and Row
- Prasad, K., "Relationship between gray directors and executive compensation in Indian firms", European Journal of Management and Business Economics, 28(3), pp.239~265 (2019)[DOI]
- Puni, A., "Do board committees affect corporate financial performance? Evidence from listed companies in Ghana", International Journal of Business and Management Review, 3(5), pp.14~25 (2015)
- Raheja, C. G., "Determinants of board size and composition : A theory of corporate boards", Journal of Financial and Quantitative Analysis, 40(2), pp.283~306 (2005)[DOI]
- Rahim, R. A., "Investment, board governance and firm value : A panel data analysis", International Review of Business Research Papers, 6, pp.293~302 (2010)
- Reverte, C., "Do better governed firms enjoy a lower cost of equity capital? : Evidence from Spanish firms", Corporate Governance : International Journal of Business in Society, 9(2), pp.133~145 (2009)[DOI]
- Ross, S., "The economic theory of agency : The principal's problem", American Economic Review, 63(2), pp.134~139 (1973)
- "Corporate governance, risk-taking, and firm performance: Evidence from Italy" (2016)[URL]
- Roudaki, R., "Corporate governance structures and firm performance in large agriculture companies in New Zealand", Corporate Governance : The International Journal of Business in Society, 18(5), pp.987~1006 (2018)[DOI]
- Rubin, A., "Ownership Level, Ownership Concentration and Liquidity", Journal of Financial Markets, 10(3), pp.219~248 (2007)[DOI]
- Sakawa, H., "Institutional ownership and corporate risk-taking in Japanese listed firms", Applied Economics, 53(16), pp.1899~1914 (2021)[DOI]
- Saleh, N. M., "Audit committee characteristics and earnings management : Evidence from Malaysia", Asian Review of Accounting, 15(2), pp.147~163 (2007)[DOI]
- "Is CEO/Chair duality associated with greater likelihood of an international acquisition?" (2010)[URL]
- A corporate governance index for large, listed companies in India, "Sarkar, J.", Indira Gandhi Institute of Development Research, ~, pp.WP-2012-009 (2012)
- Sharpe, W. F. W., "Capital asset prices : A theory of market equilibrium under conditions of risk", The Journal of Finance, 19, pp.425~442 (1964)[DOI]
- Shijun, C., "Board size and firm performance : The moderating effects of the market for corporate control", Review of Quantitative Finance and Accounting, 31(2), pp.121~145 (2018)[DOI]
- Shil, N. C., "Accounting for good corporate governance", Joaag, 3(1), pp.22~31 (2018)
- Singh, H., "Management-board relationships, takeover risk, and the adoption of golden parachutes", Academy of Management Journal, 32(1), pp.7~24 (1989)[DOI]
- Tang, J., "CEO duality and firm performance : The moderating roles of other executives and blockholding outside directors", European Management Journal, 35(3), pp.362~372 (2017)[DOI]
- Consultancy on the roles and functions of audit, nomination, and remuneration committees in connection with the corporate governance review (Report), "Tsui, J.", City University Professional Services, ~ (2017)
- Tulcanaza-Prieto, A. B., "Leverage, Corporate Governance and Real Earnings Management : Evidence from Korean Market", Global Business and Finance Review, 25(4), pp.51~72 (2020)[DOI]
- Vafeas, N., "Board structure and the informativeness of earnings", Journal of Accounting and Public Policy, 19(2), pp.139~160 (2000)[DOI]
- Vafeas, N., "Audit Committees, Boards, and the Quality of Reported Earnings", Contemporary Accounting Research, 22(4), pp.1093~1122 (2005)[DOI]
- Yermack, D., "Higher market valuation of companies with a small board of directors", Journal of Financial Economics, 40(2), pp.185~211 (1996)
- Yermack, D., "Higher market valuation of companies with a small board of directors", Journal of Financial Economics, 40(2), pp.185~211 (1996)[DOI]
- Yim, S. G., "Individual Blockholders and Corporate Risk-Taking : Korean Evidence", Global Business and Finance Review, 26(4), pp.49~ (2021)
