Governance codes:  facts or fictions? :: a study of governance codes in Colombia

Julián Benavides Franco; Samuel Arturo Mongrut Montalván

Governance codes: facts or fictions? : a study of governance codes in Colombia

Translated title of the contribution: Códigos de Gobierno en Colombia: ¿realidad o ficción?

Julián Benavides Franco, Samuel Arturo Mongrut Montalván

Research output: Contribution to journal › Article in a journal › peer-review

7 Scopus citations

Abstract

Este artículo estudia los efectos sobre el desempeño contable y sobre las decisiones financieras de empresas colombianas después de implementar su código de gobierno. Los resultados muestran que el retorno sobre los activos de las empresas, luego de implementado el código, mejora en más de 1%; el efecto es amplificado por la calidad del código. Adicionalmente, se notó un incremento de más de un 5% en el apalancamiento de las empresas que habían incorporado un código. Estos resultados sugieren que el compromiso de las partes controladas para autorregularse, reduciendo sus beneficios privados y/o la expropiación de las partes no controladoras, a través de la introducción del código, es en realidad una medida efectiva y que los mercados financieros apoyan, incrementando el suministro de fondos a las firmas.

Translated title of the contribution	Códigos de Gobierno en Colombia: ¿realidad o ficción?
Original language	English
Pages (from-to)	85-102
Journal	Estudios Gerenciales
Volume	26
Issue number	117
State	Published - Oct 2010

Bibliographical note

Bibliografía: páginas 99-100

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Cite this

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title = "Governance codes: facts or fictions? :: a study of governance codes in Colombia",

abstract = "This article studies the effects on accounting performance and financing decisions of Colombian firms after issuing a corporate governance code. We assemble a database of Colombian issuers and test the hypotheses of improved performance and higher leverage after issuing a code. The results show that the firms{\textquoteright} return on assets after the code introduction improves in excess of 1%; the effect is amplified by the code quality. Additionally, the firms leverage increased, in excess of 5%, when the code quality was factored into the analysis. These results suggest that controlling parties commitment to self restrain, by reducing their private benefits and/or the expropriation of non controlling parties, through the code introduction, is indeed an effective measure and that the financial markets agree, increasing the supply of funds to the firms.",

keywords = "Corporate governance, Governance codes, Agency theory, Accounting performance, Leverage",

author = "{Benavides Franco}, Juli{\'a}n and {Mongrut Montalv{\'a}n}, {Samuel Arturo}",

note = "Bibliograf{\'i}a: p{\'a}ginas 99-100",

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month = oct,

language = "Ingl{\'e}s",

volume = "26",

pages = "85--102",

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TY - JOUR

T1 - Governance codes: facts or fictions? :

T2 - a study of governance codes in Colombia

AU - Benavides Franco, Julián

AU - Mongrut Montalván, Samuel Arturo

N1 - Bibliografía: páginas 99-100

PY - 2010/10

Y1 - 2010/10

N2 - This article studies the effects on accounting performance and financing decisions of Colombian firms after issuing a corporate governance code. We assemble a database of Colombian issuers and test the hypotheses of improved performance and higher leverage after issuing a code. The results show that the firms’ return on assets after the code introduction improves in excess of 1%; the effect is amplified by the code quality. Additionally, the firms leverage increased, in excess of 5%, when the code quality was factored into the analysis. These results suggest that controlling parties commitment to self restrain, by reducing their private benefits and/or the expropriation of non controlling parties, through the code introduction, is indeed an effective measure and that the financial markets agree, increasing the supply of funds to the firms.

AB - This article studies the effects on accounting performance and financing decisions of Colombian firms after issuing a corporate governance code. We assemble a database of Colombian issuers and test the hypotheses of improved performance and higher leverage after issuing a code. The results show that the firms’ return on assets after the code introduction improves in excess of 1%; the effect is amplified by the code quality. Additionally, the firms leverage increased, in excess of 5%, when the code quality was factored into the analysis. These results suggest that controlling parties commitment to self restrain, by reducing their private benefits and/or the expropriation of non controlling parties, through the code introduction, is indeed an effective measure and that the financial markets agree, increasing the supply of funds to the firms.

KW - Corporate governance

KW - Governance codes

KW - Agency theory

KW - Accounting performance

KW - Leverage

M3 - Artículo de revista

SN - 0123-5923

VL - 26

SP - 85

EP - 102

JO - Estudios Gerenciales

JF - Estudios Gerenciales

IS - 117

ER -

Governance codes: facts or fictions? : a study of governance codes in Colombia

Abstract

Bibliographical note

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