| 1 |
Author(s):
Amrita Singh.
Page No : 1-26
|
INDEPENDENT DIRECTORS- ASSETS OR PUPPETS
Abstract
In the wake of the corporate governance scandals, concept of Independent directors has grappled
academicians and policy makers worldwide as to whether these independent directors are
working effectively or not. The main objective of the paper is to enunciate the factors influencing
the effectiveness of independent directors in listed Indian companies. The study uses Principal
Component factor analysis to identify the factors that impact the effectiveness of independent
directors.
Research findings: The results of the analysis suggest that presence of independent directors has
an impact on the accounting returns of the company as well as market returns by increasing
investor confidence. Further it is observed that most of the Independent Directors are selected
through personal channels and thus lack the ability to take proper decisions due to biasness
towards those who have appointed them. Proper system of appointment and selection of
Independent Directors is required for making them more effective.
Implications: Independent directors are required for not only running the organisation in an
efficient manner but also for improving its performance and enhancing investor confidence. In
fact it is an interrelated concept. If the independent directors efficiently discharge their duties it
will lead to improved financial results in the long run which in turn will boost investor
confidence thereby leading to increased market value of the firm. Policy makers need to
formalise the institution of independent directors and regulate their appointment and selection.
Further it is suggested that efforts need to be made to increase the autonomy of independent
directors so that they can more actively participate in the corporate system
| 2 |
Author(s):
Sunaina Kanojia, Gunjan Khanna.
Page No : 27-53
|
WOMEN DIRECTORS ON CORPORATE BOARDS: EVIDENCE FOR GOOD GOVERNANCE
Abstract
Despite of decades of ongoing debate, there has been a little impact on corporate practices, as the
representation of women serving on the corporate boards of the large, prime or most visible
corporation has remained negligible across the world.To expound the longing to have gender
diverse board for implementation of better corporate governance and long term survival of
corporations in India.The results revealed that in context of India, women participation on
corporate boards is at the stage of tokenism. Findings revealed that the provision under the
Companies Act, 2013 wherein certain class of companies to have at least one woman director has
eventually necessitated in India to bring any real change in the homogeneous boards and there
are substantial number of hindrances for women in the form of organisational, individual and
societal barriers while climbing the corporate ladder still women exhibit diverse leadership style
and women’s presence leads to qualitative advancement. The analysis of data highlights that
women are vigilant about all stakeholders’ interest and women are risk averse. It provides an
explanation for previous inconclusive findings of studies regarding the impact of women on
corporate governance by advocating the need to enhance board effectiveness as a transitional
stride in understanding the effects of board on governance level outcomes.
| 3 |
Author(s):
Ruchi Goyal.
Page No : 54-70
|
EMPIRICAL EVIDENCES OF CORPORATE GOVERNANCE AND PERFORMANCE OF AIRLINE SECTOR
Abstract
The study attempts to investigate the intricacies of airline industry and its dimensions with corporate governance and its relationship with performance of airline companies. Though a few studies have been undertaken on this but none havebeen reported in Indian context and especially with any conclusive empirical evidence. The paper attempts to empirically explore the status of corporate governance and performance measures using secondary data collected from various sources and analyzes the perception of airline shareholders collected through primary data analysis with respect to corporate governance attributes in Indian airline industry
| 4 |
Author(s):
Vijaylakshmi.
Page No : 71-85
|
BOARD DIVERSITY & FINANCIAL PERFORMANCE – EVIDENCE FROM LISTED INDIAN COMPANIES
Abstract
The essence of board diversity has been imbibed in the legislature with the advent of new
Companies Act, 2013 and revised clause 49 of the SEBI listing agreement of stock exchange in
India, mandating to include at least one women director and specifying the minimum number of
independent directors in the board of companies listed in India. The outcome of increasing
research from developed economies have indicated the benefits of having a diversity balanced
board in the company, which includes better comprehension of the market, business growth,
increased innovation among few. Rather than restricting to gender diversity this study has
examined the statutory aspect of the diversity also that is, board independence. The present study
undertakes a sample of NIFTY 500 index companies listed in India in the National stock
exchange belonging to different sectors – information technology, healthcare, pharmaceutical,
and consumer goods. This finds that gender diversity is positively related with Tobin’s Q (proxy
for company performance) and board independence is not related with Tobin’s Q.
| 5 |
Author(s):
Shweta Goel.
Page No : 86-100
|
MACRO ECONOMIC FACTORS AND CAPITAL STRUCTURE DECISIONS OF LISTED COMPANIES: AN EMPIRICAL STUDY FOR INDIAN ECONOMY
Abstract
The relationship betweenmacroeconomic factors andthe capital structure of Indian listed
companies has been expounded in the present study using panel data from 2008 to 2017of 255
non- financing companies. Macro-economic indicators i.e. gross domestic product (GDP),
interest rate and inflation rate have been studied to analyze their influence on capital structure
decisions. GDP growth rate is found to negatively and statistically significantly related with
capital structure measured by long term debt to total assets, whereas in terms of total debt the
relationship is again negative though not statistically significant. Inflation is positively and
statistically significantly associated with capital structure measured in terms of both long term
debt as well as total debt. As far as relationship between levels of debt and rate of interest is
concerned, the results of panel regression suggest negative though not significant relation
between the two
| 6 |
Author(s):
H.V. Jhamb, K.L.Dhaiya, Shikha Menani.
Page No : 101-114
|
THE BULL AND BEAR MARKET BETA – EVIDENCE FROM THE INDIAN STOCK MARKET
Abstract
Capital Asset pricing model is one of the oldest models that present a relationship
between expected return and market risk. The model states that market risk as measured by beta
is able to explain the returns thereby giving it the most important determinant status in asset
pricing. Recent empirical studies however present a doubt on the validity of a single beta model
and various explanations have been given to justify that a single beta is not significant in
explaining the returns of risky securities and/or portfolio as beta itself is not stable over different
time periods. The present paper is thus an attempt to find out whether a single beta CAPM as
proposed by Sharpe Lintner and Mossin is helpful in explaining the risk return relationship of the
stock returns in India using 271 securities listed on BSE 500 for the period Jan 2000 – Dec 2016
or dual beta CAPM taking account of upside and downside risk is more successful in explaining
the returns of the securities. Fabozzi and Francis supported the single beta CAPM by suggesting
that it is insignificant to use two independent betas one for the bull market and other for the bear
market. Apart from descriptive statistics the study uses Unit root test, OLS regression, Dummy
analysis to empirical test the validity of single beta and Dual beta CAPM. Results revealed that a
single beta CAPM is successful in explaining the stock returns and no significant improvement is
found by taking up and down market betas.
