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Article

Reforms Protecting Minority Shareholders and Firm Performance: International Evidence

by
Corina Burunciuc
and
Halit Gonenc
*
Economics, Econometrics & Finance, Faculty of Economics and Business, University of Groningen, 9747 AE Groningen, The Netherlands
*
Author to whom correspondence should be addressed.
J. Risk Financ. Manag. 2021, 14(1), 5; https://doi.org/10.3390/jrfm14010005
Submission received: 13 November 2020 / Revised: 17 December 2020 / Accepted: 21 December 2020 / Published: 24 December 2020
(This article belongs to the Special Issue Corporate Governance and Its Impact on Accounting and Finance)
Versions Notes

Abstract

This study investigates the effect of corporate governance reforms protecting minority shareholders on the firm value measured by Tobin’s Q. Using the difference-in-differences estimation and a large international sample from 65 countries for the period 2005–2018, the results show that the firm values increase more in the reform countries than non-reform countries relative to pre-reform levels. This positive effect changes for firms with high and low levels of debt. Moreover, the values after reforms increase more for firms located in civil countries and in countries with rule-based reform approaches and low debt enforcement because the reforms strengthening minority shareholder protection are more efficient in those countries. The evidence is robust to accounting-based performance as well.
Keywords: reforms protecting minority shareholders; firm value; corporate governance; leverage; legal origin; corporate governance approaches; debt enforcement reforms protecting minority shareholders; firm value; corporate governance; leverage; legal origin; corporate governance approaches; debt enforcement

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MDPI and ACS Style

Burunciuc, C.; Gonenc, H. Reforms Protecting Minority Shareholders and Firm Performance: International Evidence. J. Risk Financ. Manag. 2021, 14, 5. https://doi.org/10.3390/jrfm14010005

AMA Style

Burunciuc C, Gonenc H. Reforms Protecting Minority Shareholders and Firm Performance: International Evidence. Journal of Risk and Financial Management. 2021; 14(1):5. https://doi.org/10.3390/jrfm14010005

Chicago/Turabian Style

Burunciuc, Corina, and Halit Gonenc. 2021. "Reforms Protecting Minority Shareholders and Firm Performance: International Evidence" Journal of Risk and Financial Management 14, no. 1: 5. https://doi.org/10.3390/jrfm14010005

APA Style

Burunciuc, C., & Gonenc, H. (2021). Reforms Protecting Minority Shareholders and Firm Performance: International Evidence. Journal of Risk and Financial Management, 14(1), 5. https://doi.org/10.3390/jrfm14010005

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