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Article

The Impact of Corporate Governance Structures on Foreign Direct Investment: A Case Study of West African Countries

1
Department of Economics, Faculty of Economics and Management, Czech University of Life, 16500 Prague, Czech Republic
2
Department of Finance, College of Humanities, University of Ghana Business School, P. O. Box LG 78, Legon, Accra 00233, Ghana
*
Author to whom correspondence should be addressed.
Sustainability 2020, 12(9), 3715; https://doi.org/10.3390/su12093715
Received: 27 February 2020 / Revised: 23 April 2020 / Accepted: 27 April 2020 / Published: 4 May 2020
(This article belongs to the Special Issue Firm Size and Sustainable Innovation Management II)
A number of studies have been done to examine the factors that impact the level of foreign direct investment in African countries. However, most of them have not considered the effect corporate governance structures have on foreign direct investment (FDI) in their estimations. This research therefore pursued the investigation of the relationship between corporate governance structures at the national level and foreign direct investment concentrating mainly on West African economies for the period 2009–2018. The study constructed a panel, sampling annual data from 17 West African countries. The System generalized method of moments (GMM) was used in analyzing the panel data to attain the objective of the research. The results of the study reveal that countries characterized by greater protection of the interest of non-controlling parties are able to accumulate progressive FDIs. Economies with firms portraying high ethical values also generally generate increasing foreign direct investment, and the existence of effective boards also significantly improves the country’s FDI inflows. Finally, the findings report that the impact of regulations in securities and the stock exchange on FDI is insignificant. The study recommends that West African countries institute corporate governance structures purely independent of political influences in order to ensure effective utilization of foreign direct investment to mitigate poverty. View Full-Text
Keywords: foreign direct investment (FDI); West Africa; macro level corporate governance; economic development; corporate governance structure foreign direct investment (FDI); West Africa; macro level corporate governance; economic development; corporate governance structure
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MDPI and ACS Style

Appiah-Kubi, S.N.K.; Malec, K.; Maitah, M.; Kutin, S.B.; Pánková, L.; Phiri, J.; Zaganjori, O. The Impact of Corporate Governance Structures on Foreign Direct Investment: A Case Study of West African Countries. Sustainability 2020, 12, 3715. https://doi.org/10.3390/su12093715

AMA Style

Appiah-Kubi SNK, Malec K, Maitah M, Kutin SB, Pánková L, Phiri J, Zaganjori O. The Impact of Corporate Governance Structures on Foreign Direct Investment: A Case Study of West African Countries. Sustainability. 2020; 12(9):3715. https://doi.org/10.3390/su12093715

Chicago/Turabian Style

Appiah-Kubi, Seth Nana Kwame, Karel Malec, Mansoor Maitah, Sandra Boatemaa Kutin, Ludmila Pánková, Joseph Phiri, and Orhan Zaganjori. 2020. "The Impact of Corporate Governance Structures on Foreign Direct Investment: A Case Study of West African Countries" Sustainability 12, no. 9: 3715. https://doi.org/10.3390/su12093715

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