Academic journal article IUP Journal of Corporate Governance

Focus

Academic journal article IUP Journal of Corporate Governance

Focus

Article excerpt

After corporate governance became an important issue in the early 1990s, all the developed economies adopted significant legal and regulatory measures to ensure the protection of the shareholders' interest. The developing economies followed suit and adopted corporate governance mechanisms in the late 1990s. However, the effectiveness of such mechanisms is not up to the mark in developing countries due to lapses in law implementation systems. This leaves a lot of open questions to be researched in the corporate governance systems of these countries. This issue focuses on the corporate governance issues in three developing countries, namely, Ghana, India and Iran.

In the first paper, "Corporate Governance in an Emergent Economy: A Case of Ghana", the authors, Otuo Serebour Agyemang and Monia Castellini, analyze the corporate governance systems in Ghana using the collective case study method, a qualitative research tool that is gaining acceptability among the researchers in the corporate governance field. Four firms in Ghana have been considered to analyze the relation between shareholder control and board control. Ownership structure and ownership control are the two parameters studied under 'ownership issue', while under 'board effectiveness', the authors analyze board composition, director independence, board leadership structure, board meetings, audit and remuneration committees, and board control and succession planning. Then, the authors compare the actual practices of the firms with that of the recommended guidelines as per the legal and regulatory system of Ghana. The results obtained are mixed, with one or two firms confirming the recommended regulatory guidelines, while others are not for most of the parameters. Based on the comparison, the authors identify three key issues to improve the corporate governance systems of Ghana, namely, 'improving the corporate governance foundation', 'safeguarding the right of minority shareholders' and 'issues that affect board effectiveness'. The authors conclude that the solution to the corporate governance problems of Ghana lies in improving the law enforcement mechanism.

The second paper of the issue focuses on another developing economy, which also faces the law implementation issues, despite having relatively well-developed corporate governance regulatory systems. …

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