Competition and Corporate Governance: Effects on Financial Position and Profitability
Author: | Bc. Jan Kurzeja |
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Year: | 2016 - summer |
Leaders: | doc. Jiří Novák M.Sc., Ph.D. |
Consultants: | |
Work type: | Bachelors |
Language: | English |
Pages: | 48 |
Awards and prizes: | |
Link: | https://is.cuni.cz/webapps/zzp/detail/151332/ |
Abstract: | Using a novel approach towards competition and the Sarbanes Oxley Act (SOX) as a shock to internal governance we examine the interaction between product market competition and corporate governance mechanisms. Our results provide a support for notions of substitution model of dividends and firms’ financial policies being shaped by competition environment. We find evidence that companies facing higher competition threats experience a larger profitability improvement, a notion that is inconsistent with a traditional substitution relationship of governance and competition. |