| Affiliation: | (1) Department of Strategic Management, Indian Institute of Management, Kozhikode, 673 571, India;(2) Department of Strategic and International Management, Indian Institute of Management, Lucknow, India |
| Abstract: | The paper reviews international literature on corporate governance and firm performance and investigates the relationship in the Indian context, taking into account the endogeneity in the relationship. Governance parameters include board size, directors’ shareholding, institutional and foreign shareholding, while the fragmentation in shareholding is captured by public shareholding. A simultaneous equation regression model for Tobin’s Q, as a measure of firm performance, is attempted using these variables, while controlling for industry effects and other non-governance variables. The data corresponds to a panel of 340 large, listed Indian firms for the period 1997–2001 spread across 24 industry groups. |
