The nexus between corporate governance, risk taking, and growth.

Autor: Andries AM; Faculty of Economics and Business Administration, Alexandru Ioan Cuza University of Iasi, Iasi, Romania.; Institute for Economic Forecasting, Romanian Academy, Bucharest, Romania., Balutel D; Faculty of Economics and Business Administration, Alexandru Ioan Cuza University of Iasi, Iasi, Romania.; Laboratoire d'Economie d'Orleans, Orleans, France., Ihnatov I; Faculty of Economics and Business Administration, Alexandru Ioan Cuza University of Iasi, Iasi, Romania., Ursu SG; Faculty of Economics and Business Administration, Alexandru Ioan Cuza University of Iasi, Iasi, Romania.
Jazyk: angličtina
Zdroj: PloS one [PLoS One] 2020 Feb 04; Vol. 15 (2), pp. e0228371. Date of Electronic Publication: 2020 Feb 04 (Print Publication: 2020).
DOI: 10.1371/journal.pone.0228371
Abstrakt: In this study we assess the impact of corporate governance on the risk investment behavior of firms and its implications on firms' growth rate. Using a sample of non-financial companies from 10 countries over a period leading to the recent global financial crisis, we documented that the corporate governance has a nonlinear (inverted U-shape) impact on the companies' investment risk, meaning that the investment risk is increasing up to a level of corporate governance of 0.61 (as measured by our comprehensive index), while at higher levels of corporate governance the investment risk is decreasing. For the models of sales growth and assets growth it is shown that predicted investment risk has a positive effect on firms' growth measures. Moreover, the two growth models are not moving independently and a shock to one of the growth measures (sales or assets) affects the other growth measure in the same direction. Additionally, we evaluated the effect of financial crisis on both the growth measures and the risk measure. The effect of financial crisis was captured in both measures in 2009, with higher impact on the growth of sales.
Competing Interests: The authors have declared that no competing interests exist.
Databáze: MEDLINE
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