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The impact of corporate governance measures on the performance of West African IPO firms

The impact of corporate governance measures on the performance of West African IPO firms
The impact of corporate governance measures on the performance of West African IPO firms

This paper examines the impact on underpricing and firm market value arising from IPO firms implementing a range of governance attributes such as the separation of CEO and Chairman roles, the founder ceding CEO position, establishment of committees and board size. Furthermore I study the determinants of director retained ownership and the relation between this and underpricing. Using a comprehensive sample of 37 locally listed IPO firm's from across West Africa I find evidence of a mixed impact from the adoption of universally recognised governance mechanisms. Higher levels of retained director ownership increase underpricing in contrast to that of founders.

Agency theory, Cost of equity, IPO, Underpricing, West Africa
1566-0141
130-151
Hearn, Bruce
45dccea3-9631-4e5e-914c-385896674dc2
Hearn, Bruce
45dccea3-9631-4e5e-914c-385896674dc2

Hearn, Bruce (2011) The impact of corporate governance measures on the performance of West African IPO firms. Emerging Markets Review, 12 (2), 130-151. (doi:10.1016/j.ememar.2011.02.004).

Record type: Article

Abstract

This paper examines the impact on underpricing and firm market value arising from IPO firms implementing a range of governance attributes such as the separation of CEO and Chairman roles, the founder ceding CEO position, establishment of committees and board size. Furthermore I study the determinants of director retained ownership and the relation between this and underpricing. Using a comprehensive sample of 37 locally listed IPO firm's from across West Africa I find evidence of a mixed impact from the adoption of universally recognised governance mechanisms. Higher levels of retained director ownership increase underpricing in contrast to that of founders.

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More information

Accepted/In Press date: 15 February 2011
e-pub ahead of print date: 22 February 2011
Published date: June 2011
Keywords: Agency theory, Cost of equity, IPO, Underpricing, West Africa

Identifiers

Local EPrints ID: 423426
URI: http://eprints.soton.ac.uk/id/eprint/423426
ISSN: 1566-0141
PURE UUID: cb32ce26-0512-4164-8636-b9d2e15bae4f
ORCID for Bruce Hearn: ORCID iD orcid.org/0000-0001-9767-0198

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Date deposited: 21 Sep 2018 16:30
Last modified: 26 Nov 2019 01:23

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Author: Bruce Hearn ORCID iD

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