Agency costs, Ownership Structure and Corporate Governance Mechanisms in Ghana

Andrews Owusu, Charlie Weir

Research output: Contribution to journalArticle

4 Citations (Scopus)
639 Downloads (Pure)

Abstract

This paper analyses the relationship between agency costs, ownership structure and corporate governance mechanisms in Ghana for the study period 2000-2009. Our results show that smaller board size and the presence of audit and remuneration committees decrease agency costs. We also find that higher managerial and institutional ownership reduces agency costs. However, duality and the proportion of non-executive directors on the board have no effect on agency costs, suggesting that not all board structure governance mechanisms are effective in mitigating agency costs. Interestingly, the non-board structure code recommendations such as improved shareholder voting rights, the adoption of International Financial Reporting Standards and auditor quality have also reduced agency costs. Overall, we find that the introduction of the Ghanaian Code played significant role in reducing agency costs.
Original languageEnglish
Pages (from-to)63-84
Number of pages22
JournalInternational Journal of Accounting, Auditing and Performance Evaluation
Volume14
Issue number1
Early online date17 Jan 2018
DOIs
Publication statusPublished - 2018

Keywords

  • agency costs
  • corporate governance
  • ownership structure
  • Ghana

ASJC Scopus subject areas

  • Accounting

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