Company Performance and Corporate Governance Mechanisms: A Multiple Linear Regression Analysis

Abstract

The study attempts to unearth the relative impact of corporate governance practices on company performance (financial) of different banks and financial institutions of Bangladesh. Data were collected using secondary source (annual report of the companies) and judgmental and convenience sampling were used to select the Banks and Financial institutions. The statistical tool SPSS is used to analyze the collected data. Multiple regression analysis is used to examine the relative dominance of selected independent variables (selected corporate governance practices) on the dependent variable (Firm’s performance).The study discovered no significant impact of Corporate Governance Practices on firms’ financial performances (ROA, ROE, NPAT, EPS), although hypothesized otherwise. One of the paramount limitations of this study is the use of merely 32 listed companies from Dhaka Stock Exchange and using only three handpicked categories of sub-indexes from the corporate governance checklist rather than using the whole list. Thus, the future researchers are expected to prevent the causality of their studies through enlarging their respondents’ base and scope such as including all listed companies of Bangladesh.

Keywords: Corporate Governance, Firm Performance, Listed Companies, Net Profit After Tax, Bangladesh