Does Corporate Governance Associate with Productivity for Sustainable Growth? Indian Experience

40 Pages Posted: 16 Dec 2019

See all articles by Sajit Jacob

Sajit Jacob

Bharathiar University, Department of Commerce

Date Written: November 22, 2019

Abstract

This paper discusses importance of Corporate Governance on the productivity of the firm and this study in particular has chosen role of CG on Total Factor Productivity as the core of this paper. The main goal is to prove CG as the causal factor for TFP. Main attention was paid to Ordinary Least Squares based econometric modelling of TFP to identify the leading financial performance variables, that CG needs to focus. This topic was chosen because, unless productivity of firms improve the real macroeconomic growth remains a mirage. The major findings of the paper are CG needs to develop specific strategies to enhance Operating Cash flow to Sales, Debt Service Coverage and Return on Revenue to create significant impact on TFP. The above findings suggest that there exist a financial value chain that establishes logically and with correlation signs that CGPI is a critical causal factor for productivity.

Keywords: Corporate Governance Performance Index, Cobb-Douglas Production Function, Total Factor Productivity

JEL Classification: G30, G34, D24

Suggested Citation

Jacob, Sajit, Does Corporate Governance Associate with Productivity for Sustainable Growth? Indian Experience (November 22, 2019). Available at SSRN: https://ssrn.com/abstract=3491552 or http://dx.doi.org/10.2139/ssrn.3491552

Sajit Jacob (Contact Author)

Bharathiar University, Department of Commerce ( email )

India

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