Corporate Governance Policy and Company Performance: The Portuguese Case

12 Pages Posted: 9 Jul 2004

See all articles by Carlos F. Alves

Carlos F. Alves

University of Porto - Faculty of Economics

Victor Mendes

CMVM - Comissao do Mercado de Valores Mobiliarios

Abstract

Several supervisory authorities and governmental working groups issued corporate governance best practice codes for listed companies during the nineties. In this paper, we used a unique database that allowed us to analyse the relationship between the level of compliance of the code of best practice issued by the Portuguese Securities Market Commission and the returns of the concerned companies. By using a multifactor model, one can conclude that there is a positive relationship between the compliance of some of these recommendations and the returns that were determined. The recommendations on the structure and functioning of the executive board deserve a special attention. However, globally, CMVM's code of best practice doesn't have a systematic effect on firm returns.

Suggested Citation

Alves, Carlos Francisco Ferreira and Mendes, Victor, Corporate Governance Policy and Company Performance: The Portuguese Case. Corporate Governance: An International Review, Vol. 12, No. 3, pp. 290-301, July 2004. Available at SSRN: https://ssrn.com/abstract=557311

Carlos Francisco Ferreira Alves

University of Porto - Faculty of Economics ( email )

Rua Roberto Frias
s/n
Porto, 4200-464
Portugal
+351 225571242 (Phone)
+351 225505050 (Fax)

Victor Mendes (Contact Author)

CMVM - Comissao do Mercado de Valores Mobiliarios ( email )

Avenida Fontes Pereira de Melo, 21
Lisbon, 1056-801
Portugal
(351) 213177000 (Phone)
(351) 213537077/8 (Fax)

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