CORPORATE GOVERNANCE AND FIRM PERFORMANCE: AN EMPIRICAL ANALYSIS WITH DUMMY VARIABLES

Corporate governance is fundamental to the economies with extensive business background and also facilitates the success for economic growth. Corporate governance provides an assurance that management is acting in the best interest of the corporation, thereby contributing to business prosperity through openness in disclosures and accountability. In the context of the changing corporate environment, an analysis of these practices and the association of their adoption and effects on firm performances can form a basis of economic reforms. This empirical paper aims at exploring the impact of adoption of corporate governance as recommended by SEBI on selected Indian firms. The results reveal that among the selected corporate governance norms, presence of a key executive director in an audit committee is of vital significance in affecting overall performance of organizations. The presence of an active group of executive directors in the key committees contributes a great deal towards ensuring confidence in the market.