Economic Impact of 'Regulation on Corporate Governance': Evidence from India

Asish K. Bhattacharyya () and Sadhalaxmi Vivek Rao
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Sadhalaxmi Vivek Rao: Indian Institute of Management Calcutta

Finance from EconWPA

Abstract: India, with its 20 million shareholders, is one of the largest emerging markets in terms of the market capitalization. In order to protect the large investor base, the Securities and Exchange Board of India (SEBI) has enforced a regulation effective from April 2001, requiring mandatory disclosure of information and a change in the corporate governance mechanisms of the listed companies. This study empirically examines the economic impact of the Regulation on the stock market variables. The experimental group exhibits significant reduction in their beta consistent to the notion that increased information and better corporate governance mechanism reduces the risk of these companies.

Keywords: Corporate Governance; Financial Disclosure Regulation; Voluntary Disclosure; Risk; Cost of Capital (search for similar items in EconPapers)
JEL-codes: M41 G34 G38 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-acc
Date: 2005-04-02
Note: Type of Document - pdf; pages: 65. PDF, ~500KB, 65 pages
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Persistent link: http://EconPapers.repec.org/RePEc:wpa:wuwpfi:0504002

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