Shareholder Value Implications of Compliance with the German Corporate Governance Code

Thomas Kaspereit, Kerstin Lopatta and Dennis Onnen

Managerial and Decision Economics, 2017, vol. 38, issue 2, 166-177

Abstract: This study contributes to the ongoing discussion of the German Corporate Governance Code (GCGC) of the Regierungskommission Deutscher Corporate Governance Kodex (Government Commission), which should enhance the confidence of national and international investors. We apply the Feltham and Ohlson ( ) valuation model to a panel dataset of 421 German CDAX firms over the period 2002–2012 and find a positive effect of the level of compliance with the GCGC on the market value of firms. We conclude that the recommendations of the GCGC reflect corporate governance that satisfies investors' needs, as the capital markets perceive them. Our results are in favor of the efforts of the Government Commission, which have attracted criticism from both theorists and practitioners both in the past and at present. From the perspective of managerial and decision economics, the empirical results of this study suggest that executives should follow as many recommendations of the GCGC as possible. Copyright © 2015 John Wiley & Sons, Ltd.

Date: 2017
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://hdl.handle.net/

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wly:mgtdec:v:38:y:2017:i:2:p:166-177

Access Statistics for this article

Managerial and Decision Economics is currently edited by Antony Dnes

More articles in Managerial and Decision Economics from John Wiley & Sons, Ltd.
Bibliographic data for series maintained by Wiley Content Delivery ().