Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/123343
Authors: 
Drobetz, Wolfgang
Gugler, Klaus
Hirschvogl, Simone
Year of Publication: 
2004
Series/Report no.: 
WWZ Discussion Paper 2004/06
Abstract: 
This paper analyzes the determinants of the German corporate governance rating recently developed by Drobetz, Schillhofer, and Zimmermann (2004). We find a non- linear relationship between ownership concentration and the quality of firmlevel corporate governance as measured by the rating. Firms with larger boards of directors have lower governance ratings, but firms that apply US-GAAP or IAS rules and/or use an option-based remuneration plan have higher corporate governance ratings. Our results question the comply-or-explain principle embedded in recent corporate governance codes and call for a more rules-based approach in improving corporate governance in Europe.
Subjects: 
Corporate governance
endogeneity
ownership structure
board size
accounting principles
executive compensation
JEL: 
G12
G34
G38
Document Type: 
Working Paper

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