Corporate governance guidelines compliance and firm financial performance

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In my view, the paper captures two interesting issues that deserve attention: 1. The "comply or explain" and "tick box" approach to governance may not be the best. At the end of the day, you have the documents showing compliance, but the reality on the ground maybe different. You end up with high CG scores with troubled companies 2. Board evaluation and its impact has not received much attention but its time that boards especially non financial services carry out proper structured evaluation. That is not the case now. 3. Corporate Governance need to be viewed in total and so the 46 or more of the items needs to be factored in the "letter and the spirit" of good governance. The current research finds more strength when the CG index of all the variables are applied as opposed to the 3 indicators so firms, regulators and researchers should focus on all the CG variables when assessing CG.

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