The Relationship Between Management Monitoring And Firm Performance

1621 Words Oct 5th, 2015 null Page
The relationship between management monitoring and firm performance
Introduction
From previous years, corporate governance (CG) reforms provided a significant important function comply with regulations. The reforms does play an important role in improving transparency and accountability that appear in three key areas which are benefits in the provision of quality financial reporting, reduction in management overconsumption and improved management monitoring (Psaros 2009, p25). There are numerous researches proved that the focus on the impact of management monitoring. In particularly, factors which are turnover of CEO, Equity-based board of directors (BoDs) compensation, board independence and innovative knowledge assets could have correlation between management controlling and firm performance. there are positive relationship, negative relationship but hardly to found the no relationship between management monitoring and firm performance. Cornelli (2013) examine that the role of active monitor of collect information to help firm make decisions whether CEO needed to be turnover in which “soft” information rather than “hard” information can avoid inefficient information used for decision making. Furthermore, Drymiotes and Sivaramakrishnan (2012) demonstrate that equity awards help align equity-based BoD compensation with shareholder interests and enhance long-term firm value. As a result, reduce the agency problem with managers and personal cost by the firm. In Tuggle (2010)…

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