About corporate governance index

What is the governance index?
Article Talk.
The Worldwide Governance Indicators (WGI) is a project that reports both aggregate and individual governance indicators for over 200 countries and territories covering the period from 1996 to 2021.
It considers six dimensions of governance: Voice and Accountability..
CGI is a way to assess companies in terms of their compliance to the related governance rules in the country and best governance practices around the world.
Corporate Governance Rating (CGR) is an opinion on the relative position of an organisation in respect of adoption of corporate governance practices.

An index that gauges whether the board and management are acting in the best interest of the company, whether there is a vision toward sustainability, a healthy culture, transparent and accurate disclosures and effective policies and structures.

Are new corporate governance indices more relevant than the llsv ranking system?

We find that, in contrast to the LLSV ranking system, our new governance indices capture a broader scope of corporate governance regulation reforms and their dynamics.

Cite This Article

Nsour, M.F., Al-Rjoub, S.A.M. Building a corporate governance index (JCGI) for an emerging market: case of Jordan.
Int J Discl Gov 19, 232–248 (2022). https://doi.org/10.1057/s41310-021-00139-9 Download citation.
1) Received: 17 June 2021.
2) Accepted: 28 December 2021.
3) Published: 17 January 2022.
4) Issue Date: June 2022.
5) DOI: https://doi.org/10..

Do corporate governance indices predict firm value or performance?

A common strategy in corporate governance research is to build a corporate governance index and then see whether the index predicts firm value or performance.
These indices are imperfect, but their use is widespread because researchers lack good alternatives.
A major concern with governance indices is what they actually measure.

Keywords

Corporate governance determinants

What is a Governance Index?

Thus, the Governance Index ("G") is just the sum of one point for the existence (or absence) of each provision.
Gompers et al. construct subindices for each of the five categories:

Delay

Protection

Voting

Other

and State.
However, this G-index does not accurately reflect the relative impacts of different provisions.

What is the value of the Corporate Governance Index (jcgi)?

Results of the JCGI are reported in Table 2.
Table 2 presents the Corporate Governance Index along with its components for the years 2018–2019.
The corporate governance index's mean value is 67.80%, nearly two-thirds of its maximum value.

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