ECN6800 MSc Dissertation: Proposal Form 2020/21
An electronic copy of this form is to be completed and uploaded by the student on Blackboard by 12.00 on Monday 17th May 2021.
Name:
Email address:
Degree Programme:
PGT MSC Finance
1. Proposed Title
The effect of corporate governance on firms’ performance
2. Which published academic paper is MOST CLOSELY related to your intended research (use full Harvard referencing)?
Detthamrong, Umawadee, Chancharat, Nongnit & Vithessonthi, Chaiporn, 2017. Corporate governance, capital structure and firm performance: Evidence from Thailand. Research in international business and finance, 42, pp.689–709.
3. Which type of dissertation ‘model’ are you proposing?
Tick ONE
Model 1: Replicate an existing paper using a different dataset e.g. for a different country or different cohort.
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Model 2: Update an existing paper using more recent data.
Model 3: Adapt an existing paper (and its data and methodology) but ask a modified/different research question.
Model 4: Other. Please provide further details in the box below (100 words minimum)
4. Which dataset(s) will you use in your dissertation (give full sources, electronic links, details of variables etc)? Describe and indicate the availability of these datasets to you as of TODAY. If you are using time-series data please clearly state the time period and frequency of the data.
(Note: if you have less than 100 observations your proposal will be rejected)
An overview of S&P Compustat Fundamentals, including historical and point-in-time financial statements, ratios, and multiples, plus press releases available within hours of publication
https://www.refinitiv.com/en/financial-data/company-data/fundamentals-data/standardized-fundamentals/sp-compustat-database
An overview of Environmental, Social and Corporate Governance – ESG. ESG Scores from Refinitiv are designed to transparently and objectively measure a company’s relative ESG performance, commitment and effectiveness across 10 main themes (emissions, environmental product innovation, human rights, shareholders, etc.)
https://www.refinitiv.com/en/financial-data/company-data/esg-data
An overview of Officers & Directors Data
https://www.refinitiv.com/en/financial-data/company-data/company-profile-information/company-officers-directors-database-search
Ownership, Insiders and Institutional Profiles
https://www.refinitiv.com/en/financial-data/company-data/company-ownership-information-profiles
I try to find the data of non-financial companies in USA between 2008 and 2020. This is only the result I found in Datastream, i think it could be better to search wrds database as well. (But due to the website delay, I can not use this website to search what I want until I get approval.)
Denpendent variable:
ROE is used to measure the financial performance.(ratio of net income to total equaity)
ROA is used to measure the operational performance.(ratio of net income to book value of total assets)
Tobin’s Q is used to measure the market performance.((the MV of equity+Mv of liabilities)/Book value of assets)
Independent variables:
Board independence is measured as the ratioof the number of independent directors to the number of all directors;
CEO duality is a dummy variable, which takes a value of one if the CEO is also the chairperson of the board, and zero otherwise.
Ownership concentration is theproportion of common stock held by the top three shareholders.
Female directorship is measured as the ratio of the number of female directors to the number of all directors.
Control variables :
the firm size, the leverage level the Board size and the firm age.
5. What are the key hypotheses that you are going to test? What is the basic estimating equation? What is your dependent variable and what are your independent variables?
Hypothesis 1. Board independence is positively associated with firm performance.
Hypothesis 2. CEO duality is negatively associated with firm performance
Hypothesis 3. Ownership concentration is positively associated with firm performance.
Hypothesis 4. Female directorship is positively associated with firm performance.
where is the firm performance. We use ROE, ROA and Tobin’s Q to measure it.
CG is a vector of a firm’s corporate governance variables, including the BOD gender diversity, , the number of outside directors, CEO duality and ownership. .
Z is a vector of firm-level control variables including the firm size, thee leverage level the firm age and the board size.
6. Briefly describe the econometric techniques to be used. Describe how these fit with the data identified in (4) and how these techniques test the hypotheses in (5).
To evaluate the impact of corporate governance on firm performance, we estimate a series of panel OLS regressions of firm performance on corporate governance and a set of control variables. We lag all right-hand side variables by one period, which should address reverse-causality concerns. That is, we regress contemporary firm performance on lagged corporate governance and lagged control variables.
To test hypotheses, we measure firms performance as return on equity(ROE), computed as the ratio of earnings before interest and taxes to equity; as return on assets(ROA), computed as the ratio of earnings before interest and taxes to total assets, and tobin’s Q, computed as the market value of equity plus the market value of total liabilities
divided by the book value of total assets.
We collect the data of these variables and will find the analytical results by using OLS model, that is, the relationship between firm performance and corporate governance variables. And then we will know whether the hypotheses are valid.
The Department will not accept submission of a Dissertation that does not have an approved proposal form. If you want to change your topic at any time you must resubmit a completed Dissertation Proposal Form and await approval before proceeding; you can do this only once. All dissertation forms must be approved by 1st July 2021, no forms will be approved after this date.
Economics Postgraduate Ethics Form
It is compulsory for all Postgraduate students submitting a Dissertation to complete this form.
Please complete this form in full and submit along with your Dissertation Proposal.
If you do not understand the University Ethics Policy or need help completing this form, you may use the Ethics Q&A Discussion Board on the ECN MSc Dissertation Blackboard page.
Full name:
Registration Number:
Research Project Title:
The effect of corporate governance on firms’ performance
Please tick to confirm one or the other of the research ethics statements:
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I confirm that the data used in this dissertation are not on human subjects (e.g. macro data), and, therefore, my dissertation does not require research ethics approval.
I confirm that the data used in this dissertation are on human subjects (e.g. micro data) that are robustly anonymised, and, therefore, my dissertation does not require research ethics approval.*
* For the University of Sheffield research ethics policy for use of secondary data on human subjects, see Research Ethics Policy Note 13 on Re-use of existing data in research: https://www.sheffield.ac.uk/polopoly_fs/1.670949!/file/Research-Ethics-Policy-Note-13.pdf
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