Corporate Governance &

Foreign Investment : Firm Level

Empirical Study

Well governed firms invest more than badly

governed ones.

Governance Quality Investments- Opportunities

Improves the efficiency of capital allocation.
Increase the inflow of capital
The higher the marginal product of capital , the
higher the quality of corporate governance
Facts

A study of S&P 500 firms

An ABN/ AMRO study
A study of Russian Firms
A study by Korean and US researchers
A Harvard / Warton Study
2.Investors Survey

Investors state that they still put corporate

governance on par with financial indicators
when evaluating decisions.
80% of the respondents would pay a premium
for well-governed companies .(Premium
Averaged 12-14% in North America and
Western Europe ; 20-25% in Asia and Latin
America ; and over 30% in Eastern Europe and
Africa)