Monitoring Costs, Managerial Ethics and Corporate Governance: A Modeling Approach

This article evaluates effectiveness and costs of external regulation, in particular the Sarbanes–Oxley Act of 2002 (SOX) in restricting managerial malfeasance and safeguarding shareholder interests. It discusses the role of managerial ethics as an alternative corporate governance mechanism to prote...

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Главные авторы: He, Lerong (Автор) ; Ho, Shih-Jen Kathy (Автор)
Формат: Электронный ресурс Статья
Язык:Английский
Проверить наличие: HBZ Gateway
Interlibrary Loan:Interlibrary Loan for the Fachinformationsdienste (Specialized Information Services in Germany)
Опубликовано: 2011
В: Journal of business ethics
Год: 2011, Том: 99, Выпуск: 4, Страницы: 623-635
Другие ключевые слова:B Sarbanes–Oxley Act
B managerial ethics
B Корпоративное управление
B Мониторинг
Online-ссылка: Volltext (JSTOR)
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Итог:This article evaluates effectiveness and costs of external regulation, in particular the Sarbanes–Oxley Act of 2002 (SOX) in restricting managerial malfeasance and safeguarding shareholder interests. It discusses the role of managerial ethics as an alternative corporate governance mechanism to protect shareholder value. This article builds a mathematical model to illustrate shareholders’ choices of best corporate governance mechanisms, taking into account the influence of managerial ethics, effectiveness and costs of monitoring. We suggest that the best corporate governance design and the optimal monitoring expenses are influenced by managerial types, monitoring efficiency, and effectiveness of ethics education. We conclude that stringent regulation and monitoring may not always enhance shareholder value. When managerial ethics could be improved by ethics education or social norms, ethics education may be a better alternative than stringent regulation.
ISSN:1573-0697
Второстепенные работы:Enthalten in: Journal of business ethics
Persistent identifiers:DOI: 10.1007/s10551-010-0672-1