Ineffective corporate governance: Busyness of internal board monitoring committees
We examine whether the voluntary formation of a Risk Committee (RC) compromises the effectiveness of other monitoring duties carried out by the board members. We argue that adding more monitoring committees increases the board’s internal busyness, which reduces the effectiveness of monitoring by the...
| Main Authors: | , |
|---|---|
| Format: | Journal Article |
| Published: |
Virtus interpress
2016
|
| Online Access: | http://hdl.handle.net/20.500.11937/54525 |
| _version_ | 1848759393152139264 |
|---|---|
| author | Al-Yahyaee, K. Al-Hadi, Ahmed |
| author_facet | Al-Yahyaee, K. Al-Hadi, Ahmed |
| author_sort | Al-Yahyaee, K. |
| building | Curtin Institutional Repository |
| collection | Online Access |
| description | We examine whether the voluntary formation of a Risk Committee (RC) compromises the effectiveness of other monitoring duties carried out by the board members. We argue that adding more monitoring committees increases the board’s internal busyness, which reduces the effectiveness of monitoring by the Audit Committee (AC). Using a sample of financial firms over the period 2007 to 2011 from the Gulf Cooperation Countries (GCC), we find that voluntarily adopting a risk committee impairs the effectiveness of the audit committee, which in turn reduces financial reporting quality. Our findings suggest that multiple layers of monitoring capacity viz-a-viz the existence of both an audit and risk committee may weaken the quality of monitoring provided by the audit committee. |
| first_indexed | 2025-11-14T09:59:10Z |
| format | Journal Article |
| id | curtin-20.500.11937-54525 |
| institution | Curtin University Malaysia |
| institution_category | Local University |
| last_indexed | 2025-11-14T09:59:10Z |
| publishDate | 2016 |
| publisher | Virtus interpress |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | curtin-20.500.11937-545252017-09-13T16:11:45Z Ineffective corporate governance: Busyness of internal board monitoring committees Al-Yahyaee, K. Al-Hadi, Ahmed We examine whether the voluntary formation of a Risk Committee (RC) compromises the effectiveness of other monitoring duties carried out by the board members. We argue that adding more monitoring committees increases the board’s internal busyness, which reduces the effectiveness of monitoring by the Audit Committee (AC). Using a sample of financial firms over the period 2007 to 2011 from the Gulf Cooperation Countries (GCC), we find that voluntarily adopting a risk committee impairs the effectiveness of the audit committee, which in turn reduces financial reporting quality. Our findings suggest that multiple layers of monitoring capacity viz-a-viz the existence of both an audit and risk committee may weaken the quality of monitoring provided by the audit committee. 2016 Journal Article http://hdl.handle.net/20.500.11937/54525 10.22495/cocv13i3c2p5 Virtus interpress fulltext |
| spellingShingle | Al-Yahyaee, K. Al-Hadi, Ahmed Ineffective corporate governance: Busyness of internal board monitoring committees |
| title | Ineffective corporate governance: Busyness of internal board monitoring committees |
| title_full | Ineffective corporate governance: Busyness of internal board monitoring committees |
| title_fullStr | Ineffective corporate governance: Busyness of internal board monitoring committees |
| title_full_unstemmed | Ineffective corporate governance: Busyness of internal board monitoring committees |
| title_short | Ineffective corporate governance: Busyness of internal board monitoring committees |
| title_sort | ineffective corporate governance: busyness of internal board monitoring committees |
| url | http://hdl.handle.net/20.500.11937/54525 |