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Corporate Governance Determinants of FII in Indian IT Firms

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  • Vidya Sukumara Panicker
  • Sumit Mitra
  • Rudra Sensarma

Abstract

The objective of this study is to investigate the impact of corporate governance characteristics on foreign ownership in the Indian information technology industry. The ownership pattern of a firm and board characteristics are analysed to understand their impact on inflow of foreign institutional investors to the firms. Panel data for 9 years from 113 Indian IT firms, which are publicly listed, have been used. The results show that firms with more concentrated promoter holdings have lesser foreign investments. Apart from the total number of board members, measures of corporate governance including the number of independent members on board and an independent board chairman have been found to be insignificant. The outcomes point to the need of a strong performance before relying on international investments for fundraising.

Suggested Citation

  • Vidya Sukumara Panicker & Sumit Mitra & Rudra Sensarma, 2016. "Corporate Governance Determinants of FII in Indian IT Firms," Indian Journal of Corporate Governance, , vol. 9(1), pages 1-18, June.
    • Handle: RePEc:sae:ijcgvn:v:9:y:2016:i:1:p:1-18
    DOI: 10.1177/0974686216635785
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    More about this item

    Keywords

    FII; corporate governance; ownership patterns; board characteristics; Indian IT industry;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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