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The Impact of Corporate Governance on Romanian Stock Performance

Author

Listed:
  • Maria-Lenuţa Ciupac-Ulici

    (IPAG Business School
    Hyperion University)

  • Renate Bratu

    (Lucian Blaga University of Sibiu)

  • Daniela-Georgeta Beju

    (Babeș-Bolyai University)

  • Vasile Paul Bresfelean

    (Babeș-Bolyai University)

Abstract

Establishing effective corporate governance is key to fostering microeconomic efficiency. There is a direct correlation between its effects on resource allocation and the maturation and operation of financial markets. The sample used for this analysis consists of 48 companies listed on the Bucharest Stock Exchange. The studied period spans from 2015 to 2021, with a total of 322 observations. The data used in the study are annual reports from the companies that were analyzed, as well as data obtained from the Bucharest Stock Exchange website, Eikon, and Thomson Reuters. The study makes use of panel data and the Generalized Method of Moments. We found some results that don’t match up with what’s already in the financial literature. Stock market price and Price/sales ratio are negatively and significantly affected by the corporate governance score. We observed a negative and negligible effect on ROE, company value, net profit margin, and stock market capitalization. One reason for the negative impact is that the studied period encompasses the COVID pandemic, which caused a significant drop in the share prices of the companies included and also caused some of them to incur financial losses.

Suggested Citation

  • Maria-Lenuţa Ciupac-Ulici & Renate Bratu & Daniela-Georgeta Beju & Vasile Paul Bresfelean, 2025. "The Impact of Corporate Governance on Romanian Stock Performance," CSR, Sustainability, Ethics & Governance,, Springer.
    • Handle: RePEc:spr:csrchp:978-3-031-86337-0_10
    DOI: 10.1007/978-3-031-86337-0_10
    as

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