The beneficial effect of shareholder participation in general meetings: Evidence in the context of audit quality

Ameneh Bazrafshan, Akram Banaiy, Vajiheh Bazrafshan

Abstract


Purpose – This paper aims to investigate how shareholder participation in general meetings (SPGM) affects audit quality

 

Design/methodology/approach – We measure SPGM as the percentage of the ownership represented by the shareholders who attend the general meeting. We measure audit quality by auditor industry specialization, audit firm size, and auditor fees. In order to investigate the relationship between SPGM and audit quality, we use a sample of 576 firm-years from Iran’s capital market between 2012 and 2018 and employ multivariate regression analysis. 

 

Findings – The findings show that, in general, there is an insignificant relationship between SPGM and audit quality. However, we reveal that there is a positive and significant association between the presence of institutional shareholders in general meetings and audit quality. Furthermore, for the companies with a high presence of institutional shareholders in their general meetings, there is a significant and positive relationship between the participation of other shareholders in the general meetings and audit quality. Our findings are robust in regards to a variety of additional tests.  

 

Originality/value – Collectively, the findings reveal that the impact of SPGM on audit quality is conditional to the presence of institutional shareholders in general meetings. The findings provide further insights among the mixed evidence on the beneficial effects of SPGM. 


Keywords


General meetings, audit quality, corporate governance, regulators, institutional shareholders.



DOI: https://doi.org/10.7819/rbgn.v23i1.4096

Article Metrics

Metrics Loading ...

Metrics powered by PLOS ALM


 
Av. da Liberdade, 532 - São Paulo - SP Brasil Cep. 01502-001 Tel. 55 11 3272-2340
 The RBGN adopts the Creative Commons licens CC-BY Creative Commons Attribution 4.0 

The RBGN has the financial support from Fundação Escola de Comércio Álvares Penteado - FECAP and development agencies Conselho Nacional de Desenvolvimento Científico e Tecnológico - CNPq and Coordenação de Aperfeiçoamento de Pessoal de Nível Superior – CAPES.

Desenvolvido por:

Logomarca da Lepidus Tecnologia