Relationship between corporate governance and firm performance in Ghana: does compliance to national governance frameworks matter?

The study examines the effect of compliance with national governance frameworks on the relationship between corporate governance and the performance of publicly traded companies in Ghana. A sample of 31 companies listed on the Ghana Stock Exchange was drawn for the study based on their annual reports spanning from 2013 to 2022. A new national governance quality index composed of items drawn from world governance indicators and a corporate governance index was developed by principal component analysis. The study used the Huber M-estimation Robust Least Squares (HMRLS) regression method. The findings of our study reveal that corporate governance practices adversely affect the level of firm performance. However, our results demonstrate that compliance with national governance and institutional frameworks plays a significant moderating role in the relationship between corporate governance and firm performance. The study offers managerial implications, as listed firms can adopt effective national governance and institutional quality practices to improve firm performance. This study investigates the relationship between corporate governance and business performance in Ghana, with a special focus on determining whether adherence to national governance frameworks has a significant impact. This research enhances the current understanding of corporate governance in Ghana and its impact on the performance of companies. This study offers useful information to policymakers, regulators, and business organisations in Ghana. This will result in improved corporate practices and greater performance of companies in Ghana. It will further aid stakeholders' comprehension of the significance of complying with national governance frameworks. Ultimately, the findings in this research would promote a culture of transparency, responsibility, and ethical behaviour in the business industry. This would enhance the overall economic progress and investor confidence in Ghana.