Daily BriefsESG

Daily Brief ESG: Why Are Companies with High Corporate Governance Practices Ratings More Profitable? and more

In today’s briefing:

  • Why Are Companies with High Corporate Governance Practices Ratings More Profitable?


Why Are Companies with High Corporate Governance Practices Ratings More Profitable?

By Aki Matsumoto

  • Companies with higher ratings for Corporate Governance Practices (Board Practices and Key Actions) tend to have significantly higher profitability, market capitalization and valuations.
  • Foreign ownership has the highest correlation with the Metrical CG score, suggesting that years of overseas investor engagement have improved the companies’ corporate governance practices and profitability.
  • The pace of efforts varies with criteria of Corporate Governance Practices.  Companies with Metrical CG scores of over 70% are ahead in % independent directors and % female board members.

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