Effect of Corporate Governance on Performance of Audit Firms in United Kingdom; Case of Deloitte Touche Tohmatsu Limited

Authors

  • Harry Marcel Elamer University of London
  • George Martin Abidin University of London
  • John Boros Smith University of London

DOI:

https://doi.org/10.53819/81018102t5096

Abstract

Good corporate governance brings about ethical company practices that cause financial viability. Corporate governance is the system of rules, practices and processes by which a company is directed and controlled. It can be argued that corporate governance includes how companies are governed and for what purpose. Notably, corporate governance identifies who has power and accountability and who makes decisions. Thus, the study sought to examine the effect of corporate governance on the performance of audit firms in the United Kingdom in the case of Deloitte Touche Tohmatsu Limited. The study made inferences based on the reviewed literature. The outcomes of the study showed that corporate governance is key in determining performance. Efficient application of sound corporate governance needs relevant lawful, governing and institutional foundations. Strong and effective corporate governance helps to cultivate a company culture of integrity, leading to positive performance and a sustainable business overall. Essentially, it exists to increase the accountability of all individuals and teams within your company, working to avoid mistakes before they can even occur. The study concluded that the performance of an organization can be highly influenced by the extent of corporate governance. The research recommended that there is a need to form a governing body to improve corporate governance using a particular code of ethics to protect the public interest in the firm. Organizations need to have controls and corporate governance criteria to increase their level of responsibility and performance. Corporate governance should be regarded as one of the key aspects that need to be a consideration in the policy formulations of the audit firms.

Keywords: Corporate Governance, Performance, Audit Firms, Deloitte Touche Tohmatsu Limited, United Kingdom

Author Biographies

Harry Marcel Elamer, University of London

University of London

George Martin Abidin , University of London

University of London

John Boros Smith , University of London

University of London

References

Abdullah, R., Ismail, Z., & Smith, M. (2018). Audit committees' involvement and the effects of quality in the internal audit function on corporate governance. International Journal of Auditing, 22(3), 385-403. https://doi.org/10.1111/ijau.12124

AlQadasi, A., & Abidin, S. (2018). The effectiveness of internal corporate governance and audit quality: the role of ownership concentration–Malaysian evidence. Corporate Governance: The International Journal of Business in Society 28(3), 17-42. https://doi.org/10.1108/CG-02-2017-0043

Arslan, M., & Alqatan, A. (2020). Role of institutions in shaping corporate governance system: evidence from emerging economy. Heliyon, 6(3), e03520. https://doi.org/10.1016/j.heliyon.2020.e03520

Boros, A., & Fogarassy, C. (2019). Relationship between corporate sustainability and compliance with state-owned enterprises in Central-Europe: A case study from Hungary. Sustainability, 11(20), 56-63. https://doi.org/10.3390/su11205653

Cohen, J. R., Joe, J. R., Thibodeau, J. C., & Trompeter, G. M. (2021). Audit Partners' Judgments and Challenges in the Audits of Internal Control over Financial Reporting. Auditing: A Journal of Practice & Theory, 39(4), 57-85. https://doi.org/10.2308/AJPT-18-088

Harun, M. S., Hussainey, K., Kharuddin, K. A. M., & Al Farooque, O. (2020). CSR disclosure, corporate governance and firm value: a study on GCC Islamic banks. International Journal of Accounting & Information Management 18 (3), 18-27. https://doi.org/10.1108/IJAIM-08-2019-0103

Hilb, M. (2020). Toward artificial governance? The role of artificial intelligence in shaping the future of corporate governance. Journal of Management and Governance, 24(4), 851-870. https://doi.org/10.1007/s10997-020-09519-9

Khatib, S. F., Abdullah, D. F., Elamer, A., & Hazaea, S. A. (2022). The development of corporate governance literature in Malaysia: a systematic literature review and research agenda. Corporate Governance: The International Journal of Business in Society 9(2), 17-41. https://doi.org/10.1108/CG-12-2020-0565

Koutoupis, A. G., & Pappa, E. (2018). Corporate governance and internal controls: a case study from Greece. Journal of governance & regulation, (72), 91-99. https://doi.org/10.22495/jgr_v7_i2_p8

Liwal, E. M. (2021). The role of media in selected aspects of governance in Afghanistan (Doctoral dissertation, Brac University).

Manita, R., Elommal, N., Baudier, P., & Hikkerova, L. (2020). The digital transformation of external audit and its impact on corporate governance. Technological Forecasting and Social Change. Journal of Technology, 6(2), 119-127. https://doi.org/10.1016/j.techfore.2019.119751

Mansur, H., & Tangl, A. (2018). The effect of corporate governance on the financial performance of listed companies in Amman stock exchange (Jordan). Journal of Advanced Management Science 6(2), 97-102. https://doi.org/10.18178/joams.6.2.97-102

Monks, R. A., & Minow, N. (2020). Corporate governance. John Wiley & Sons.

Mustafa, F. M., & Al-Nimer, M. B. (2018). The association between enterprise risk management and corporate governance quality: The mediating role of internal audit performance. Journal of Strategic Management, 9(4), 13-27. https://doi.org/10.14505//jarle.v9.4(34).27

Rustam, A. R., & Narsa, I. (2021). Good Corporate Governance: A Case Study of Family Business in Indonesia. The Journal of Asian Finance, Economics and Business, 8(5), 69-79.

Shu, P. G., & Chiang, S. J. (2020). The impact of corporate governance on corporate social performance: Cases from listed firms in Taiwan. Pacific-Basin Finance Journal, 61(9), 101-132. https://doi.org/10.1016/j.pacfin.2020.101332

Tricker, R. I. (2019). Corporate governance: Principles, policies, and practices. Oxford University Press, USA. https://doi.org/10.4324/9781315191157

Downloads

Published

2022-08-22

How to Cite

Elamer, H. M. ., Abidin , G. M. ., & Smith , J. B. . (2022). Effect of Corporate Governance on Performance of Audit Firms in United Kingdom; Case of Deloitte Touche Tohmatsu Limited. Journal of Public Policy & Governance, 6(2), 12–21. https://doi.org/10.53819/81018102t5096

Issue

Section

Articles