Current state of corporate governance practices in Colombia

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Abstract

In this paper, we review the current state of corporate governance in Colombia. First, we discuss the evolution of the legal framework of corporate governance including the main changes in the code of best corporate governance practices that took place since the global financial crisis of 2008. After this, we discuss key corporate governance issues such as the ownership structure of listed corporations and the market for corporate control, we analyze the practices of corporate boards of Colombian listed companies and their remuneration systems and the role of pension funds and hedge funds as shareholder activists. We also review the evidence regarding corporate governance and firm performance. Finally, we discuss the current state of corporate social responsibility (CSR) and an assessment of corporate governance specifics by industry. We conclude that there are opportunities for future research in several of these fields of study, especially regarding boards of director practices, director remuneration, and corporate social responsibility.

Keywords: Corporate Governance, Board of Directors, Ownership Structure, Emerging Markets

Authors’ individual contributions: Conceptualization — S.G. and J.A.S.; Investigation — S.G. and J.A.S.; Writing — S.G. and J.A.S.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: G30, G34, G38

Received: 08.05.2021
Accepted: 11.06.2021
Published online: 14.06.2021

How to cite this paper: Gaitán, S., & Saravia, J. A. (2021). Current state of corporate governance practices in Colombia. Corporate Board: Role, Duties and Composition, 17(1), 51–59. https://doi.org/10.22495/cbv17i1art5