#12425. How firms performance mediates the relationship between corporate governance quality and earnings quality?

July 2026publication date
Proposal available till 10-05-2025
4 total number of authors per manuscript0 $

The title of the journal is available only for the authors who have already paid for
Journal’s subject area:
Sociology and Political Science;
Development;
Accounting;
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Abstract:
The purpose of this study is to propose an analytical model that investigates both a direct path between corporate governance quality and earnings quality and an indirect path, in which firms performance is a mediating variable that is influenced by corporate governance quality and that, in turn, influences earnings quality. The study employs a structural equation modelling (SEM) to test the proposed analytical model and to determine the relative importance of both the direct and indirect paths. The findings show a statistically significant evidence of both a direct path from corporate governance quality to earnings quality, and an indirect path that is mediated by firms performance, suggesting that both corporate governance quality and performance have a complementary effect on earnings quality. However, the weight of the evidence favouring the direct path is more important in case of accounting-based performance measures; and the weight of the evidence favouring the indirect path is more important in case of market-based performance measures. This study is distinguished by validating an analytical model that has been overlooked by prior studies. Moreover, it provides a new constructed index for measuring corporate governance quality.
Keywords:
Corporate governance quality; Earnings quality; Egypt; Performance; Structural equation modelling

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