Corporate Governance Strategies to Improve Organizational Performance in the Accounting Industry

Corporate Governance Strategies to Improve

Organizational Performance in the Accounting

Industry

Section 1: Foundation of the Study

Corporate governance (CG) strategies, their implementation, and whether they

positively influence organizational performance have been subjects of ongoing

controversy (Michaely, Rubin, & Vedrashko, 2013). Stakeholders such as consumers and

employees favor CG policies as indicators that corporations are more socially

responsible. However, practitioners and scholars have conflicting views about the role of

considerable scrutiny by scholars and shareholders. Claessens and Yurtoglu (2013) wrote

that during the wave of financial crises in 1998 in Russia, Asia, and Brazil, the behavior

of the corporate sector affected entire economies, and deficiencies in CG endangered

global financial stability. In 2002, financial scandals rocked the United States and Europe

with news about the failure of corporate boards and governance involving Enron,

WorldCom, and Tyco (Holmstrom & Kaplan, 2003).

In the aftermath of these events, the term CG became more widely known.

Researchers, people within the corporate world, and policymakers began to recognize the

potential macroeconomic, distributional, and long-term consequences of weak CG

systems (Claessens & Yurtoglu, 2013). CG is critical in relation to access to financing,

greater efficiency (Claessens, & Yurtoglu, 2013).

Problem Statement

Poor CG is a leading factor in poor organizational performance, financial

reporting manipulation, and stakeholder dissatisfaction (Bhasin, 2013). Companies that

execute CG efficaciously have a 41% higher sustainability rate than businesses that do

not have sound CG (Eccles, Ioannou, & Serafeim, 2014). The general business problem is

that poor CG negatively affects organizational performance. The specific business

problem is that some senior managers lack the strategies needed to enforce CG and

improve organizational performance in the accounting industry.

Purpose Statement

organizational performance. Participants consisted of three senior managers of three

corporations who demonstrated experience in implementing CG and improving

organizational performance. Interviews with the three participants and the data collection

process took place in the western United States. This study has implications for social

determine the limits of what a corporation can or cannot do toward positive social change

I used a qualitative research method for this study. Using qualitative research

enables researchers to explore and better understand subject phenomena at a deeper level

(Kaczynski, Salmona, & Smith, 2014). In contrast, researchers using quantitative research

methods form hypotheses and analyze numerical data to test those hypotheses (Corner,

2002). The quantitative approach was not conducive to the study, in that I was not trying

quantitative data are collected, analyzed, and interpreted (Zohrabi, 2013). I did not

collect, analyze, or interpret statistical data to test hypotheses. Therefore, the mixed

methods research approach was not appropriate for the study.

A multiple case study design was proper for this study because my objective was

to conduct semistructured interviews and ask in-depth questions of organizational leaders

about how implementation and enforcement of CG strategies could improve

organizational performance in the accounting industry. Yin (2014) wrote that case study

research is the preferred method when (a) the central research questions are how and why

questions, (b) a researcher has little or no control over behavioral events, and (c) the

focus of study is a contemporary (as opposed to entirely historical) phenomenon. An

ethnographic design was not suitable for the study because ethnographers enter the spaces

of their participants to gain a deeper understanding of how people experience, perceive,

create, and navigate (Hahn, Pinkse, Preuss, & Figge, 2015). Phenomenological design

managers implement to enforce CG and improve organizational performance in the

accounting industry?

CG involves several theories. For this study, I used stakeholder theory for the

conceptual framework. A precursor to stakeholder theory, shareholder theory, was

proposed by Freidman (1962). From the perspective of shareholder theory, the sole

responsibility of businesses is to increase profits. The premise of shareholder theory is

that management runs a company for the shareholders’ benefit and therefore,

management as the agent of shareholders is legally and morally obligated to serve

Freeman (1984) initially proposed stakeholder theory. A stakeholder is any identifiable

group or individual who affects the achievement of an organization's objectives or who is

affected by the achievement of an organization's goals (Freeman & Reed, 1983).

Stakeholders include public interest groups, protest groups, government agencies, trade

associations, competitors, unions, employees, customers, creditors, suppliers, and the

stakeholder-centered approach (Brennan & Solomon, 2008).

such measures as performance, efficiency, growth, financial structure, and treatment of

shareholders and other stakeholders (Claessens & Yurtoglu, 2013).

Corporate social responsibility (CSR): The voluntary integration of social and

environmental concerns in company operations and interactions with stakeholders and

surrounding communities (Cheng, Ioannou, & Serafeim, 2015).

Economic value added: An index of a company’s measurement of its internal

performance (Huang, Shieh, & Kao, 2015).

Return on assets: A profitability ratio that measures the net income produced by

total assets during a period by comparing net income to the average total assets. In other

Assumptions are believed to be factual but are not substantiated (Lips-Wiersma &

Mills, 2014). Three assumptions influenced this research. The first assumption was that

senior managers have a vast knowledge of the CG strategies that exist in their business.

The second assumption was that participants would fully disclose current methods of

implementation and enforcement of CG procedures, rules, and regulations. The third

assumption was that the interviewees would provide truthful responses.

Limitations

The limitations focused on the internal and external validity of the study. Internal

validity pertains to the conduct of a study, while external validity focuses on the

applicability of the findings to larger populations (Connelly, 2013). The multiple case

research design involving three organizations was a limitation because it does not allow

generalization of the research to every accounting organization in the industry. The

Delimitations

representing the accounting industry in the western United States were used. Significance

of the Study

Contribution to Business Practice

The significance of this study is in the opportunity to offer strategies to improve

organizational performance through assuring compliance with CG, particularly for the

economic development and well-being (Claessens & Yurtoglu, 2013). CG plays a critical

role in how a firm progresses and increases the benefits of an organization (Claessens &

Yurtoglu, 2013). Better CG benefits businesses through greater access to financing, lower

cost of capital, better performance, and greater ability to address the needs of all

Implications for Social Change

The study’s implications for social change relate to the potential for improvement

in the quality of work life for employees. Marta et al. (2013) conducted a study of factors

guidelines (Marta et al., 2013). Additionally, strategies for ensuring accounting processes

and processes based on research findings about strategies of CG for improving

performance through CG could enhance trust among organizations, their key

stakeholders, and consumers. Building trust among organizations, stakeholders, and

consumers could lead to corporate sustainability that addresses the needs of stakeholders

Cheng et al. suggested that managers who can develop successful CSR strategies and

Cadbury. Cadbury (1992) defined CG as the system by which companies are regulated

and held in check.

The Organization for Economic Co-operation and Development (OECD, 2004a)

defined CG as rules and practices that govern the relationship between managers,

shareholders, and stakeholders of corporations who contribute to the growth and financial

stability of the organization. Agyenmang and Castellini (2015) and Strine (2010)

described CG as the structure, processes, and mechanisms of firms directed and managed

to strengthen long-term shareholder value, which will then improve firm performance.

Jordan (2013) provided a comprehensive description of CG, suggesting that the concept

encompasses every force that bears on the decision making of the firm. The forces consist

of control rights of the stockholders, contractual agreements and insolvency powers of

debt holders, and commitments with employees, customers, suppliers, and regulations

legal system, judicial system, financial markets, and factor (labor) markets (Claessens &

Yurtoglu, 2013).

Nwagbara (2012) and Garuba and Otomewo (2015) viewed CG as describing

approaches to and strategies for control and guidance of managerial governance.

Oghoghomeh and Ogbeta (2014) stated that CG helps to ensure the accountability and

forthrightness of managers to deliver an acceptable return to investors and meet

regulatory and agreed-upon responsibilities. El-Chaarani (2014) suggested that CG

presents directions and rules to align diverse interests of managers with interests of

shareholders. Donaldson (2012) described CG as instructions, methods, and traditions

that influence the control of a company. El-Chaarani further found that CG contributes to

the establishment of organizational goals and procedures to oversee performance.

individuals internally and externally to achieve company objectives indicates external

people are essential to the operations of business.

Fokum Sama-Lang and Zesung Njonguo (2016) termed the interaction of how

others manage, and direct businesses are critical to the process as the stakeholder theory

of CG. Fokum Sama-Lang and Zesung Njunguo used the stakeholder theory of CG,

coupled with ethical positivism, to examine the role of ethics in the Organization for

Harmonization of Business Laws in Africa. The authors broadened the definition of CG

to involve a business’s CSR and include an expansive stakeholder community (Fokum

employees of intricate global supply chains. CG in global firms is not sufficiently

inclusive of all parties involved (Schneider & Scherer, 2015). Therefore, global

organizations have extended their research to incorporate stakeholder theory in CG

(Schneider & Scherer, 2015).

Corporate Governance and Corporate Social Responsibility

Du Plessis, Hargovan, Bagaric, and Harris (2015) defined CG as a system for

regulating and overseeing corporate conduct and balancing the interests of all internal

stakeholders and other parties who can be affected by a corporation’s conduct. The

has undergone considerable changes in evolving into the term’s present definition. The

changes made to this definition relate to eliminating the profit and revenue maximization

concepts of the meaning (du Plessis et al., 2015). The elimination of profit and revenue

maximization has been interrelated with a shift in the global interest from profit

maximization for shareholders’ goals toward the fulfillment of corporate social

and Development (OECD) published a report in 2009 that suggested that poor CG has

(Tricker, 2015). Lack of understanding of the benefits of CG has led to challenges in

emerging markets. The changing nature of CG concerning emerging trends in the market

is important (Tricker, 2015). Changes to the definition of CG have occurred in light of the

growth of interest toward stakeholder management in contrast to shareholder orientation

Even though there is a considerable amount of research done about CG and CSR,

there is a lack of research about the relationship between these two concepts (Banerjee,

2014; Devinney, Schwallbach, & Williams, 2013). CSR as a concept, has grown in

popularity among the modern companies. CSR has risen due to the increase in consumer

interest towards the organizations that fulfill CSR and present governmental initiatives to

motivate the businesses to become more ethical (Banerjee, 2014; Devinney et al., 2013).

However, even though the effectiveness of the CSR depends on the motives and values of

current companies must adopt CG to increase organizational legitimacy in the market

(Arosa et al., 2013; Jizi et al., 2014). Researchers of CSR stated that the potential for

threats towards the organizational legitimacy make the new organizations adopt the CSR

strategy (Arosa et al., 2013; Jizi et al., 2014). Therefore, there is a relationship between

In the context of the links between CSR and CG, the orientation of CG towards

the shareholder value or stakeholder interests affects the links with societal organizations

and the perspective on social obligations (De Graaf & Stoelhorst, 2013). Modern

stakeholder-oriented companies tend to prioritize the fulfillment of stakeholder interests.

Fulfilling the stakeholder's interests implies that businesses are considering the

fulfillment of the interests of employees, society, customers, nongovernmental

equation applies to the concept of CSR thus creating a link between those two concepts.

Viewing CG through the prism of CSR results in the enhancement of a shareholdercentric

approach as well as a hub-spoke method in the management of the organization and

stakeholder relationships (Banerjee, 2014; De Graaf & Stoelhorst, 2013; Jizi et al., 2014).

Graaf & Stoelhorst, 2013; Jizi et al., 2014).

CSR practice has become quite popular (Banerjee, 2014). Studies have shown that

Flammer (2013) stakeholder orientation and implementation of CSR positively influence

an increase in shareholder value. Both stakeholder and shareholder groups receive an

advantage from an increased protection of their relevant values (Flammer, 2013).

Even though CSR reporting and organizational engagement in CSR might

influence organizational risks and profitability, there are still companies that disregard the

value of CSR (Jizi et al., 2014). Potential investors consider the social behavior of an

organization in their decision-making process in light of their future investments in the

organization, which may imply that the degree of investments in the company depends on

the quality of implementation of CSR strategy (Jizi et al., 2014). Jizi et al. (2014) also

noted there is minimal research on practicing “good” CG at the board level. The lack of

"good" CG may indicate that companies should demonstrate they follow CSR strategy.

However, in most cases, the need to satisfy the interests of all stakeholder groups

Williams, 2014). CSR also impacts the desire of individuals to apply for the jobs based

on indications that potential applicants are looking for companies that are socially

responsible (Williams, 2014). As a result, the companies with a CSR and CG strategy

tend to attract the best talent, which contributes to organizational performance in the

Corporate Governance and Organizational Performance

The organization’s board of directors is an important element in the

organization’s management (John, de Masi, & Paci, 2016; van Essen, Engelen, & Carney,

increasing shareholder value (John et al., 2016; van Essen et al., 2013). Consequently, in

the context of the stakeholder management, the board of directors tends to play a

significant role in allocating resources for the benefit of the management of relationships

with the principal stakeholders (John et al., 2016; van Essen et al., 2013). Furthermore,

the development and integration of the CSR strategy must be maintained with a top-down

CSR strategy.

the framework of activity, analysis, and evaluations (Joseph et al., 2014). Stakeholder

management practitioners’ debate whether stakeholders should have representation on the

board of directors (Joseph et al., 2014). The argument for including stakeholder

representatives on the board of directors has been the enhancement of organizational

legitimacy and normative approval from society and government (Joseph et al., 2014).

The opposing argument against the inclusion of stakeholder representatives has been that

external managers tend to demonstrate more philanthropic behavior than inside directors

(Joseph et al., 2014). The presence of stakeholders with a philanthropic mindset might

negatively influence the financial performance of the company; therefore, the directors

are hesitant to include stakeholders on the board of directors (Joseph et al., 2014). The

inclusion of outside managers is the inclusion of stakeholder representatives on the board

of directors (Shahzad, Rutherford, & Shafman, 2016). Some scholars argue that some

directors tend to view outside managers as the positive influence on the board of directors

CG practices. The different types of strategies vary per industry. Cuevas-Rodriguez,

Guerrero-Villegas, and Ramón Valle-Cabrera (2016) studied how the implementation of

CG strategies changes in the process of privatization of a firm.

Various strategies are adopted for CG to have a positive impact

on organizational performance. One of the major strategies is to

change the board’s structure and character (Joseph et al., 2014). There

is a general shift from memberbased board models towards CEO-only

based board models (Joseph et al., 2014). In the CEO-only board design

the CEO has all the power, and he or she is responsible for the entire

decision-making activities (Guo & Masulis, 2015; Joseph et al., 2014).

Some practitioners (Joseph et al., 2014; Miller et al., 2013) are

concerned about the degree of power that the CEO holds in the

model, both structural elaboration and institutional theories tend to be

ambiguous in the context of formal structures and allow people with

political influences to formulate fundamental processes (Joseph et al.,

2014). Managers who use logic create pressure on the fundamental

(Joseph et al., 2014).

board (Mori & Mersland, 2014; Wellens & Jegers, 2014). The increase in

outside directors may result in the emergence of diverse and different

opinions leading to the development of debates and discussions (Mori

& Mersland, 2014; Wellens & Jegers, 2014). The increase in outside

interests thus leading to the increased interest towards the company

from the consumers and socially responsible entities (Mori & Mersland,

may result from business-to-business consumers, and individuals who

are more interested in the companies that manifest corporate socially

responsible behavior. Outside directors demonstrate less reluctance

towards risky behavior and innovative solutions. The development of

creative and innovative solutions to existing problems positively affects

organizational performance (Mori &

Mersland, 2014; Wellens & Jegers, 2014).

Christensen, Kent, Routledge, and Stewart (2013) examined

a manager in charge of the sustainability management process to

facilitate a positive outcome for the environmental risk disclosure

process (Peters & Romi, 2014). Environmental CG strategies include an

environmental committee and a manager in charge of the

increased transparency in the environmental reporting whereas, the

Businesses with improved CG strategies also have better CSR

policies in place (van Essen et al., 2013). Unified CG and CSR strategies

have a much more positive effect on the corporate financial

performance than a CSR strategy on a stand-alone basis (van Essen et

The literature review yielded key findings. First, the

implementation of CG and CSR strategies, when combined, positively

contribute to corporate financial performance. Second, the structure of

the board of directors and the number of outside managers on the

The concept of CG in the accounting industry is different from

CG in industrial companies. CG in the accounting sector is much more

complex; therefore, CG in accounting businesses should take into

consideration the complexity factor. In the literature review,

companies that implement CG strategies and recommendations about

CG improvement obtain increased organizational financial

performance. Thus, companies that integrate CSR and CG strategies

in-depth research. The results are reported in Section 3. Following the central research

and interview questions, I presented the nature of the study. The critical point is the

conceptual framework which established the perspective from which I analysed the

results. In the following section on the significance of the study, I focused on how the

organization. I also highlighted both the positives and negatives of CG and discussed if it

The focal points of Section 2 are the purpose of the study and the role of the

researcher. Section 2 also includes a detailed explanation of the criteria used to select,

access, and build rapport with the participants. Furthermore, I describe in detail the

research method, research design, and method for population and sampling. Moreover, I

address the protection and confidentiality of the participants, ethical considerations, data

collection instruments, techniques, organization, and analysis. Finally, I elaborate on the

reliability and validity of the study.

Purpose Statement

The purpose of this qualitative multiple case study was to explore strategies that

senior managers in accounting organizations implement to enforce CG and improve

organizational performance for the accounting industry. Participants consisted of three

senior managers of three corporations who demonstrated experience in enforcing CG and

improving organizational performance. Interviews with the three participants and the data

collection process took place in the western United States. The study’s implications for

social change relate to how the implementation and enforcement of CG strategies

positively improve the CSR of an organization. Corporations have been asked to play

pivotal roles in matters of contention outside their principal economic goals and are

pressed to deal with issues such as global poverty, human rights, and climate change

(Banerjee, 2014). Powerful agents in markets and states, as well as civil society agents in

politics and economics, generate specific ideas of CSR that regulate the limits of what a

corporation can or cannot do toward positive social change (Banerjee, 2014). Enforcing

CG strategies could improve CSR to help make a difference in society.

During the data collection process for this qualitative multiple case study, I served

researcher as a human data collection instrument is to collect, organize, and analyze data.

As human data collection instruments, researchers must describe relevant aspects of

themselves, which include biases, assumptions, expectations, and experiences, to qualify

their ability to conduct the research (Greenbank, 2003). Researchers should also explain

As an accounting and tax practitioner with over 15 years of experience in the

private and public sector, I have not personally witnessed enforcement or implementation

equal treatment. The Belmont Report protocol has three ethical treatment foundations for

human beings: respect for person, beneficence, and justice (Vollmer & Howard,

2010). I completed the National Institutes of Health web-based training course on

Protecting Human Research Participants on July 11, 2015 (Certificate Number 1797447).

To mitigate bias and conduct research ethically, researchers must recognize and

acknowledge their biases. If a researcher does not recognize or acknowledge biases, he or

she may contradict the research of a case study to substantiate a preconceived position

(Yin, 2014). Other processes to help reduce bias in research include the following: (a)

Researchers may examine how open they are to evidence that is contradictory to what

they believe, and (b) researchers may test their tolerance level for findings contrary to

interviews with open-ended questions. I designed questions for the interview process to

allow the participants to contribute as much detailed information as they desired, and to

allow me to ask insightful follow-up questions. Turner (2010) referenced the format in

which I conducted interviews as the standardized open-ended interview. Standardized

express their perspectives and experiences (Turner, 2010). In the preparation stage of the

interview process, I followed eight steps: (a) choose a setting with few distractions, (b)

explain the purpose of the interview, (c) address terms of confidentiality, (d) explain the

format of the interview, (e) indicate how long the interview will take, (f) tell the

interviews progressed, I watched for nonverbal cues, clarified information as needed, and

For this study, participants determined the location for their interviews.

Determining the interview location allows participants to choose a place that feels

comfortable and nonintimidating, and where the interview will have only minimal

interruptions, as recommended by Jacob and Ferguson (2012). Empowering participants

Ethical Research

The researcher is ethically responsible to guard participants from harm, protect

their confidentiality, and acquire their approval preceding participation in the research

project (Knepp, 2014). The consent form provided participants with an explanation of the

study and allowed them to ask questions before agreeing to participate. The consent form

included the following information: (a) contact information, (b) purpose of the study, (c)

possible risks, d) the institution that will sponsor the study, (e) the option to withdraw

from the research project at any time. Participants in research were given the right to

withdraw by requesting that their data not be made available for research and, in some

situations, to destroy their data (Kaye et al., 2014). No participants withdrew from the

study. Participants did not receive any incentives for participation in this study.

Ethical research processes when followed, ensures protection of participant

rights, builds trust with the participants, guards them against potential harm, and

with standards for the ethical protection of participants I followed the Internal Review

Board (IRB) ethical research guidelines related to the following areas: (a) proposed

research, (b) community research stakeholders and partner potential risks and benefits, (c)

data integrity and confidentiality, (d) potential conflicts of interest, (e) data collection

The second step I used to ensure the ethical protection of participants is to follow

the principles per the Belmont Report (Brakewood & Poldrack, 2013). The Belmont

Report is a set of fundamental concepts for human subject research based on three

principles. The first principle is twofold respect for persons which means people should

be able to make autonomous decisions and protection for individuals with limited

research, on a password protected USB drive, kept in a bank lock box for 5 years. After

the 5-year period, I will destroy the research supporting documents by incineration.

Disintegration, incineration, and shredding are methods used in the destruction of data

(Zou & Ma, 2013).

Data Collection Instruments

I was the primary data collection instrument for this study. Yin (2014) noted that

in qualitative studies; the researcher is the primary data collection instrument. Owens

(2006) described the researcher as a data collection instrument who facilitates and creates

a conversational space where respondents feel safe to share their stories and experiences.

detail from respondents. When the participants and researchers discussed various topics,

three interviewer characteristics (i.e. energy, neutrality, or self-disclosure) resulted in

amply detailed responses from the respondents (Pezalla et al., 2012).

I conducted semistructured face-to-face interviews with open-ended questions and

collected current written CG strategies to explore the strategies senior managers

implemented to enforce CG and improve the organizational performance in the

toface interviews are often the single data source for a qualitative research project,

coordinated for a designated time and location and formulated around a set of

predetermined open-ended questions. Open-ended questions allow for the emergence of

other questions from the communication between interviewer and participants

(DiciccoBloom & Crabtree, 2006). According to Leech (2002), semistructured interviews

with open-ended questions are best in elite interviewing and helps build rapport with

participants.

I collected organizational CG strategies already documented to help strengthen the

data collected from the semistructured face-to-face interviews of participants. The use of

documentation has four advantages: (a) documents can repeatedly be reviewed, (b)

historical documents were not created as a result of the study, (c) documents may include

specific details and references to an event, and (d) historical documents can cover a long

span of time (Yin, 2014). The most important use of documents is to substantiate and

enhance evidence from other sources (Yin, 2014).

accounting organizations. Interviews may provide in-depth information relevant to

participants’ understanding and perspectives on a topic. In qualitative research, interviews

are combined with other forms of data collection to present the researcher with a well-

rounded collection of information for analyses (Turner, 2010). In face-to-face interviews

collect similar data from all participants and create order. In following proper protocol

memberchecking for establishing reliability and validity. Participants’ feedback post

analysis can be challenging. Sandelowski (1993) and Morse, Barrett, Mayan, Olson, and

Spiers (2002) argued when the researcher presents the study’s combined results back to

the participants for feedback, individuals may not recognize their own responses or their

the participants had apprehensions or questions about the content of their interviews

An interview is a method of collecting data with open-ended qualitative questions,

where participants can respond in their words. Interviews are the most frequently used

method of collecting data (Turner, 2010). Griffee (2005) wrote that interviews in

qualitative research are popular because the perception is people are talking and talking is

normal. I used a semistructured face-to-face interview process and protocol with

predetermined questions that were based on my research question: What strategies do

accounting industry? Successful interviews begin with deliberate planning that considers

the focus of the research question (Doody & Noonan, 2013). The interview process took

approximately 30 to 45 minutes. The interviews took place at locations chosen by the

participants.

I received permission to audio record the interview sessions. The audio recordings

will accurately record the responses of participants. A professional transcriptionist

transcribed the audio recordings. The transcriber did not have knowledge of or access to

any participant personal information or organizational affiliation. I sent an email to share

my understanding of the participant’s responses with them to ensure accuracy by the

member checking process. Member checking will provide participants the opportunity to

review content, ensure data is accurate, allow the researcher to make corrections if

needed, and strengthen data credibility (Reilly, 2013).

Upon consent, I explained the interview process and protocol before each interview. The

A drawback with the face-to-face semistructured interview method is that

participants may not truthfully answer questions (Doody & Noonan, 2013). I must build

trust and establish rapport because the participant needs to be comfortable answering

questions honestly (Doody & Noonan, 2013). Another weakness of the method is that

novice researchers are not always able to recognize when to ask prompt questions or

inquire further for responses (Noble & Smith, 2015). Therefore, some relevant data may

not be gathered (Noble & Smith, 2015).

Data Organization Technique

I used Microsoft Excel to label and categorize the data collected based on

participants. The data included participant identifiers, consent forms, participant personal

achieve confidentiality by assigning generic codes to each participant (Gibson, Benson, &

Brand, 2013). The NVivo 11 Pro for Windows was the software that was used to manage

all data collected from the participants during the interview process and any follow-up

required.

As the researcher, my perspective and expectations may influence the framework

of the participants’ experiences under study. To help minimize personal bias when

conducting qualitative research Lincoln and Guba (1985) suggested the reflexive

journaling process. Ponterotto (2014) and Riddick Dowden, Decuir Gunby, Warren, and

Boston (2014) concluded that the use of reflexive journals might increase a researcher’s

capacity to maintain an unbiased position toward the topic under study. Reflexive

trustworthiness throughout the study (Riddick Dowden, et al., 2014). I used a reflexive

journal in my research process to maintain trustworthiness and ensure the participants

responses were presented in the study, not my own.

The informed consent process will be used to seek the authorization to audio

record the interviews. After the interviews, a professional transcriptionist transcribed the

audio recordings from the interviews verbatim into written documents, which I have

saved in separate folders for each participant on a password protected USB drive (Jacob

& Furgerson, 2012). I have stored all collected data on a password protected USB drive

in a bank lockbox where it will remain for 5 years.

the data, and (e) drawing conclusions. I conducted a data analysis using the participant

responses from the semistructured face-to-face interview questions and company

documents about CG strategies provided by the participants. I used the various data to

attain methodological triangulation. Triangulation is the use of different methods of data

manage, organize, and simplify the analysis of data and the labelling of themes. With

NVivo, the researcher codes the data and develops themes or categories. Data analysis

NVivo may produce subjective results and allow the researcher to engage more in the

analysis process. Cretchley, Rooney, and Gallois (2010) argued that a lot of bias results

from use of software like NVivo because the program requires the researcher to

determine the list of codes and rules which are attached to the data. I addressed my bias

by using reflexive journaling.

I linked strategies senior managers implemented to enforce CG and improve

organizational performance in the accounting industry to the conceptual framework of the

stakeholder theory. I achieved the connection of strategies and conceptual framework by

staying abreast of challenges in the accounting industry and its relationship with CG. CG

has started to broaden its coverage as the emphasis has shifted from the traditional

shareholder- centered approach to a more stakeholder-centered approach (Brennan &

Solomon, 2008).

Lincoln and Guba (1985) defined the criteria for reliability and validity in

qualitative research as credibility, dependability, confirmability and transferability.

Together the four criteria formed the framework for determining the rigor of qualitative

research (Lincoln & Guba, 1985). According to Anney (2014) the four criteria described

by Lincoln and Guba are also known as qualitative research trustworthy criteria.

Reliability

dependability and is also referred to as the stability of data collected in a study

(Graneheim & Lundman, 2004; Tobin & Begley, 2004). To ensure the reliability and

was different, in that employees were included in the feedback process. P2’s spoken

words were as follows:

P2 discussed the selection process for members of the board of directors and how they

gave advice and structure to the process of determining CG strategies for implementation

and enforcement. P2 of O2 was adamant about the level of integrity of the people on the

P2 stated,

Participant 3 (P3) of organization 3 (O3) expressed how CG strategies are thought of

from a legal and operational perspective but focused on the legal aspect. P3 of O3

discussed CG structures, governing documents, and the rules and regulations that needed

that law, rules, and regulations were a major part of the structure of what CG strategies

were implemented and enforced. Claessens and Yourtoglu (2013) composed a

comprehensive definition of CG that applies to this research. Under this definition, CG is

separated into two parts, corporate behavior and normative framework. Corporate

normative framework addresses rules by which a firm operates, which come from the

legal system, judicial system, financial markets, and labor markets (Claessens &

Yurtoglu, 2013). The normative framework aligns with the concerns of each organization

represented in this study. An important frame of reference of corporate governance is

Francoeur (2016) and Hayibor and Collins (2016) agreed that stakeholder theory relates

to an organizational decision-making process that is inclusive of inside and outside

relations that may contribute to businesses achieving their organizational goals. In each

answer given by P2 of O2, I noted how the employees, suppliers, and customers factored

into every interview question. The actions of P2 embodied who stakeholders include, as

described by Harrison, Freeman, and Cavalcanti Sa de Abreu (2015); stakeholders

include employees and managers, shareholders, financiers, customers, and suppliers.

Theme 2: The Role of Corporate Governance in Organizational Performance

Organizational performance is not limited to the financial gains of a company; it can also

represent the efficiency of the business. Carton et al., (2014) and Ibrahim (2013) noted

that the relationship between CG and organizational performance has focused on

employee responsibilities, the purpose of employees’ work, and CG’s influence on

organizational performance. The findings of this study showed that senior managers and

upper management emphasized communication, clarity, processes, compliance, and

adherence to policy and procedure.

Employees being aware of the compliance policies and following the processes keep a

level of efficiency and the processes flowing. P1 of O1 pointed out that another factor

that contributes to improved organizational performance is internal audits performed on a

regular basis.

P1 said,

CG strategies can be created to serve a dual purpose. P2 of O2 discussed creating

of internal controls, it is not so much for efficiency, it is for protection of corporate assets.

So, what you try to do is create a system that does both.” Therefore, the CG strategies

used at O2 to retain the efficiencies of the organization also protect the assets of the

corporation for the stakeholders involved. Another point emphasized during the interview

time. Best thing you can do is nurture your inside people to make sure they are doing a

really good job, nurture your customers to make sure they know they are taken care of

and then make sure you are being responsible. At O3, organizational performance

was approached from a more rigid perspective. P3 did not think of CG compliance as

significantly improving the organization's operations. P3’s statement was “I think of

those things as being required because of legal rules and requirements.” However, P3

did describe five elements that need to be defined and are critical parts of CG structure:

Relationship to literature. Many scholarly articles have examined CG strategies

and how they relate to improving organizational performance. In such articles, scholars

have approached research on organizational performance from an economic standpoint.

John, de Masi, and Paci (2016) noted that through CG, a board of directors has a

fiduciary duty to control and monitor operations to ensure the beneficial allocation of

Olar reached two conclusions about responsibility: (a) responsibility is the most

substantial part of governance, and possibly the least understood and certainly the

sparsest in organizations; and (b) if responsibility is not spelled out and well ascertained,

both the staff and the management have free reign to act as they will. Brahmana,

corporate encompasses the whole organization, taking into consideration all its internal

hence improving organizational performance. Theme 3: Effective Corporate

Governance Strategies

The process of developing CG strategies involves strategic planning, which

includes an organization’s board of directors, upper management, senior managers, and

others who add value to the strategy development and implementation process. Strategic

planning is a forward-looking activity, and all managers should be involved with it

(Owolabi & Makinde, 2012). This study showed that senior managers and boards of

directors worked together to develop effective CG strategies for implementation

throughout the organization. Each participant shared the same thoughts concerning the

role that laws, rules, regulations, policy, and procedures contributed to the development

and implementation of CG strategies. Adhering to mandated requirements was the crux of

the formulation of CG strategies.

P2 of O2 reiterated that O2 did not have a deep management structure. P2 shared, “we

come up with the ideas or strategies; we share with employees.” P2 explained how O2

created their congress:

P3 of O3 stressed how important it is to comply with the rules and required

Relationship to literature. Different CG strategies may be put in place to achieve

beneficial outcomes in terms of organizational performance. The three companies in this

study developed and implemented CG strategies that involved communication and

compliance with rules and regulations. The semistructured interviews confirmed that

companies of the same industry may differ in their strategies for implementing CG, as

well as in what they consider in the development process of said strategies. Joseph,

Ocasio, and McDonnell (2014) wrote that to change the board of directors from member-

based to CEO-only is a CG strategy to shift the power of decision-making activities.

Cuevas-Rodriguez et al. (2016) argued that the implementation of CG strategies changes

in the process of privatization for a firm. Bually, Hamdan, and Zureigat (2017) found that

Relationship to conceptual framework. The findings from this study showed

how each firm was inclusive of shareholders and stakeholders in the process of

developing and implementing CG strategies. Effective CG strategies should strive to line

up the interests of shareholders and stakeholders (Honoré, Munari, & van Pottelsberghe

de La Potterie, 2015). Donaldson and Preston (1995) discussed three possible choices of

to improve organizational performance through operational effectiveness. Meaning the

regulations which govern the accounting industry. Effectiveness also applied to how

productive the businesses were in their monthly output.

The size of a firm may dictate how CG strategies are implemented. The

organizations that participated in this study varied in size. O1 was over 6,000 employees,

O2 was less than 100 employees, and O3 had over 500 employees. In O1 and O3

following the rules and regulations and complying was emphasized because it brought

Each company in this study CG strategies were driven by a small internal board of

directors, and they were all privately held corporations. The study showed that the

organizations in this study applied CG strategies from a stakeholder perspective. An

external board of directors versus an internal board of directors may have a different view

on how to decide what CG strategies are critical outside of CG strategies which are

implemented because of law. The external board of directors may apply the point of view

The implication for social change discovered during the interview process was a

O2 and O3 more relaxed, friendly, family oriented and fun environments. P2 and P3

spoke of less stress on employees when policies and procedures were clear, concise and