Sustainability of Corporate Governance practices on Organization’s Financial Performance in Selected Companies of Colombo Stock Exchange

Abstract

This research paper examines the corporate governance on organization’s financial performancein selected companies of Colombo stock exchange and sample of this study is the top 45 companies of the Colombo stock exchange, and sample size was 45 company’s annual reports for the period of four years (2012 -2015) and observation was 180. There were three objectives for this research paper and two objectives were achieved through quantitative method and the third objective was achieved by qualitative method. E views (9 version) software has been chosen to analyze the data.There are two types of variables have used as independent variable and dependent variable. Independent variables are named as Size of Board of Directors,Independent Board of Directors and Chief Executive Duality (CEO). Dependent variable is named as Return on Asset (ROA). To test the hypothesis hausement test was used and got the result as, null hypothesis was rejected and alternative hypothesis was accepted. So, it stated that there is a relationship in between independent variables and the dependent variable. The quantitative results are based on correlation and regression model. Keywords: Corporate governance, Financial performance, Independent variable, Dependent variable, Return on asset, Board of directors, Independent directors, Ceo duality