A Five-country study on the influence of corporate governance on IPO underpricing

Our study empirically analyzes the impact of corporate governance on IPO underpricing using five ASEAN countries - Indonesia, Malaysia, Philippines, Singapore and Thailand. In our study, the corporate governance is represented by Accounting Standard, Disclosure, and country level corporate governance ratings from Credit Lyonnais Securities Asia (CLSA). We find that better country level corporate governance reduces the IPO underpricing measured by the first day return. We also analyze the impact of Islamic country characteristics on the IPO underpricing. Contrary to our hypothesis, we find that the IPO underpricing is higher in Islamic countries. Finally, we also analyze the country fixed effect of Singapore and find that the IPO underpricing is higher for Singapore compare to the other four countries considered.BUSINES