Transparency of Corporate Governance Through Public Information: Evidence from Spain

The measurement of corporate governance takes into account not only the profitability and solvency of the companies, but also the degree of information provided: its transparency. Corporate governance has become particularly relevant in recent years and one of the main problems is how to measure it properly. It is usually measured privately, either through audits or private verification companies. However, the public and mandatory information issued by these companies is rarely valued. This is where this research is new. The aim of this article is to develop a CGRI (Corporate Governance Ratio Index) to evaluate the transparency of corporate governance of companies using public and mandatory information. For this purpose, it is applicable to companies listed on the Spanish continuous market. This paper applies the index to the 35 most relevant companies in the Spanish continuous market. Subsequently, the paper asses the interrelation of the index with the main factors of corporate governance such as remuneration, monitoring and governance structure. By using a publicly available index, this study contributes to the transparency and accessibility of CG assessment, providing valuable insights into the effective corporate governance practices and thus the index helps to identify areas for improvement in the company itself and to observe the actions of its competitors.