Abstract

The main purpose of this study is to test whether corporate governance is a system or not. Seven hypotheses are formed to reach this objective. The existence of significant relationships among three dimenisons (principles, processes and business results) is the main theme in these hypotheses. Regression analysis and reliability analysis are used in the study. 74 world’s biggest companies in electric utilities industry are used in the sample of the study. Corporate governance, sustainability and corporate social responsibility reports of these 74 companies are coded with 34 variables in the corporate governance system. It is found that there is a significant and strong relationship among three dimensions. Corporate governance is a construct of our study and principles, processes and business results are dimensions that explain this construct. The seventh hypothesis is formed to test whether corporate governance is constituted from these three dimensions or not. Cronbach alpha of these three dimensions (principles, processes and business results) is 91%. In other words, it is found that these three dimensions explain the construct (corporate governance system) of our study. Stakeholder governance model is used to test the hypotheses of the study. In sum, this study showed us that stakeholder governance model works in electric utilities industry and that there is an integrity among the variables and elements of corporate governance system.

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