*3.1. Sample and Data Collection*

We intended to test the hypothesis regarding the link between compliance with best practice and company value on a unique sample of companies listed on the Warsaw Stock Exchange over a long period, during which corporate governance conformity evolves and gradually becomes institutionalized. We purposefully choose sample companies listed over a 10-year period (2006–2015) that are characterized by their relative stability of corporate governance code recommendations. We constructed a balanced panel to investigate companies which were listed over the whole period of our analysis and reveal similar attributes with regard to corporate governance practice. Over the analyzed period, the numbers of companies listed on the Warsaw Stock Exchange varied due to initial public offerings (POs) and delisting, as reported in Table 1.


**Table 1.** Number of companies listed on the Warsaw Stock Exchange.

Source: GPW, www.gpw.pl/statystyki.

We start with 284 firms quoted on the Warsaw Stock Exchange in 2006. We eliminate companies operating in the insurance sector, real estate firms, companies with missing observations and those delisted over the analyzed period. Our final sample consists of a balanced panel with 155 companies and 1550 observations. We collect data on company financial characteristics and performance, company value, and ownership structure from the IQ Capital data base. Prior research emphasizes the essential role of the board for mitigating agency costs, for attaining sufficient quality in corporate governance (Khan et al. 2020). Data on compliance include the conformity—or the lack thereof—of a given company with best practice on the following: the presence of two independent directors, information concerning the identification of independent board members, the presence of an independent board chairman, and the formation of an audit committee and remuneration committee on the supervisory board. Due to the absence of such data in any available database, all information on compliance is collected by hand directly from annual reports of the companies in the sample. The analyses were performed, using STATA16 software.
