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A broad-based governance index constructed by Gompers, Ishii and Metrick in their paper “Corporate governance and equity prices”.
They classify governance provisions into firm-level charter and by-law provisions and state-level anti-takeover laws that restrict shareholder rights by allowing limitations on voting power, restrictions on board replacement, or shareholder activism.
They combine 24 provisions into the governance index, which is also known as the G index. A high G-index value represents weak shareholder (or strong managerial) power.