Recently, there has been a great deal of interest from the part of many organizations in the concept of IT governance in order to justify Information Technology (IT) investments. Some studies have shown that companies which have good IT governance models generate higher returns of their IT investments than their competitors. However, there is a lack of scientific research confirming that effective IT governance leads to better financial performance. In this paper, we attempt to determine whether companies that have adopted IT governance mechanisms have improved their financial performance, by measuring pre and post adoption performance indicators. We observed that companies that have adopted IT governance practices have significantly improved their performance when compared to those which have not, particularly in relation to profitability. Furthermore, we found that the differences in performance between companies which have adopted IT governance mechanisms and those which have not are more pronounced in the year following the adoption than in the year in which they were adopted.
Financial performance; IT governance; IT impact
