Всего публикаций в данном разделе: 596
Опубликовано на портале: 19-04-2007Darin G. Clay SSRN Working Papers. 2002.
Institutional shareholdings have a systematically positive effect on firm value and alter the Morck, Shleifer, and Vishny (1988) finding of a nonmonotonic relation between insider ownership and value. The evidence indicates that, on average, a 1% increase in institutional stock ownership translates to a 0.6% increase in the firm's market-to-book ratio, or an increase of $125M for the mean firm in cross-sectional analysis. Controlling for institutional holdings converts the original MSV finding - that firm value first increases with stock ownership by the board, then decreases, and then increases again - to one in which firm value uniformly increases with greater board ownership. These findings support the view that increased incentives for monitoring both by the board and by institutional investors consistently leads to higher company value. The evidence also indicates that the positive relation between institutional holdings and firm value is stronger in firms with higher discretionary cash flows and in the period following the 1992 adoption of proxy rule amendments that increased the bargaining power of institutions.
Опубликовано на портале: 19-04-2007Elizabeth A. Gordon, Elaine Henry, Darius Palia EFA 2004 Maastricht Meetings Papers. 2004. No. 4377.
Recent corporate scandals have raised considerable concern among regulators and stock market participants about related party transactions (RPTs), prompting Sarbanes-Oxley (SOX) to prohibit personal loans to executives and non-executive board members. In a representative sample of companies for a period that predates SOX, we find RPTs are wide spread and involve equally executives and non-executive board members; additionally, the proportion of related party loans is smaller than other non-loan related party transactions such as purchases or direct services. When we examine the relationship between RPTs and the extant literature's corporate governance mechanisms (such as board characteristics, CEO pay-performance sensitivity, and outside monitors), we generally find weaker corporate governance mechanisms associated with more and higher dollar amounts of RPTs. We also find that industry-adjusted returns are negatively associated with RPTs. On further examination of loans versus other types of RPTs not considered in SOX, we find a negative relationship between industry-adjusted returns and the number and dollar amount of loans to executives and non-executive directors, and a similar relationship between the number of other types of RPTs with non-executive directors. In summary, our results provide support for the view of RPTs as conflicts of interest between managers/board members and their shareholders, in contrast with the view of RPTs as efficient transactions.
Опубликовано на портале: 19-04-2007Geoffrey C. Kiel, Gavin J. Nicholson Corporate Governance. 2004. Vol. 4. No. 1. P. 5 - 23.
We contend that practitioners need to take care not to act on the recommendations from a single theory in isolation from the others. To address this concern, we provide a model of board effectiveness that uses the construct of board intellectual capital to integrate the predominant theories of corporate governance and illustrate how the board can drive corporate perfoemance. We futher contend that boards that wish to improve their perfomance need to review their untellectual capital. We conclude by linking the model to a practitioner-focused framework that identifies four key areas on which a board must concentrate to develop its intellectual capital.
Опубликовано на портале: 19-04-2007Marion Hutchinsona, Ferdinand A. Gul Journal of Corporate Finance. 2004. Vol. 10. No. 4. P. 595-614.
Prior research on the relationship between corporate controls and firm performance is premised on the notion that, in theory, there is direct association between corporate governance and firm performance. However, extensive research has produced mixed and often weak results. In this paper, we posit, as a primary relationship, a negative association between growth and firm performance and then examine whether corporate governance variables moderate this negative relationship. Our results support this notion and show that the role of corporate governance variables in firm performance should be evaluated in the context of the firm’s external environment measured in this study in terms of growth opportunities.
Опубликовано на портале: 19-04-2007James A. Brickley, Jeffrey L. Coles, Gregg Jarrell Journal of Corporate Finance. 1997. Vol. 3. No. 3. P. 189-220.
Shareholder activists and regulators are pressuring U.S. firms to separate the titles of CEO and Chairman of the Board. They argue that separating the titles will reduce agency costs in corporations and improve performance. The existing empirical evidence appears to support this view. We argue that this separation has potential costs, as well as potential benefits. In contrast to most of the previous empirical work, our evidence suggests that the costs of separation are larger than the benefits for most large firms.
Опубликовано на портале: 19-04-2007David Manry, David Stangeland Journal of Corporate Finance. 2003. Vol. 9. No. 3. P. 353-375.
From 1989 through 1993, the United Shareholders Association (USA) published its Shareholder 1000 report, which ranked 1000 firms on several dimensions of corporate performance, including shareholder rights and management compensation. We examine two measures reported by the USA of the alignment between managers’ and shareholders’ interests: a shareholder rights score and a management compensation rating. The associations between these measures and measures of operating performance and investment levels are analyzed. We find evidence that the USA shareholder rights and management compensation scores are significantly and positively associated with measures of operating performance and investment spending. Further tests indicate that USA management compensation scores proxy for aspects of corporate behavior that have significant valuation implications not reflected in financial statements.
Опубликовано на портале: 18-04-2007Eugene Kang, Asghar Zardkoohi Corporate Governance: An International Review. 2005. Vol. 13. No. 6. P. 786-799.
We suggest that the equivocal empirical results of board leadership structure on firm performance have both methodological and conceptual roots. We stress that whether board leadership structure enhances or lowers performance depends on its fit with a firm’s internal and external conditions, a point that has not been comprehensively addressed by the extant literature. To guide future research in this field, we develop five testable propositions and offer some suggestions on how these propositions may be empirically tested.
Опубликовано на портале: 18-04-2007Vidhan K. Goyal, Chul W. Park Journal of Corporate Finance. 2002. Vol. 8. No. 1. P. 49-66.
We study whether bestowing chief executive officer (CEO) and board chairman duties on one individual affects a boards decision to dismiss an ineffective CEO. The results show that the sensitivity of CEO turnover to firm performance is significantly lower when the CEO and chairman duties are vested in the same individual. These results are consistent with the view that the lack of independent leadership in firms that combine the CEO and Chairman positions makes it difficult for the board to remove poorly performing managers.
An Analysis of the Effect of Management Participation in Director Selection on the Long-Term Performance of the Firm [статья]
Опубликовано на портале: 18-04-2007William T. Callahan, James A. Millar, Craig Schulman Journal of Corporate Finance. 2003. Vol. 9. No. 2. P. 169-181.
A major criticism of corporate boards of directors is the absence of objectivity in appraising and monitoring management [The Business Lawyer, 48 (1992) 59–77]. Recently, Shivdasani and Yermack [Journal of Finance LIV (5) (1999) 1829] find that CEO involvement in board selection is associated with a greater proportion of gray and a lower proportion of outside director appointments. The question addressed here is whether corporate performance, as measured by Tobin’s q, is affected by management influence in the board nominating process. Agrawal and Knoeber [Journal of Financial and Quantitative Analysis, 31 (3) (1996) 377] find interdependence among seven mechanisms to control agency problems between managers and stockholders. Their finding suggests that cross-sectional OLS regressions of firm performance on a single mechanism may be misleading and that interpretation of multiple regression methods is weakened by multicollinearity. In this study,a principal component analysis (PCA) is employed to mitigate such problems. An index of management involvement in director nomination is constructed for a sample of 106 firms from 1989 to 1992 via a PCA method utilizing selected governance mechanisms within the nominating process. We find a positive relationship between management participation in the director selection process and corporate performance.
Are Two Heads Better than One? The Impact of Changes in Management Structure on Performance by Firm Size [статья]
Опубликовано на портале: 18-04-2007Oded Palmon, John K. Wald Journal of Corporate Finance. 2002. Vol. 8. No. 3. P. 213-226.
We investigate how switching between two alternative management structures affects firms, and how this impact varies with firm size. Under one structure a single executive serves as both chief executive officer (CEO) and chairman of the board (COB). Under the alternative structure two separate executives fill these positions. In order to evaluate which management structure is optimal, we examine the impact of a change in management structure on firm performance. A change from one to two executives induces negative abnormal returns for small firms, but positive abnormal returns for large firms. These impacts are also evident with accounting profitability measures of returns. Our results are consistent with the hypothesis that small firms benefit more from the clarity and decisiveness of decision-making under a single executive, while large firms benefit more from the checks and balances of having two executives in the CEO and COB positions. D 2002 Elsevier Science B.V. All rights reserved.
Board Composition and Corporate Performance: How the Australian Experience Informs Contrasting Theories of Corporate Governance [статья]
Опубликовано на портале: 18-04-2007Geoffrey C. Kiel, Gavin J. Nicholson Corporate Governance: An International Review. 2003. Vol. 11. No. 3. P. 189-205.
In many respects, Australian boards more closely approach normative “best practice” guidelines for corporate governance than boards in other Western countries. Do Australian firms then demonstrate a board demographic-organisational performance link that has not been found in other economies? We examine the relationships between board demographics and corporate performance in 348 of Australia’s largest publicly listed companies and describe the attributes of these firms and their boards. We find that, after controlling for firm size, board size is positively correlated with firm value. We also find a positive relationship between the proportion of inside directors and the market-based measure of firm performance. We discuss the implications of these findings and compare our findings to prevailing research in the US and the UK.
Опубликовано на портале: 18-04-2007Yangmin Kim Corporate Governance: An International Review. 2005. Vol. 13. No. 6. P. 800-808.
This paper examines the effects of board of directors’ network characteristics on firm performance using a sample of 199 large, publicly traded Korean companies from 1990 through 1999. Two board network characteristics are discussed, namely: board network density and board external social capital. Board network density is defined as the extensiveness or the cohesiveness of contact among the members of board of directors, and board external social capital refers to the degree to which board members have outside contacts in the external environment. The test results suggest that a moderate level of board network density enhances firm value, while too cohesive a board network destroys it. It is also found that board members’ elite school networks were positively associated with firm performance.
Опубликовано на портале: 18-04-2007Niclas L. Erhardt, James D. Werbel, Charles B. Shrader Corporate Governance: An International Review. 2003. Vol. 11. No. 2. P. 102-111.
This study examines the relationship between demographic diversity on boards of directors with firm financial performance. This relationship is examined using 1993 and 1998 financial performance data (return on asset and investment) and the percentage of women and minorities on boards of directors for 127 large US companies. Correlation and regression analyses indicate board diversity is positively associated with these financial indicators of firm performance. Implications for both strategic human resource management and future research are discussed.
Опубликовано на портале: 18-04-2007Mark R. Huson, Paul H. Malatesta, Robert Parrino Journal of Financial Economics. 2004. Vol. 74. No. 2. P. 237-275.
We examine CEO turnover and firm financial performance.Accounting measures of performance relative to other firms deteriorate prior to CEO turnover and improve thereafter. The degree of improvement is positively related to the level of institutional shareholdings, the presence of an outsider-dominated board, and the appointment of an outsider (rather than an insider) CEO.Turnover announcements are associated with significantly positive average abnormal stock returns, which are in turn significantly positively related to subsequent changes in accounting measures of performance.This suggests that investors view turnover announcements as good news presaging performance improvements.
Опубликовано на портале: 18-04-2007James H. Nelson Journal of Corporate Finance. 2005. Vol. 11. No. 1-2. P. 197-228.
This paper examines the link between firm performance, CEO characteristics and changes in corporate governance practices using an unbalanced panel of 1721 firms from 1980 to 1995. This paper provides the stylized facts about corporate governance practices and details how governance practices have evolved over time. By 1995, the majority of firms had implemented differing types of charter amendments, poison pills or other governance provisions that are potentially harmful to shareholders. Most firms have adopted multiple and even redundant governance provisions. Shareholders are more likely to approve an increase in the power of the boards of directors of better performing firms, while the boards of poorly performing firms are much more likely to initiate governance changes, such as poison pills, that circumvent shareholder approval. I find no relationship between CEO age, tenure or compensation and governance changes.
Опубликовано на портале: 18-04-2007C.B. Ingley, Nicholas T. van der Walt Corporate Governance: An International Review. 2004. Vol. 12. No. 4. P. 534-551.
The paper outlines the problems of conflicts of interest for fiduciary shareholders with respect to the stock of publicly owned companies in their portfolios and considers various approaches proposed to address these problems. The questions of whether fiduciary problems are the result of a vacuum of ownership and an imbalance of power, and the extent to which regulatory reform and shareholder activism can resolve these problems, are examined. From this analysis a framework is developed that describes the sources, outcomes and factors contributing to the effectiveness of conflict management in the context of the current investment environment. A series of recommendations for mediating conflicts of interest by changing board architectures are presented. These recommendations apply principles of participative corporate democracy to the overall governance system.
Опубликовано на портале: 18-04-2007Andres de Pablo, Valentin Azofra, Felix Lopez Corporate Governance: An International Review. 2005. Vol. 13. No. 2. P. 197-210.
In recent years, the debate about the efficiency of corporate governance mechanisms has focused on the activity of the corporate boards of directors. This paper analyses the effect of the size of the board, its composition and internal functioning on firm value in a sample of 450 non-financial companies from ten countries in Western Europe and North America. The econometric method combines uniequational regression analysis with simultaneous equations in order to control for the possibility of board size and composition endogeneity. The results show a negative relationship between firm value and the size of the board of directors. This relation holds when we control for alternative definitions of firm size and for board composition, the board’s internal functioning, country effect and industry effect. We find no significant relationship between the composition of the board and the value of the firm. These results are consistent with previous relevant papers and show that companies with oversized boards of directors have poorer performance both in countries where internal mechanisms of governance dominate and in countries where external mechanisms are predominant.
Опубликовано на портале: 18-04-2007C.B. Ingley, Nicholas T. van der Walt Corporate Governance: An International Review. 2005. Vol. 13. No. 5. P. 632-653.
Based on British legislation, the duties of directors are stated in the New Zealand Companies Act 1993. However, “good” governance is not defined within the Act. Considering the relative importance attached by boards to a variety of governance tasks, this paper evaluates directors’perceptions of the current contribution of fellow board members to different aspects of governance practice. This evaluation is discussed in relation to the influence of board tasks and functions on actions that may be regarded as being in the interests of the company as defined by the Act. The evaluation illustrates the strategic orientation of the board,highlighting the extent to which individual directors and the board as a whole can actually influence key outcomes and, thereby, their governance contribution. The paper reports responses to findings based on a study involving 3000 directors and presents suggestions for enhancing board processes as well as possible changes in expectations that could be encapsulated in legislation.
Опубликовано на портале: 18-04-2007Ivor Francis Corporate Governance: An International Review. 1997. Vol. 5. No. 4. P. 239–244.
This long and discursive book results from a research commission by the Australian Institute of Company Directors (AICD) given to an experienced consultant and academic, Ivor Francis. Francis, a New Zealander, worked closely with the late Edwards Deming, who was internationally respected for his work on quality management, and is himself an acknowledged expert in corporate performance measurement. After eighteen years as a business school professor at Cornell and New York Universities, Francis moved to Australia, where he is now Chairman of the Deming Centre International in Sydney. The fascinating part of the book, for readers of this journal, comes in the final few pages and an appendix, which report the findings of a survey of directors' views on the effectiveness of Australian directors. According to the Australian press, the AICD sought to distance itself from these findings
Опубликовано на портале: 18-04-2007Peter M. Brown Corporate Governance: An International Review. 1997. Vol. 5. No. 4. P. 232–235.
In recent years the Top Pay Research Group have produced an annual survey, in co-operation with 3I Plc., in which they approach individual directors and board chairmen, seeking their views on the needs and opportunities facing independent directors as well as obtaining hard data on board related topics.