TMT Departures and Post‐IPO Outside Director Additions: Implications for Young IPO Firms’ Survival and Performance

We draw on resource‐based logic to argue that relatively stable TMTs and boards are beneficial for young IPO firms because of the need to maintain and develop valuable firm‐specific capabilities and psychological attachment of pre‐IPO TMTs. Using panel data from 272 young IPO firms, we find that pre‐IPO TMT member exits negatively affect young IPO firms’ survival and performance. This negative effect is greater when more post‐IPO outside directors are added. We also find that the above interaction is positively and negatively associated with survival and performance when TMT ownership declines substantially and when firms have a founder CEO, respectively.     

Board Effectiveness and Cost of Debt

Does the board of directors influence cost of debt financing? This study of a sample of Spanish listed companies during the period 2004?C2007 provides some evidence about the question. The results suggest that two board attributes ?C director ownership and board activity ?C appear to influence in the risk assessment of debtholders because of their ability to reduce agency cost and information asymmetry. We also find a non-linear relationship between board size and cost of debt, suggesting that from certain levels the benefits of large boards may be outweighed by the cost of poorer communication and increased decision-making time.     

Corporate Governance and the CEO Pay–Performance Link: Australian Evidence

We examine the influence of corporate governance mechanisms, namely blockholdings and board structure, on CEO pay–performance sensitivity in listed Australian firms. Results highlight blockholders' role in shaping observed pay–performance associations and their impact varying with their independence and relative magnitude of ownership. Monitoring blockholders increase the sensitivity of long‐term at‐risk pay to performance, better aligning manager and shareholder interests. However, consistent with a shorter investment horizon, insider blockholders increase (decrease) the responsiveness of cash bonuses (long‐term at‐risk pay). Finally, consistent with them affording less‐effective monitoring, larger boards raise (lower) the sensitivity of known pay (long‐term at‐risk pay) to performance.     

The Impact of Family Involvement on SMEs’ Performance: Theory and Evidence

By complementing agency theory with behavioral assumptions, we explore the effects of family involvement on small and medium enterprises’ (SMEs) performance. We identify three separate dimensions of family involvement and hypothesize nonlinear, direct, and interaction effects on the performance of an SME. The evidence on 787 SMEs suggests that an inverted U‐shaped relationship exists between family ownership and performance, and ownership dispersion among family members negatively affects performance. Balancing family and nonfamily members in the top management team (TMT) is found to be beneficial to SMEs’ performance, but the family ratio in the TMT becomes crucial only at high levels of family ownership.     

Diversity & internationalization: The case of boards and TMT's

Using a mixed US and European sample where both the board and TMT units are analyzed at the same time, we test the variables age, tenure and functional background.We extend the information/decision making perspective (Williams & O’Reilly, 1998) to both TMTs and boards by analyzing them as separate but related entities. In line with our hypotheses we find a positive effect on internationalization for functional background diversity of both boards and TMTs.Contrary to our expectations longer TMT tenure and younger board age also have a positive effect on internationalization.     

The Impact of the Dual Board Structure and Board Diversity: Evidence from Chinese Initial Public Offerings (IPOs)

Chinese listed companies have a two-tier (dual) governance structure that comprises a supervisory board/committee (SB) and the board of directors (BoD). However, as there is no hierarchical relationship between them, the two boards are independent. This is different from the governance mechanism in Continental Europe in which the SB appoints the directors of the management board; in this sense, the Chinese two-tier governance structure is unique. We investigate the impact of governance characteristics and ownership structure on gender diversity of both the BoD and the SB for a sample of 892 Chinese Initial Public Offerings floated in both the Shanghai and Shenzhen Stock Exchanges. We find that the average proportion of female directors and female SB members on the BoD and the SB are 10 and 22 %, respectively. Using both static and dynamic panel data methods, we find that there is no significant impact of board structure on gender diversity in China. However, we find a positive and significant relationship between SB size and gender diversity. We also find that the higher the state ownership, the lower the female representation on both boards. Finally, our findings show that there is a bi-directional relationship between financial performance and the proportion of female directors sitting on the BoD.     

Formal and informal influences of the state on OFDI of hybrid state-owned enterprises in China

This study investigates how the state influences the outward foreign direct investment (OFDI) of hybrid state-owned enterprises (SOEs) in China. Previous studies have provided conflicting arguments and empirical findings on the internationalization of SOEs, with some studies proposing a positive relationship between state ownership and OFDI, while others propose a negative relationship. In this paper, we argue that the mixed effects are due to different influences of different levels of state ownership and different types of political connections. We investigate our proposed hypotheses based on a sample of publicly listed hybrid Chinese SOEs between 2009 and 2016. We find an S-shaped relationship between state ownership and OFDI such that at low levels of state ownership, OFDI increases as state ownership increases; at medium levels of state ownership, OFDI decreases as state ownership increases; at high levels of state ownership, OFDI increases again as state ownership increases. We further find that executive-branch political connections between boards and top management teams of firms and the government have a negative effect on OFDI, while legislative-branch political connections have no significant effect on OFDI.     

Top management team characteristics,R&;D investment and capital structure in the IT industry

This paper is based on agency theory, resource-based and upper-echelons perspectives to examine the relationship between R&D investment and capital structure and the moderating effects of top management team (TMT) characteristics on the financing decisions of R&D investment in small and medium enterprises (SMEs). Using data for SMEs in Taiwan’s IT industry, we find that (1) SMEs involved in R&D activities tend to have lower debt levels and (2) TMT characteristics exert considerable influence on the R&D investment-financial leverage relationship in SMEs. One important implication of the empirical evidence is that for SMEs trying to compete on the basis of innovation, the TMT characteristics significantly influence financing decisions. As innovative activities increase, the selection and development of top executives, who are responsible for choosing an optimal capital structure that could keep financial costs low while providing sufficient financial resources for maintaining a continuous, uninterrupted rate of R&D, is crucial for SMEs.     

Hysteresis in adjusting the ownership structure of foreign subsidiaries

In this paper we study the insight that multinational companies might delay the adjustment of the ownership structure of their foreign subsidiaries despite the fact that the fundamentals call for an immediate adjustment (hysteresis). Based on company-level data, we empirically investigate the company and industry conditions that influence the strength of the hysteresis in adjusting this ownership structure. Exchange rate volatility and adjustment cost strengthen the hysteresis in ownership adjustment decisions, while the growth of sales in the foreign market weakens it.     

Effect of corporate governance on default risk in financial versus nonfinancial firms: Canadian evidence

This paper investigates the influence of corporate governance variables on default risk of Canadian firms after the 2008 financial crisis. We provide evidence that important governance mechanisms have differential impacts between Canadian financial and nonfinancial firms. Ownership structure, (e.g., institutional ownership and insider ownership), has a significant impact on the default risk of financial firms but not on nonfinancial firms. Nonfinancial firms with more independent boards are associated with lower default risk, while financial firms with larger boards and more independent boards have higher default risk. In addition, although cross‐listing in the US reduces the default risk for Canadian nonfinancial firms, it actually increases the risk for Canadian financial firms during the postcrisis period. Copyright © 2016 ASAC. Published by John Wiley & Sons, Ltd.     

CEO power and its effect on performance and governance: Evidence from Chinese banks

This study investigates whether CEO power matters in Chinese banks. We find that the effects of four power dimensions on banks' performance and board structure vary in their own unique ways. The CEOs with structural power are negatively related to performance but positively related to gender-diversified boards. Moreover, CEOs with ownership power enhance performance but are negatively associated with professionalism and diversification in the boards. Banks that have CEOs with expert power perform well and have gender-diversified boards. Meanwhile, CEOs with prestige power are likely to appoint politically connected directors to the board.     

中央政府与地方政府在所有制结构调整中的博弈分析

中央政府与地方政府在所有制结构调整中的博弈主要体现在两个方面,即所有制结构的增量调整和存量调整。在我们的博弈模型中,中央政府与地方政府在所有制结构调整上的博弈策略是不一样的。从中央政府与地方政府所有制结构的增量调整和存量调整的实际来看,不同的博弈策略确实导致了不同的所有制结构调整速度。与我们的博弈模型大体一致,地方政府在与中央政府进行所有制结构调整的博弈时,不同的地方政府所选择的调整速度又是有差异的。     

Board Pay and the Separation of Ownership from Control in U.K. SMEs

This paper examines Board pay for a sample of 571 U.K. SMEs from 1991 to 1995. Approximately half of the sample were closely-held (i.e., owner-managed) firms which allowed empirical testing of models of the relationship between Board pay and ownership from control characteristics. Consistent with their need to align shareholder and manager incentives, the results indicate that the change in nonclosely-held SME Board pay is significantly related to both external market pay comparisons and “benchmark” profits. This contrasts with the empirical results for the closely-held firms where Board pay awards are typically highly sensitive to current total profits but wholly unrelated to external market pay levels.     

Risk-taking behaviour and ownership in the banking industry: The Spanish evidence

This paper analyses the determinants of risk-taking in Spanish financial intermediaries, with special emphasis on the ownership structure and size of the different entities. On the one hand, the specific legal configuration of Spanish Savings banks may lead them to differ from Commercial banks in their risk behaviour. In particular, they may invest in riskier projects. Nevertheless, other theories indicate that greater stockholder control in Commercial banks may induce them towards greater risk-taking in certain situations. In this paper we test these hypotheses with a dynamic panel data model (1993–2000) for Spanish Commercial banks and Savings banks. We analyse whether differences in risk behaviour are related to different ownership structures or to other factors such as the size of the entity.     

The Stakeholder Model: The Influence of the Ownership and Governance Structures

This paper addresses the possibilities to introduce the stakeholder model in the firm, especially the possibility to give property or decision rights to stakeholders. This paper argues that it is not practical to give full property rights to more than one group of stakeholders. Decision rights to employees and creditors are already in place in some countries, but the possibility to introduce them more generally to other stakeholder groups depends very much on the governance and ownership structure of the firm and the legal environment. The future of the stakeholder model in a globalised economy is also analysed.Eva Jansson is currently associate professor of managerial economics at the Universitat Autònoma of Barcelona. She holds a BA in statistics from the University of Stockholm and graduated in economics from Universitat of Barcelona. She holds a Ph.D. from Universitat Autònoma of Barcelona. Her research interests have been in fiscal policy, regulations of service sectors and recently topics in corporate governance. Special interest has been given to international comparison of ownership structures, changes in ownership structure of Spanish firms and to the evolution of ownership structures of privatized Spanish firms. Recent works include topics on the stakeholder model.     

Are Demographic Attributes and Firm Characteristics Drivers of Gender Diversity? Investigating Women’s Positions on French Boards of Directors

In this article, we examine the factors determining the representation of women on boards of directors by considering three main questions. The first question deals with the relationship between characteristics of ownership and governance on one side, and female directorship on the other. The second major question concerns the demographic attributes of women directors, such as nationality, foreign experience, educational level, business expertise, and connections to external sources. The third important question refers to women in senior positions on French boards (e.g., as independent members or board subcommittee members) in relation to firm characteristics and women’s demographic attributes. Our study focuses on French large- and mid-capitalized companies belonging to the SBF120 stock market index during a 5-year period running from 2000 to 2004. First, our results give evidence that the appointment of women directors is strongly related to family ownership and board or firm size. Second, the appointment of women directors is related to their professional services, valuable skills, and network links. Furthermore, we show that women face a double glass-ceiling problem, and note that French firms rely more on the demographic attributes of their women directors when they are appointed to senior board positions. Our study sheds light on issues concerning the law that comes into force in 2016, which imposes quotas of women members on boards of directors in French companies.     

TMT strategic consensus in Mexican companies

Scholars show continuing interest in top management teams (TMT). This line of research emphasizes their importance for organizational success. This study reveals a clear challenge for researchers; to better understand the relationships between TMT characteristics and firm performance, researchers should consider the firm's environment. Results suggest that environmental complexity moderates the relationship between TMT strategic consensus and performance in Mexican companies. Interestingly, the results contradict initial expectations; lower levels of consensus correlate with higher performance in simple, more than in complex environments. Higher levels of consensus correlate with higher performance, in complex environments.     

Female Presence on Corporate Boards: A Multi-Country Study of Environmental Context

A growing body of ethics research investigates gender diversity and governance on corporate boards, at individual and firm levels, in single country studies. In this study, we explore the environmental context of female representation on corporate boards of directors, using data from 43 countries. We suggest that women’s representation on corporate boards may be shaped by the larger environment, including the social, political and economic structures of individual countries. We use logit regression to conduct our analysis. Our results indicate that countries with higher representation of women on boards are more likely to have women in senior management and more equal ratios of male to female pay. However, we find that countries with a longer tradition of women’s political representation are less likely to have high levels of female board representation.     

Women on the Board and Managers’ Pay: Evidence from Spain

The current literature shows great interest in the issue of gender diversity on boards of directors. Some studies have hypothesized a direct relationship between diversity and the value of the firm, but not many examine the intermediate mechanisms that may exert an influence on such relationships. We employ two stages of GMM estimation methodology to exhibit evidences of the relationship between gender diversity and compensation of top managers in the Spanish context. Results show that gender diversity positively affects the effectiveness of boards—in terms of composition, structure, size and functioning—influencing a proper design of top managers compensation linked to company performance. Evidences suggest that legislative actions aimed at increasing the presence of women on boards of directors are justified not only for ethical reasons, but also for reasons of economic efficiency.     

法制环境、两权分离与资本结构动态调整

本文实证检验了法制环境以及控股股东控制权和所有权分离对资本结构动态调整的影响。研究发现：上市公司控股股东控制权和所有权分离程度越高,实际资本结构偏离最优资本结构的幅度越大,资本结构调整速度越慢;上市公司所处的法制环境越好,实际资本结构偏离最优资本结构的幅度越小,资本结构调整速度越快;法制环境的改善能够显著的缓解两权分离对资本结构动态调整的负面影响;结合中国的制度背景,基于公司产权性质的分析发现,相比国有上市公司,非国有上市公司受法制环境和两权分离的影响更加显著。