INVESTMENT BEHAVIOUR,CORPORATE CONTROL,AND PRIVATE BENEFITS OF CONTROL: EVIDENCE FROM A SURVEY OF UKRAINIAN FIRMS

We analyse the impact of ownership and corporate control on firms’ investment using the 2001 survey of Yacoub et al. on Ukrainian firms. The model explains investment by output, financial and soft budget constraints, and corporate control (and ownership) categories potentially enjoying private benefits of control. We find that the corporate control model fits better than the ownership model, a negative relationship between state and employee control and firms’ investment, and evidence for the presence of soft budget constraints. A negative relationship between firms’ investment and the relative size of non‐monetary transactions strengthens the conclusion of private benefits of control impacting investment.     

How forestland size affects household profits from timber harvests: A case-study in China’s Southern collective forest area

To improve the economies of scale in forest management and reduce the fragmentation of forestland, the Chinese central government has implemented a collective forest tenure supplementary reform since 2008. This has included a series of policies for motivating transfer of forestlands use rights among households in the country’s Southern Collective Forest Area (SCFA). However, to date there is little evidence that large-scale forest owners can earn more profits from timber harvests than small-scale forest owners in the SCFA. Using data collected from household surveys in the three of the SCFA’s provinces in 2016, this paper examines the return to scale of forestland ownership for timber harvests in this region, and how the scale of forestland ownership affects households’ profits from timber harvests. The results show a constant return to scale in timber harvests in the case provinces in China’s SCFA, that forestland area makes the most important contribution to the output of timber harvests, and that fragmentation of forestland results in lower profits from timber harvests. It appears that a moderate scale of forestland ownership should be identified for increasing the profits from timber harvests. With the rapid urbanization throughout China, an increase in off-farm employment among rural household members has a negative impact on timber harvests in the region. We argue that policymakers should realize the importance of encouraging the forestland transfers and improve the concentration of forestlands in the next stage of forest tenure rights reform in China’s SCFA.     

Do institutional investors drive corporate transparency regarding business contribution to the sustainable development goals?

Institutional investors show increasing interest in how companies align their corporate social responsibility strategies with the sustainable development goals (SDGs) proposed by the United Nations (UN). The information disclosed in this regard is essential to know and monitor business contribution to the 2030 Agenda. In this paper, we analyze the influence that institutional investors have on the adoption of the disclosure strategy established by UN and the Global Reporting Initiative (GRI)—GRI‐SDG Compass. The results obtained for a sample of 989 international companies, which prepare their sustainability reports following the GRI guidelines, show that ownership by foreign investors, pension funds, and “other” investors boosts the relevance of the information disclosed in relation to the 2030 Agenda. On the contrary, government, financial institutions, and cross holdings have no impact on the information systems developed.     

The Level and Stability of Institutional Ownership and Firm Performance: Evidence from Taiwan

The purpose of this paper is to investigate the influence of shareholding stability of institutional investors on firm performance. We analyze 647 sample companies listed in the Taiwan Stock Exchange from 2005 to 2009 using the coefficient of variance of institutional holding proportion as the measure for ownership stability. The empirical results show that increasing stability of institutional holdings is related to better firm performance. The low-risk and younger firms with higher CEO incentive compensation, larger insider holdings, and higher growth usually have better performance. Furthermore, when the long-term institutional shareholdings, particularly of foreign institutions, are higher, the firm performance is better.     

The trade-offs between economic efficiency and job creation in olive grove smallholdings

Cooperation among farmers is an effective alternative to reduce production costs in smallholdings of traditional olive groves and increase their low profitability. However, an increase in efficiency reduces working hours and the labour required for the management of farms. This fact can lead to negative effects in rural areas, especially considering the importance of the social aspect of the crop. Therefore, to contribute to the global discussion on the transition towards more sustainable farming, it is important to know, ex ante, what level of employment is generated by olive groves and what could be lost under more competitive and efficient scenarios. The purpose of the work is to quantify the expected impact on employment by the implementation of cooperative management methods in order to generate true and accurate information that can be used in the design of future policies that aim to increase the economic profitability of small olive farms. The results make clear that this way of managing farms, by increasing the efficiency of agricultural work, has a significant negative impact on employment. However, this management formula does encourage the professionalisation of the sector by generating quality employment, in addition to contributing to the preservation of small farms and the socio-cultural and territorial benefits they generate.     

‘Good’ farm management employment: Emerging values in the contemporary Irish dairy sector

The number of Irish dairy farms with herds greater than 100 cows has increased from 4.5 % in 2005 to 23 % in 2016. The abolition of the dairy quota in 2015 has led to predictions that this trend will continue and that an additional 6000 people will be required to work on dairy farms by 2025. Ownership of farms is esteemed, with farm employment perceived as a poor second option, so it is necessary to identify possible routes towards creating 'good' farm employment relationships. This paper explores the social, cultural and economic values of employers and employees in the context of early experiences of farm employment in post-quota Ireland. Using narrative analysis, this study found that employees gained esteem and pride from acquiring managerial responsibilities and receiving recognition for their abilities and accomplishments from their employers. Greater social recognition of employ’ abilities by peer groups and in networks (social capital) cemented ‘good employee’ status. Employers, in a context of unprecedented dairy production expansion, emphasised the need for and demonstrated changing of power structures to open up the farm to new forms of influence. However, employers’ reflexivity in support of employment relationships was undermined overall by what the management literature calls a weak ‘rewards system’ for employees. Without the supportive scaffolding of a formalised rewards system, relational gestures of responsibility-devolution and employ’ appreciation of employees may be insufficient to sustain quality farm management employment in the long term. Inevitably, this diminishes the attractiveness of farm employment, limiting the drawing of talent not only into farm employment but into associated capacity-building programmes.     

The geography of suppliers and retailers

In the last decades, supply chains have increasingly transcended national boundaries developing into global supply chains. Along with the many opportunities arising from international sourcing and the extended commercial presence over the world, the management of a globally dispersed supply chain is highly complex. A key issue to consider when dealing with the global supply chain design is the location of facilities, not only with respect to firms' owned facilities but also the supply and distribution side as factors that affect supply chain complexity and operational performance. This paper sets out a methodological framework to characterize the geographical configuration of a firm's suppliers and retailer networks. Quantitative indexes of network spatial concentration and relative proximity measures based on a nonparametric kernel density estimator are developed to identify both intra- and inter-firm patterns between the supply and point of sales' distributions. The method is first described by means of a series of theoretical-illustrative examples and exemplified by analyzing the geographical dispersion of four practical cases from the fashion-textile industry (i.e., Adidas, Benetton, C&A, and Puma). Subsequently, managerial implications and potential use of the metrics are discussed, showing how the proposed approach can support researchers and practitioners to improve supply chain location decisions and logistic integration, and evaluate changes in either the purchasing or distribution strategy.     

S&P 500 Affiliation and Stock Price Informativeness

Abstract

When firms are added to a stock index, more information should be discovered, traded on, and incorporated into their stock prices, making them more informative. We test this hypothesis using a large sample of additions to the S&P 500 index. Using two alternative statistical tests, we find that the stocks added experience more random, less predictable return and, thus, appear to be priced more efficiently information-wise. We further find concurrent increases in institutional ownership and investor awareness, which tend to contribute to the higher pricing efficiency, adding to the literature. These findings should be of interest to academics and practitioners.     

中国的所有制结构与区域劳动生产率收敛

基于2001~2017年中国工业分企业所有制-分地区-分行业的面板数据，利用相对劳动生产率和变异系数指标对全国和分区域的国有企业、私营企业、外商和港澳台企业的劳动生产率增长和收敛性进行描述性分析，并运用双向固定效应模型对其进行计量检验。结果显示：从全国范围来看，三类所有制结构的劳动生产率均呈现显著的绝对收敛和条件收敛，但是收敛速度呈现差异。其中，私营企业收敛速度最快，外商和港澳台企业次之，国有企业收敛速度最慢。分区域来看，东北和西部收敛速度相对较快，中部次之，而沿海三类所有制结构的劳动生产率收敛速度均较慢。因此，政府应进一步从深化国有企业改革、鼓励非公有制经济发展和完善市场竞争等方面努力，有助于缩小区域发展差距和促进所有制结构的收敛，从而带动整体经济的收敛。     

CEO compensation in EU telecom companies: Does the state design the right incentives?

This paper analyzes the structure of CEO pay in European fixed telecommunication companies, focusing on the impact of state ownership. Results show that, under the (partial or total) control of the state, the level of CEO compensation is lower and pay-performance sensitivity is higher than in privately-controlled firms. This finding suggests the state provides an incentive as well as a monitoring effect. However, when the state holds the majority of the shares, the pay level is significantly affected by the CEO power, suggesting that in these firms, CEOs are more likely to be entrenched with boards and succeed in raising their pay.