Stakeholder Duties: On the Moral Responsibility of Corporate Investors

Stakeholder theory usually focuses on the moral responsibility of corporations towards their stakeholders. This article takes the reverse perspective to shed light on the moral responsibility of stakeholders??specifically, investors or ??financiers??. It explicates a distinction between two types of financiers, creditors and shareholders. Many intuitively judge that shareholders have greater or more extensive moral responsibility for the actions of the corporations they invest in than do bondholders and other creditors. Examining the merits of possible arguments for or against treating owners and creditors differently elucidates which arguments can support the moral duties of investors generally, and different duties for different groups of investors specifically. The paper considers three possible lines of arguments, rooting investors?? responsibility, respectively, in how they enable corporate conduct, how they benefit from it, and to what extent they are complicit in it. The paper argues that a notion of complicity is the only tenable ground for holding investors liable; sketches an account of complicity based on the recent philosophical literature on collective intention and collective action; and concludes that shareholders but not creditors can generally be seen as complicit on this account.     

Science and Technology in British Business History

This essay provides a comparative perspective on the process of financial reconstruction and industrial reorganisation in the large-firm sector in inter-war Sweden and the UK. The behaviour of private banks is analysed during a period when their bargaining power is likely to have been transferred from the distressed firm to any of the external investors. In the UK and Sweden investors have traditionally been viewed as having respectively an arm's length approach towards industry and a control-oriented one. The hypothesis here is that the two financial systems were more similar than has conventionally been assumed. Besides protecting their claims, creditors in both countries became involved in the rationalisation of production which followed. This empirical study is limited to 24 large firms. However, the evidence suggests that whilst the Swedish system contained elements of the arm's length approach, the British investor's involvement in industrial transformation featured elements of control-orientation.     

Optimal cash holdings under heterogeneous beliefs

This paper explores a one‐period model for a firm that finances its operations through debt provided by heterogeneous creditors. Creditors differ in their beliefs about the firm's investment outcomes. We show the existence of Stackelberg equilibria in which the firm holds cash reserves in order to provide incentives for pessimistic creditors to invest in the firm. We find interest rates and cash holdings to be complementary tools for increasing debt capacity. In markets with a high concentration of capital across a small interval of pessimistic creditors or by a few large creditors, cash holdings is the preferred tool to increase the debt capacity of the firm.     

论股东对公司债权人的直接责任

公司不能清偿债务,同时存在股东虚假出资或抽逃出资的情况,债权人在何种情况下可要求股东直接承担责任,《关于审理公司纠纷案件若干问题的规定(一)》(征求意见稿)于第六部分就股东对债权人的直接责任问题加以规定。股东对公司债权人直接承担责任的理论基础是揭开公司面纱即公司人格否认原则。滥用公司人格是导致股东对公司债权人直接承担责任的法定事由。     

保证期间与诉讼时效关系新探

保证期间与诉讼时效决定着保证人的责任存在与否以及债权人权利能否实现,涉及到债权人和保证人的自身经济利益。我国的保证期间实际上肩负着两个任务,它既是债权人向保证人行使权利的时间限制,也是债权人向债务人行使权利的时间限制。债务届期后,债权人要在保证期间内,先向债务人主张,不按时向债务人主张权利,保证人免责。在对债务人执行完毕后而未完全受偿时,债权人还要在保证期间内再对保证人主张,不按时向保证人主张,保证人同样免责。在期间内向保证人主张之后,才开始计算保证合同的诉讼时效。     

Ownership Differences,Auditor Reputation,and Debt Financing: Evidence from China

This research examines whether “the paradox of auditor reputation” exists in China’s private debt market. Two types of hypotheses are developed to explain the “paradox” in terms of ownership differences. Our findings suggest: (1) by retaining big name auditors, non-state-owned enterprises (non-SOEs) significantly reduce the cost of debt and lower financial constraints; (2) For the non-SOEs, the effect of auditor reputation on the cost of debt and financial constraints declines over time due to the accumulation of these firms’ own reputation; (3) SOEs are more sensitive to the interest rate of bank loans than their counterparts, implying their stronger bargaining power when negotiating with potential creditors than non-SOEs due to their government connections. However, SOEs’ government connections weaken the informational role of auditors and firm reputation on signaling debt market; and (4) Corporate governance is taken into consideration by creditors as an important indicator of solvency. Further investigation demonstrates that after controlling for firm size, operating cash flow, profitability and leverage ratio, the possibility of hiring big name auditors by the younger and median-aged group of non-SOEs is considerably higher than “elder” non-SOEs. Moreover, poor-performing SOEs have greater incentives to make use of their government connections in their bargaining for lower debt cost, as compared with their well-performing peers.     

Positioning in political marketing: How semiotic analysis adds value to traditional survey approaches

Abstract

The 2010 British election particularly focused on the party leaders’ images – a departure in fifty years of British elections. The principal contribution of the article is to illustrate how a combined approach to assessing leadership positioning using both the traditional survey and semiotic analysis can provide insights into what image attribute dimensions end up in the minds of members of the public (actual positioning) and on what image attribute dimensions party marketers are trying to position themselves (intended positioning). Using data from the 2010 British general elections, our findings indicate that the combined methodological approach would be particularly useful for brands that need repositioning, those whose image attribute positions change dramatically over time, and those who wish to target previously unresponsive target audience segments.     

When secured and unsecured creditors recover the same: The emblematic case of the Tunisian corporate bankruptcies

Bankruptcy is an essential screening mechanism for developing economies. This paper focuses on the way bankruptcy is managed in Tunisia, a country characterized by the importance of its banking sector. We collected data on a set of bankrupt firms (1995–2009). We address several questions. Do the Tunisian bankruptcy procedures generate substantial overall recoveries? Are the secured creditors (mostly banks) well-enough protected under bankruptcy, and do they influence the courts' decisions? To which extent the creditors compete together? The highest recoveries are found mostly under reorganization procedures. Yet, despite a high level of competition between the classes of claimholders, the secured creditors' recovery rate remains similar to one of the unsecured creditors. Last, the court's decision to liquidate/reorganize the debtor seems not influenced by the structure of claims. The likely consequences on development are twofold: higher risks of capital misallocation/credit rationing, and stronger incentives for the banks to prioritize informal workouts.     

Price of privacy: Selling consumer databases in bankruptcy

This article analyzes whether bankrupt Internet companies can sell consumer database information in their attempts to pay off creditors as mandated by Chapter 7 and Chapter 11 bankruptcy protection law and provides guidance to solvent e-commerce companies in regard to their privacy policies. Database sales in bankruptcy are in conflict with most companies’ own posted privacy policies and, therefore, have been contested. The question pits the commercial interests of creditors, which have as their advocates bankruptcy court judges, against the privacy interests of consumers, who have found allies in state attorneys general, privacy groups and foundations, and the Federal Trade Commission (FTC). With no clear law preventing them, bankruptcy trustees have attempted to sell the databases. Ultimately they agreed not to sell by settling claims filed by the FTC and attorneys general. There is no law specifically prohibiting such sales, and until specific legislation is passed, bankruptcy court judges will continue to be left to rule on a case-by-case, even a motion-by-motion basis, interpreting the United States Code to the best of their ability. Their options are outlined and discussed.     

Duration of sovereign debt renegotiation

In the period since 1990, sovereign debt renegotiations take an average of five years for bank loans but only one year for bonds. We provide an explanation for this finding by highlighting one key difference between bank loans and bonds: bank loans are rarely traded, while bonds are heavily traded on the secondary market. In our theory, the secondary market plays a crucial information revelation role in shortening renegotiations. Consider a dynamic bargaining game with incomplete information between a government and creditors. The creditors' reservation value is private information, and the government knows only its distribution. Delays in reaching agreements arise in equilibrium because the government uses costly delays to screen the creditors' reservation value. When the creditors trade on the secondary market, the market price conveys information about their reservation value, which lessens the information friction and reduces the renegotiation duration. We find that the secondary market tends to increase the renegotiation payoff of the government but decrease that of the creditors while increasing the total payoff. We then embed these renegotiation outcomes in a simple sovereign debt model to analyze the ex ante welfare implications. The secondary market has the potential to increase the government ex ante welfare when the information friction is severe.     

Indian and British personnel specialists' understanding of the dynamics of their function: an empirical study

This paper highlights the need for cross-national HRM comparisons from a cognitive perspective. It examines the perceptions of top Indian and British personnel specialists regarding their function. The influence of national culture, national institutions and dynamic business environment on HRM is evaluated. An interview based “visual cards sorting” technique is used to tap the comparative thinking of respondents. The research was conducted in 48 manufacturing (24 Indian and 24 British) firms. The sample firms were closely matched on a number of control variables. A number of differences and similarities were found in the thinking of Indian and British managers regarding their HRM functions. The impact of certain dimensions of national culture, different national institutions and some aspects of competitive business environment on Indian and British HRM practices and policies helps to highlight the context specific nature of HRM function. The findings of the study have both research and practical implications. The analysis opens avenues for future research.     

Retailer Supply Chain and Market Access: Evidence From French Agri‐food Firms Certified with Private Standards

This paper explores an original data set identifying French agri‐food firms certified with two European private standards: the International Food Standard and/or the British Retail Consortium standard (BRC). Certified firms complying with such requirements are able to supply some European retailers with products sold under their retailers' own private label. Our analysis revealed that certified firms were among the biggest and most productive firms in the sample. Then, based on recent developments in international economics, we propose a modification of Chaney's model and estimations to test for the hypothesis that entering retailer networks reduces export costs faced by certified firms to access European union (EU) markets. After controlling for size and productivity effects, model estimations show that French firms who adopt BRC and enter the corresponding network benefit from better access through a significant decrease in their entry costs to certain EU markets.     

游离于公司法、破产法之间的债权人保护

如何加强对债权人的保护是学术界一直在研究的论题,有种观点认为公司的管理者在公司资不抵债时应当由对股东负责转为对债权人负责;公司的主要目的是为股东创造收益,破产的目的是保护债权人的利益。因此,应当废除公司领域中对债权人的保护,使其尽快回归到专门为债权人服务的破产领域,让公司法和破产法各司其职,使股东利益和债权人的保护得到强化。     

BOUNDING WRONG‐WAY RISK IN CVA CALCULATION

A credit valuation adjustment (CVA) is an adjustment applied to the value of a derivative contract or a portfolio of derivatives to account for counterparty credit risk. Measuring CVA requires combining models of market and credit risk to estimate a counterparty's risk of default together with the market value of exposure to the counterparty at default. Wrong‐way risk refers to the possibility that a counterparty's likelihood of default increases with the market value of the exposure. We develop a method for bounding wrong‐way risk, holding fixed marginal models for market and credit risk and varying the dependence between them. Given simulated paths of the two models, a linear program computes the worst‐case CVA. We analyze properties of the solution and prove convergence of the estimated bound as the number of paths increases. The worst case can be overly pessimistic, so we extend the procedure by constraining the deviation of the joint model from a baseline reference model. Measuring the deviation through relative entropy leads to a tractable convex optimization problem that can be solved through the iterative proportional fitting procedure. Here, too, we prove convergence of the resulting estimate of the penalized worst‐case CVA and the joint distribution that attains it. We consider extensions with additional constraints and illustrate the method with examples.     

British Steel: a Turnaround under Public Ownership

This case history of British Steel Corporation (BSC) is based on personal experience: the author was advisor to the Chairmen between 1976 and 1981 - the period when the company, still publicly owned, adopted the critical measures on which the turnaround was founded. BSC has been a model for a successful heavy industry turnaround and subsequent privatisation, even if some of its circumstances were unique. This article argues that it was the management rather than government which created the framework for change and that the steel strike of 1980, seen at the time as a disaster, became the watershed for fundamental change. Several of the principal actors achieved effects which were the opposite of what they intended: the article is about irony as well as steel.     

Domestic Distortions and the Early Emergence of the International Trade in Fire Insurance from the UK

In the second half of the nineteenth century, British fire insurance exports grew rapidly to more than half of the revenue accepted by British fire insurance companies. It has been suggested by some, including Michael Porter, that this expansion was based on a comparative advantage created in large part by a highly competitive domestic insurance market. Yet the existence of strong and sophisticated cartels in the British insurance market is well known. The paper argues that in fact the chief motive for the drive to develop business abroad came from the existence of the cartel, whose increasing power prompted the creation of a number of new well‐supported companies. The circumstances of the insurance business forced them to develop a large and diversified business and this required them to join the cartel. This membership deprived them of the price weapon to develop their business in the domestic market. They were thus forced to develop innovative strategies to grow. One of these was to deploy innovative marketing policies at home. The other was to expand abroad. By contrast, most of the older companies that had created the cartel developed foreign business later and on a far smaller scale.     

The influence of various factors on the main meal format served in New Zealand households

The traditional main meal served in New Zealand households has been based on that of the British, i.e. a meat-based main course that includes potatoes and other vegetables followed by a dessert. In recent years consumption figures for meat suggest that New Zealanders are making changes in their diets. This study investigates whether this change has involved a change for New Zealanders in the format of their meal. It also examines the factors that influence meal choices. It was found that cultural traditions are strongly associated with meal format and that the meal format varies most for those who hold strong ecological beliefs. This finding suggests that nutrition educators attempting to bring about changes in a population's diet should institute changes within accepted meal formats.     

Richard Perren. Taste, Trade and Technology: The Development of the International Meat Industry since 1840

This is a very British book about the international meat industry.A volume in Ashgate's Modern Economic and Social History series,its principal contribution is charting the relationships betweencountries engaged in the meat business, especially the nationsin Latin America, plus Australia and New Zealand that exportedmost of their production to the United Kingdom. The author notes several times that Britain was "the largestmarket for internationally traded meat." His analysis throughmuch of the volume is     

Acculturation and the influence of ethnicity on market orientation of African and Caribbean companies in Britain

Since acculturation is the process of acquiring the customs of an alternative society we assume that adapting to consumers from various cultures will be a fundamental task for African and Caribbean (A&C) companies in Britain. This study investigates market orientation of A&C service companies and their processes of cultural learning and adaptation using ethnicity as a basis for an exploratory study of the British market. The findings indicate that A&C companies serve as bicultural mediators, both accommodating their consumers and working to alter their consumption patterns to bring them into line with their own ethnic and British national market customs. The adaptation of A&C service companies to the cultural characteristics and needs of their customers results in changes to their companies, consumers and the British marketplace.