Corporate governance in a major British holding company: BSA in the interwar years

This paper uses a case study of BSA to examine corporate governance in a holding company during the interwar years. Recognised as generally progressive in its policy towards financial disclosure, nevertheless BSA attracted hostile criticism from its shareholders, showed little evidence of developing administrative coordination and provided limited detailed information concerning the performance of its subsidiaries. Voice did have an effect in changing the pattern of financial reporting, but even under the pressure of its banker, when financial circumstances deteriorated in the early 1930s, BSA was only prepared to change personnel while organisational structures remained in place.     

Management accounting and corporate governance: An institutional interpretation of the agency problem

Challenging the dominant economic agency theory of corporate governance with a new discourse drawn from institutional theory, the paper analyses how management accounting is implicated in corporate governance. The proposed institutional theory of agency links the micro-institutions of the organization that are informed by the practices of management accounting with external institutional players and stakeholders. The paper identifies emerging narratives in which the management accounting profession has recognised a distinctive, post-Enron set of sensibilities. Although techniques drawn from strategic management accounting can be adapted to embed better corporate governance practices, the institutional theory of agency identifies tensions between the heroic CEO narrative and the routinization of strategy implicit in strategic management accounting.     

Board Members and Company Value

This essay surveys research about the value of individual members of boards of directors. When directors join or exit corporate boards, company stock prices respond, often in magnitudes of 1% of firm value or more. Related research shows that when a significant event impacts the stock price of one company, the effects are transmitted to other companies that share board members in common with the primary company. Share price reactions are sensitive to variables such as a director’s occupation, independence, and professional qualifications. Together, this evidence suggests that a well-functioning market for directors might already exist, making direct regulation unnecessary and possibly counter-productive.     

美国高校会计的特征及其启示

传统上美国高校会计制度采用"双轨制"方法,私立大学遵从财务会计准则委员会的准则,公立大学采用政府会计准则委员会的准则,二者一般都采用"基金"会计核算方法.近年来,财务会计准则委员会和政府会计准则委员会制定的有关高校会计信息披露法规出现了融合的趋势,两类高校会计信息披露的内容开始向企业会计靠拢.我国高校会计改革应吸收美国已有的成果,应尽量缩小与企业会计的差别.     

高技术企业的权变治理、管理者更替与企业永续发展

高技术企业的治理与规范化公司的治理存在很大的差异,甚至是本质上的差异。这种差异主要来自于高技术企业的人力资本价值和团队合作价值。但从企业长期发展来看,高技术企业必须平衡权威治理和企业永续发展的关系问题。本文运用企业权力主体竞争力模型分析高技术企业控制权结构,剖析了高技术企业的“两人治理结构”现象,揭示出保持高技术企业永续发展的两大主题——权变治理和管理者更替问题。     

Corporate Governance and Expected Stock Returns: Evidence from Germany

Recent empirical work shows evidence for higher valuation of firms in countries with a better legal environment. We investigate whether differences in the quality of firm‐level corporate governance also help to explain firm performance in a cross‐section of companies within a single jurisdiction. Constructing a broad corporate governance rating (CGR) for German public firms, we document a positive relationship between governance practices and firm valuation. There is also evidence that expected stock returns are negatively correlated with firm‐level corporate governance, if dividend yields are used as proxies for the cost of capital. An investment strategy that bought high‐CGR firms and shorted low‐CGR firms earned abnormal returns of around 12% on an annual basis during the sample period.     

Accounting development in Pakistan

This paper examines the origins, growth, and the development of accounting practices and disclosures in Pakistan and the factors that influenced them. We trace the early days of accounting in the Indian subcontinent and discuss the British colonial influence. We examine the development of accounting in Pakistan through three eras: Independence through 1971, Post 1971-1984, and 1984 to present. We describe how the colonial past and later the international financial institutions such as the Asian Development Bank and the International Monetary Fund played key roles in shaping accounting and reporting practices of the country. Pakistan's adoption of International Financial Reporting Standards as national standards has not led to improvement in the quality of financial reporting. We argue that Pakistan, even though classified as a common law country in literature, exhibits most of the properties of code law countries. We conclude that lack of investor protection (e.g., minority rights protection, insider-trading protection), judicial inefficiencies, and weak enforcement mechanisms are more critical to explaining the state of financial reporting in Pakistan than are cultural factors. This insight has policy implications for developing countries that are making efforts to improve the quality of the financial reporting of their business entities.     

Zombie Board: Board Tenure and Firm Performance

We show that board tenure exhibits an inverted U‐shaped relation with firm value and accounting performance. The quality of corporate decisions, such as M&A, financial reporting quality, and CEO compensation, also has a quadratic relation with board tenure. Our results are consistent with the interpretation that directors’ on‐the‐job learning improves firm value up to a threshold, at which point entrenchment dominates and firm performance suffers. To address endogeneity concerns, we use a sample of firms in which an outside director suffered a sudden death, and find that sudden deaths that move board tenure away from (toward) the empirically observed optimum level in the cross‐section are associated with negative (positive) announcement returns. The quality of corporate decisions also follows an inverted U‐shaped pattern in a sample of firms affected by the death of a director.     

An international study of internal audit function quality

We investigate organisational and environmental factors that influence firms’ incentives to develop high-quality internal audit functions (IAFs) by using a unique international sample formed by matching proprietary data from a global internal auditor survey with public data obtained from Worldscope. Concerning organisational factors, we find that a positive relationship exists between IAF quality and firm complexity and confirm that complex firms have a higher demand for monitoring and advising and, therefore, a greater need for formal controls. In addition, IAF quality is positively related to board monitoring and audit committee diligence but negatively associated with CEO power, which suggests that IAF quality is influenced by other key players in corporate governance. Regarding environmental factors, we document that IAF quality is positively associated with industry competition, which implies that a firm’s incentive for a high-quality IAF is enhanced when confronted with greater environmental uncertainty. Furthermore, IAF quality has a significantly positive relationship with our self-constructed index of IAF requirements included in national corporate governance codes, which indicates that strong home-country corporate governance codes play a role in fostering IAF development.     

Managing and financing metropolitan public services in China: experience of the Pearl River Delta region

Under China’s current fiscal policies and inter-governmental relations, it is a significant challenge to finance and deliver public services across jurisdictions. This challenge was met in the Pearl River Delta region in southern China with a collaborative governance approach. Directives from higher-level governments and horizontal inter-city fiscal arrangements were successfully combined to deliver public services. Effective networks should be developed to improve co-ordination and collaboration in delivering cross-jurisdictional public services.