Repurchases of convertible preferred stock and shareholder wealth

In this paper we provide the first comprehensive examination of the stock price reaction to announcements of convertible preferred stock repurchases over the 1981 to 2005 period. We document a positive and significant average common stock abnormal return of 3.27% around announcements of these repurchases. We test signaling and free cash flow explanations for the observed wealth effects by studying abnormal returns and changes in operating performance around repurchase announcements. We find that abnormal returns are positively related to size of repurchases and managerial ownership. We find no evidence of higher stock price reactions for low-q and high free cash flow firms. In addition, we find significant improvements in accounting profitability subsequent to repurchases, but not for low-q firms. Collectively, our results are most consistent with the signaling hypothesis.     

Democracy and dividend policy around the world

This paper investigates how democracy influences corporate dividend policy. With a sample of 228,628 observations from 37 countries, we find that democracy is negatively associated with both the likelihood to pay dividends and the payout ratio. Moreover, we document that this effect is stronger when shareholders (creditors) are weakly (strongly) protected. These findings imply that the effect of democracy on corporate dividend policy is transmitted mainly through democratic procedures. Besides, we find that democracy also negatively affects dividend initiations.     

境外股东持股对我国商业银行经营绩效的影响研究

境外战略投资者的引入是否能够实质性地改善我国商业银行的公司治理从而提升经营绩效,这是我国银行业对外开放以来备受实务界、政策层和学术界广泛关注的重要课题。本文运用我国银行业33家上市或非上市商业银行在1998~2010年间的面板数据,实证研究境外股东持股如何影响我国商业银行的经营绩效。同时采用资产收益率和不良贷款率来度量经营绩效,并在控制了其他公司层面因素的影响后发现,境外股东的引入显著地改善我国商业银行的公司治理效力,提升经营绩效,表现为资产收益率的显著上升和不良贷款率的显著下降。根据实证研究结果,本文提出了有针对性的政策建议。     

我国金字塔型控股结构下的大股东利益侵害行为研究

我国上市公司普遍存在"大股东"现象。大股东通过金字塔型的控股结构获得超额控制权,并"挖空"上市公司的资源,损害了广大中小股东的利益。本文在考虑我国上市公司金字塔型控股结构的基础上,构建大股东利益侵害行为模型,系统探讨了影响利益侵害行为的因素,并提出了制约大股东"隧道挖空"行为的对策。     

Measuring and managing customer relationship risk in business markets

There have been repeated calls from top management and marketing academics for greater accountability in marketing so that the financial returns of marketing investments can be more robustly evaluated. These are coalescing around the issue of whether or not marketing delivers shareholder value. One promising line of enquiry explores customer lifetime value and the profitable management of these relationships. Although helpful, this approach fails to make the final link with shareholder value since customer lifetime value is still essentially a profit or cash flow measure and does not fully account for customer risk. This paper describes empirical research which explores differing approaches to measuring customer risk and the creation of shareholder value through customer relationship management (CRM). We develop a customer relationship scorecard which proves an innovative tool for managers to use in determining the risks in their customer relationships and developing risk mitigation strategies. The scorecard is then used to forecast retention probabilities, from which a risk-adjusted customer lifetime value is calculated. Both the scorecard and the calculations have an impact on the CRM practices of the customer relationship managers. From a theoretical perspective, an enhanced consideration of customer risk and returns is an important additional step towards demonstrating that marketing creates shareholder value.     

The impact of introductory accounting courses on student perceptions about the purpose of accounting information and the objectives of business: A comparison of the UK and Japan

This paper is concerned with the impact of introductory financial accounting courses on student perceptions of business objectives. The paper reports the results of a questionnaire survey of UK and Japanese university students which investigated their views at the start and end of an introductory financial accounting module. The views of Japanese students, in comparison with those from the UK, are of particular interest given evidence in the literature that traditional “social market” traditions in Japan are being influenced by Anglo-American “stock market” values. Our results are consistent with such a phenomenon in that Japanese students’ values regarding business objectives show significant changes that are not mirrored by changes in the perceptions of their UK counterparts. We suggest that accounting education is acting as a conduit for views more commonly held in Anglo-American societies.     

Corporate governance,accounting and finance: A review

We review accounting and finance research on corporate governance (CG). In the course of our review, we focus on a particularly vexing issue, namely endogeneity in the relationships between CG and other matters of concern to accounting and finance scholars, and suggest ways to deal with it. Given the advent of large commercial CG databases, we also stress the importance of how CG is measured and in particular, the construction of CG indices, which should be sensitive to local institutional arrangements, and the need to capture both internal and external aspects of governance. The ‘stickiness’ of CG characteristics provides an additional challenge to CG scholars. Better theory is required, for example, to explain whether various CG practices substitute for each other or are complements. While a multidisciplinary approach to developing better theory is never without its difficulties, it could enrich the current body of knowledge in CG. Despite the vastness of the existing CG literature, these issues do suggest a number of avenues for future research.     

Shareholder Value Maximisation,Stock Market and New Technology: Should the US Corporate Model be the Universal Standard? 1

In 1992 a blue‐ribbon group of US economists led by Michael Porter concluded that the US stock market‐based corporate model was misallocating resources and jeopardising US competitiveness. The faster growth of US economy since then and the supposed US lead in the spread of information technology has brought new legitimacy to the stock market and the corporate model, which is being hailed as the universal standard. Two main conclusions of the analysis presented here are: (a) there is no warrant for revising the blue‐ribbon group’s conclusion; and (b) even US corporations let alone developing country ones would be better off not having stock market valuation as a corporate goal.     

Capital markets and legal development: The China case

Recent research establishes a significant positive correlation between law and finance (and hence economic growth), restarting a debate on the “law matters” thesis. However, which way the causality goes is still not clear. The purpose of this paper is to use the ongoing reform experience of China, especially its capital market experience, to examine the direction of causality. First, we show that China's recent experience is largely consistent with Coffee's [Yale Law Journal 111 (2001, October)] “crash-then-law” interpretation of this correlation. Indeed, it is the large and clearly defined constituency of investors that has been a key driving force behind much of the recent legal progress. The rights and economic interests of this constituency have fundamentally challenged the traditional emphasis of the Chinese legal culture on administrative and criminal sanctions, but not on civil litigation law. Second, we compare the different contributions to legal change made by the stock market and the consumer product markets. We argue that capital markets are perhaps the most conducive to the formation of a politically powerful constituency and hence more aggressive legal change, because of (1) the higher degree of commonality among interested parties and (2) immediately measurable and tangible damages. These two characteristics not only allow investors to identify with each other more easily, but also create an ideal basis for more debate in the media, which in turn promotes the development of a legal culture.     

Economization of Society: Functional Differentiation and Economic Stagnation

The explanation of economization and marketization processes is typically approached in the mindset of structural superiority, primacy or hegemony of the economic subsystem over non-economic spheres of social life. However, economic primacy is an underexplored puzzle for social theory from the perspective of functional differentiation theory, which emphasizes equal autonomy of social subsystems. Schimank has paved the way for theorizing economic primacy and economization pressures coherent with functional differentiation. Economization in his theoretical solution is connected to the economy’s governance mechanism—the market which is seen as having a weak order-building capacity. The contribution of this article lies in suggesting an alternative conceptualization of the internal dynamics of the economy—the stagnation tendency for explaining economization pressures as a systematic outcome.