Board characteristics, ownership concentration and SME IPO underpricing

IF 2.1 Q2 BUSINESS, FINANCE Pacific Accounting Review Pub Date : 2022-06-06 DOI:10.1108/par-08-2020-0111
N. Arora, Balwinder Singh
{"title":"Board characteristics, ownership concentration and SME IPO underpricing","authors":"N. Arora, Balwinder Singh","doi":"10.1108/par-08-2020-0111","DOIUrl":null,"url":null,"abstract":"Purpose This study aims to explore the moderating impact of governance structure, that is, board characteristics including board size, board independence, board committees and ownership structure like ownership concentration, on the underpricing of small- and medium-sized enterprise (SME) initial public offerings (IPOs) in the context of an emerging economy such as India. Design/methodology/approach Using a sample size of 403 SME IPOs listed on Bombay Stock Exchange SME platform and National Stock Exchange EMERGE, this study uses moderated hierarchical regression analysis to investigate these relationships. Findings The findings highlighted that board independence, board committees and ownership concentration negatively influence underpricing measured using market-adjusted excess returns. While analysing the moderating relationship, this study finds that ownership concentration positively moderates the relationship between board independence and underpricing, as well as the relationship between board committees and IPO underpricing. Research limitations/implications This study is limited to a single country only. Although perfectly suitable for our research inquiry, it is imperative to check the validity of the findings by extending it to other emerging countries with similar socio-economic characteristics. Furthermore, this study tested the hypotheses concerning three board characteristics only. Hence, it could be extended to explore additional governance characteristics for a more comprehensive understanding. Practical implications This study provides a foundation for managers to adopt a fine-grained approach to effectively design the board structure ahead of an IPO event. Additionally, the findings may assist policymakers in formulating various policies and guide regulators in regulating the limit on ownership held by various shareholders to prevent their opportunism. The results of this study may further advise potential investors interested in SME IPO firms to critically consider the ownership concentration as a driving factor when scrutinizing their investment portfolios. Originality/value This study is unique as it advances the debate on the importance of a governance characteristic, that is, ownership concentration, as a moderating variable in the underexplored context of IPO underpricing of small- and medium-sized firms in India.","PeriodicalId":46088,"journal":{"name":"Pacific Accounting Review","volume":null,"pages":null},"PeriodicalIF":2.1000,"publicationDate":"2022-06-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"1","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Pacific Accounting Review","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1108/par-08-2020-0111","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q2","JCRName":"BUSINESS, FINANCE","Score":null,"Total":0}
引用次数: 1

Abstract

Purpose This study aims to explore the moderating impact of governance structure, that is, board characteristics including board size, board independence, board committees and ownership structure like ownership concentration, on the underpricing of small- and medium-sized enterprise (SME) initial public offerings (IPOs) in the context of an emerging economy such as India. Design/methodology/approach Using a sample size of 403 SME IPOs listed on Bombay Stock Exchange SME platform and National Stock Exchange EMERGE, this study uses moderated hierarchical regression analysis to investigate these relationships. Findings The findings highlighted that board independence, board committees and ownership concentration negatively influence underpricing measured using market-adjusted excess returns. While analysing the moderating relationship, this study finds that ownership concentration positively moderates the relationship between board independence and underpricing, as well as the relationship between board committees and IPO underpricing. Research limitations/implications This study is limited to a single country only. Although perfectly suitable for our research inquiry, it is imperative to check the validity of the findings by extending it to other emerging countries with similar socio-economic characteristics. Furthermore, this study tested the hypotheses concerning three board characteristics only. Hence, it could be extended to explore additional governance characteristics for a more comprehensive understanding. Practical implications This study provides a foundation for managers to adopt a fine-grained approach to effectively design the board structure ahead of an IPO event. Additionally, the findings may assist policymakers in formulating various policies and guide regulators in regulating the limit on ownership held by various shareholders to prevent their opportunism. The results of this study may further advise potential investors interested in SME IPO firms to critically consider the ownership concentration as a driving factor when scrutinizing their investment portfolios. Originality/value This study is unique as it advances the debate on the importance of a governance characteristic, that is, ownership concentration, as a moderating variable in the underexplored context of IPO underpricing of small- and medium-sized firms in India.
查看原文
分享 分享
微信好友 朋友圈 QQ好友 复制链接
本刊更多论文
董事会特征、股权集中度与中小企业IPO抑价
目的本研究旨在探讨治理结构的调节作用,即董事会特征,包括董事会规模、董事会独立性、董事会委员会和股权集中等股权结构,在印度等新兴经济体的背景下,中小企业首次公开募股(IPO)的定价偏低。设计/方法/方法使用403家在孟买证券交易所中小企业平台和国家证券交易所EMERGE上市的中小企业IPO的样本量,本研究使用有调节的层次回归分析来调查这些关系。调查结果强调,董事会独立性、董事会委员会和所有权集中度对使用市场调整后超额收益衡量的抑价产生负面影响。在分析调节关系的同时,本研究发现股权集中正调节董事会独立性与抑价之间的关系,以及董事会委员会与IPO抑价的关系。研究局限性/含义本研究仅限于一个国家。尽管完全适合我们的研究调查,但必须将研究结果扩展到其他具有类似社会经济特征的新兴国家,以检验其有效性。此外,本研究仅检验了关于三个董事会特征的假设。因此,它可以扩展到探索其他治理特征,以便更全面地理解。实际含义本研究为管理者在首次公开募股之前采用细粒度的方法有效设计董事会结构提供了基础。此外,研究结果可能有助于政策制定者制定各种政策,并指导监管机构监管各种股东持有的所有权限制,以防止他们的机会主义。这项研究的结果可能会进一步建议对中小企业IPO公司感兴趣的潜在投资者在仔细审查其投资组合时,严格考虑股权集中度作为一个驱动因素。独创性/价值这项研究是独一无二的,因为它推动了关于治理特征重要性的辩论,即所有权集中度,在印度中小企业IPO定价偏低的未充分探索的背景下,作为一个调节变量。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
求助全文
约1分钟内获得全文 去求助
来源期刊
Pacific Accounting Review
Pacific Accounting Review BUSINESS, FINANCE-
CiteScore
3.80
自引率
9.50%
发文量
36
期刊介绍: Pacific Accounting Review is a quarterly journal publishing original research papers and book reviews. The journal is supported by all New Zealand Universities and has the backing of academics from many universities in the Pacific region. The journal publishes papers from both empirical and theoretical forms of research into current developments in accounting and finance and provides insight into how present practice is shaped and formed. Specific areas include but are not limited to: - Emerging Markets and Economies - Political/Social contexts - Financial Reporting - Auditing and Governance - Management Accounting.
期刊最新文献
Auditor mood and audit quality: evidence from music sentiment measure Dissatisfaction with professional accountant training: the role of learning styles CSR disclosure quantity to CSR disclosure quality – in pursuit of a disclosure quality index Social capital and business strategy Corporate tax performance and the COVID-19 pandemic: empirical evidence from Indonesia
×
引用
GB/T 7714-2015
复制
MLA
复制
APA
复制
导出至
BibTeX EndNote RefMan NoteFirst NoteExpress
×
×
提示
您的信息不完整,为了账户安全,请先补充。
现在去补充
×
提示
您因"违规操作"
具体请查看互助需知
我知道了
×
提示
现在去查看 取消
×
提示
确定
0
微信
客服QQ
Book学术公众号 扫码关注我们
反馈
×
意见反馈
请填写您的意见或建议
请填写您的手机或邮箱
已复制链接
已复制链接
快去分享给好友吧!
我知道了
×
扫码分享
扫码分享
Book学术官方微信
Book学术文献互助
Book学术文献互助群
群 号:481959085
Book学术
文献互助 智能选刊 最新文献 互助须知 联系我们:info@booksci.cn
Book学术提供免费学术资源搜索服务,方便国内外学者检索中英文文献。致力于提供最便捷和优质的服务体验。
Copyright © 2023 Book学术 All rights reserved.
ghs 京公网安备 11010802042870号 京ICP备2023020795号-1