Mohammad Abweny, Godfred Adjapong Afrifa, Abdullah Iqbal
Research Question/Issue
The study examines whether CSR-focused governance mechanisms (CSR committees, standalone CSR reports, and CSR contracting) operate as complements or substitutes for each other in mitigating CSR decoupling.
Research Findings/Insights
The study finds that CSR-focused governance mechanisms diminish CSR decoupling and enhance CSR credibility in UK firms. In addition, the simultaneous presence of CSR committees and standalone CSR reports has a complementary effect in mitigating CSR decoupling. Conversely, the combinations of CSR committees and CSR contracting as well as standalone CSR reports and CSR contracting exhibit a substitute relationship. These impacts remain consistent when categorizing CSR decoupling into underreporting and overreporting. During the financial crisis of 2008–2009, the complementary relationship between CSR committees and CSR reports remained consistent, although the substitution between CSR committees and CSR contracting, and CSR reports and CSR contracting, is only observed after the crisis.
Theoretical/Academic Implications
The study innovatively contributes to the agency theory literature by adopting a bundle corporate governance approach while focusing on specific CSR governance mechanisms to address agency issues. It empirically shows that complementary combinations of CSR-focused governance mechanisms signify a marginal benefit in reducing CSR decoupling, leading to a reduction in agency costs.
Practitioner/Policy Implications
The study offers several implications. First, it helps firms create ideal combinations of different CSR-focused governance mechanisms that provide superior marginal benefits. Second, firms' stakeholders, especially the investors, could identify the usefulness of adopting CSR-focused governance mechanisms in CSR reporting. Finally, it could also attract regulators' attention toward the weaker aspects of the existing corporate governance code regarding CSR.
{"title":"The Complementarity and Substitution Effects of CSR-Focused Governance Mechanisms on CSR Decoupling","authors":"Mohammad Abweny, Godfred Adjapong Afrifa, Abdullah Iqbal","doi":"10.1111/corg.12591","DOIUrl":"10.1111/corg.12591","url":null,"abstract":"<div>\u0000 \u0000 \u0000 <section>\u0000 \u0000 <h3> Research Question/Issue</h3>\u0000 \u0000 <p>The study examines whether CSR-focused governance mechanisms (CSR committees, standalone CSR reports, and CSR contracting) operate as complements or substitutes for each other in mitigating CSR decoupling.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Research Findings/Insights</h3>\u0000 \u0000 <p>The study finds that CSR-focused governance mechanisms diminish CSR decoupling and enhance CSR credibility in UK firms. In addition, the simultaneous presence of CSR committees and standalone CSR reports has a complementary effect in mitigating CSR decoupling. Conversely, the combinations of CSR committees and CSR contracting as well as standalone CSR reports and CSR contracting exhibit a substitute relationship. These impacts remain consistent when categorizing CSR decoupling into underreporting and overreporting. During the financial crisis of 2008–2009, the complementary relationship between CSR committees and CSR reports remained consistent, although the substitution between CSR committees and CSR contracting, and CSR reports and CSR contracting, is only observed after the crisis.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Theoretical/Academic Implications</h3>\u0000 \u0000 <p>The study innovatively contributes to the agency theory literature by adopting a bundle corporate governance approach while focusing on specific CSR governance mechanisms to address agency issues. It empirically shows that complementary combinations of CSR-focused governance mechanisms signify a marginal benefit in reducing CSR decoupling, leading to a reduction in agency costs.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Practitioner/Policy Implications</h3>\u0000 \u0000 <p>The study offers several implications. First, it helps firms create ideal combinations of different CSR-focused governance mechanisms that provide superior marginal benefits. Second, firms' stakeholders, especially the investors, could identify the usefulness of adopting CSR-focused governance mechanisms in CSR reporting. Finally, it could also attract regulators' attention toward the weaker aspects of the existing corporate governance code regarding CSR.</p>\u0000 </section>\u0000 </div>","PeriodicalId":48209,"journal":{"name":"Corporate Governance-An International Review","volume":"33 1","pages":"153-175"},"PeriodicalIF":4.6,"publicationDate":"2024-05-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/corg.12591","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"141194732","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We investigate the impact of mandatory operating information disclosure rules on related-party transactions (RPTs) in Chinese-listed firms. To achieve this, we use the staggered implementation of China's Industry Disclosure Guidelines (CIDG) as an exogenous shock to firms' operating information. We then examine how this regulatory change influences controlling shareholders' expropriation behavior through RPTs.
Research Findings/Insights
The implementation of CIDG results in a reduction in suspicious RPTs, indicating that the mandatory disclosure of operating information effectively mitigates expropriation behavior by controlling shareholders. Additionally, we observe improvements in both the quantity and quality of disclosures after the CIDG, which enhances corporate governance by increasing investor attention and improving the efficiency of regulatory inquiries into RPTs. In our cross-sectional analysis, the impact of the CIDG is more pronounced for firms with weaker internal controls, lower institutional holdings, and a weaker institutional environment as compared to their counterparts, suggesting a “substitution effect” between the CIDG and firms' internal and external governance mechanisms.
Theoretical/Academic Implications
This study contributes to addressing the challenge of curbing opportunistic RPTs in emerging markets. Our study contributes to previous research by emphasizing the crucial role of operating information. This information enhances outsiders' ability to comprehensively understand and utilize disclosed numbers, thereby compensating for a firm's weak corporate governance and restraining expropriation by controlling shareholders. We also provide evidence that corporate governance can be strengthened by improving operational transparency. Our study also contributes to the literature on the actual effect of information on managerial behavior.
Practitioner/Policy Implications
This study has several important policy implications. Providing sufficient operating information to minority shareholders and other monitors can empower them to oversee controlling shareholders' behavior effectively. Policymakers can enhance market discipline by reforming information disclosure rules and promoting industry-level transparency, particularly in emerging markets that have insufficient investor protection against tunneling.
{"title":"The Impact of Mandatory Operating Information Disclosure on Related-Party Transactions: Evidence From China","authors":"Yan He, Jing Wang, Qingxi Meng","doi":"10.1111/corg.12589","DOIUrl":"https://doi.org/10.1111/corg.12589","url":null,"abstract":"<div>\u0000 \u0000 \u0000 <section>\u0000 \u0000 <h3> Research Question/Issue</h3>\u0000 \u0000 <p>We investigate the impact of mandatory operating information disclosure rules on related-party transactions (RPTs) in Chinese-listed firms. To achieve this, we use the staggered implementation of China's Industry Disclosure Guidelines (CIDG) as an exogenous shock to firms' operating information. We then examine how this regulatory change influences controlling shareholders' expropriation behavior through RPTs.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Research Findings/Insights</h3>\u0000 \u0000 <p>The implementation of CIDG results in a reduction in suspicious RPTs, indicating that the mandatory disclosure of operating information effectively mitigates expropriation behavior by controlling shareholders. Additionally, we observe improvements in both the quantity and quality of disclosures after the CIDG, which enhances corporate governance by increasing investor attention and improving the efficiency of regulatory inquiries into RPTs. In our cross-sectional analysis, the impact of the CIDG is more pronounced for firms with weaker internal controls, lower institutional holdings, and a weaker institutional environment as compared to their counterparts, suggesting a “substitution effect” between the CIDG and firms' internal and external governance mechanisms.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Theoretical/Academic Implications</h3>\u0000 \u0000 <p>This study contributes to addressing the challenge of curbing opportunistic RPTs in emerging markets. Our study contributes to previous research by emphasizing the crucial role of operating information. This information enhances outsiders' ability to comprehensively understand and utilize disclosed numbers, thereby compensating for a firm's weak corporate governance and restraining expropriation by controlling shareholders. We also provide evidence that corporate governance can be strengthened by improving operational transparency. Our study also contributes to the literature on the actual effect of information on managerial behavior.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Practitioner/Policy Implications</h3>\u0000 \u0000 <p>This study has several important policy implications. Providing sufficient operating information to minority shareholders and other monitors can empower them to oversee controlling shareholders' behavior effectively. Policymakers can enhance market discipline by reforming information disclosure rules and promoting industry-level transparency, particularly in emerging markets that have insufficient investor protection against tunneling.</p>\u0000 </section>\u0000 </div>","PeriodicalId":48209,"journal":{"name":"Corporate Governance-An International Review","volume":"33 1","pages":"103-124"},"PeriodicalIF":4.6,"publicationDate":"2024-05-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143115460","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Gabriele Cardullo, Maurizio Conti, Mirella Damiani, Andrea Ricci, Sergio Scicchitano, Giovanni Sulis
Research Question/Issue
The purpose of this paper is to analyze the long-run determinants of the corporate structure of Italian firms to explain the persistent role of a long-run tradition of civic capital that has favored interpersonal trust, fostered cooperation outside of the narrow ties of family members and limited the diffusion of family businesses managed predominantly by family members.
Research Findings/Insights
We examined a large sample of Italian listed and not listed firms and identified those that operate in current municipalities that in the past used to be independent communes. Such firms featuring experiences of civic engagement are today less likely to be owned by a family and run by family management.
Theoretical/Academic Implications
Our findings highlight the role of institutions as drivers of corporate governance and signal that long forgotten institutions, by modifying local social capital, may interact with family social capital and have important persistent effects on current corporate governance arrangements. Therefore, significant elements of path dependency may explain current patterns of unbundling of ownership and management.
Practitioner/Policy Implications
Persistent corporate governance structures are difficult even for policymakers to modify. Our findings suggest that political measures should favor the accumulation of social capital at the local level when aiming to change ownership and management arrangements and limit the misallocation of resources due to family management.
{"title":"Family Management and Historical Origins: The Italian Experience","authors":"Gabriele Cardullo, Maurizio Conti, Mirella Damiani, Andrea Ricci, Sergio Scicchitano, Giovanni Sulis","doi":"10.1111/corg.12587","DOIUrl":"10.1111/corg.12587","url":null,"abstract":"<div>\u0000 \u0000 \u0000 <section>\u0000 \u0000 <h3> Research Question/Issue</h3>\u0000 \u0000 <p>The purpose of this paper is to analyze the long-run determinants of the corporate structure of Italian firms to explain the persistent role of a long-run tradition of civic capital that has favored interpersonal trust, fostered cooperation outside of the narrow ties of family members and limited the diffusion of family businesses managed predominantly by family members.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Research Findings/Insights</h3>\u0000 \u0000 <p>We examined a large sample of Italian listed and not listed firms and identified those that operate in current municipalities that in the past used to be independent communes. Such firms featuring experiences of civic engagement are today less likely to be owned by a family and run by family management.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Theoretical/Academic Implications</h3>\u0000 \u0000 <p>Our findings highlight the role of institutions as drivers of corporate governance and signal that long forgotten institutions, by modifying local social capital, may interact with family social capital and have important persistent effects on current corporate governance arrangements. Therefore, significant elements of path dependency may explain current patterns of unbundling of ownership and management.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Practitioner/Policy Implications</h3>\u0000 \u0000 <p>Persistent corporate governance structures are difficult even for policymakers to modify. Our findings suggest that political measures should favor the accumulation of social capital at the local level when aiming to change ownership and management arrangements and limit the misallocation of resources due to family management.</p>\u0000 </section>\u0000 </div>","PeriodicalId":48209,"journal":{"name":"Corporate Governance-An International Review","volume":"33 1","pages":"55-72"},"PeriodicalIF":4.6,"publicationDate":"2024-05-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140839099","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
<div> <section> <h3> Research Issue</h3> <p>We investigate the deliberations of controlling shareholders in assessing the trade-offs between costs and benefits preceding the adoption of an Employee Stock Ownership Plan (ESOP). Furthermore, we explore the market responses to ESOP announcements and their associations with the private benefits of control. Moreover, our study delves into the modifications in private benefits of control, changes in employment dynamics, and subsequent operating performance subsequent to the implementation of ESOPs.</p> </section> <section> <h3> Research Insights</h3> <p>We conduct our research employing a comprehensive dataset encompassing the adoptions of ESOPs within publicly listed Chinese companies during the period spanning from 2014 to 2020. Our empirical findings reveal that firms characterized by diminished private benefits of control, as indicated by a reduced wedge between control rights and cash flow rights, as well as a lower frequency of related party transactions, are more inclined to consider the adoption of ESOPs, especially when the potential for productivity gains is substantial. These firms also elicit more positive market reactions upon the announcement of their ESOP initiatives. While ESOPs do lead to heightened productivity, the overall enhancement in operating performance remains relatively modest due to the significant cost burden imposed on shareholders by the large unearned employee compensation. Our results suggest that controlling shareholders who partake in fewer private benefits of control are more inclined to forego these entitlements in favor of embracing ESOPs as a strategic mechanism for realizing productivity gains. However, it is imperative to acknowledge that such gains may be considerably offset by substantial increases in employee compensation expenses. Despite the prevalence of short-lived features in Chinese practice, we lack substantial evidence supporting their inhibitory effects on the increased monitoring and productivity following ESOP adoption.</p> </section> <section> <h3> Academic Implications</h3> <p>This study provides a comprehensive examination of recent ESOPs in the Chinese context, offering insights into the regulatory complexities within the largest emerging market. The research contributes to the existing literature by unveiling the intricate relationship between private benefits of control and the decision to adopt ESOPs, as well as their subsequent implications. Notably, our findings, particularly the observed neutral impact on operating performance, augment the ongoing discourse surrounding the efficacy of ESOPs in augmenting shareholder value.</p> </section> <section>
{"title":"The Benefits and Costs of Employee Stock Ownership Plans in China","authors":"Qing He, Dongming Jiang, Erzhuo Liu","doi":"10.1111/corg.12585","DOIUrl":"https://doi.org/10.1111/corg.12585","url":null,"abstract":"<div>\u0000 \u0000 \u0000 <section>\u0000 \u0000 <h3> Research Issue</h3>\u0000 \u0000 <p>We investigate the deliberations of controlling shareholders in assessing the trade-offs between costs and benefits preceding the adoption of an Employee Stock Ownership Plan (ESOP). Furthermore, we explore the market responses to ESOP announcements and their associations with the private benefits of control. Moreover, our study delves into the modifications in private benefits of control, changes in employment dynamics, and subsequent operating performance subsequent to the implementation of ESOPs.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Research Insights</h3>\u0000 \u0000 <p>We conduct our research employing a comprehensive dataset encompassing the adoptions of ESOPs within publicly listed Chinese companies during the period spanning from 2014 to 2020. Our empirical findings reveal that firms characterized by diminished private benefits of control, as indicated by a reduced wedge between control rights and cash flow rights, as well as a lower frequency of related party transactions, are more inclined to consider the adoption of ESOPs, especially when the potential for productivity gains is substantial. These firms also elicit more positive market reactions upon the announcement of their ESOP initiatives. While ESOPs do lead to heightened productivity, the overall enhancement in operating performance remains relatively modest due to the significant cost burden imposed on shareholders by the large unearned employee compensation. Our results suggest that controlling shareholders who partake in fewer private benefits of control are more inclined to forego these entitlements in favor of embracing ESOPs as a strategic mechanism for realizing productivity gains. However, it is imperative to acknowledge that such gains may be considerably offset by substantial increases in employee compensation expenses. Despite the prevalence of short-lived features in Chinese practice, we lack substantial evidence supporting their inhibitory effects on the increased monitoring and productivity following ESOP adoption.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Academic Implications</h3>\u0000 \u0000 <p>This study provides a comprehensive examination of recent ESOPs in the Chinese context, offering insights into the regulatory complexities within the largest emerging market. The research contributes to the existing literature by unveiling the intricate relationship between private benefits of control and the decision to adopt ESOPs, as well as their subsequent implications. Notably, our findings, particularly the observed neutral impact on operating performance, augment the ongoing discourse surrounding the efficacy of ESOPs in augmenting shareholder value.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 ","PeriodicalId":48209,"journal":{"name":"Corporate Governance-An International Review","volume":"33 1","pages":"21-54"},"PeriodicalIF":4.6,"publicationDate":"2024-04-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143120899","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Florencio Lopez-de-Silanes, Joseph A. McCahery, Paul C. Pudschedl
Research Question/Issue
We examine the effect of multiple environmental, social, and governance (ESG) scores on institutional investor ownership of firms and investor portfolio weightings. We are also the first to analyze the three individual components of ESG rankings to estimate the relative preferences of institutional investors.
Research Findings/Insights
Using a unique panel dataset covering US companies and institutional investor portfolios over the 2010–2019 period, we find that while investors are driven to add high-quality ESG companies to their portfolios, there is a negative relationship with ESG when it comes to taking large ownership stakes. Furthermore, ESG scores are negatively related to the portfolio weightings of institutional investors, which raises concerns of greenwashing. Our analysis of individual ESG scores points to significantly larger effects of G scores in terms of holdings, and G is the only score with no negative impact on portfolio weightings. Finally, in support of systematic stewardship theory, top institutional investors allocate higher proportions of their portfolios to firms with high-ESG ratings. Our results are robust to the use of a difference-in-differences analysis addressing endogeneity concerns.
Theoretical/Academic Implications
The findings in this paper offer important policy implications for institutional investors, managers, and policymakers. Given the ongoing debate on ESG scores, this paper shows the importance of examining greenwashing for investors who have a concern regarding the extent to which the valuation of assets might be influenced by unsupported sustainability claims. In addition, our study adds to the debate regarding ESG investing and stewardship theory.
{"title":"Institutional Investors and ESG Preferences","authors":"Florencio Lopez-de-Silanes, Joseph A. McCahery, Paul C. Pudschedl","doi":"10.1111/corg.12583","DOIUrl":"10.1111/corg.12583","url":null,"abstract":"<div>\u0000 \u0000 \u0000 <section>\u0000 \u0000 <h3> Research Question/Issue</h3>\u0000 \u0000 <p>We examine the effect of multiple environmental, social, and governance (ESG) scores on institutional investor ownership of firms and investor portfolio weightings. We are also the first to analyze the three individual components of ESG rankings to estimate the relative preferences of institutional investors.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Research Findings/Insights</h3>\u0000 \u0000 <p>Using a unique panel dataset covering US companies and institutional investor portfolios over the 2010–2019 period, we find that while investors are driven to add high-quality ESG companies to their portfolios, there is a negative relationship with ESG when it comes to taking large ownership stakes. Furthermore, ESG scores are negatively related to the portfolio weightings of institutional investors, which raises concerns of greenwashing. Our analysis of individual ESG scores points to significantly larger effects of G scores in terms of holdings, and G is the only score with no negative impact on portfolio weightings. Finally, in support of systematic stewardship theory, top institutional investors allocate higher proportions of their portfolios to firms with high-ESG ratings. Our results are robust to the use of a difference-in-differences analysis addressing endogeneity concerns.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Theoretical/Academic Implications</h3>\u0000 \u0000 <p>The findings in this paper offer important policy implications for institutional investors, managers, and policymakers. Given the ongoing debate on ESG scores, this paper shows the importance of examining greenwashing for investors who have a concern regarding the extent to which the valuation of assets might be influenced by unsupported sustainability claims. In addition, our study adds to the debate regarding ESG investing and stewardship theory.</p>\u0000 </section>\u0000 </div>","PeriodicalId":48209,"journal":{"name":"Corporate Governance-An International Review","volume":"32 6","pages":"1060-1086"},"PeriodicalIF":4.6,"publicationDate":"2024-04-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140581514","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Saneesh Edacherian, Amit Karna, Klaus Uhlenbruck, Sunil Sharma
Manuscript Type
Empirical.
Research Question/Issue
We examine how the combined presence of women in multiple levels of strategic leadership, including gender-diverse boards, affects firm accounting performance.
Research Findings/Insights
Our meta-analysis of 273 effect sizes across various hypotheses expands research on women in upper echelons by showing that gender-diverse boards are positively related to gender spillovers, that is, the appointment of female executives. Most importantly, our work demonstrates that gender spillovers mediate the relationship between board gender diversity and firm performance, indicating there are joint effects of women leaders when serving at various levels of the organization simultaneously. We also find that the size of gender-diverse boards negatively affects gender spillovers to the level of executives.
Theoretical/Academic Implications
Our research highlights interdependencies between gender diversity at different organizational levels and the distinct contribution of women directors. We draw attention to the role of gender spillovers as a mechanism that helps explain how the appointment of women directors benefits firm performance. Our findings broadly contribute to upper echelons theory.
Practitioner/Policy Implications
This study emphasizes that increasing the representation of women on boards can advance the cause of women at other levels of strategic leadership. Furthermore, if women are in multiple levels of strategic leadership at the same time, this can lead to improved firm performance.
{"title":"Women at Multiple Levels of Strategic Leadership: Evidence of Gender Spillovers","authors":"Saneesh Edacherian, Amit Karna, Klaus Uhlenbruck, Sunil Sharma","doi":"10.1111/corg.12584","DOIUrl":"10.1111/corg.12584","url":null,"abstract":"<div>\u0000 \u0000 \u0000 <section>\u0000 \u0000 <h3> Manuscript Type</h3>\u0000 \u0000 <p>Empirical.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Research Question/Issue</h3>\u0000 \u0000 <p>We examine how the combined presence of women in multiple levels of strategic leadership, including gender-diverse boards, affects firm accounting performance.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Research Findings/Insights</h3>\u0000 \u0000 <p>Our meta-analysis of 273 effect sizes across various hypotheses expands research on women in upper echelons by showing that gender-diverse boards are positively related to gender spillovers, that is, the appointment of female executives. Most importantly, our work demonstrates that gender spillovers mediate the relationship between board gender diversity and firm performance, indicating there are joint effects of women leaders when serving at various levels of the organization simultaneously. We also find that the size of gender-diverse boards negatively affects gender spillovers to the level of executives.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Theoretical/Academic Implications</h3>\u0000 \u0000 <p>Our research highlights interdependencies between gender diversity at different organizational levels and the distinct contribution of women directors. We draw attention to the role of gender spillovers as a mechanism that helps explain how the appointment of women directors benefits firm performance. Our findings broadly contribute to upper echelons theory.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Practitioner/Policy Implications</h3>\u0000 \u0000 <p>This study emphasizes that increasing the representation of women on boards can advance the cause of women at other levels of strategic leadership. Furthermore, if women are in multiple levels of strategic leadership at the same time, this can lead to improved firm performance.</p>\u0000 </section>\u0000 </div>","PeriodicalId":48209,"journal":{"name":"Corporate Governance-An International Review","volume":"33 1","pages":"6-20"},"PeriodicalIF":4.6,"publicationDate":"2024-04-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/corg.12584","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140581556","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Mansoor Afzali, Vasiliki Athanasakou, Siri Terjesen
<div> <section> <h3> Research Question/Issue</h3> <p>This study explores the relationship between the presence of a lead independent director (LID) and firms' internal information environment. LIDs are elected independent members of the board who perform key duties for the independent directors and the board, including reviewing and approving board meeting agendas, chairing non-executive board meetings, and acting as a liaison between the CEO and other independent directors. We hypothesize that LID presence lowers information barriers between the CEO and the rest of the board members, enabling more rapid information acquisition and integration and enhancing the internal information environment of the firm.</p> </section> <section> <h3> Research Findings/Insights</h3> <p>Using a sample of US publicly listed companies from 2001 to 2019, we document that LID presence on the board is positively associated with proxies of internal information quality that reflect better information acquisition and information integration: accuracy and precision of management earnings forecasts, speed of earnings announcement, and absence of material weaknesses in internal controls. These results are robust to alternative model specifications, including entropy balancing, Heckman two-step correction for self-selection bias, firm fixed effects, and placebo tests. Further analyses suggest that LIDs with financial expertise and audit committee memberships are more effective in positively influencing internal information quality. We also show that LID presence is positively associated with several proxies of external information quality.</p> </section> <section> <h3> Theoretical/Academic Implications</h3> <p>We build on agency theory to argue that LIDs improve internal information quality by reinforcing the information quality benefits of unified leadership while mitigating potential compromises in information quality arising from entrenchment. Similarly, we use arguments emanating from the novel strategic leadership systems theory to posit that a LID appointment facilitates the tasks of the CEO and the board, enhancing the effectiveness of both groups in their respective roles: the CEO in making operating and investment decisions and the board in strengthening oversight while bringing cohesion in their shared role of strategy visioning and implementation.</p> </section> <section> <h3> Practitioner/Policy Implications</h3> <p>Our findings suggest that there is scope for shareholders to consider LID appointments as an addition to their firms' corporate governance structures t
研究问题 本研究探讨首席独立董事（LID）的存在与公司内部信息环境之间的关系。首席独立董事是董事会中当选的独立成员，他们为独立董事和董事会履行重要职责，包括审查和批准董事会会议议程、主持非执行董事会会议，以及充当首席执行官和其他独立董事之间的联络人。我们假设，独立董事的存在降低了首席执行官与董事会其他成员之间的信息壁垒，从而能够更迅速地获取和整合信息，并改善公司的内部信息环境。研究结果/见解利用 2001 年至 2019 年的美国上市公司样本，我们记录了独立董事在董事会中的存在与反映更好的信息获取和信息整合的内部信息质量代用指标正相关：管理层盈利预测的准确性和精确性、盈利公布的速度以及内部控制中不存在重大缺陷。这些结果对其他模型规格是稳健的，包括熵平衡、Heckman 两步自我选择偏差校正、公司固定效应和安慰剂测试。进一步的分析表明，具有财务专业知识和审计委员会成员资格的 LID 在积极影响内部信息质量方面更为有效。理论/学术启示我们以代理理论为基础，认为 LID 通过加强统一领导对信息质量的益处，同时减轻因固化而对信息质量造成的潜在损害，从而提高了内部信息质量。同样，我们利用新颖的战略领导系统理论提出的论点，认为LID的任命有利于CEO和董事会的工作，提高两个群体在各自角色中的效率：CEO负责制定运营和投资决策，董事会负责加强监督，同时在战略构想和实施的共同角色中发挥凝聚力。政策制定者在通过监管指南推广公司治理最佳实践时，也可以鼓励在董事会中任命 LID。
{"title":"Lead Independent Directors and Internal Information Environment","authors":"Mansoor Afzali, Vasiliki Athanasakou, Siri Terjesen","doi":"10.1111/corg.12582","DOIUrl":"10.1111/corg.12582","url":null,"abstract":"<div>\u0000 \u0000 \u0000 <section>\u0000 \u0000 <h3> Research Question/Issue</h3>\u0000 \u0000 <p>This study explores the relationship between the presence of a lead independent director (LID) and firms' internal information environment. LIDs are elected independent members of the board who perform key duties for the independent directors and the board, including reviewing and approving board meeting agendas, chairing non-executive board meetings, and acting as a liaison between the CEO and other independent directors. We hypothesize that LID presence lowers information barriers between the CEO and the rest of the board members, enabling more rapid information acquisition and integration and enhancing the internal information environment of the firm.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Research Findings/Insights</h3>\u0000 \u0000 <p>Using a sample of US publicly listed companies from 2001 to 2019, we document that LID presence on the board is positively associated with proxies of internal information quality that reflect better information acquisition and information integration: accuracy and precision of management earnings forecasts, speed of earnings announcement, and absence of material weaknesses in internal controls. These results are robust to alternative model specifications, including entropy balancing, Heckman two-step correction for self-selection bias, firm fixed effects, and placebo tests. Further analyses suggest that LIDs with financial expertise and audit committee memberships are more effective in positively influencing internal information quality. We also show that LID presence is positively associated with several proxies of external information quality.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Theoretical/Academic Implications</h3>\u0000 \u0000 <p>We build on agency theory to argue that LIDs improve internal information quality by reinforcing the information quality benefits of unified leadership while mitigating potential compromises in information quality arising from entrenchment. Similarly, we use arguments emanating from the novel strategic leadership systems theory to posit that a LID appointment facilitates the tasks of the CEO and the board, enhancing the effectiveness of both groups in their respective roles: the CEO in making operating and investment decisions and the board in strengthening oversight while bringing cohesion in their shared role of strategy visioning and implementation.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Practitioner/Policy Implications</h3>\u0000 \u0000 <p>Our findings suggest that there is scope for shareholders to consider LID appointments as an addition to their firms' corporate governance structures t","PeriodicalId":48209,"journal":{"name":"Corporate Governance-An International Review","volume":"32 6","pages":"1035-1059"},"PeriodicalIF":4.6,"publicationDate":"2024-04-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/corg.12582","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140581520","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Are companies monitored by common owners (i.e., institutional investors that block-own [owning 5% or more] several companies in a single industry) more likely than other companies to record goodwill impairments when their assets are overstated?
Research Findings/Insights
We find that companies monitored by common owners are more likely than other companies to record goodwill impairments when their assets are overstated. The monitoring effect is stronger for common owners with a stronger incentive to monitor and with more industry knowledge and stronger for the co-presence of multiple common owners. Our findings are in line with the notion that common owners have an economy of scale in monitoring and internalize the negative externality of delayed recording of goodwill impairment. We also find that common ownership is associated with lower information asymmetry, which in turn increases the timeliness of goodwill impairment.
Theoretical/Academic Implications
Our research emphasizes the monitoring role of common ownership in recording goodwill impairments. We find support for the mechanisms enabling common owners to be better monitors.
Practitioner/Policy Implications
The prevalence of common ownership has prompted regulatory and societal concerns regarding under-investment in the oversight of the companies. Our findings documenting the association between common ownership and the timely recording of goodwill impairments are relevant to the ongoing debate regarding the potential costs and benefits of common ownership.
{"title":"Common Ownership and Goodwill Impairments","authors":"Chunlai Ye, Lin-Hui Yu","doi":"10.1111/corg.12581","DOIUrl":"10.1111/corg.12581","url":null,"abstract":"<div>\u0000 \u0000 \u0000 <section>\u0000 \u0000 <h3> Research Question/Issue</h3>\u0000 \u0000 <p>Are companies monitored by common owners (i.e., institutional investors that block-own [owning 5% or more] several companies in a single industry) more likely than other companies to record goodwill impairments when their assets are overstated?</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Research Findings/Insights</h3>\u0000 \u0000 <p>We find that companies monitored by common owners are more likely than other companies to record goodwill impairments when their assets are overstated. The monitoring effect is stronger for common owners with a stronger incentive to monitor and with more industry knowledge and stronger for the co-presence of multiple common owners. Our findings are in line with the notion that common owners have an economy of scale in monitoring and internalize the negative externality of delayed recording of goodwill impairment. We also find that common ownership is associated with lower information asymmetry, which in turn increases the timeliness of goodwill impairment.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Theoretical/Academic Implications</h3>\u0000 \u0000 <p>Our research emphasizes the monitoring role of common ownership in recording goodwill impairments. We find support for the mechanisms enabling common owners to be better monitors.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Practitioner/Policy Implications</h3>\u0000 \u0000 <p>The prevalence of common ownership has prompted regulatory and societal concerns regarding under-investment in the oversight of the companies. Our findings documenting the association between common ownership and the timely recording of goodwill impairments are relevant to the ongoing debate regarding the potential costs and benefits of common ownership.</p>\u0000 </section>\u0000 </div>","PeriodicalId":48209,"journal":{"name":"Corporate Governance-An International Review","volume":"32 6","pages":"1016-1034"},"PeriodicalIF":4.6,"publicationDate":"2024-03-26","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140581639","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Mushtaq Hussain Khan, Mohammad Bitar, Amine Tarazi, Arshad Hassan, Ahmad Fraz
Research Question/Issue
We investigate whether the risk-taking of Islamic banks is affected differently by corruption compared to conventional banks. We also examine whether the characteristics of the Shari'ah Supervisory Board (SSB) of Islamic banks and the characteristics of the board of directors of conventional banks play an effective role in moderating such an effect.
Research Findings/Insights
We find consistent evidence that banks in countries with higher corruption have higher bank risk for both conventional and Islamic banks. However, this association is attenuated by the size of the SSB, the presence of female board members, and higher academic qualifications of SSB members. For conventional banks, the moderating effect of the presence of female directors and academically qualified members on the board of directors is also prevalent but to a lesser extent.
Theoretical/Academic Implications
This study contributes to the corporate finance literature more generally by highlighting the role played by corporate governance, particularly the presence of female members and academically qualified members on the SSBs of Islamic banks and on the board of directors of conventional banks, in mitigating the effect of corruption on bank risk-taking for the two bank types.
Practitioner/Policy Implications
Our findings are based on a matched sample of banks operating in 10 OIC (Organization of Islamic Cooperation) countries and have important implications for bank stability and bank governance reforms. On the detrimental side, urgency of the anti-corruption campaigns in these countries is justified due to the significant effect of corruption on risk-taking for both conventional and Islamic banks. Overall, to better fight corruption in countries with dual banking systems, there is a need to enforce stricter rules for all types of banks.
{"title":"Corruption and Bank Risk-Taking in Dual Banking Systems","authors":"Mushtaq Hussain Khan, Mohammad Bitar, Amine Tarazi, Arshad Hassan, Ahmad Fraz","doi":"10.1111/corg.12579","DOIUrl":"10.1111/corg.12579","url":null,"abstract":"<div>\u0000 \u0000 \u0000 <section>\u0000 \u0000 <h3> Research Question/Issue</h3>\u0000 \u0000 <p>We investigate whether the risk-taking of Islamic banks is affected differently by corruption compared to conventional banks. We also examine whether the characteristics of the Shari'ah Supervisory Board (SSB) of Islamic banks and the characteristics of the board of directors of conventional banks play an effective role in moderating such an effect.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Research Findings/Insights</h3>\u0000 \u0000 <p>We find consistent evidence that banks in countries with higher corruption have higher bank risk for both conventional and Islamic banks. However, this association is attenuated by the size of the SSB, the presence of female board members, and higher academic qualifications of SSB members. For conventional banks, the moderating effect of the presence of female directors and academically qualified members on the board of directors is also prevalent but to a lesser extent.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Theoretical/Academic Implications</h3>\u0000 \u0000 <p>This study contributes to the corporate finance literature more generally by highlighting the role played by corporate governance, particularly the presence of female members and academically qualified members on the SSBs of Islamic banks and on the board of directors of conventional banks, in mitigating the effect of corruption on bank risk-taking for the two bank types.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Practitioner/Policy Implications</h3>\u0000 \u0000 <p>Our findings are based on a matched sample of banks operating in 10 OIC (Organization of Islamic Cooperation) countries and have important implications for bank stability and bank governance reforms. On the detrimental side, urgency of the anti-corruption campaigns in these countries is justified due to the significant effect of corruption on risk-taking for both conventional and Islamic banks. Overall, to better fight corruption in countries with dual banking systems, there is a need to enforce stricter rules for all types of banks.</p>\u0000 </section>\u0000 </div>","PeriodicalId":48209,"journal":{"name":"Corporate Governance-An International Review","volume":"32 6","pages":"984-1015"},"PeriodicalIF":4.6,"publicationDate":"2024-03-26","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/corg.12579","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140303026","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"OA","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This study investigates whether and how executives with legal expertise impact corporate innovation.
Research Findings
Using a sample of listed firms in China, we have the following findings: (1) Firms that hire executives with legal expertise are associated with more corporate innovation. (2) These firms talk about potential legal risks and legal advisors more often in their annual reports and have lower chances of being sued in patent litigations. (3) The innovation-promoting effect is stronger when the firms are state-owned enterprises, have more overseas revenue, operate in high-tech industries, have prior patent litigation experience, and are in strong legal environments.
Theoretical/Academic Implications
The findings indicate that executives with legal expertise bring more attention to legal risks and help the firm to shape a stable environment, which can effectively promote innovation activities. Also, the innovation-promoting effect of lawyer executives complements the role of in-house legal counsels and the external legal environment. This paper adds to the literature on the value of executives with legal background.
Practitioner/Policy Implications
Our results emphasize the important role played by executives with legal expertise in corporate innovation. Given the continuing shortage of legal talents and the gradual improvement of the legal system in China, firms need to employ more legal talents to avoid potential legal risks and maintain sustainable growth.
本研究调查了具有法律专业知识的高管是否以及如何影响企业创新。
{"title":"Executives' Legal Expertise and Corporate Innovation","authors":"Yunhao Dai, Xinchu Tong, Xiao Jia","doi":"10.1111/corg.12578","DOIUrl":"10.1111/corg.12578","url":null,"abstract":"<div>\u0000 \u0000 \u0000 <section>\u0000 \u0000 <h3> Research Question</h3>\u0000 \u0000 <p>This study investigates whether and how executives with legal expertise impact corporate innovation.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Research Findings</h3>\u0000 \u0000 <p>Using a sample of listed firms in China, we have the following findings: (1) Firms that hire executives with legal expertise are associated with more corporate innovation. (2) These firms talk about potential legal risks and legal advisors more often in their annual reports and have lower chances of being sued in patent litigations. (3) The innovation-promoting effect is stronger when the firms are state-owned enterprises, have more overseas revenue, operate in high-tech industries, have prior patent litigation experience, and are in strong legal environments.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Theoretical/Academic Implications</h3>\u0000 \u0000 <p>The findings indicate that executives with legal expertise bring more attention to legal risks and help the firm to shape a stable environment, which can effectively promote innovation activities. Also, the innovation-promoting effect of lawyer executives complements the role of in-house legal counsels and the external legal environment. This paper adds to the literature on the value of executives with legal background.</p>\u0000 </section>\u0000 \u0000 <section>\u0000 \u0000 <h3> Practitioner/Policy Implications</h3>\u0000 \u0000 <p>Our results emphasize the important role played by executives with legal expertise in corporate innovation. Given the continuing shortage of legal talents and the gradual improvement of the legal system in China, firms need to employ more legal talents to avoid potential legal risks and maintain sustainable growth.</p>\u0000 </section>\u0000 </div>","PeriodicalId":48209,"journal":{"name":"Corporate Governance-An International Review","volume":"32 6","pages":"954-983"},"PeriodicalIF":4.6,"publicationDate":"2024-03-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140302920","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
扫码关注我们
求助内容：
应助结果提醒方式：
京公网安备 11010802042870号