Using proprietary valuations from a large sample of international private equity managers, we examine how the use of fair value accounting improves the valuation of private companies. We find that the use of fair value accounting reduces valuation bias and increases valuation accuracy. These improvements are especially salient for the valuation of outperforming and mature private companies. Our findings provide novel evidence that fair value accounting improves the usefulness of financial reporting even in settings where valuations are subjective and unverifiable.
{"title":"The Bright Side of Fair Value Accounting: Evidence from Private Company Valuation","authors":"Nicholas Crain, Kelvin K. F. Law","doi":"10.2139/ssrn.3040396","DOIUrl":"https://doi.org/10.2139/ssrn.3040396","url":null,"abstract":"Using proprietary valuations from a large sample of international private equity managers, we examine how the use of fair value accounting improves the valuation of private companies. We find that the use of fair value accounting reduces valuation bias and increases valuation accuracy. These improvements are especially salient for the valuation of outperforming and mature private companies. Our findings provide novel evidence that fair value accounting improves the usefulness of financial reporting even in settings where valuations are subjective and unverifiable.","PeriodicalId":57292,"journal":{"name":"公司治理评论","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2018-12-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"78736996","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We provide new evidence about the effect of securitization on bank stability and systemic risk in the run-up to and following the global financial crisis by considering the role of the bank lending channel of monetary policy. In so doing, we use a structural model of bank stability to construct a new measure of the net effect of securitization on bank stability. Analyzing the dynamics of this measure at the individual bank and the banking system levels shows that securitization activities have a destabilizing effect on banks, although this effect decreases after the crisis. To explain this change, we then use the bank lending channel as the main link between securitization and monetary policy. We find that low monetary policy interest rates in the aftermath of the global financial crisis have mitigated the destabilizing effect of securitization on banks.
{"title":"Securitization, Monetary Policy and Bank Stability","authors":"Mohamed Bakoush, T. Mishra, S. Wolfe","doi":"10.2139/ssrn.3630704","DOIUrl":"https://doi.org/10.2139/ssrn.3630704","url":null,"abstract":"We provide new evidence about the effect of securitization on bank stability and systemic risk in the run-up to and following the global financial crisis by considering the role of the bank lending channel of monetary policy. In so doing, we use a structural model of bank stability to construct a new measure of the net effect of securitization on bank stability. Analyzing the dynamics of this measure at the individual bank and the banking system levels shows that securitization activities have a destabilizing effect on banks, although this effect decreases after the crisis. To explain this change, we then use the bank lending channel as the main link between securitization and monetary policy. We find that low monetary policy interest rates in the aftermath of the global financial crisis have mitigated the destabilizing effect of securitization on banks.","PeriodicalId":57292,"journal":{"name":"公司治理评论","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2018-11-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"89446039","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2018-10-01DOI: 10.1590/1807-7692BAR2018180005
Luana Zanetti Trindade Ferraz, A. Rezende, João Paulo Cavalcante Lima, E. Todeva
This research evaluates the perception of members regarding the value-creation actions offered by a cooperative and whether the characteristics of the member and cooperative affected this perception. A model to measure the perception of the value co-creation activities provided by the cooperative and member characteristics was created. The adopted methodology was a questionnaire and the Partial Least Square method. Value co-creation, professionalization of management, satisfaction and loyalty, and long-term time orientation of the member were measured based on the member’s perception. The results demonstrate a significant association between satisfaction and loyalty and perception of value co-creation and a positive association between the long-term time horizon and the perception of value co-creation actions. In other words, perception of the benefits generated by the actions of the cooperative can be influenced by time orientation and level of satisfaction and loyalty. The main contribution is the creation of an instrument that measures the level of perception of value co-creation actions.
{"title":"Perception of Value Co-Creation Actions in Agricultural Cooperatives","authors":"Luana Zanetti Trindade Ferraz, A. Rezende, João Paulo Cavalcante Lima, E. Todeva","doi":"10.1590/1807-7692BAR2018180005","DOIUrl":"https://doi.org/10.1590/1807-7692BAR2018180005","url":null,"abstract":"This research evaluates the perception of members regarding the value-creation actions offered by a cooperative and whether the characteristics of the member and cooperative affected this perception. A model to measure the perception of the value co-creation activities provided by the cooperative and member characteristics was created. The adopted methodology was a questionnaire and the Partial Least Square method. Value co-creation, professionalization of management, satisfaction and loyalty, and long-term time orientation of the member were measured based on the member’s perception. The results demonstrate a significant association between satisfaction and loyalty and perception of value co-creation and a positive association between the long-term time horizon and the perception of value co-creation actions. In other words, perception of the benefits generated by the actions of the cooperative can be influenced by time orientation and level of satisfaction and loyalty. The main contribution is the creation of an instrument that measures the level of perception of value co-creation actions.","PeriodicalId":57292,"journal":{"name":"公司治理评论","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2018-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"72723290","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper analyzes whether or not investors who utilize financial advisors/brokers are systematically directed to mutual fund investments that have lower quality governance. By utilizing the Morningstar Stewardship Grades and analyzing the Board Quality, Managerial Incentive, Fee Rating, and Corporate Culture Rating, we conclude that investors in multiple share class mutual funds (MS funds) are indeed investing in funds that have lower quality governance. Specifically, ordered probit regressions suggest that MS funds are less likely to have higher board quality ratings, less likely to have higher managerial incentive ratings, and are less likely to have higher fee ratings. The results suggest that regulating bodies like the US Securities and Exchange Commissions should investigate these investments to make sure retail investors are not being disadvantaged.
{"title":"Are Multiple Share Class Investors Disadvantaged? Evidence from Morningstar Stewardship Grades.","authors":"Jonathan Handy, Thomas I. Smythe","doi":"10.2139/ssrn.3249734","DOIUrl":"https://doi.org/10.2139/ssrn.3249734","url":null,"abstract":"This paper analyzes whether or not investors who utilize financial advisors/brokers are systematically directed to mutual fund investments that have lower quality governance. By utilizing the Morningstar Stewardship Grades and analyzing the Board Quality, Managerial Incentive, Fee Rating, and Corporate Culture Rating, we conclude that investors in multiple share class mutual funds (MS funds) are indeed investing in funds that have lower quality governance. Specifically, ordered probit regressions suggest that MS funds are less likely to have higher board quality ratings, less likely to have higher managerial incentive ratings, and are less likely to have higher fee ratings. The results suggest that regulating bodies like the US Securities and Exchange Commissions should investigate these investments to make sure retail investors are not being disadvantaged.","PeriodicalId":57292,"journal":{"name":"公司治理评论","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2018-09-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"75777506","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Black & Gilson (1998) argued that an IPO-welcoming stock market stimulates venture deals by enabling VCs to give founders a valuable “call option on control”. We study 18,000 startups to investigate the value of this option. Among firms that IPO, 60% of founders are no longer CEO. With little voting power, only half of the others survive three years as CEO. At initial VC financing, the probability of getting real control of a public firm for three years is 0.4%. Our results shed light on control evolution in startups, and cast doubt on the plausibility of the call-option theory linking stock and VC markets.
Black & Gilson(1998)认为，欢迎ipo的股市使风投能够给予创始人有价值的“控制权看涨期权”，从而刺激了风险投资交易。我们研究了18000家初创公司来调查这种选择的价值。在上市公司中，60%的创始人不再担任CEO。由于没有多少投票权，其他CEO中只有一半能在任三年。在最初的风投融资中，获得上市公司三年实际控制权的概率为0.4%。我们的研究结果揭示了创业公司的控制权演变，并对将股票和风险投资市场联系起来的看涨期权理论的合理性提出了质疑。
{"title":"Do Founders Control Start-Up Firms that Go Public?","authors":"Brian J. Broughman, J. Fried","doi":"10.2139/ssrn.3171237","DOIUrl":"https://doi.org/10.2139/ssrn.3171237","url":null,"abstract":"Black & Gilson (1998) argued that an IPO-welcoming stock market stimulates venture deals by enabling VCs to give founders a valuable “call option on control”. We study 18,000 startups to investigate the value of this option. Among firms that IPO, 60% of founders are no longer CEO. With little voting power, only half of the others survive three years as CEO. At initial VC financing, the probability of getting real control of a public firm for three years is 0.4%. Our results shed light on control evolution in startups, and cast doubt on the plausibility of the call-option theory linking stock and VC markets.","PeriodicalId":57292,"journal":{"name":"公司治理评论","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2018-09-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"88630209","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2018-07-07DOI: 10.18510/IJMIER.2018.421
Abdullah Al Buraiki, Firdouse R Khan
Purpose: The objectives of the study were to critically investigate the challenges faced by SMEs; to analyze SMEs difficulties during adopting new technologies and to critically investigate the difficulties in the form of policies and procedures. Design/methodology/approach: For this research study, purposive sampling methodology was adopted. Using a well-defined questionnaire, 257 samples were collected from all over Oman. The data collected was recorded, tabulated, summarized and the tests – Chi-square tests, Kolmogorov-Smirnov tests and regression analysis were carried to obtain the results. Findings: The study reveals that most of the respondents got delay in the commencement of business due to lack of finance. It is also revealed that the SMEs are in dire need of technical support at the time of commencement of their businesses and need support to establish IT infrastructure. Research limitations/Implications: The study suggests that the adequate support from General Authority for SMEs can change the scenario of setting up of the SMEs in a smooth transition and the interim advances by the financial institutions can help them avoid time lag. Social implications: The study suggests that the Governmental authority should monitor and follow up SMEs to avoid the SME units becoming sick and provide technical support, guidance and nurse the units, if they become sick. Also, the licensing for the SME units should be made easier through single window system. Originality/Value: Only a very few have examined the main challenges faced by SMEs in Oman. Our study includes selected samples of SMEs and not the micro enterprises. The study can further be extended to all the MSMEs in all the regions / Governorates of Oman.
{"title":"Finance and Technology: Key Challenges Faced by Small and Medium Enterprises (SMES) in Oman","authors":"Abdullah Al Buraiki, Firdouse R Khan","doi":"10.18510/IJMIER.2018.421","DOIUrl":"https://doi.org/10.18510/IJMIER.2018.421","url":null,"abstract":"Purpose: The objectives of the study were to critically investigate the challenges faced by SMEs; to analyze SMEs difficulties during adopting new technologies and to critically investigate the difficulties in the form of policies and procedures. \u0000Design/methodology/approach: For this research study, purposive sampling methodology was adopted. Using a well-defined questionnaire, 257 samples were collected from all over Oman. The data collected was recorded, tabulated, summarized and the tests – Chi-square tests, Kolmogorov-Smirnov tests and regression analysis were carried to obtain the results. \u0000Findings: The study reveals that most of the respondents got delay in the commencement of business due to lack of finance. It is also revealed that the SMEs are in dire need of technical support at the time of commencement of their businesses and need support to establish IT infrastructure. \u0000Research limitations/Implications: The study suggests that the adequate support from General Authority for SMEs can change the scenario of setting up of the SMEs in a smooth transition and the interim advances by the financial institutions can help them avoid time lag. \u0000Social implications: The study suggests that the Governmental authority should monitor and follow up SMEs to avoid the SME units becoming sick and provide technical support, guidance and nurse the units, if they become sick. Also, the licensing for the SME units should be made easier through single window system. \u0000Originality/Value: Only a very few have examined the main challenges faced by SMEs in Oman. Our study includes selected samples of SMEs and not the micro enterprises. The study can further be extended to all the MSMEs in all the regions / Governorates of Oman.","PeriodicalId":57292,"journal":{"name":"公司治理评论","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2018-07-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"74311990","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper shows that long-term shareholders embed horizon incentives in executive compensation contracts as a mechanism to promote long-term oriented managerial behavior. Increases in long-term institutional ownership lead to longer equity vesting periods measured by CEO pay duration. Further, CEO pay duration decreases following hedge-fund activism that is often argued to be associated with short-term investment horizon. To establish causality, we use institutional mergers as an exogenous change in institutional investor horizon, and to address reverse causality, we use the indexing behavior of institutions. Overall, CEO pay duration is a potential mechanism for institutional investors to align managerial horizon with their investment horizon, and ultimately to influence corporate behavior.
{"title":"Investor Horizon and Managerial Short-Termism","authors":"Ugur Lel, M. Tepe","doi":"10.2139/ssrn.3209865","DOIUrl":"https://doi.org/10.2139/ssrn.3209865","url":null,"abstract":"This paper shows that long-term shareholders embed horizon incentives in executive compensation contracts as a mechanism to promote long-term oriented managerial behavior. Increases in long-term institutional ownership lead to longer equity vesting periods measured by CEO pay duration. Further, CEO pay duration decreases following hedge-fund activism that is often argued to be associated with short-term investment horizon. To establish causality, we use institutional mergers as an exogenous change in institutional investor horizon, and to address reverse causality, we use the indexing behavior of institutions. Overall, CEO pay duration is a potential mechanism for institutional investors to align managerial horizon with their investment horizon, and ultimately to influence corporate behavior.","PeriodicalId":57292,"journal":{"name":"公司治理评论","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2018-07-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87694149","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Full paper is available at: https://ssrn.com/abstract=3193697 Most papers in the financial literature control for Type I errors (false positive rate), while ignoring Type II errors (false negative rate). This is a mistake, because a low Type I error can only be achieved at the cost of a high Type II error. In this presentation we derive analytical expressions for both, after correcting for Non-Normality, Sample Length and Multiple Testing.
{"title":"Type I and Type II Errors in Finance (Presentation Slides)","authors":"Marcos M. López de Prado","doi":"10.2139/ssrn.3201981","DOIUrl":"https://doi.org/10.2139/ssrn.3201981","url":null,"abstract":"Full paper is available at: https://ssrn.com/abstract=3193697 Most papers in the financial literature control for Type I errors (false positive rate), while ignoring Type II errors (false negative rate). This is a mistake, because a low Type I error can only be achieved at the cost of a high Type II error. In this presentation we derive analytical expressions for both, after correcting for Non-Normality, Sample Length and Multiple Testing.","PeriodicalId":57292,"journal":{"name":"公司治理评论","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2018-06-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"89648386","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Little is known about the family firm as an economic entity except for the very few family firms that are public. Our paper describes a wide range of governance and finance characteristics in the population of all private and public family firms with limited liability. We find that the family firm is the dominating organizational form in the economy, and that family firms behave and perform differently than other firms. We use proprietary data from Norway in 2000–2015 to describe main characteristics of family firms, which we define as firms where more than half the equity is owned by individuals related by blood or marriage. A firm is either an individual entity or a business group. Analyzing about 86,000 firms per year, we find that family firms account for 66% of all firms in the economy, 33% of employment, 22% of sales, and 13% of the assets. We find that family firms have very concentrated ownership regardless of firm size, and that most firms have owners from the controlling family, only. The family’s dominance at the shareholder meeting carries over to the CEO and to the board, which is unusually small. The distribution of firm size is lognormal, growth is independent of size, and family firms are smaller and grow less than nonfamily firms do. Family firms are more labor intensive, and small family firms are particularly liquid, risky, and young. The financing and dividend policy is quite similar in family firms and nonfamily firms. We find a performance premium for family firms. This premium exists for family firms vs. nonfamily firms as a whole, across firms with different size, across firms with and without minority owners, and across most industries.
{"title":"The Governance and Finance of Norwegian Family Firms: Main Characteristics of the Population","authors":"J. Bērziņš, Øyvind Bøhren, Bogdan Stacescu","doi":"10.2139/SSRN.3182411","DOIUrl":"https://doi.org/10.2139/SSRN.3182411","url":null,"abstract":"Little is known about the family firm as an economic entity except for the very few family firms that are public. Our paper describes a wide range of governance and finance characteristics in the population of all private and public family firms with limited liability. We find that the family firm is the dominating organizational form in the economy, and that family firms behave and perform differently than other firms. \u0000We use proprietary data from Norway in 2000–2015 to describe main characteristics of family firms, which we define as firms where more than half the equity is owned by individuals related by blood or marriage. A firm is either an individual entity or a business group. Analyzing about 86,000 firms per year, we find that family firms account for 66% of all firms in the economy, 33% of employment, 22% of sales, and 13% of the assets. \u0000We find that family firms have very concentrated ownership regardless of firm size, and that most firms have owners from the controlling family, only. The family’s dominance at the shareholder meeting carries over to the CEO and to the board, which is unusually small. \u0000The distribution of firm size is lognormal, growth is independent of size, and family firms are smaller and grow less than nonfamily firms do. Family firms are more labor intensive, and small family firms are particularly liquid, risky, and young. The financing and dividend policy is quite similar in family firms and nonfamily firms. \u0000We find a performance premium for family firms. This premium exists for family firms vs. nonfamily firms as a whole, across firms with different size, across firms with and without minority owners, and across most industries.","PeriodicalId":57292,"journal":{"name":"公司治理评论","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2018-06-07","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"75574462","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This study is a comprehensive analysis of the Australian private rental sector and its institutions. It explores the interplay between regulation; organisations and structures; and social norms and practices of prevailing policies. It also explores the impact of innovation and digital technology.
{"title":"Private Rental in Transition: Institutional Change, Technology and Innovation in Australia","authors":"K. Hulse, Chris Martin, Amity James, W. Stone","doi":"10.18408/AHURI-5112101","DOIUrl":"https://doi.org/10.18408/AHURI-5112101","url":null,"abstract":"This study is a comprehensive analysis of the Australian private rental sector and its institutions. It explores the interplay between regulation; organisations and structures; and social norms and practices of prevailing policies. It also explores the impact of innovation and digital technology.","PeriodicalId":57292,"journal":{"name":"公司治理评论","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2018-04-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"75158321","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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