BI Open (Norwegian Business School)
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Geopolitical volatility and subsidiary investments
Get PDFResearch Summary We examine how geopolitical volatility—the instability of bilateral political affinity between countries—affects foreign subsidiary investments. Building on prior work that shows that the level of political affinity between countries facilitates foreign investments, we argue that the volatility of political affinity impedes firms' ability to form expectations about stakeholder behavior and reduces subsequent investments in subsidiaries. We further argue that the effect of volatility of political affinity on foreign subsidiary investments is less pronounced when the level of political affinity between countries is high and when the firm has strong political connections at home. Our analyses examine 1054 US firms and their subsidiary investments in 106 countries from 2000 to 2015. Managerial Summary Geopolitical risk has emerged as an important factor in foreign investment decisions in recent years. The rise of geopolitical tensions worldwide and the fragmentation of relationships between countries have introduced new dimensions to foreign investment risks. We study the propensity for sudden and unpredictable shifts in the political relationship between countries—that is, volatility of political affinity in their bilateral political relations—and its effect on firms' foreign subsidiary investments. We show that volatility of political affinity negatively affects the number of subsidiaries, employees, and local sales in the host country because when bilateral relations change suddenly, it is more difficult for multinational firms to predict how stakeholder behavior will impact the performance of their investments.publishedVersio
Standardization cycles in sustainability reporting within the Global Reporting Initiative
Get PDFTo analyze whether Global Reporting Initiative (GRI) standards could reduce transparency in sustainability reporting, we performed a longitudinal content analysis of sustainability reports for 15 large Norwegian organizations from 2010 to 2020 (inclusive). The content of reports increased by 90%, in contrast to an increase of only 18% in transparency. The content of GRI standards increased by more than 500%. For further examination, we develop a system dynamics model using a multilevel perspective including the standardization organizations, the organizations writing sustainability reports, and their audiences. Our model demonstrates how multilevel interactions may produce unintended results. More standards could impede transparent reporting for organizations, which in turn hinders stakeholders in making fair judgments about the sustainability of organizations. This condition then may trigger a new cycle in which standardization organizations define even more standards. We conclude that for sustainability reporting standards, less is more. Our findings have implications for both researchers and practitioners.publishedVersio
The Rise of Private Labels: Exploring Price Dynamics and Market Strategies in Norwegian Low- Price Grocery Stores
Get PDFMasteroppgave(MSc) in Master of Science in Strategic Marketing Management - Handelshøyskolen BI, 2024In our comprehensive study, we explore the pricing strategies of three major low-price grocery retailers in Norway, specifically focusing on their use of economy and standard private labels. Conducted from week 40 of 2023 to week 21 of 2024, our research involved detailed weekly price monitoring, thorough analysis of store flyers from Q1 2024, and in-depth interviews with representatives from two grocery retailers and four suppliers. Our aim was to understand the nuances of long-term price trends, the frequency and magnitude of short-term price adjustments, the role of store flyer promotions and the strategic application of price matching within this competitive landscape.
Our findings reveal that economy private labels are more frequently adjusted in price, significantly influencing the retailers' pricing image compared to national brands. Though not significant, we also observed that while national brands tend to undergo larger price adjustments, standard private labels experience substantial fluctuations themselves, often as part of targeted promotional efforts. Interestingly, standard private labels are prominently featured in store flyers, highlighting their strategic importance, whereas national brands tend to dominate front-page placements.
The study also delved into price matching practices across different brand tiers, finding minimal variation and yielding inconclusive results. Insights from interviews support the quantitative data, suggesting a strategic emphasis on price matching for economy private labels and national brands over standard private labels. Although our research did not fully support our hypothesis regarding long-term price development due to lack of significance in the quantitative analysis and qualitative inconsistencies, we still managed to provide significant insights in terms of store flyer promotions and price adjustment frequency, as well as useful insights from industry professionals
Speaking Up in the Cancel Culture Era
Get PDFMasteroppgave(MSc) in Master of Science in Digital Communication Management, Handelshøyskolen BI, 2024In an era where social media serves as a powerful platform for public discourse, cancel culture has emerged as a significant force. This thesis investigates the impact of cancel culture on corporate communication, employee identity alignment, stakeholder engagement, and brand perception, focusing on the nuanced dynamics within corporate social advocacy. This research explores: To what extent does cancel culture affect organisational communication and decision-making processes, and how do companies navigate the fine line between socially responsible corporate communication and the fear of stakeholder alienation?
Through qualitative analysis, involving 16 semi-structured interviews with key personnel from a big media company in Norway, this thesis reveals that genuine and transparent corporate social advocacy efforts are crucial in building trust and loyalty among stakeholders. Companies must strategically align their corporate social advocacy initiatives with core values and stakeholder expectations, ensuring that advocacy for social issues is perceived as authentic and sincere. The findings underscore the importance of proactive communication strategies and the need for clear, honest, consistent messaging. Transparent internal and external communication is vital in managing stakeholder perceptions and fostering longterm relationships. Internal communication fosters employee alignment with corporate social advocacy goals, while external communication enhances stakeholder trust and engagement. This research contributes to theoretical frameworks on cancel culture, corporate social advocacy, identity theory, brand equity, brand loyalty, and stakeholder theory, providing practical insights for organisations navigating the complexities of cancel culture.
In summary, this thesis emphasises the importance of strategic communication and stakeholder engagement in managing cancel culture challenges, promoting a corporate social advocacy approach that supports organisational values and stakeholder expectations to maintain brand equity and loyalty.
Keywords: Cancel Culture, Boycott, Corporate Social Advocacy (CSA), Social issues, Stakeholder Theory, Identity Theory, Brand Loyalty, Brand Equity, Transparent Communication, Communication strategies, Internal Communication, External Communicatio
Analyzing the Ripple Effects - Unraveling the Effects of the Silicon Valley Bank Failure on the US Bank Stock, Corporate Bond, and Loan Market
Get PDFMasteroppgave(MSc) in Master of Science in Finance - Handelshøyskolen BI, 2024Understanding the severe impact of bank failures on market dynamics is crucial in developing tools to improve overall market stability. Therefore, we examine the impact of the Silicon Valley Bank’s (SVB) failure on different US financial markets. We add to existing literature by quantifying the SVB collapse’s impact on the US bank stock, corporate bond and loan market. Utilizing an event study approach and regression analysis, we find significant negative reactions in the US bank stock and loan market. Surprisingly, the US corporate bond market initially showed positive abnormal returns but reversed to negative returns within three months. The corporate bond market reaction varied by industry and remaining time to maturity. Our findings indicate that banking sector turmoil caused by the SVB failure spilled over to the lending markets, increasing funding costs for firms. Additionally, we conclude that the financial system in the US remains vulnerable to sudden shocks as emergency measures were necessary to prevent further contagion of the crisis to other banks and the broader economy. This highlights the need for further regulatory improvements and contingencies
En strategisk analyse av Lerøy Seafood Group ASA og hvordan lakselus utgjør en trussel for oppdrettsnæringen
Get PDFBacheloroppgave i Økonomi og administrasjon fra Handelshøyskolen BI, 2024I denne oppgaven tar vi for oss hvordan Lerøy Seafood Group ASA kan håndtere utfordringene med lakselus for å opprettholde og styrke sin ledende posisjon i oppdrettsnæringen. Ved å analysere ulike strategiske tiltak, søker oppgaven å finne de mest effektive metodene for å bekjempe lakselus og sikre bærekraftig vekst for fremtiden . Vi har i prosessen utarbeidet følgende problemstilling.
«Hvordan kan Lerøy Seafood Group ASA effektivt håndtere utfordringene med
lakselus for å opprettholde og styrke sin ledende posisjon i oppdrettsnæringen gjennom strategiske tiltak?»
Problemstillingen vår skal belyses gjennom kvalitative metoder ved å ta i bruk primær og sekundærdata. Relevant faglitteratur har også blitt brukt i stor grad under utarbeidelsen av oppgaven. Vi har også gjennomført dybdeintervjuer med sentrale personer i selskapet, samt supplert med intervju av en ekstern aktør.
Vi har gjennom diverse analyser og datainnsamling kunne konkludere med at lakselus utgjør en betydelig risiko for oppdrettsnæringen. Høyt lusetrykk øker dødeligheten blant laksen betydelig . Dette gjør at bransjen er avhengig av å finne løsninger for å kunne imøtekomme de utfordringene næringen møter på i dag . Oppgaven vår vil belyse at det finnes flere ulike metoder å løse lakselusproblemet på. Lerøys tilnærming til problemet gjennom å investere tungt i anleggenes infrastruktur ansees som en god løsning. Vi velger også å konkludere med at bransjen med fordel vil
kunne oppnå gode resultater gjennom å ta i bruk nye teknologiske nyvinninger som tilbys i markedet. Lerøy og næringen går glipp av betydelige summer grunnet biologiske utfordringer , og vi vil derfor gjennom oppgaven forsøke å finne løsninger
som kan redusere disse faktorene betydelig
Investigating the Role of Reddit in Cryptocurrency Price Fluctuations
Get PDFMasteroppgave(MSc) in Master of Science in Business Analytics, Handelshøyskolen BI, 2024In recent years, the exponential growth in the value of cryptocurrencies like Bitcoin and Ethereum has attracted many investors. Unlike traditional currencies, cryptocurrencies do not have a central issuing or regulating authority; instead, they use a decentralized system to record transactions and issue new units. This leads to their prices being influenced by many factors, including their popularity on social media platforms. Consequently, sentiment extracted from these platforms can potentially act as an indicator of changes in cryptocurrency prices and help in their prediction. This thesis focuses on discussions on Reddit, a popular social media site,
and aims to answer the research question: “Can sentiment features extracted from Reddit discussions help predict the volatile price movements of cryptocurrencies?” To address this question, discussions about Bitcoin and Ethereum on
Reddit were extracted and analyzed using two sentiment analyzers: VADER and CryptoBERT. The sentiment and textual features extracted from these
discussions were used to create time series data, which were then utilized for forecasting cryptocurrency prices. Both statistical models, such as Vector Autoregression (VAR), and advanced machine learning models, such as Long Short-Term Memory (LSTM) networks, were employed for the prediction task. The findings of this study illustrate that the inclusion of sentiment features only from Reddit discussions does not significantly help in the prediction of cryptocurrency prices. This outcome suggests that while discussions on Reddit reflect varied public opinions, they do not provide sufficient information for predicting the price movements of cryptocurrencies. This could be attributed to cryptocurrency prices being influenced by many factors, which may not be adequately represented by sentiment data alone. Moreover, the inherent volatility of cryptocurrency prices further adds to the complexity of the task. These fluctuations in prices can often overshadow the sentiment trends extracted from social media platforms
Occupational Prestige and Occupational Social Value in the United Kingdom: New Indices for the Modern British Economy
Get PDFSociological research has long been interested in occupational evaluation. However, occupational research remains hampered by conceptual ambiguity and methodological problems. To address these issues, we present new indices of occupational prestige and occupational social value for 576 occupation titles aligned with the ILO International Standard Classification of Occupations (ISCO-08). A shorter core list with 130 occupation titles – one per ISCO-08 minor group – is also provided. Based on comprehensive and recent evidence from 2429 respondents, we carve out the evaluative landscape of occupations in the United Kingdom. We show how occupational prestige and occupational social value are correlated but distinct. A clear hierarchy appears, with highly educated occupations at the top and stigmatised or illicit occupations at the bottom. The study thus contributes to social stratification research and encourages reuse of the scores in future occupational research.Sociological research has long been interested in occupational evaluation. However, occupational research remains hampered by conceptual ambiguity and methodological problems. To address these issues, we present new indices of occupational prestige and occupational social value for 576 occupation titles aligned with the ILO International Standard Classification of Occupations (ISCO-08). A shorter core list with 130 occupation titles – one per ISCO-08 minor group – is also provided. Based on comprehensive and recent evidence from 2429 respondents, we carve out the evaluative landscape of occupations in the United Kingdom. We show how occupational prestige and occupational social value are correlated but distinct. A clear hierarchy appears, with highly educated occupations at the top and stigmatised or illicit occupations at the bottom. The study thus contributes to social stratification research and encourages reuse of the scores in future occupational research.Occupational Prestige and Occupational Social Value in the United Kingdom: New Indices for the Modern British EconomypublishedVersio
Green Grades and Financial Shades: The ESG Influence on Default Risk
Get PDFMasteroppgave(MSc) in Master of Science in Finance - Handelshøyskolen BI, 2024This paper investigates the relationship between ESG scores and Default Probability (DP) for European firms in the STOXX Europe 600 index. We model this relationship using the Altman Z-Score and Ohlson O-Score as proxies for DP in regression analysis, while controlling for leverage, volatility, and size. The findings of this study show that higher ESG scores are associated with a higher DP for the Altman Z-Score, but with a lower DP when using the Ohlson O-Score. This discordant outcome highlights the sensitivity of results to the choice of DP proxy. The conclusion is that, even though the ESG factors can influence financial stability, their effect on default risk is minimal; hence, ESG is not the primary driver of default risk.
Keywords: ESG Scores, Probability of Default, Altman Z-Score, Ohlson O-Score, Financial Stability, Environmental Performance, Social Responsibility, Corporate Governance, STOXX Europe 600, Sustainable Finance, Risk Management, Fixed Effects Model, Random Effects Model, Default Risk, Credit Risk
Verdsettelse av råvareleverandøren Prima Vestfold AS
Get PDFBacheloroppgave i Økonomi og administrasjon fra Handelshøyskolen BI, 2024Denne bacheloroppgaven tar for seg verdsettelsen av råvareleverandøren Prima Vestfold AS, et selskap som opererer innen både Horeca-markedet og privatmarkedet. Formålet har vært å fastsette en realistisk verdi for selskapet basert på grundige analyser av både interne og eksterne faktorer.
Problemstillingen vi har
valgt for oppgaven er er: Hva er den nåværende verdien av
Prima Vestfold AS i dagens skiftende matmarked?
For å besvare problemstillingen har vi gjennomført flere strategiske analyser, inkludert VRIO, PESTEL, konkurrentanalyse og Porters Five Forces. Selskapets styrker, svakheter, utfordringer og muligheter oppsummeres i et SWOT-rammeverk. Prima Vestfold har sterke konkurransefortrinn som god produktkunnskap, et godt nettverk og et bredt sortiment som skaper verdi for kundene. Imidlertid møter selskapet utfordringer som begrenset distribusjonskapasitet, konkurranse fra andre leverandører og endringer i forbrukerpreferanser. Videre analyserte vi regnskapstall og nøkkeltall, hvor vi identifiserte solid omsetningsvekst og god kostnadskontroll.
For å fastsette en verdi benyttet vi fundamentale metoder, inkludert neddiskontert kontantstrøm (DCF-modellen), med beregnet avkastningskrav gjennom kapitalverdimodellen. Videre benyttet vi komparativ metode gjennom multiplene P/E, P/B, P/S og EV/EBITDA.
DCF-analysen indikerte en sannsynlig verdi på mellom 12 og 21 millioner kroner, ofte mellom 15 og 18 millioner, mens de komparative metodene bekreftet at dette var en realistisk vurdering.
På bakgrunn av disse omfattende analysene konkluderer oppgaven med at en verdivurdering mellom 15 og 18 millioner kroner for Prima Vestfold er et realistisk estimat, med en mulig verdi mellom 12 og 21 millioner kroner. Vår konkrete beregning lander på en verdi på 16 475 000 kroner