1,721,100 research outputs found
The firm's life-cycle and the dynamics of corporate governance: Overcoming governance 'thresholds'.
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Founder retention as CEO at IPO in emerging economies: the role of private equity owners and national institutions
Full text linkWe integrate the institutional perspective with research on the governance role of private equity firms in an investigation of Founder-CEO successions in Initial Public Offerings (IPOs) in emerging markets. Using a unique, hand-collected and comprehensive sample of 191 firms having undertaken IPOs in 21 markets across the African continent between January 2000 and August 2016, we apply instrumental variable (IV) Probit methodology and find that higher levels ofprivate equity ownership are positively associated with the probability of the founder's retention as CEO, especially in the context of low-quality formal institutions. Further, in societies with high tribalism, higher private equity ownership is associated with an increased likelihood of founder retention. Voids in the institutional architecture underscore the importance of the founder as akey organizational resource for the firm and a source of institutionalized legitimacy, which in turn confers on the firm an ability to access required resources
Dispersed ownership and asset pricing:An unpriced premium associated with free float
No full textWe explore differences in the levels of dispersed ownership that lead to a returns-based free float hedging factor in addition to size, which augments the capital asset pricing model (CAPM) in explaining the cross-section of stock returns. Using the S&P 1500 stocks in the US between 1985 and 2023, the results support the advantages of free float within a three-factor CAPM including size over alternative models based on liquidity, book-to-market value, and momentum. We argue that this yields a useful means for hedging effectively against the risks associated with the fundamental underlying likelihood of expropriation in a specific firm based on its ownership structure.</p
The corporate governance of digital transformation: the CEO’s digital orientation and board impact
No full textBuilding on the sociology-grounded perspective on capital markets we argue that in conditions of technological change, investor perceptions about firm value are enhanced by the CEO’s orientation towards digital technologies. This base relationship is moderated by the extent to which boards allow and support experimentation with, and implementation of, new technologies. To test our theory, we focus on the early phases of the so-called “digital transformation” (2003 to 2016). We test our hypotheses using a sample of S&P 500 companies and a unique, hand-collected, set of measures associated with digital technology orientation by the CEO, as well as board members’ digital expertise. We suggest that: (a) board monitoring power is not always positively perceived by investors as widely implied in the extant agency-grounded literature; and (b) effective board monitoring is associated with complementarities between digital expertise of independent directors and the knowledge requirements underpinning CEO’s strategic orientation
The cognitive base of educational background and its impact on entrepreneurial knowledge structures
No full textPrior research in entrepreneurship suggests that the type of educational background is conducive for different cognitive bases. However, very few studies have produced empirical support for this assumption, and existing research does not define what these cognitive differences refer to. With this study, we aim to address these theoretical and empirical gaps. In a sample of 575 university students wishing to attend an entrepreneurship education program, we found that the fields of academic specialization have an impact on students’ knowledge structures, operationalized as the way of organizing a set of non-technical concepts related to entrepreneurship. Students in humanities exhibit significant differences from their peers with backgrounds in engineering, hard and social sciences. At the same time, students outside the humanities show homogeneous cognitive patterns. Important implications related to entrepreneurship education and entrepreneurial cognition are discussed
Exporting Activity in Transitional Economies: An Enterprise-Level Study
No full textThis study represents the first enterprise level analysis of the determinants of exporting in transitional economies, and focuses on privatised manufacturing firms in Russia, Ukraine and Belarus. Employing models developed from the existing literature on enterprise-level trade, results derived from longitudinal data suggest that the most important influences on a firm's decision to export are company size and the non-monotonic, curvilinear influence of managerial ownership and control. Comparisons are made with studies of less developed countries.Enterprise-Level Analysis, Transitional Economies, Exports, Trade,
Impact of CEO’s Digital Technology Orientation and Board Characteristics on Firm Value: A Signaling Perspective
Full text linkIntegrating signaling research with the institutional perspective on capital markets we argue that, in conditions of radical technological change, investor perceptions about firm value are enhanced by the CEO’s orientation towards digital technologies that exceeds the firm’s industry peers. This base relationship is moderated by board characteristics, so that the board members’ digital expertise and knowledge diversity enhance the effect of the CEO’s relative digital technology orientation on firm value. Furthermore, the monitoring power of independent board members that do not have digital expertise negatively moderates our baseline hypothesis, whereas board monitoring exerted by independent board members with digital expertise has a positive moderating effect. To test our theory, we use advanced Natural Language Processing techniques to develop the CEO’s relative digital technology orientation construct combined with a unique, hand-collected, set of measures associated with board members’ digital expertise and knowledge diversity in a sample of S&P 500 companies. Our paper offers novel insights on how technology-related signals associated with the CEO’s communications to shareholders interact with board characteristics in determining investor perceptions of the firm’s value in conditions of high technological uncertainty
(De)centralized governance and the value of platform-based new ventures: The moderating role of teams and transparency
Full text linkDrawing on institutional and demand-side perspectives, we investigate performance implications of (de)centralized governance modes in platform-based new ventures, and the conditions under which (de)centralization generates more value. Using a sample of 1,431 Initial Coin Offerings (ICOs), a new source of entrepreneurial finance, we find that centralization of decision-making is positively associated with platforms’ market value. Further, we consider how platform characteristics affect this relationship, finding that both the presence of an experienced Chief Technology Officer (CTO) and project transparency negatively moderate the positive relationship between centralization and market value. Thus, decentralized platforms need leaders with technical experience and project transparency to generate more value. Overall, this study provides a better understanding of the boundary conditions that increase the value of (de)centralized governance
Corporate Governance in IPOs
Full text linkIt is increasingly recognized in the management literature that the initial public off ering
(IPO) is an important stage in the life cycle of privately held and entrepreneurial fi rms.
At this critical juncture, a fi rm has overcome the fi rst challenges of its entrepreneurial
phase and entered a growth stage. As Fama and French ( 2004 : 229) emphasize, an IPO
“is the point of entry that gives fi rms expanded access to equity capital, allowing them to
emerge and grow.” An IPO can provide an entrepreneurial fi rm with critical resources
for its future expansion. It can also provide the entrepreneur with the fi rst substantive
access to cash from their investment of time and resources in the entrepreneurial eff ort.
Despite the growing awareness of the importance of IPOs among both academics and
the investor community, the process by which a privately held fi rm transforms itself into
a publicly traded company is still not well understood. While numerous studies have
investigated the determinants of the going public decision (e.g. Booth and Smith, 1986 ;
Jain and Kini, 1999 ) and post-issue performance (e.g. Beatty and Ritter, 1986 ; Brav,
Geczy, and Gompers, 2000 ; Espenlaub and Tonks, 1998 ; Michaely and Shaw, 1994 ), there
is relatively little research on the related but equally important issue of what factors
infl uence the corporate governance mechanism of a fi rm at IPO stage, and how the specifi
c characteristics of this mechanism such as board composition, executive incentives,
and ownership interests of private equity investors may aff ect the IPO’s performance
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