Business Commons^™

What Drives Firms To Diversity?, Rong Guo

Finance Dissertations

WHAT DRIVES FIRMS TO DIVERSITY? By RONG GUO Committee Chair: Dr. Omesh Kini Major Department: Finance This paper examines whether corporate governance structures, serving as proxies for agency costs, can explain firms’ decision to diversify. Specifically, it has been hypothesized that firms with worse corporate governance structures are more likely to diversify. The extant literature usually compares the governance characteristics of multi-segment firms to those of single segment firms to address this issue. However, different governance characteristics may simply reflect differences in firm characteristics of diversified firms and focused firms. Furthermore, industry factors may affect both the propensity of firms …

Dolorous Songs And Blessing Of The Curses: Corporate Governance In Australia, Jane Andrew, K. Cooper, K. Islam

Faculty of Commerce - Papers (Archive)

The spate of corporate collapses that have plagues the business community in the last few years has had both positive and negative impacts. These have implicated accounting in the scandals and the commonality in the nature of collapses has bought in a number of blessings by triggering global consciousness and consensus to root out the problems. We argue that regulatory changes, the emergence of corporate governance codes, mandatory compliance with accounting standards for greater transparency and the emergence of a new accounting order would not have been possible without such spectacular failures.

The Interaction Among Multiple Governance Mechanisms At Young, Newly Public Firms, Tammy K. Berry, L. Paige Fields, Michael S. Wilkins

School of Business Faculty Research

We focus on the relations among inside ownership, board composition, unaffiliated block ownership, and compensation structure for a sample of firms following their IPOs. Specifically, we follow firms for up to eleven years after their IPOs and examine the full sample and subsamples of firms that survive, are acquired, or that file for bankruptcy during the sample period. We find that as CEO ownership declines, board independence, board seats held by venture capitalists, and unaffiliated block ownership increase. Our findings suggest that as inside ownership decreases alternative governance mechanisms evolve to help mitigate the resulting increase in agency costs. Interestingly, …

Strategic Investments In Japanese Corporations: Do Foreign Portfolio Owners Foster Underinvestment Or Appropriate Investment?, Parthiban David, Toru Yoshikawa, Murali D. R. Chari, Abdul A. Rasheed

Research Collection Lee Kong Chian School Of Business

This paper investigates the effect of foreign ownership on strategic investments in Japanese corporations. Foreign owners are typically portfolio investors who frequently buy and sell shares and hold diversified portfolios of small stakes in many firms. Prior research has presented two conflicting perspectives on the role of such investors: (a) their frequent trading leads to pressure for short-term returns that fosters underinvestment; (b) their active trading fosters appropriate investments. We investigated the relationship between foreign ownership and strategic investments using dynamic panel data analysis of a sample of 146 Japanese manufacturing firms from 1991 to 1997. We found that foreign …

Knowledge Creation: Revisiting The 'Ba' Humbug: People And 'Latent' Knowledge In Organizational Learning, Donald Nordberg

Donald Nordberg

This paper is a draft of an article that appeared in the Icfai Journal of Knowledge Management in 2007. Knowledge management theory has struggled with the concept of knowledge creation. Since the seminal article of Nonaka in 1991, an industry has grown up seeking to capture the knowledge in the heads and hearts of individuals so as to leverage them for organizational learning and growth. But the SECI process of socialization, externalization, combination and internalization outlined by Nonaka and his colleagues has dealt essentially with knowledge transfer rather than creation. This paper looks at attempts to fill the gap in …

The Impact Of Enterprise Risk Management On The Internal Audit Function, Mark S. Beasley, Richard Clune, Dana Hermanson

Faculty and Research Publications

This exploratory study provides evidence about factors associated with the overall impact of enterprise risk management (ERM) on the internal audit function’s activities. Based on responses from 122 organizations in several countries, we find that ERM has the greatest impact on internal audit’s activities when (a) the organization’s ERM process is more completely in place, (b) the CFO and audit committee have called for greater internal audit activity related to ERM, (c) the chief audit executive’s (CAE) tenure is longer, (d) the organization is in the banking industry or is an educational institution, and (e) the internal audit function has …

Government Ownership And The Performance Of Government-Linked Companies: The Case Of Singapore, James Ang, David K. Ding

Research Collection Lee Kong Chian School Of Business

In an emerging economy, the alternative to government control is often no governance. We investigate the governance structure of government-linked companies (GLCs) in Singapore under the ownership/control structure of Temasek Holdings, the government holding entity, which typically owns substantial cash flow rights but disproportional control rights and exercises no operational control. We compare the financial and market performance of GLCs with non-GLCs, where each has a different set of governance structure, the key difference being government ownership. We show that Singaporean GLCs have higher valuations and better corporate governance than a control group of non-GLCs. The results hold even when …

An Investigation Of The Impact Of The Pace Of Change In Post -Ipo Corporate Governance On Firm Performance, Son A. Le

Doctoral Dissertations

In this study, I examine the impact of changes in post-IPO corporate governance on firm performance. Changes in corporate governance affect firm performance in various ways. Some theories such as agency and resource dependence theories predict that fast-paced change in post-IPO corporate governance will enhance firm performance. Other theories such as the resource-based view offer the opposite prediction that slowpaced change is more beneficial for firm performance. I, therefore, develop competing hypotheses regarding the impact of change in post-IPO corporate governance on firm performance.

IPO firms have unique characteristics. They are often small, young firms. As a matter of fact, …

Good Faith, State Of Mind, And The Outer Boundaries Of Director Liability In Corporate Law, Christopher M. Bruner

Scholarly Works

The Delaware General Corporation Law was amended in 1986 to permit shareholder-approved exculpatory charter provisions shielding corporate directors from monetary liability for certain fiduciary duty breaches not including (among other things) breaches of the duty of loyalty and acts not in good faith. This article examines the development of corporate fiduciary duty doctrine in Delaware leading up to and following this statutory amendment, focusing particularly on the Delaware courts' evolving conception of the meaning anddoctrinal status of the good faith concept employed in recent cases to permit a non-exculpable cause ofaction for conscious nonfeasance.

The article argues that Delaware's good …

From Vision To Variables: A Scorecard To Continue The Professionalization Of A Family Firm, Ken Moores, Justin Craig

Justin B. Craig

This chapter builds on previous projects we have conducted that have concentrated on the key areas of corporate governance and strategic planning in family business. Whereas our previous projects have enlisted an additive approach (that saw the family perspective added to the business), this current research takes on an integrated approach and seeks to integrate issues that influence the family and business systems. Specifically, in this research we use innovation action research (Kaplan, 1998) to illustrate how the Balanced Scorecard that includes reference to family business challenges has been introduced and used to assist family members, board members and management …