scholarly journals Governance under the Gun: Spillover Effects of Hedge Fund Activism*

2018 ◽  
Vol 23 (6) ◽  
pp. 1031-1068 ◽  
Author(s):  
Nickolay Gantchev ◽  
Oleg R Gredil ◽  
Chotibhak Jotikasthira
Keyword(s):  
Hedge Fund ◽  
Spillover Effects ◽  
Threat Perception ◽  
Capital Expenditures ◽  
Return On Assets ◽  
Positive Effects ◽  
Asset Turnover ◽  
Hedge Fund Activism ◽  
And Performance ◽  
Industry Conditions

Abstract Hedge fund activism is associated with improvements in the governance and performance of targeted firms. In this article, we show that these positive effects of activism reach beyond the targets, as nontargeted peers make similar improvements under the threat of activism. Peers with higher threat perception, as measured by director connections to past targets, are more likely to increase leverage and payout, decrease capital expenditures and cash, and improve return on assets and asset turnover. As a result, their valuations improve, and their probability of being targeted declines. Our results are not explained by time-varying industry conditions or competition effects whereby improved targets force their product market rivals to become more competitive.

A Review of Hedge Fund Activism: Impact on Shareholders vs. Stakeholders

2021 ◽  
pp. 282-317
Author(s):  
Hadiye Aslan
Keyword(s):  
Hedge Funds ◽  
Hedge Fund ◽  
Spillover Effects ◽  
Empirical Literature ◽  
Target Firm ◽  
Market Strategy ◽  
Target Firms ◽  
Product Market Strategy ◽  
Hedge Fund Activism ◽  
Rival Firms

This chapter reviews the growing empirical literature on shareholder activism by hedge funds, summarizing the sources and nature of the activist data and examining the evidence on target firm outcomes. Target firms do not exist in a vacuum, however; they have industry competitors, suppliers, customers, debtholders, and employees. Hedge fund activists often demand a reformulation of the target firm’s product market strategy to enhance its ability to earn inframarginal profits. This positive strategic effect may be especially significant for target firms that are economically distressed and facing predatory moves from deep-pocketed rival firms to induce exit. The putative significant effects of hedge fund activism on targets should generate spillover effects on their stakeholders. The chapter considers these spillover effects in a number of well-defined categories: industry rivals, customers, suppliers, debtholders, and employees.

scholarly journals Assets Utilization and Performance of Manufacturing Firms in Nigeria

2019 ◽  
Vol 14 (4) ◽  
pp. 107 ◽  
Author(s):  
G. T. Akinleye ◽  
Adesina Olufemi Dadepo
Keyword(s):  
Annual Report ◽  
Secondary Data ◽  
Manufacturing Firms ◽  
Descriptive Statistics ◽  
Coefficient Of Determination ◽  
Regression Analyses ◽  
Return On Assets ◽  
Current Ratio ◽  
Asset Turnover ◽  
And Performance

This study examined the effect of assets utilization on performance of selected manufacturing firms in Nigeria. Secondary data were collected from the annual report and accounts of the ten selected quoted firms for a period of five years spanning from 2012 to 2016. Data collected were analyzed using descriptive statistics, correlation and regression analyses. The empirical results revealed that asset turnover(ATR) has positive and significant effect on return on assets (ROA) of the selected manufacturing firms as confirmed by the coefficient and probability value of 0.235999(p=0.0000). Current assets ratio also has positive and significant effect on return on assets with the coefficient of 0.109040 (p=0.0035) while debt assets ratio has negative but insignificant effect on return on assets. The overall coefficient of determination (R2)of 0.84951showed that about 85 % of the total variation in the ROA is explained by asset turnover (ATR), current ratio (CUR) and debt-assets ratio (DAR). The study concluded that assets utilization has positive and significant effect on the performance of manufacturing firms in Nigeria and therefore recommended that attention should be purposely paid to optimum asset utilization in the manufacturing firms in Nigeria.

Undesirable Effects of Goal Setting on Perceived Fairness, Commitment, and Unethical Behavior

2018 ◽  
Vol 62 (2) ◽  
pp. 97-107 ◽  
Author(s):  
Nina Keith
Keyword(s):  
Goal Setting ◽  
Unethical Behavior ◽  
The United States ◽  
Goal Commitment ◽  
Management Technique ◽  
Long Term Effects ◽  
Perceived Fairness ◽  
Negative Effects ◽  
Positive Effects ◽  
And Performance

Abstract. The positive effects of goal setting on motivation and performance are among the most established findings of industrial–organizational psychology. Accordingly, goal setting is a common management technique. Lately, however, potential negative effects of goal-setting, for example, on unethical behavior, are increasingly being discussed. This research replicates and extends a laboratory experiment conducted in the United States. In one of three goal conditions (do-your-best goals, consistently high goals, increasingly high goals), 101 participants worked on a search task in five rounds. Half of them (transparency yes/no) were informed at the outset about goal development. We did not find the expected effects on unethical behavior but medium-to-large effects on subjective variables: Perceived fairness of goals and goal commitment were least favorable in the increasing-goal condition, particularly in later goal rounds. Results indicate that when designing goal-setting interventions, organizations may consider potential undesirable long-term effects.

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