scholarly journals Do family firms pay less for external funding?

2021 ◽  
pp. 031289622110182
Author(s):  
Muhammad Jahangir Ali ◽  
Seema Miglani ◽  
Man Dang ◽  
Premkanth Puwanenthiren ◽  
Mazur Mieszko
Keyword(s):  
Family Involvement ◽  
Family Firms ◽  
Jel Classification ◽  
Family Control ◽  
Listed Firms ◽  
Family Enterprises ◽  
The Cost ◽  
And Control ◽  
The Impact

We examine the impact of family control on the cost of raising external funds by family enterprises. Using a sample of Australian publicly listed firms, we find a significantly negative relation between cost of newly raised capital and family control. Moreover, we show that this relationship varies with the quality of corporate governance and the quality of firm’s information environment. Furthermore, we conduct several robustness checks and consistently find that our main results remain unchanged. Overall, our evidence suggests that family firms have easier access to external financing fostered by family involvement in the ownership and control. JEL Classification: G31; G32; M41; M42

CEO pay and family firm heterogeneity: A behavioral agency model perspective

2021 ◽  
pp. 234094442110517
Author(s):  
Carlos Fernández Méndez ◽  
Rubén Arrondo García ◽  
Shams Pathan
Keyword(s):  
Family Firms ◽  
Firm Heterogeneity ◽  
Jel Classification ◽  
Agency Model ◽  
Family Control ◽  
Listed Firms ◽  
Top Executives ◽  
Pay Disparity ◽  
Ceo Pay ◽  
Behavioral Agency

We study the effects of family control on CEO pay from the perspective of behavioral agency model (BAM), with particular focus on family firm’s generational stage and CEO family ties. Using a panel of Australian listed firms, we find that family firms present lower total and variable CEO pay, showing also less pay disparity between the CEO and other top executives. We also find that multi-generational family firms and those run by non-family CEOs offer higher total and variable CEO pay and present high pay disparity. The BAM and family’s aversion to socioemotional wealth loss can explain the effects of family control based on the pursuing of non-financial family goals. The decline of these goals derived from the aging of the firm and the hiring of external CEOs shape family control and should be considered in the design of executive compensation policies and by external parties when assessing their suitability. JEL CLASSIFICATION: G30; G32; G34; G38

The Impact of Family Involvement on the R&D Intensity of Publicly Traded Firms

2011 ◽  
Vol 24 (1) ◽  
pp. 62-70 ◽  
Author(s):  
Fernando Muñoz-Bullón ◽  
Maria J. Sanchez-Bueno
Keyword(s):  
Family Involvement ◽  
Risk Taking ◽  
Time Horizon ◽  
Family Firms ◽  
Publicly Traded ◽  
Time Period ◽  
Resource Endowment ◽  
Negative Effect ◽  
And Control ◽  
The Impact

This study examines the impact of family involvement in ownership and control on firms’ R&D intensity, relying on panel data on publicly held firms in Canada over the 2004 to 2009 time period. The literature on the link between family firms and R&D is unclear: although some characteristics may promote R&D intensity in family firms, others factors may have a negative effect. Thus, the authors propose a theoretical framework whereby differences in R&D intensity between family and nonfamily firms are explained based on key conditions, including time horizon, agency costs, resource endowment, or risk-taking behavior. The findings of this study show that publicly traded family firms in Canada record lower R&D intensity compared with nonfamily firms and, therefore, support one side of the previous literature over the other.

The Impact of Vote Differentiation on Investment Performance in Listed Family Firms

2010 ◽  
Vol 23 (4) ◽  
pp. 327-340 ◽  
Author(s):  
Per-Olof Bjuggren ◽  
Johanna Palmberg
Keyword(s):  
Empirical Analysis ◽  
Family Firms ◽  
Positive Impact ◽  
Performance Measure ◽  
Investment Performance ◽  
Family Control ◽  
And Control ◽  
The Impact ◽  
Marginal Q ◽  
The Empirical Analysis

This article investigates the effects of separation of ownership and control because of vote differentiation on listed family firms’ investment performance. The authors study the question of whether family-controlled firms have better investment performance than nonfamily firms and whether this investment performance is negatively affected by a separation of ownership and control because of vote differentiation. Marginal q is used as a performance measure. The empirical analysis shows that family control has a positive impact on investment performance when ownership and control are aligned, whereas separation of ownership and control in terms of vote-differentiated shares reduce investment performance.

scholarly journals Impact of financial crisis and family control on earning management of Portuguese listed firms

2017 ◽  
Vol 6 (2) ◽  
Author(s):  
Inês Lisboa
Keyword(s):  
Financial Crisis ◽  
Earnings Management ◽  
Family Firms ◽  
Management Strategies ◽  
Negative Relationship ◽  
Earning Management ◽  
Family Control ◽  
Listed Firms ◽  
The Family ◽  
The Impact

Accounting information is used to evaluate the firm's financial performance. Although, firms may have incentives to engage in earnings management, misleading all stakeholders. This study aims to analyse earnings management behaviours of Portuguese listed firms. Both accrual-based and real activities of earnings management are analysed to draw an overall picture of earnings management’ strategies. Most studies focused only in discretionary accruals as a proxy for earnings management, since cash flow-based earnings management is more difficult to detect. Although both strategies can be complementary instead of substituting. Moreover, the impact of financial crisis, family control, and firm characteristics is taken into account. Previous literature found that 2008 crisis had impact on earnings management as firms want to meet debt covenants and investors’ expectations. Moreover, family firms also impact the magnitude of earnings management. While some researchers found a negative relationship since managers are highly controlled, others found the opposite relationship because the family may want to maximize their own wealth. Analysing 51 listed firms, from 2003 till 2015, results show that firms engage more in earnings management during crisis, when the firm's financial situation is less stable. In addition, accrual-based earnings management is higher in family firms than in non-family ones, suggesting less quality of information in the first group. Due to less control of family firms, the family may expropriate minority investors’ wealth to increase personal benefits. Finally, the impact of firms’ characteristics on earnings management depends on the proxy of earning management analysed, suggesting that firms use accrual or real-activities earnings management depending on its purposes.

The effect of family control on audit fees during financial crisis

2020 ◽  
Vol 35 (5) ◽  
pp. 645-665
Author(s):  
Jihad Al-Okaily
Keyword(s):  
Family Involvement ◽  
Fixed Effects ◽  
Family Firms ◽  
Audit Fees ◽  
Fixed Effect Model ◽  
Policy Implications ◽  
Content Type ◽  
Family Control ◽  
Effect Model ◽  
The Impact

Purpose The purpose of this study is to empirically examine the effect of family involvement in ownership, management and directorship on audit fees during the crisis and non-crisis periods. Design/methodology/approach Following Anderson and Reeb (2003), this paper uses a two-way fixed effect model to examine the impact of family control on audit fees in crisis and non-crisis periods. The fixed effects include dummy variables for each year and each industry code in the sample. Findings This paper finds that during normal economic periods, family firms pay lower audit fees relative to non-family firms because of the incentive alignment or monitoring effect. While, during crisis periods, family firms pay higher audit fees because of the shareholder expropriation effect. Research limitations/implications The results reported in this paper have both practical and policy implications for the demand and supply of audit services to firms having different ownership structures. Originality/value This is the first study of its kind to examine the effect of family ownership and involvement on audit fees during the crisis period.

Kebijakan Utang Jangka Panjang : Kajian Struktur Modal Entitas Terbuka Non Keuangan di Indonesia Yang Dikendalikan Keluarga

2010 ◽  
Vol 2 (1) ◽  
pp. 70-90
Author(s):  
Sugiarto Sugiarto
Keyword(s):  
Human Capital ◽  
Capital Structure ◽  
Financial Distress ◽  
Family Firms ◽  
Debt Maturity ◽  
Family Control ◽  
Listed Firms ◽  
Specific Human Capital ◽  
Capital At Risk ◽  
The Impact

Compared to non-family controlled firms, family controlled firms  have a stronger desire to maintain control to protect their highly valuable private benefits of control and firm-specific human capital. With substantial wealth and human capital at risk, family owners tend to be more risk averse than non-family owners, and also have stronger intention to reduce the prospect of financial distress and bankruptcy. These unique characteristics of family firms potentially make their capital structure decisions different from those of non-family firms. Panel data from 137 publicly listed firms in Indonesia from 1996 to 2005 were used to investigate the impact of family control on capital structure, particularly on debt maturity decisions. Keywords: Family controlled firms, capital structure decisions, debt maturity

scholarly journals The impact of ownership structure on firm performance: The role of chairman and CEO in Portugal

2017 ◽  
Vol 13 (2) ◽  
pp. 6-19 ◽  
Author(s):  
Lious Agbor Tabot Ntoung ◽  
Jorge Eduardo Vila Biglieri ◽  
Helena Maria Santos de Oliveira ◽  
Benjamim Manuel Ferreira de Sousa ◽  
Ben C. Outman ◽  
...  
Keyword(s):  
Ownership Structure ◽  
Family Firms ◽  
Corporate Performance ◽  
Active Management ◽  
Set Covering ◽  
Data Set ◽  
Family Control ◽  
Listed Firms ◽  
The Family ◽  
The Impact

This analysis investigates how family ownership structure affects the corporate performance of Portuguese listed firms using a panel data set covering the period from 2006 to 2014. Three characteristics of family firms (such as active management, active founder or heir and second blockholder) were examined with respect to the corporate performance. The main finding is that family firms over perform non-family in term productivity and profitability. This indicates that companies that have total family control are more productive and profitable than those market favour firms that the family does not have total ownership. Specifically, family firms with active founders perform better whereas those with active heirs significantly outperform compared to family firms with passive owners or heirs. Family firms with a family member in the company as either CEO or Chairman create more value and are more profitable than non-family firms. Family firms with descendant as CEO perform better meanwhile family firms with the founder as CEO significantly outperform family firms with Outside CEO for corporate performance. Lastly, the presence of a second blockholder who owns between 5-10% of the voting right enhances the corporate performance of the family firms as it counterbalances the controlling shareholder from unnecessary behaviours.

Return on Invesment (ROI) of Software Product: A Systematic Literature Review

2015 ◽  
Vol 6 (1) ◽  
pp. 50-57
Author(s):  
Rizqa Raaiqa Bintana ◽  
Putri Aisyiyah Rakhma Devi ◽  
Umi Laili Yuhana
Keyword(s):  
Return On Investment ◽  
Assessment Criteria ◽  
Software Product ◽  
And Performance ◽  
Rational Consideration ◽  
Actual Return ◽  
The Cost ◽  
Investment Models ◽  
The Impact

The quality of the software can be measured by its return on investment. Factors which may affect the return on investment (ROI) is the tangible factors (such as the cost) dan intangible factors (such as the impact of software to the users or stakeholder). The factor of the software itself are assessed through reviewing, testing, process audit, and performance of software. This paper discusses the consideration of return on investment (ROI) assessment criteria derived from the software and its users. These criteria indicate that the approach may support a rational consideration of all relevant criteria when evaluating software, and shows examples of actual return on investment models. Conducted an analysis of the assessment criteria that affect the return on investment if these criteria have a disproportionate effort that resulted in a return on investment of a software decreased. Index Terms - Assessment criteria, Quality assurance, Return on Investment, Software product

scholarly journals Are Multi-Language Design Smells Fault-Prone? An Empirical Study

2021 ◽  
Vol 30 (3) ◽  
pp. 1-56
Author(s):  
Mouna Abidi ◽  
Md Saidur Rahman ◽  
Moses Openja ◽  
Foutse Khomh
Keyword(s):  
Programming Languages ◽  
Language Design ◽  
Functional Requirements ◽  
Code Smells ◽  
Design And Implementation ◽  
Design Smells ◽  
The Cost ◽  
The Impact ◽  
Fault Proneness

Nowadays, modern applications are developed using components written in different programming languages and technologies. The cost benefits of reuse and the advantages of each programming language are two main incentives behind the proliferation of such systems. However, as the number of languages increases, so do the challenges related to the development and maintenance of these systems. In such situations, developers may introduce design smells (i.e., anti-patterns and code smells) which are symptoms of poor design and implementation choices. Design smells are defined as poor design and coding choices that can negatively impact the quality of a software program despite satisfying functional requirements. Studies on mono-language systems suggest that the presence of design smells may indicate a higher risk of future bugs and affects code comprehension, thus making systems harder to maintain. However, the impact of multi-language design smells on software quality such as fault-proneness is yet to be investigated. In this article, we present an approach to detect multi-language design smells in the context of JNI systems. We then investigate the prevalence of those design smells and their impacts on fault-proneness. Specifically, we detect 15 design smells in 98 releases of 9 open-source JNI projects. Our results show that the design smells are prevalent in the selected projects and persist throughout the releases of the systems. We observe that, in the analyzed systems, 33.95% of the files involving communications between Java and C/C++ contain occurrences of multi-language design smells. Some kinds of smells are more prevalent than others, e.g., Unused Parameters , Too Much Scattering , and Unused Method Declaration . Our results suggest that files with multi-language design smells can often be more associated with bugs than files without these smells, and that specific smells are more correlated to fault-proneness than others. From analyzing fault-inducing commit messages, we also extracted activities that are more likely to introduce bugs in smelly files. We believe that our findings are important for practitioners as it can help them prioritize design smells during the maintenance of multi-language systems.

STUDY ON THE PROCESS OF RAPESEED HULLING BY THE IMPACT

2019 ◽  
Author(s):  
А.О. РЕНЗЯЕВ ◽  
О.П. РЕНЗЯЕВ ◽  
С.Н. КРАВЧЕНКО ◽  
Р.В. КРЮК
Keyword(s):  
Rotational Speed ◽  
Calculated Data ◽  
Quality Characteristics ◽  
Complete Separation ◽  
Edible Oil ◽  
Siberian Region ◽  
The Core ◽  
The Cost ◽  
The Impact

Исследованы прочностные и физико-механические свойства оболочки рапса с точки зрения ее разрушения и удаления. Установлено, что наиболее рациональным является двухстадийный способ обрушивания: 1-я стадия – на вальцовых мельницах, 2-я – на центробежной обрушивающей машине. Определены параметры центробежной обрушивающей машины для обеспечения минимальной необходимой линейной скорости 10,81 м/с: угол наклона отбойной пластины (90 ± 2)°, частота вращения барабана (2400 ± 150) об/мин. Установлено, что правильно подобранные условия и угол, под которым происходит удар, позволяют значительно снизить количество не до конца обрушенного семени и содержание расколотого ядра. При этом при свободном ударе об отбойную пластину под углом, отличным от 88–91°, или подаче недостаточно равномерного потока семян значительно увеличивается содержание необрушенных семян. На разрушение 1 кг семян необходимо затратить 58,45 Дж. Таким образом, по расчетным данным, для семян рапса диаметром 1,5 мм частота вращения барабана должна находиться в диапазоне от 2221 до 2565 об/мин при ударе семени под углом 90°. Диаметр семян рапса, выращиваемого в Сибирском регионе, составляет от 0,8 до 1,8 мм. Установлено, что подсушивание семян рапса в течение 30–40 с при температуре 100°С позволяет увеличить эффективность разрушения оболочки до полного ее отделения от ядра рапса. Представленные результаты позволяют повысить качество очистки семян рапса от оболочки и улучшить качественные характеристики получаемого масла, облегчить последующие технологические процессы получения пищевого масла, снизить затраты на рафинацию и дезодорацию на 2%. The strength and physico-mechanical properties of the shell of rapeseed in terms of its destruction and removal are investigated. It is established that the most rational is a two-stage method of seed hulling: the 1st stage – on roller mills, the 2nd – on a centrifugal hulling machine. The parameters of the centrifugal hulling machine to provide the minimum required linear speed of 10,81 m/s are defined: the angle of inclination of the turnback plate (90 ± 2)°, the rotational speed of drum (2400 ± 150) RPM. It is established that the correctly selected conditions and the angle at which the impact occurs, can significantly reduce the amount is not completely hulling seed and the substance of the split nucleus. At the same time, with a free impact on the turnback plate at an angle different from 88–91°, or the supply of an insufficiently uniform flow of seeds, the content is not completely hulling seed increases significantly. On hulling of 1 kg of seeds it is necessary to spend 58,45 J. Thus, according to the calculated data, for rape seeds with a diameter of 1,5 mm, the rotational speed of drum should be in the range from 2221 to 2565 RPM when the seed is struck at an angle of 90°. The diameter of rapeseed grown in the Siberian region ranges from 0,8 to 1,8 mm. It was found that drying of rapeseed for 30–40 s at a temperature of 100°C, can increase the efficiency of destruction of the shell to its complete separation from the core of rapeseed. The presented results make it possible to improve the quality of cleaning of rape seeds from the shell and improve the quality characteristics of the obtained oil, facilitate the subsequent technological processes of obtaining edible oil, reduce the cost of refining and deodorization by 2%.

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