Females’ Representation in the Boardroom and Their Impact on Financial Distress: An Evidence from Family Businesses in India

2018 ◽  
Vol 11 (1) ◽  
pp. 35-44 ◽  
Author(s):  
Sangeeta Mittal ◽  
Lavina
Keyword(s):  
Logistic Regression ◽  
Chief Executive Officer ◽  
Financial Distress ◽  
Family Firms ◽  
Gender Diversity ◽  
Chief Executive ◽  
Family Businesses ◽  
Descriptive Statistics ◽  
Negatively Associated ◽  
Practical Implications

This study empirically examine the females’ representation (gender diversity) on the board as well as their impact on financial distress by taking the sample of Indian-listed family firms for a period ranging from 2013 to 2016. Descriptive statistics and logistic regression have been used to find out the influence of feminine on financial distress. The results of descriptive statistics show that on an average, there is just 9 per cent share of females on the board to a maximum of 28 per cent and only 2 per cent of firms have female chief executive officer (FCEO). Further, females have a diminutive impact on financial distress since their presence on the board is very low. Only one variable, females’ percentage (FPER) on the board is significant and negatively associated with financial distress. However, other insignificant variables are also negatively related with financial distress indicating that gender diversity on the board can minimise the financial distress. Consequently, practical implications derived from the present study are that there should be a considerable share of females on the board and executive positions so that their decisions could considerably impact the firm’s performance and be helpful to reduce the financial distress.

scholarly journals Chief executive officer retirement and auditor’s risk assessment

2020 ◽  
Vol 18 (2) ◽  
pp. 343-361
Author(s):  
Salau Olarinoye Abdulmalik ◽  
Noor Afza Amran ◽  
Ayoib Che-Ahmad
Keyword(s):  
Risk Assessment ◽  
Chief Executive Officer ◽  
Perceived Risk ◽  
Family Firms ◽  
Chief Executive ◽  
Family Businesses ◽  
Moderating Effect ◽  
Content Type ◽  
Client Risk ◽  
The Relationship

Purpose This study aims to examine the unique nature of family firms by investigating the moderating effect of chief executive officer (CEO) identity on CEO career horizon and the auditor’s client risk assessment. Consistent with literature on family businesses, the level of CEO attachment to socio-emotional wealth (SEW) varies among family businesses. Design/methodology/approach This study used a longitudinal sample of 2,063 non-financial family firm-year observations from 2005 to 2016 listed on the Bursa Malaysia. The study used the general method of moments (GMM), which controls for endogeneity concerns. Findings The results reveal that, without the moderating effect of CEO identity, the relationship between CEO career horizon and auditor’s risk assessment is positive, which suggests that the auditor’s risk perception of retiring CEOs is very high. However, the interaction of CEO identity reverses the relationship as evidenced by the negative and significant coefficient on the interacted terms. The finding suggests that the auditor’s perceived risk associated with CEO career horizon is lower in family firms with CEOs affiliated to family members or in which the CEO has an equity stake. Overall, the findings provide compelling evidence that the extent of the CEO’s attachment to the firm’s SEW affects the auditor’s client risk assessment. Practical implications The findings of the study serve as an enlightenment to policymakers such as Bursa Malaysia and Security Commission that within the family-controlled firms, differences still exist; therefore, there might be a need for future regulatory initiative to cater for the specific need of family-controlled firms. Originality/value The study contributes to prior literature by departing from the agency theory adopted in previous studies on auditor choice in family firms under the assumption that family firms are homogenous.

Do Female Directors on Corporate Boards Make a Difference in Family Owned Businesses?

2019 ◽  
Vol 19 (1) ◽  
pp. 85-102 ◽  
Author(s):  
Barbara Sveva Magnanelli ◽  
Luigi Nasta ◽  
Elisa Raoli
Keyword(s):  
Firm Performance ◽  
Family Firms ◽  
Negative Impact ◽  
Gender Diversity ◽  
Family Businesses ◽  
Corporate Boards ◽  
Listed Firms ◽  
Female Directors ◽  
And Performance ◽  
Gender Quota

ABSTRACT This paper investigates how the presence of female directors on corporate boards impacts the performance of family firms. This study enriches the literature on gender diversity on corporate boards and its effects on firm performance by focusing on a country in which family businesses are dominant. The empirical analysis is conducted on a sample of 165 Italian-listed firms from 2011 to 2016, representing the period during which the mandatory gender quota law was introduced and implemented in Italy. The results show a positive relationship between the presence of women on corporate boards and firm performance, specifically in family owned businesses. These findings lead to the conclusion that female directors do not have a negative impact on firm performance. And, given the domination of family businesses and a mandatory gender quota law in Italy, this study makes a regulatory and performance assessment not previously examined in the literature. JEL Classifications: M1; M12; M48; M21.

Do organisations in developing economies legitimise their level of profit? Evidence from Fiji

2016 ◽  
Vol 29 (1) ◽  
pp. 59-80 ◽  
Author(s):  
Acklesh Prasad ◽  
Peter Green ◽  
Jon Heales
Keyword(s):  
Social Contract ◽  
Chief Executive Officer ◽  
Design Methodology ◽  
Developing Economies ◽  
Chief Executive ◽  
Annual Reports ◽  
Public Enterprises ◽  
Content Type ◽  
Practical Implications ◽  
Corporate Annual Reports

Purpose This paper aims to investigate whether organisations in developing economies legitimise their level of profit. Design/methodology/approach Organisations’ level of profit is evaluated against the readability of sections of information available in the corporate annual reports. These sections include the Chairman’s Report, the Chief Executive Officer Report and the Notes to the Accounts. Findings More profitable organisations report more readable information in their corporate annual reports. Information in the non-mandatory sections of the report (Notes to the Accounts) is more readable compared to the information in the mandatory sections of the report (Chairman’s Report). Larger organisations report more readable information. Public Enterprises report more readable information compared to the Publicly Listed Companies. Research limitations/implications Organisations in the developing economies are aware of their role in their society. They respond to instances of possible violation of the implied social contract by sharing information in ways that relays news in certain ways. Practical implications Evidence of presence of legitimising activities by organisations would imply the need to strengthen the regulatory and monitoring guidelines to ensure efficient use of society’s resources and a fair rent charge for the utilities. Social implications There is a greater need to monitor and question organisations’ level of earned profit to ensure it is necessary to maintain their operations. Originality/value This study is the first attempt to investigate organisations’ immediate legitimising activities in relation to their reported profit.

Financial Structure of the Family Business: Evidence From a Group of Small Spanish Firms

2007 ◽  
Vol 20 (4) ◽  
pp. 269-287 ◽  
Author(s):  
José López-Gracia ◽  
Sonia Sánchez-Andújar
Keyword(s):  
Financial Distress ◽  
Small Businesses ◽  
Family Firms ◽  
Order Theory ◽  
Family Businesses ◽  
Financial Behavior ◽  
Control Group ◽  
Financial Policy ◽  
Pecking Order Theory ◽  
Internal Resources

This article presents empirical evidence on the determinants of the financial behavior of small family businesses and their differences from nonfamily small businesses. Taking into account two consolidated financial approaches, (1) the trade-off theory and (2) the pecking order theory, several hypotheses on the financial behavior of both groups of firms have been tested. By estimating these models through panel data methodology, using a sample of Spanish family businesses together with another control group of nonfamily businesses, we have obtained results confirming that a business's family nature does lead it to employ financial policy different from the rest of businesses. Furthermore, results indicate that growth opportunities, financial distress costs, and internal resources appear to be the main factors that differentiate the financial behavior of family firms from their nonfamily counterparts.

scholarly journals The relationships between organizational context and CEO’s use of psychological words in speeches

2011 ◽  
Vol 24 (4) ◽  
pp. 759-783 ◽  
Author(s):  
Jeeyoung Lee ◽  
MyungUn Kim
Keyword(s):  
Organizational Development ◽  
Chief Executive Officer ◽  
Organizational Context ◽  
Negative Emotion ◽  
Chief Executive ◽  
Development Stage ◽  
Critical Events ◽  
Expansion Stage ◽  
Three Stages ◽  
Practical Implications

This study examined the relationships between organizational context and the chief executive officer (CEO)’s psychological statements. To this end, using a linguistic analysis program of K-LIWC, content analyses were conducted on three major speeches-the New Year’s addresses, the founding day addresses, and the year-ending farewell Address-which had been presented between 1969 and 1992 by the founder and chief executive officer of POSCO. This study analyzed two kinds of organizational context; the number of critical events within and outside the organization and the three stages of organizational development. With respect to the number of critical events measured as one aspect of organizational context, it was found that the greater the number of critical events, the more the CEO used words with both positive emotion and negative emotion. In relations to the organizational development stage measured as another aspect of organizational context, psychological statements related to both emotional and social processes were made significantly more often during the entrepreneurial stage and growth stage compared to the expansion stage. The findings suggest that the outstanding CEO tend to adjust the use of psychological words according to the change in organizational context in communicating with organization members through speeches. Finally, the theoretical and practical implications and limitations of the current study were discussed.

scholarly journals Estrutura de capital e remuneração dos funcionários: evidência empírica no Brasil

2015 ◽  
Vol 19 (2) ◽  
pp. 249-269 ◽  
Author(s):  
Duk Young Choi ◽  
Richard Saito ◽  
Vinicius Augusto Brunassi Silva
Keyword(s):  
Chief Executive Officer ◽  
Financial Distress ◽  
Chief Executive

Este artigo analisa se uma empresa com maior alavancagem financeira implica que seus funcionários demandem maiores salários dado o risco de financial distress. Utilizando o modelo de Berk, Stanton e Zechner (2010), foi aplicada uma regressão de dois estágios para uma amostra de 250 empresas não financeiras listadas na BOVESPA de 2007 a 2009. De fato, encontrou-se que, para cada 1% de alavancagem financeira incremental, a remuneração dos funcionários aumenta em 0,26%, mesmo controlando para o perfil do Chief Executive Officer (CEO).

scholarly journals Internationalization of Polish enterprises. A comparative analysis of family and non-family businesses

2021 ◽  
Vol 2021 (150) ◽  
pp. 255-266
Author(s):  
Izabela STEINEROWSKA-STREB ◽  
Keyword(s):  
Design Methodology ◽  
Family Firms ◽  
Business Environment ◽  
Family Businesses ◽  
Primary Research ◽  
Foreign Markets ◽  
Similar Activity ◽  
International Activity ◽  
Study Results ◽  
Practical Implications

Purpose: The study aimed to determine whether family businesses in Poland are as involved in international activity as non-family businesses. Moreover, the intention was to identify differences in the forms of foreign expansion employed by family and non-family firms. Design/methodology/approach: The objectives were pursued based on primary research conducted in 188 family firms and 223 non-family firms operating on the Polish market. Findings: The analysis of the results indicates that family firms conduct business activity outside the domestic market significantly less frequently than non-family firms. The most common form of internationalization chosen by Polish family firms is export and import. Generally, these firms are not interested in joint ventures with foreign partners. Compared to non-family firms, Polish family firms establish divisions abroad significantly less frequently. However, they engage in non-equity cooperation more often than non-family firms. Practical implications: Knowledge about the involvement of family and non-family firms in international activity and their preferred forms of internationalization can be used by business environment institutions. Originality/value: The study results enrich the knowledge on the activity of Polish family firms on foreign markets as compared to similar activity of non-family businesses

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