scholarly journals Linkages between share pledging, stock price risk and profitability: Evidence from the P.R. China

PLoS ONE ◽  
2021 ◽  
Vol 16 (11) ◽  
pp. e0260040
Author(s):  
Fengchao Li ◽  
Xing Zhang ◽  
Jaime Ortiz
Keyword(s):  
Stock Price ◽  
Fixed Effects ◽  
Positive Impact ◽  
Transmission Mechanism ◽  
Price Risk ◽  
Controlling Shareholders ◽  
Listed Firms ◽  
Firm Profitability ◽  
Investor Expectations

Share pledging has become popular as a method of loan collateral among Chinese shareholders. Our research used a sample of Chinese listed firms between 2008–2018 and produced two main findings. Firstly, we found a negative association between stock price risk and firm profitability. Our second finding was that the interaction effect of share pledging and stock price risk is greater on firm profitability than the effect of stock price risk itself. We examined the role of share pledging by modeling pooled OLS and fixed effects using share pledging behavior, controlling shareholders’ share pledging and the share pledging ratio to reinforce the robustness of our results. Furthermore, we investigated the Davis Double Play effect of share pledging to analyze how share pledging affects stock price risk. We found that higher EPS and investor expectations cannot mitigate the positive impact of share pledging on stock price risk. That is, the reduction of EPS and the deterioration of investor expectations caused by share pledging risk will not further aggravate the stock price risk, as shareholders may have taken some managerial actions to affect the transmission mechanism.

scholarly journals Female on boards and the risk-taking of microfinance institutions: The moderating role of outreach

2020 ◽  
Vol 16 (2) ◽  
pp. 19-34
Author(s):  
Michael Adusei
Keyword(s):  
Risk Taking ◽  
Fixed Effects ◽  
Positive Impact ◽  
Microfinance Institutions ◽  
Female Representation ◽  
Return On Assets ◽  
Omitted Variable Bias ◽  
Variable Bias ◽  
Moderating Role

This study examines the effect of female on boards on risk-taking with data from 401 microfinance institutions (MFIs) drawn from 64 countries. The study also investigates whether the effect is sensitive to the outreach performance of MFIs. The MFIs sampled for this study are spread across the six MFI regions. The study measures MFI risk by its risk-taking Z-score and risk-adjusted return on assets. The fixed effects estimation technique, known to overcome the omitted variable bias, is deployed to analyze the data. The results show that female representation in the boardroom increases the risk-taking of MFIs. However, when female on boards interacts with the depth of outreach performance of an MFI, its positive impact on MFI risk is observed. It suggests that female directors are more likely to be beneficial to risk management in MFIs that lend more to indigent clients. Several tests, including an instrumental variable test for endogeneity, have been conducted to confirm the robustness of these results.

scholarly journals Voluntary social performance disclosure and firm profitability of South African listed firms: Examining the complementary role of board independence and managerial ownership

2021 ◽  
Vol 24 (1) ◽  
Author(s):  
Frank Sampong ◽  
Na Song ◽  
Gilbert K. Amoako ◽  
Kingsley O. Boahene
Keyword(s):  
Corporate Governance ◽  
Corporate Social Performance ◽  
Social Performance ◽  
Executive Directors ◽  
Listed Firms ◽  
Complementary Role ◽  
Firm Profitability ◽  
Corporate Social

Background: There is growing literature promoting corporate governance mechanisms as important elements that could mitigate the inconclusive findings within the corporate social performance and firm profitability research. A key theoretical assumption within the extant literature that provides support for this proposition is that corporate social performance and firm profitability are organisational outcomes in the presence of good corporate governance.Aim: Firstly, the aim is to re-investigate voluntary social performance disclosure (SPD) and long-term profitability association from the perspective of international standards, using the Global Reporting Initiative G3.1 guidelines. Secondly, to examine the joint moderating effect of board independence and managerial ownership (MO) on the voluntary SPD and profitability nexus.Setting: The South Africa institutional setting, where recent corporate governance regimes require firms to voluntarily make corporate governance related disclosures on both shareholder-and stakeholder-related information is used as the study context.Method: Utilising manually extracted data of listed firms, over the period 2010 to 2015, the generalised least square regression and seemingly unrelated regression (with a 1-year lag as the main independent variable) are used to examine the stated hypotheses.Results: We found a positive association between voluntary SPD and long-term profitability. We also found that the presence of non-executive directors positively moderates the association between voluntary SPD and long-term profitability. Thirdly, the proportion of MO significantly positively moderates the association between voluntary SPD and long-term profitability. Lastly, the complementary role of the presence of non-executive directors and the proportion of MO significantly positively moderates the association between voluntary SPD and long-term profitability.Conclusion: This study finds support for scholarly theoretical arguments that organisational outcomes are largely possible in the presence of good corporate governance, which has a long-term implication for firms’ shareholder wealth maximisation. This study contributes to the ongoing research examining the notion of substitutive versus complementary effects of governance mechanisms, and a growing research literature on corporate social responsibility (CSR) disclosure from the perspective of international standardisation. This study therefore makes far-reaching contributions to the corporate governance and social responsibility literature in an African context.

scholarly journals Evaluation of Managerial Overconfidence, Cash Holding, and Investment Efficiency in Companies

2021 ◽  
Vol 2021 ◽  
pp. 1-11
Author(s):  
Abdorreza Asadia ◽  
Maryam Oladia ◽  
Mohammad Ghasem Aghela
Keyword(s):  
Fixed Effects ◽  
Stock Exchange ◽  
Financial Statements ◽  
Investment Efficiency ◽  
Cash Holding ◽  
Data Set ◽  
Listed Firms ◽  
Managerial Overconfidence ◽  
Moderating Role

Managers’ overconfidence leads to overestimating their ability to manage cash sources. Holding more cash may result in overinvestment in projects and investment inefficiency consequently. The present study aims to investigate the effect of cash holding on investment efficiency with the moderating role of managerial overconfidence in Iranian companies. All listed firms in Tehran Stock Exchange, excluding banks, insurance, pension funds, and financial intermediaries, are included in the research. We have used data from financial statements of 91 companies over the period from 2010 to 2018 and conducted multiple regression models to test the hypotheses based on pooled and panel data set with fixed effects. The results indicate a positive relationship between managerial overconfidence and cash holding. The effect of cash holding on investment efficiency turns out to be significantly negative. Furthermore, managerial overconfidence has a significant moderating effect on the relation of the variables. This study is almost the first one, which has been done in emerging markets, so the study’s findings not only contribute to the existing literature on managerial overconfidence and investment efficiency but also assist policymakers, managers, and investors in making effective decisions.

Understanding the effects of self-peer-platform incentives on users' physical activity in mobile fitness apps: the role of gender

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Qiuju Yin ◽  
Lun Li ◽  
Zhijun Yan ◽  
Chenxi Guo
Keyword(s):  
Physical Activity ◽  
Social Support ◽  
Gender Differences ◽  
Fixed Effects ◽  
Positive Impact ◽  
Self Determination Theory ◽  
Self Monitoring ◽  
Content Type ◽  
Positive Effect

PurposeMobile fitness apps (MFAs) are increasingly popular for people to promote physical activity (PA) and further enhance health status via behavioral change techniques (BCTs), but the phenomenon of users abandoning MFAs is still common. For improving users' PA and decreasing dropout rates of MFAs, this study intends to gain insights into the effects of major BCTs-based incentive factors on users' PA under MFAs context and the gender differences in their effects.Design/methodology/approachBased on self-determination theory, three major incentive factors were chosen from the perspective of self-peer-platform incentives, i.e. self-monitoring (SM), social support (SS) and platform rewards (PR). A dataset of 4,530 users from a popular mobile fitness app was collected and was analyzed using fixed effects models.FindingsThe results show that all three types of incentive factors are positively associated with users' PA. The estimated effect sizes can be ordered as: SM > PR > SS. Moreover, social support has a stronger positive impact on PA of females than males, whereas platform rewards have a weaker positive effect on PA of females than males. In addition, the results also indicate there are no significant gender differences in the effect of self-monitoring.Originality/valueThere is insufficient research on systematically examining the effects of different types of incentive factors of MFAs on users' PA in one study. This study extends the current understanding of incentive factors by simultaneously examining different incentive factors and the role of gender. The findings can also provide insightful guidance for the design of MFAs.

The Effects of Leverage, Investment Decision, Dividend Policy and Profitability, on Firm Value of the Automotive Sector Companies

2021 ◽  
Vol 5 (2) ◽  
pp. 68
Author(s):  
Heri Ispriyahadi ◽  
Grace Aprilia Uli Putri
Keyword(s):  
Firm Value ◽  
Stock Price ◽  
Fixed Effects ◽  
Dividend Policy ◽  
Positive Impact ◽  
Stock Exchange ◽  
Investment Decision ◽  
Sampling Technique ◽  
Automotive Sector ◽  
The Impact

<p>This paper examined the impact of leverage, investment decision, dividend policy and profitability on the firm value of the automotive sector companies from 2010 - 2016. There are 12 firms chosen using a purposive sampling technique implementing specific criteria. Those firms are publicly listed on the Indonesia Stock Exchange. Panel data regression (Pooled OLS, Fixed Effects, and Random Effects) is used in this research. The results have shown that leverage, dividend policy and profitability, have a positive and significant impact on firms' value. A rise in these factors will lead to an increasing stock price, whereas even though has  has a positive impact, but investment decision not a substantial effect on company value.</p>

CEO Materialism and Corporate Social Responsibility

2018 ◽  
Vol 94 (1) ◽  
pp. 101-126 ◽  
Author(s):  
Robert H. Davidson ◽  
Aiyesha Dey ◽  
Abbie J. Smith
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Stock Price ◽  
Fixed Effects ◽  
Price Performance ◽  
Corporate Social ◽  
Jel Classifications

ABSTRACT We study the role of individual CEOs in explaining corporate social responsibility (CSR) scores. We find that CEO fixed effects explain 59 percent of the variation in CSR scores, whereas firm fixed effects explain 23 percent of the variation in CSR scores. Specifically, firms led by materialistic CEOs have lower CSR scores, fewer strengths, and more weaknesses. Finally, we document that CSR scores in firms with non-materialistic CEOs are positively associated with accounting and stock price performance. In contrast, CSR scores in firms with materialistic CEOs are unrelated to profitability. JEL Classifications: G30; G34; G38.

scholarly journals Corporate Governance and Stock Price Synchronicity: Empirical Evidence from Vietnam

2020 ◽  
Vol 8 (2) ◽  
pp. 22
Author(s):  
Anh Huu Nguyen ◽  
Thu Minh Thi Vu ◽  
Quynh Truc Thi Doan
Keyword(s):  
Corporate Governance ◽  
Stock Price ◽  
Fixed Effects ◽  
Negative Impact ◽  
Positive Impact ◽  
Foreign Ownership ◽  
Managerial Ownership ◽  
Board Size ◽  
Stock Price Synchronicity ◽  
The Impact

This research is conducted to investigate the impact of corporate governance on stock price synchronicity in the context of the Vietnamese market. The paper tests four hypotheses proposing the effect of four crucial components of corporate governance including board size, board independence, managerial ownership, and foreign ownership on stock price synchronicity. The study sample includes 247 non-financial listed companies on the Ho Chi Minh Stock Exchange (HOSE) in Vietnam over a period of five years from 2014 to 2018. The fixed effects model is employed to address econometric issues and to improve the accuracy of the regression coefficients. The research results show the positive impact of board size and foreign ownership but the negative impact of managerial ownership on stock price synchronicity. This study confirms the viewpoint that stocks in the market move more together when the firms’ corporate governance gets better. In other words, the research findings suggest that low synchronicity signifies the corporate intransparency and weak information environment and vice versa. From this, the paper provides a new insight to managers on how to improve stock price synchronicity with corporate governance.

Large Shareholders and Stock Price Synchronicity: Evidence from Vietnam

2021 ◽  
pp. 097215092110056
Author(s):  
Anh Tho To ◽  
Trung Dao Le ◽  
Quoc Tuan Tran ◽  
Thanh Lam Nguyen ◽  
Thi Thu Hong Ho
Keyword(s):  
Stock Price ◽  
Fixed Effects ◽  
State Ownership ◽  
Information Environment ◽  
Standard Errors ◽  
Stock Exchanges ◽  
Firm Level ◽  
Stock Price Synchronicity ◽  
Listed Firms ◽  
Large Shareholders

This article aims to investigate how large shareholders affect the information environment, as measured by stock price synchronicity, of listed firms in the Vietnam stock exchanges. Upon applying fixed effects and instrumental variables fixed effects with firm-level clustered standard errors for a sample of 160 listed firms in the Vietnam stock exchanges over the period 2008–2017, the results show that stock price synchronicity is negatively associated with the two largest shareholders’ ownership and positively related to state ownership. The findings support that non-state large ownership plays an important role in improving the information environment in emerging markets where investor protection laws are relatively weak.

scholarly journals Corporate Governance and Pyramidal Ownership: The Role of Novo Mercado

2018 ◽  
Vol 16 (1) ◽  
pp. 5
Author(s):  
Dante Mendes Aldrighi ◽  
Fernando Antonio Slaibe Postali ◽  
Maria Dolores Montoya Diaz
Keyword(s):  
Corporate Governance ◽  
Panel Data ◽  
Fixed Effects ◽  
Financial Constraints ◽  
Data Models ◽  
Panel Data Models ◽  
Controlling Shareholders ◽  
Binary Dependent Variable ◽  
Pyramidal Ownership

The literature has not reached a consensus on the motivation and implications of pyramidal ownership schemes. For some, such arrangements make it easier for controlling shareholders to expropriate outside investors. More recently, some studies have challenged this view and emphasized that their rationale lies in overcoming financial constraints. This paper focuses on whether firms owned through pyramidal schemes are more likely to be listed on the “Novo Mercado,” the Brazilian stock exchange’s premium listing segment created in 2000, which prohibits firms from issuing non-voting shares. We built a dataset of ownership data with annual observations for a panel of firms over the period 2003-2010 by hand-collecting data drawn from reports that firms submit periodically to the Brazilian securities regulator (CVM). Estimating fixed effects non-linear panel data models of a binary dependent variable, we find that firms listed on the Novo Mercado are less likely to be owned through a pyramid arrangement, result which appears to be consistent with the expropriation view.

The Role of Market-Share Management Strategies in Explaining the Stocks Performance Variance of a Number of Industrial Companies- An Analytical Research

2021 ◽  
Vol 39 (11) ◽  
Author(s):  
Hussein Qusay Abbood ◽  
Mustafa Muneer Isma'eel
Keyword(s):  
Market Share ◽  
Fixed Effects ◽  
Positive Impact ◽  
Stock Exchange ◽  
Management Strategies ◽  
Fixed Effects Model ◽  
Industrial Companies ◽  
Analytical Research ◽  
Research Period

The study aims to know the nature of the expected relationship between market share management strategies and the variation in the performance of the shares of a number of Iraqi industrial companies listed in the Iraqi Stock Exchange. For the period (2005-2018) in the light of both the monthly closing prices and sales volume during the research period, the (Panel Data) method was relied on through a stylistic test (fixed effects model and random effects model), and the results determined the need to adopt the fixed effects model method for sample data and test Assumptions, the results showed the positive impact of market share according to its strategies on the performance of stocks according to its studied indicators (Treynor index and Sharpe index), and the results of the study also showed that the variation in managing market share strategies leads to affecting the performance of stocks and in terms of both return and risk.

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