scholarly journals Ownership structure and corporate performance: evidence from property and real estate public companies in Indonesia

2017 ◽  
Vol 14 (2) ◽  
pp. 252-263 ◽  
Author(s):  
Mustaruddin Saleh ◽  
Giriati Zahirdin ◽  
Ellen Octaviani
Keyword(s):  
Firm Performance ◽  
Real Estate ◽  
Ownership Structure ◽  
Corporate Performance ◽  
Random Effect ◽  
Economic Value ◽  
Value Added ◽  
Institutional Investor ◽  
Managerial Ownership ◽  
The Impact

This paper has proposed a specific case in the property and real estate sector regarding the impact of ownership structure and corporate performance, since this sector is one of those with booming investment in Indonesia. The ownership structure was represented by the institutional investor and managerial ownership, and the Economic Value Added (EVA) and Tobin’s Q were used as a proxy for firm performance. This study utilized the purposive sampling of 240 observations over the period 2010-2015. The fixed and random effect panel data model was employed to determine the relationship among the variables. Findings show that the institutional investor and company’s size, as well as debt ratio, are important in explaining firm performance, while managerial ownership has a partially significant effect on the performance of companies in this industry.

scholarly journals Managerial Ownership, Board of Directors, Equity-based Compensation and Firm Performance: A Comparative Study between France and the United States

2017 ◽  
Vol 8 (1) ◽  
pp. 78-95 ◽  
Author(s):  
Mehdi Bouras ◽  
Mohamed Imen Gallali
Keyword(s):  
Firm Performance ◽  
Comparative Study ◽  
Board Of Directors ◽  
Ownership Structure ◽  
Corporate Performance ◽  
The Other ◽  
Managerial Ownership ◽  
Managerial Entrenchment ◽  
Non Linear ◽  
The One

Abstract The aim of this comparative study between the French and American markets, characterized by a different ownership structure is to examine the relationship between managerial ownership, the board of directors, the equity-based compensation and corporate performance. Regardless of the selected sample, we found on the one hand, a non-linear relationship between managerial ownership and firm performance and on the other hand, in the case of managerial entrenchment board of directors is a substitute for managerial ownership to solve the agency problem. In addition, stock-based compensation is non-linear function with managerial ownership, contrary to previous studies that assume a monotonous or non-significant relationship. The hypothesis of endogeneity is valid only in the American case. This result leads us to believe that the U.S. CEO has a preference to hold a large percentage of shares of firms that generate a good performance to neutralize capital market monitoring. Our study is exclusive in terms of the effect of managerial ownership on corporate performance in terms of comparison between two markets, characterized by a difference in ownership structure. We determine the impact of equity compensation on the one hand, the managerial ownership where all the studies assume either a monotone or neutral relationship between these two variables and on the other hand, the effect of board in the alignment or managerial entrenchment cases.

scholarly journals The Impact of Intellectual Capital on Firm Performance of the Turkish Real Estate Companies Before and After the Crisis

2018 ◽  
Vol 14 (1) ◽  
pp. 29 ◽  
Author(s):  
Sedeaq Nassar
Keyword(s):  
Firm Performance ◽  
Real Estate ◽  
Intellectual Capital ◽  
Value Creation ◽  
Positive Impact ◽  
Value Added ◽  
Significant Relation ◽  
Capital Efficiency ◽  
The Impact ◽  
Positive Significant Relation

Purpose- The main purpose of this study is to find the impact of intellectual capital on firm performance of real estate companies listed in Borsa Istanbul, using data of 27 listed companies over the period 2004-2015. Value Added Intellectual Coefficient (VAIC) method is utilized as a measure of intellectual capital (IC). Methodology- An OLS regression is used to examine the impact of intellectual capital (VAIC); Human capital efficiency (HCE), Structural capital efficiency (SCE), and Capital employed efficiency (CEE) on market, productivity, and financial performance. Findings- The findings show that SCE consider as a key role of value creation in real estate companies where has a positive significant relation with MB, ROE, and EPS before the crisis and with ROA and ROE after the crisis. HCE show a positive significant relation with ROA and ROE before the crisis and a negative significant association with MBand ATO after the crisis. CEE show a negative significant impact on ATO after the crisis. VAIC shows a significant positive impact on ROA, ROE, and EPS before the crisis, while it has the same relation with ROE after the crisis. Conclusion- Although the good result of using intellectual capital for value creation, real estate Turkish companies still weakly depend on its intellectual capital.

The Value Of The State-Owned Enterprises In Indonesia: A Case Study Of Privatization

2011 ◽  
Vol 8 (7) ◽  
Author(s):  
Sri Hasnawati
Keyword(s):  
Ownership Structure ◽  
Stock Exchange ◽  
Economic Value ◽  
Value Added ◽  
Market Value ◽  
The State ◽  
State Budget ◽  
Market Value Added ◽  
The Impact

This research aims to test the impact of the ownership structure toward the performance of the State-Owned Enterprises (SOEs). It examines the relationship between the performance of the SOEs and the market value. The study involves 13 SOEs listed at the Jakarta Stock Exchange. Of the 13 SOEs, 9 were selected as samples. The performance of the SOEs is measured by means of the EVA (Economic Value Added) indicator and the market value by the MVA (Market Value Added) indicator. The result of the study reveals that the ownership structure does not have an impact on the performance of the SOEs, either partially or simultaneously. To a smaller degree, the study also indicates that there is a relationship between the EVA and the MVA. The implication of this study is that the privatization of the SOEs should not fully be used to help with the state budget deficit. That is, the majority of the funds should be allocated for the purpose of developing or expanding the SOEs themselves so that they can perform optimally for the sake of society. Furthermore, the SOEs should be well-managed if they would like to obtain good responses from the market.

scholarly journals Corporate performance and boards’ dilemma of listed subsidiaries

2013 ◽  
Vol 10 (4) ◽  
pp. 130-147 ◽  
Author(s):  
Emiliano Di Carlo ◽  
Francesco Ranalli
Keyword(s):  
Corporate Governance ◽  
Firm Performance ◽  
Financial Performance ◽  
Ownership Structure ◽  
Corporate Performance ◽  
Listed Companies ◽  
The Impact ◽  
The Relationship ◽  
Parent Companies

The paper focuses on listed companies controlled by other (listed or not listed) entities. The decisionmaking power of listed subsidiary’s boards could be strongly influenced by (or instead could be autonomous from) the parent companies’ board. However, so far literature on corporate governance seems not to have considered adequately this aspect as well as the impact of that influence on listed companies’ financial performance and on corporate governance variables. The main objective of this paper is to explore how and why this phenomenon is relevant, giving some preliminary suggestions on the interpretation of the ownership structure, board demography and the financial performances of directed listed subsidiaries. In order to explore the relevance of the phenomenon, we use a sample of Italian listed companies controlled and consolidated by other companies for the year 2010. The analysis shows that 71.4% (145 firms) of Italian non-financial listed companies are consolidated by the respective controlling entities and 24.1% (35 firms) of these listed subsidiaries declare to be directed by their parents. Thus, they are not independent economic entities and the effort to study the relationship between corporate governance variables and firm performance could be strongly biased.

scholarly journals Analysing the Impact of Managerial Ownership on the Performance of Shariah-Compliant Firms in Pakistan

2018 ◽  
Vol 11 (11) ◽  
pp. 55 ◽  
Author(s):  
Naveeda K Katper ◽  
Sanober Salman Shaikh ◽  
Vivake Anand ◽  
Najma Imtiaz Ali
Keyword(s):  
Firm Performance ◽  
Agency Theory ◽  
Random Effect ◽  
Agency Cost ◽  
The Body ◽  
Muslim World ◽  
Managerial Ownership ◽  
Strong Impact ◽  
The Impact ◽  
Retained Earnings

This paper analyses the impact of managerial ownership upon firm performance in the Shariah-compliant firms of Pakistan. Agency theory that suggests involving managers as part of firm's ownership can help firms reduce the agency cost, has widely been applied in the corporate setup of conventional finance, however, there is growing need of academic research to find out the role and application of this theory in the Shariah-compliant organizations. All around the Muslim world, there is the rise of Shariah-compliant firms; however, little work has been done to critically evaluate such important concepts based on agency theory, it is, therefore, an optimistic approach to familiarise the idea of firm performance with the relationship of managerial ownership under Agency Theory in such organizations. In order to better understand the acceptability and adaptability of Agency Theory, the objective of this study is to examine the impact of managerial ownership upon firm performance in Shariah-compliant firms of Pakistan for the first time. This paper is based upon panel data and regression models applied to the sample of 68 Shariah-compliant firms listed on Pakistan’s Karachi Stock Exchange covering five years from 2009 to 2013. This paper tests the firm performance through two different dependent variables Tobin’s Q and ROA by regressing through OLS, Fixed effect (FE) and Random effect(RE) methods. Both models are proved empirically significant. The robust results confirm that managerial ownership (MO) has a positive and strong impact upon firm performance (Q)/ (ROA) in the Shariah-compliant firms of Pakistan. The outcomes may provide a good understanding and help in making a better decision regarding investment on the ethical grounds. It proves that more concentrated managerial ownership produces the higher firm profits. It can be also inferred that the increased proportion of managerial ownership tends to align with the interests of owners and thus help to reduce the agency conflict in our sample of Shariah-compliant firms in Pakistan. Moreover, Size (LNTA) has a positive relationship with firm performance (Q)/ (ROA) viewing that the Shariah-compliant firms depend on retained earnings. It may be due to the restricted criterion on the leverage for Shariah-compliant firms by the board of Shariah compliance. Leverage (DAR) is negatively and significantly correlated with profitability and growth (GROW) is positively and significantly correlated with firm performance (Q). In the developing and Muslim world, this study may reserve a unique place due to its virgin attempt and highlight the ignored aspect in the body of literature. These findings are of great benefit to investment managers, and Shariah cautious and other ethical investors regarding investment and portfolio related decisions.

Do corporate boards affect firm performance? New evidence from an emerging economy

2017 ◽  
Vol 66 (6) ◽  
pp. 724-741 ◽  
Author(s):  
Qaiser Rafique Yasser ◽  
Abdullah Al Mamun ◽  
Michael Seamer
Keyword(s):  
Firm Performance ◽  
Firm Value ◽  
Corporate Performance ◽  
Stock Exchange ◽  
Economic Value ◽  
Value Added ◽  
Emerging Economy ◽  
Corporate Boards ◽  
Content Type ◽  
Developed Economies

Purpose The purpose of this paper is to examine an association between board demographics and corporate performance using a sample of Pakistani firms listed on the Pakistan Stock Exchange in the 2014 year. Design/methodology/approach This study is unique in that corporate performance is examined using a mixture of performance measures: accounting-based measures (return on assets), market-based measures (Tobin’s Q, earnings per share, and total return) and economic profit measures (economic value added). Findings The results of this research show a significant positive relationship between board size, minority representation on the board and the appointment of a family director and enhanced firm performance. However, contrary to expectations, the authors also find that instead of adding value, the appointment of independent directors to Pakistani firm boards negatively impacts firm value. Originality/value This study adds to a growing body of empirical evidence that suggests that agency theory-based corporate governance recommendations adopted in developed economies may not be relevant to emerging economy firms.

The impact of intellectual capital on firm performance: a study of Indian firms listed in COSPI

2018 ◽  
Vol 19 (5) ◽  
pp. 935-964 ◽  
Author(s):  
Neha Smriti ◽  
Niladri Das
Keyword(s):  
Firm Performance ◽  
Intellectual Capital ◽  
Value Creation ◽  
Generalized Method Of Moments ◽  
Value Added ◽  
Secondary Data ◽  
Share Price ◽  
Content Type ◽  
Listed Firms ◽  
The Impact

Purpose The purpose of this paper is to examine the effect of intellectual capital (IC) on financial performance (FP) for Indian companies listed on the Centre for Monitoring Indian Economy Overall Share Price Index (COSPI). Design/methodology/approach Hypotheses were developed according to theories and literature review. Secondary data were collected from Indian companies listed on the COSPI between 2001 and 2016, and the value-added intellectual coefficient (VAIC) of Pulic (2000) was used to measure IC and its components. A dynamic system generalized method of moments (SGMM) estimator was employed to identify the variables that significantly contribute to firm performance. Findings Indian listed firms appear to be performing well and efficiently utilizing their IC. Overall, human capital had a major impact on firm productivity during the study period. Furthermore, the empirical analysis showed that structural capital efficiency and capital employed efficiency were equally important contributors to firm’s sales growth and market value. The growing importance of the contribution of IC to value creation was consistently reflected in the FP of these Indian companies. Practical implications This study has robust theoretical grounds and employs a validated methodology. The present study extends knowledge of IC among academicians and managers and highlights its contribution to value creation. The findings may help stakeholders and policymakers in developing countries properly reallocate intellectual resources. Originality/value This study is the first study to evaluate IC and its relationship with traditional measures of firm performance among Indian listed firms using dynamic SGMM and VAIC models.

How does ownership structure affect the financing and dividend decisions of firm?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Tahar Tayachi ◽  
Ahmed Imran Hunjra ◽  
Kirsten Jones ◽  
Rashid Mehmood ◽  
Mamdouh Abdulaziz Saleh Al-Faryan
Keyword(s):  
Ownership Structure ◽  
Dividend Policy ◽  
Generalized Method Of Moments ◽  
Institutional Ownership ◽  
Agency Cost ◽  
Debt Financing ◽  
Policy Implications ◽  
Managerial Ownership ◽  
Content Type ◽  
The Impact

Purpose Ownership structure deals with internal corporate governance mechanism, which plays important role in minimizing conflict of interests between shareholders and management Ownership structure is an important mechanism that influences the value of firm, financing and dividend decisions. This paper aims to examine the impact of the ownership structures, i.e. managerial ownership, institutional ownership on financing and dividend policy. Design/methodology/approach The authors use panel data of manufacturing firms from both developed and developing countries, and the generalized method of moments (GMM) is applied to analyze the results. The authors collect the data from DataStream for the period of 2010 to 2019. Findings The authors find that managerial ownership and ownership concentration have significant and positive effects on debt financing, but they have significant and negative effects on dividend policy. Institutional ownership shows a positive impact on financing decisions and dividend policy for sample firms. Originality/value This study fills the gap by proving the policy implications for both firms and investors, as managers prefer debt financing, but at the same time try to ignore dividend payment. Therefore, investors may not invest in firms with a higher proportion of managerial ownership and may choose to invest more in institutional ownership, which lowers the agency cost.

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