scholarly journals Exploring the moderating effect of family CEO on the association between family ownership and firm value: An empirical analysis of top Indian family firms

2015 ◽  
Vol 12 (2) ◽  
pp. 349-361
Author(s):  
Lakshmi Kalyanaraman
Keyword(s):  
Family Member ◽  
Empirical Analysis ◽  
Interaction Effect ◽  
Firm Value ◽  
Family Firms ◽  
Stock Exchange ◽  
Moderating Effect ◽  
Market Valuation ◽  
Family Ownership ◽  
The Relationship

We study 288 family firms included in the NSE CNX 500 index of the National Stock Exchange of India. We find an entrenchment-alignment-entrenchment relationship between family ownership and firm value. We show that family CEO has a negative moderating effect on the relationship between family ownership and firm value. When the interaction effect of Family CEO on family ownership is controlled, only family shareholding in the alignment range is found to be statistically significant. The study shows that family firms with family CEO suffer from a decrease in market valuation. This finding is extremely valuable given the fact that India is dominated by family firms and majority of family firms appoint a family member as CEO

scholarly journals PENGARUH CSR TERHADAP NILAI PERUSAHAAN: INTEGRASI MANAJEMEN LABA SEBAGAI MEDIASI DAN KEPEMILIKAN KELUARGA SEBAGAI MODERASI

2021 ◽  
Vol 8 (1) ◽  
pp. 1
Author(s):  
Stacia Senjaya ◽  
Fransiskus Randa ◽  
Ferdinandus Sampe
Keyword(s):  
Earnings Management ◽  
Firm Value ◽  
Family Firms ◽  
Management Practices ◽  
Stock Exchange ◽  
Annual Reports ◽  
Family Ownership ◽  
Financial Reports ◽  
The Impact ◽  
The Relationship

<p><em>The purpose of this study is to investigate the role of family ownership integration in moderating and earnings management in mediating the relationship between CSR and firm value. The population used is all companies listed on the Indonesia Stock Exchange (BEI) with the 2015-2018 research period. The number of samples is 67 companies each year, which were selected by purposive sampling method. This study uses documentary data, namely annual reports and financial reports. Path analysis is used to analyze data. The results of this study indicate that CSR has a significant positive effect on earnings management, also earnings management on firm value has a significant positive relationship. The family ownership variable in moderates the relationship between CSR and earnings management is type Pure Moderation, conversely earnings management in mediating the relationship between CSR to the firm's value is type of No Mediation, nor is there any effect of integration of family ownership and earnings management on the relationship of CSR and firm value. The implication of this research, especially for family firms to maintain control of the company's operations, especially in the socio-emotional aspect compared to the financial aspect, because this contributes stakeholder to avoid the impact of earning management practices with the higher the discretionary accrual value is indicated to hide actions that harm firm’s reputation.</em></p>

scholarly journals The Role of Political Connections on Family Firms’ Performance: Evidence from Indonesia

2019 ◽  
Vol 7 (4) ◽  
pp. 55 ◽  
Author(s):  
Iman Harymawan ◽  
Mohammad Nasih ◽  
Muhammad Madyan ◽  
Diarany Sucahyati
Keyword(s):  
Family Firms ◽  
Stock Exchange ◽  
Least Square ◽  
Political Connections ◽  
Family Ownership ◽  
Ols Regression ◽  
Ordinary Least Square ◽  
Relationship Of ◽  
The Relationship

The purpose of this study is to investigate the relationship of firms with family ownership and their performance in Indonesia and further examine on how political connections affect this relationship. This study used 933 samples from 413 companies listed on the Indonesia Stock Exchange (IDX) in the period between 2014 and 2016. Using ordinary least square (OLS) regression, the results shows that firms without family ownership (non-family firms) have better performance than firms with family ownership (family firms) in Indonesia. Furthermore, the findings also show that the performance of family firms significantly improve when the firms are affiliated with political connections. Our findings imply that establishing political connections in family firms will increase the performance of the firms.

scholarly journals Board independence, earnings management and the moderating effect of family ownership in Jordan

2018 ◽  
Vol 13 (2) ◽  
pp. 985-994
Author(s):  
Mohammed Idris ◽  
Yousef Abu Siam ◽  
Mahmoud Nassar
Keyword(s):  
Earnings Management ◽  
Stock Exchange ◽  
Negative Relationship ◽  
Legal Protection ◽  
Moderating Effect ◽  
Family Ownership ◽  
Board Independence ◽  
Industrial Companies ◽  
The Relationship

Abstract This research examines the moderating effect of family ownership over the relationship between board independence and earnings management. Using information of industrial companies indexed on Amman Stock Exchange, this research provides evidence of negative relationship between board independence and earnings management, proposing that higher percentage of board independence is related with more effective monitoring to reduce earnings management. Moreover, the results document that the relationship between board independence and earnings management becomes weak when there is an interaction with family ownership control. These outcomes indicate that an increase in the percentage of independent directors to mitigate earnings management is less likely to be influential in the case of family controlled firms. The results of this research could be valuable to regulators in their efforts to restrict the incidence of earnings management and improve the quality of monitoring mechanisms, especially in an environment where the capital market is still evolving and the legal protection and law enforcement are weak.

scholarly journals Family ties, do they matter? Family ownership and firm performance in Peru

2012 ◽  
Vol 9 (4) ◽  
pp. 96-107 ◽  
Author(s):  
Julián Benavides Franco ◽  
Samuel Mongrut Montalván ◽  
Mónica González-Velasco
Keyword(s):  
Family Firms ◽  
Stock Exchange ◽  
Ownership Concentration ◽  
Board Members ◽  
Family Ownership ◽  
Industrial Firms ◽  
Family Ties ◽  
Accounting Performance ◽  
The Relationship ◽  
Excessive Risk

This paper studies the relationship between ownership concentration, family ownership, management, and market and accounting performance for 59 industrial firms listed in the Lima Stock Exchange during the period of 1999 to 2005. An inverted U-shaped relationship was found between ownership concentration and market performance in both family and non-family firms, pointing out an entrenchment effect or excessive risk aversion of the controlling group. This effect is worsened for family firms. The presence of family members as CEOs, Chairmen and Board Members is also negative for a firm’s performance and family ownership was found to increase the leverage of a firm.

Social and ethical practices and firm value: the moderating effect of green innovation: evidence from international ESG data

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Salim Chouaibi ◽  
Jamel Chouaibi
Keyword(s):  
Firm Value ◽  
Small Sample ◽  
Moderating Effect ◽  
Market Valuation ◽  
Green Innovation ◽  
Data Set ◽  
Ethical Practices ◽  
Content Type ◽  
Dynamic Dimension ◽  
The Relationship

Purpose This study aims to examine the potential effect of integrating social and ethical practices into strategy on the market valuation of environmental, social and governance (ESG) businesses using the moderating effect of green innovation. Design/methodology/approach The sample used consisted of 523 international firms listed on the ESG index and headquartered in North America and Western Europe, forming an unbalanced panel of 7,845 observations spanning the period 2005–2019. The authors run a fixed-effects panel regression model using the Thomson Reuters ASSET4 to test the relationship between societal and ethical practices and the stock market value creation. Similarly, as an extension of the research, this paper exploits two robustness analyzes. The authors tested the dynamic dimension of the data set through the generalized moment method and the effect of the legal system. Findings Evidence reveals a significant positive relationship between societal and ethical practices and businesses’ market valuation. The empirical results indicate that societal and ethical strengths increase firm value with the moderating effect of green innovation and weaknesses reduce it. The results found with the dynamic dimension of the data set indicate the existence of continuity between firm values over time. Research limitations/implications Given the long study period, many firms with missing data were eliminated. To avoid the small sample size, countries with few observations were included, which led to an uneven distribution between observations per country. Practical implications Findings from this paper can help ESG firms to consider their future growth opportunities in a context where the approach of business ethics occupies a central position in business valuation. Originality/value This study is the only study that provides ESG companies with seven different nationalities with evidence for the effect of social and ethical practices regarding market valuation. This paper is also relevant as it addresses the relationship between social effectiveness and financial efficiency, as well as the dynamic effect of this relationship.

scholarly journals Family Ownership and Tax Avoidance: An Analysis of Foreign Related Party Transactions and Dividend Payments

2020 ◽  
Vol 21 (2) ◽  
pp. 643-659
Author(s):  
Nuritomo ◽  
Sidharta Utama ◽  
Ancella A, Hermawan
Keyword(s):  
Family Firms ◽  
Tax Avoidance ◽  
Moderating Effect ◽  
Family Ownership ◽  
Tax Burden ◽  
Related Party Transactions ◽  
Dividend Payments ◽  
Negative Effect ◽  
The Relationship ◽  
Positive Effect

This paper aims to investigate the effect of shareholder tax burden on related party transactions (RPTs) and dividend payments in Indonesia. The paper also investigates the moderating effect of family ownership on the relationship between shareholder tax burden, RPTs and dividend payments. The study uses 451 firm-year observations comprising hand-collected data for the period 2010–2015. The results suggest that a high shareholder tax burden has a positive effect on RPTs and a negative effect on dividend payments. This indicates that companies engage in tax avoidance through dividend minimization and RPTs. When faced with a high tax burden, companies tend to reduce dividends and increase their RPTs in a bid to reduce their tax burden. This research also shows that the  positive effect of shareholder tax burden on RPTs is weakened with greater family ownership and that the negative effect of shareholder tax burden on dividend payments is strengthened by greater family ownership. This proves that Indonesian family firms tend to engage in tax avoidance through the use of dividend mechanisms as opposed to RPTs.

scholarly journals Existence Of Company Size In Control Towards Family Ownership And Debt Policy Value Of Companies

2020 ◽  
Vol 4 (2) ◽  
pp. 133
Author(s):  
Murtiadi Awaluddin ◽  
Alim Sholihin ◽  
Sumarlin Sumarlin ◽  
Rulyanti Susi Wardhani ◽  
Andi Sylvana
Keyword(s):  
Firm Value ◽  
Stock Exchange ◽  
Control Variable ◽  
Family Ownership ◽  
Company Size ◽  
Theory Analysis ◽  
Analysis Technique ◽  
Relationship Of ◽  
The Relationship ◽  
Debt Policy

This study aims to examine the effect of family ownership, debt policy on firm value with firm size as a control variable. The sample used was a family company listed on the Indonesia Stock Exchange from 2014 to December 2017. The type of this research was quantitative using Agency theory and Signaling Theory. Analysis technique with multiple regression analysis. The results showed that family ownership had a positive and significant effect on firm value, and debt policy had a negative and significant effect on firm value. While company size as a control variable in this study cannot control the relationship of the influence of family ownership and debt policy on firm value, in other words, company size as a control variable does not have a significant effect on the relationship of family ownership and corporate value policy debt.

Family Firms, Social Responsibility, and Non-Family Member Employees Identification

Think India ◽  
2013 ◽  
Vol 16 (3) ◽  
pp. 10-19
Author(s):  
Ang Bao
Keyword(s):  
Resource Allocation ◽  
Social Responsibility ◽  
Family Member ◽  
Program Implementation ◽  
Social Identity Theory ◽  
Family Firms ◽  
The Family ◽  
Corporate Social ◽  
The Relationship ◽  
Csr Engagement

The objective of this paper is to find the relationship between family firms’ CSR engagement and their non-family member employees’ organisational identification. Drawing upon the existing literature on social identity theory, corporate social responsibility and family firms, the author proposes that family firms engage actively in CSR programs in a balanced manner to increase non-family member employees’ organisational identification. The findings of the research suggest that by developing and implementing balanced CSR programs, and actively getting engaged in CSR activities, family firms may help their non-family member employees better identify themselves with the firms. The article points out that due to unbalanced CSR resource allocation, family firms face the problem of inefficient CSR program implementation, and are suggested to switch alternatively to an improved scheme. Family firms may be advised to take corresponding steps to select right employees, communicate better with non-family member employees, use resources better and handle firms’ succession problems efficiently. The paper extends employees’ identification and CSR research into the family firm research domain and points out some drawbacks in family firms’ CSR resource allocation while formerly were seldom noticed.

PENGARUH FAMILY OWNERSHIP, PERUBAHAN TARIF PAJAK DAN KEBIJAKAN HUTANG TERHADAP NILAI PERUSAHAAN

2017 ◽  
Vol 9 (2) ◽  
Author(s):  
Elfina Astrella Sambuaga
Keyword(s):  
Ownership Structure ◽  
Tax Reform ◽  
Stock Exchange ◽  
Family Ownership ◽  
Corporate Debt ◽  
Tax Rates ◽  
Manufacturing Companies ◽  
The Impact ◽  
The Relationship ◽  
Debt Policy

<p>This study aims to provide empirical evidence related to the influence of family ownership, tax reform on corporate debt policy, and further prove the impact on the firm value.This study examined the effect of changes in tax rates in 2009 and 2010 on the relationship between family ownership structure and corporate debt policy. The population of this research is manufacturing companies listed in Indonesia Stock Exchange for 8 consecutive years (2006-2013), with the period of observation for 7 years (2007-2013). A period of 8 years was taken to see a company that is consistently listed on the Stock Exchange prior to the end of the observation period. The result of this study shows that tax reform from progressive tax rates to a flat rate does not affect the relationship between family ownership structure and corporate debt policy. In contrast to the year 2009, changing rate from 28% to 25% in late 2010 was a significant effect on the debt policy with the company of family ownership. Based on the results, it was found that family ownership and debt policy significantly affect the company's enterprise value. It can be concluded, the higher the family ownership, the company's value would be diminished. Instead, the company's value will increase when the company adds to its debt policy.</p><p>Keywords : debt policy, family ownership, firm value, tax reform.</p>

Corporate Social Responsibility and Earnings Management: The Moderating Role of Family Ownership

2019 ◽  
Vol 12 (1) ◽  
Author(s):  
Asif Saeed ◽  
Aijaz Mustafa Hashmi ◽  
Attiya Yasmin Javid
Keyword(s):  
Corporate Social Responsibility ◽  
Social Responsibility ◽  
Earnings Management ◽  
Family Firms ◽  
Negative Impact ◽  
Stock Exchange ◽  
Least Square ◽  
Family Ownership ◽  
Corporate Social ◽  
The Impact

This study aims to explore the impact of family ownership on the relationship among corporate social responsibility (CSR) and earning management (EM) in Pakistan. Data is collected from nonfinancial listed firms on Pakistan Stock Exchange (PSE) for the period 2009-2017. Our results of pooled ordinary least square regression indicate that CSR has significant negative impact on EM. Furthermore, results also indicate that association between CSR and EM is moderated by family ownership. Family firms which perform CSR activities are less involved in EM as compare to nonfamily firms perform CSR activities. This variation in behavior of EM in family and non-family firms can possibly be explained by socioemotional wealth theory. Keywords: Corporate Social Responsibility, Earnings Management, Family Ownership

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