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1 – 8 of 8Corporate governance is the system of rules, practices, and processes used to direct and control a company. It is important to ensure that companies are managed fairly and…
Abstract
Corporate governance is the system of rules, practices, and processes used to direct and control a company. It is important to ensure that companies are managed fairly and transparently, protecting all stakeholders' interests. Joint-stock companies (JSCs) are a type of business organization in which ownership is divided into shares. Shareholders are the company's owners; they have the right to vote on important company matters (e.g., electing the board of directors and approving major financial decisions). International standards for corporate governance have been developed by a number of organizations, including the World Bank, the Organization for Economic Cooperation and Development (OECD), and the International Finance Corporation (IFC). These standards provide guidance on how to establish and maintain effective corporate governance systems.
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Cliff Oliver Winoto and Felizia Arni Rudiawarni
Banking industry is synonymous to larger dividend payment compared to other sectors. The complexity of dividend policy is further exacerbated by the occurrence of COVID-19…
Abstract
Banking industry is synonymous to larger dividend payment compared to other sectors. The complexity of dividend policy is further exacerbated by the occurrence of COVID-19 pandemic. This research is aimed to test the impact of COVID-19 pandemic on dividend policy relevance to firm value (FV). FV is measured by firm market value (MV) and TOBINSQ. Meanwhile, dividend policy is measured by dividend payout ratio and dividend yield ratio. This research used Indonesian Banking Companies listed in Indonesia Stock Exchange Period 2018–2022. This research does not find a significant impact of dividend policy on FV and supports Irrelevance Theory, both for pre-COVID-19 pandemic and during COVID-19 pandemic. However, this research finds differing significant impact on each bank’s common equity tier that reflects the dynamic expectation imposed by the market for each common equity tier. This research also finds a more profound negative and significant impact of dividend policy on FV for state-owned banks compared to private banks. Furthermore, banking-specific performance measurement like a non-performing loan (NPL) and capital adequacy ratio (CAR) consistently impacts the banks’ FV.
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David Tree and Dilin Wang
This study explores the relationship between firm value and conforming tax avoidance (tax avoidance that does not create a book-tax difference). Tax avoidance provides firms with…
Abstract
This study explores the relationship between firm value and conforming tax avoidance (tax avoidance that does not create a book-tax difference). Tax avoidance provides firms with more cash and creates value. However, conforming tax avoidance has costs, such as lower book income, and these costs potentially lower firm value. As such, it is unclear whether conforming tax avoidance is positively or negatively correlated with firm value. We use a measure of conforming tax avoidance that was recently introduced in the literature, and bifurcate tax avoidance into conforming and nonconforming portions using a large sample. We present evidence that investors place a negative value on conforming tax avoidance for the average firm. We also examine the top quartile based on the measure of conforming tax avoidance and find a positive correlation between firm value and conforming tax avoidance for this subsample.
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Nidhi Mittal and Sangeeta Mittal
Research and development (R&D) is a vital strategy for firms to sustain their competitive locus and profitability in the global marketplace. Therefore, the existing research is…
Abstract
Purpose
Research and development (R&D) is a vital strategy for firms to sustain their competitive locus and profitability in the global marketplace. Therefore, the existing research is engrossed in the correlation between firm performance (FP) and R&D intensity (RDI) meta-analysis. It also examined the ‘Type of Firm’ as a moderator in this relationship.
Need for the Study
This study is motivated by its potential to address existing knowledge gaps, guide decision-making, influence policy and contribute to advancing theoretical and practical insights in the domain of business, economics and innovation.
Methodology
This study is based on the secondary data. The researcher uses ‘Meta- Essentials 1.5’ for meta-analysis covering the studies of developed and emerging economies from 1985 to 2022.
Findings
The outcome conveys a small effect of magnitude between RDI and FP. It also indicates the positively significant linkage between them, directing that investing in R&D projects leads to improvement in the performance of companies. It also points out that private firms engaging in R&D activities have a negative while public firms have a positive correlation with their performance.
Significance
Understanding this linkage is imperative as it aids managers in making strategic decisions, the government in funding research-related schemes and investors in choosing R&D projects for investment.
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Lois S. Mahoney, Daniel R. Brickner, William LaGore and Philip A. Lewis
The COVID-19 pandemic resulted in economic and financial hardships on firms, forcing them to make tough decisions regarding their social and ethical behavior. The purpose of this…
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The COVID-19 pandemic resulted in economic and financial hardships on firms, forcing them to make tough decisions regarding their social and ethical behavior. The purpose of this study is to examine whether the COVID-19 pandemic affected the corporate social responsibility (CSR) performance and disclosures of the US S&P 500 firms. In particular, this study examined the relationship between both CSR performance and COVID-19 and the relationship between CSR disclosures and COVID-19 along with the dimensions of environmental, social, and governance. Using t-tests and panel data analysis for the years 2018 through 2021, we found that CSR performance and CSR disclosure increased after the start of the pandemic for total CSR and for the dimensions of environmental, social, and governance. We also found that CSR performance was impacted by a larger change than CSR disclosures for all dimensions of CSR. This study is one of the first to examine the impact of COVID-19 on CSR and helps stakeholders understand the role that it played on firm decisions. The results further illustrate the importance that firms’ managements place on CSR performance and disclosures, even during a time of significant challenge and uncertainty.
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We examine why Cash ETRs of US domestic firms have decreased over time. Using samples from two periods – an early period (1994–1998) and a late period (2011–2015) – we regress…
Abstract
We examine why Cash ETRs of US domestic firms have decreased over time. Using samples from two periods – an early period (1994–1998) and a late period (2011–2015) – we regress Cash ETRs in each period on a set of explanatory variables, and allow coefficients to differ across time periods. We find that, when coefficients are allowed to differ, there is no longer a decline in the unexplained portion of Cash ETR across the two periods, and that the previously observed decline is associated with a change in the relation between firm size and Cash ETR between the two periods. Further analysis suggests that the coefficient on firm size has been declining over the past 20 years, and that controlling for this time trend alone is sufficient to explain the declining trend in Cash ETRs for domestic firms.
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