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1 – 10 of over 69000Mara Sousa and Maria João Santos
This article addresses gender imbalances in senior company board decision-making positions and analyses the effects of applying gender quotas in European countries, through…
Abstract
This article addresses gender imbalances in senior company board decision-making positions and analyses the effects of applying gender quotas in European countries, through comparative and interpretative data analysis.
The results clearly demonstrate that those countries implementing quotas not only return higher levels of female representation on their boards of directors – approximately 40% – but also register higher rates of growth over both countries without quotas and those with quotas but without sanctions. Results furthermore suggest that the success of any quota system deeply depends on its formulated terms, on a country's corporate culture, on social receptivity and, at the micro level, on the sector an organisation belongs to.
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This paper examines the adoption of internationally accepted accounting standards by European companies listed on the New York Stock Exchange. The study focuses on the evolution…
Abstract
Purpose
This paper examines the adoption of internationally accepted accounting standards by European companies listed on the New York Stock Exchange. The study focuses on the evolution of the use of different generally accepted accounting principles (GAAP), and on the features of those companies that have adopted these non‐local GAAP.
Design/methodology/approach
The sample was obtained from 336 Forms 20‐F for the period 1997‐2000. Using the information included in contingency tables and Pearson chi‐square statistic, proves whether there are any relationships between GAAP choice and other explanatory factors, i.e. country, size, industry, time listed and profitability.
Findings
The majority of the analysed companies keep using domestic‐GAAP. IAS firms are mainly non‐financial entities based in Switzerland and more profitable than US‐GAAP companies, which are mainly financial entities or companies engaged in SIC code 7 (services) based in Germany and less profitable than IAS firms.
Research limitations/implications
The most important limitation of the paper is the period of the study. It is admitted that a deeper analysis would imply obtaining data from the most recent years.
Originality/value
Bearing in mind the next adoption in Europe of International Financial Reporting Standards issued by the IASB, the results of the paper give a clue about the type of European multinationals which tend to adopt non‐local GAAP, and which kind of internationally accepted accounting standards they preferentially adopt.
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Giancarlo Giudici and Peter Roosenboom
In this chapter we describe the development of venture capital and new stock markets in Europe. We argue that markets for high-growth stocks offer venture capitalists a valuable…
Abstract
In this chapter we describe the development of venture capital and new stock markets in Europe. We argue that markets for high-growth stocks offer venture capitalists a valuable exit opportunity for their investments. This allows them to re-invest their money in other start-up companies and may spur the rate of new business creation and technological innovation. The private equity market in Europe today is as large as it was just before the advent of new stock markets in 1997–1999. As such, the need for stock markets that allow private equity investors to divest their equity stakes in growth companies did not disappear.
Jean‐Michel Sahut, Sandrine Boulerne and Frédéric Teulon
The purpose of this paper is to study the information content of intangible assets under IAS/IFRS when compared to local GAAP for European listed companies.
Abstract
Purpose
The purpose of this paper is to study the information content of intangible assets under IAS/IFRS when compared to local GAAP for European listed companies.
Design/methodology/approach
The paper employs multivariate regression models for a sample of 1,855 European listed firms in a six‐year period, from 2002 to 2004 in local GAAP and from 2005 to 2007 in IAS/IFRS to investigate the empirical relationships between market value of European firms and book value of their intangible assets.
Findings
The results suggest that the book value of other intangible assets of European listed firms is higher under IFRS than local GAAP and has more informative value for explaining the price of the share and stock market returns. European investors, however, consider the financial information conveyed by capitalized goodwill to be less relevant under IFRS than with local GAAP. Thus, identified intangible assets capitalized on European company balance sheets provide more value‐relevant information for shareholders than unidentified intangible assets that have been transferred into goodwill, with the exception of Italian and Finnish investors.
Originality/value
The paper adds to the existing literature on IFRS by documenting the association between the market value of European listed firms and the book value of their goodwill and other intangibles assets. The study complements prior studies by demonstrating that country differences persist despite the use of common accounting standards and that legal and regulatory country characteristics as well as market forces could still have a significant impact on the value relevance of accounting data.
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This study aims to analyse the relationships between board processes, board role performance and board effectiveness for a cross-country (UK and Romania) sample of comparable…
Abstract
Purpose
This study aims to analyse the relationships between board processes, board role performance and board effectiveness for a cross-country (UK and Romania) sample of comparable European listed companies.
Design/methodology/approach
The research design is quantitative in nature and based on the survey method, a self-administered questionnaire which was send to 342 chairmen of selected Romanian and British listed companies and which contains validated statements measured through a seven-point Likert-type scale and grouped in validated constructs.
Findings
This study found further empirical evidence that board processes are stronger determinants of board effectiveness than board characteristics and that board roles mediate the relationship between board processes and board effectiveness. It further confirmed the relevance of the three board processes mentioned by Forbes and Milliken (1999) in their seminal work on board decision-making.
Research limitations/implications
The main limitation of this study is the relatively small number of responses (55), which indicates a reduced reliability and generalizability of the results. However, several steps were taken to assure the homogeneity of the sample, starting with a unique data set of firms of comparable size and industry representation.
Practical implications
This study is useful to board directors and chairmen of listed companies, as it can help them to better understand and manage board behaviour.
Originality/value
This study contributes to the limited body of research that investigates specific board process constructs derived from the small team literature and their effect on board effectiveness.
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Peter Curwen, Bert Sadowski and Jason Whalley
This paper aims to identify the number of European companies among the world’s largest telecommunication, media and technology (TMT) companies. Through this, industry trends will…
Abstract
Purpose
This paper aims to identify the number of European companies among the world’s largest telecommunication, media and technology (TMT) companies. Through this, industry trends will be discerned and light shed on whether European companies are losing out to their rivals based in the USA and Asia in relation to the new highly technological economy that is emerging.
Design/methodology/approach
The paper begins by outlining the context for the study before detailing the data sources used in the analysis of the world’s largest TMT companies. The data are drawn from successive annual lists of the world’s largest companies published by the Financial Times.
Findings
The paper highlights the limited European presence among the world’s largest TMT companies. A significant proportion of these companies provide telecommunication services.
Research limitations/implications
The paper draws on annual lists compiled by the Financial Times. The categorisation adopted in these lists changes over time and does not facilitate the identification of TMT operations in companies where the main activities are in other sectors.
Practical implications
There is a need for more data to be available in the public domain. One aspect of this relates to the need to extend the analysis to include smaller TMT companies, while another is the need for more detailed information regarding companies operating in more than one sector.
Originality/value
The paper extends existing research into structural change within the TMT sector by focussing on Europe. A longitudinal approach is adopted, with the companies uniquely divided into six lines of business.
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Fabio La Rosa and Francesca Bernini
This paper aims to investigate the effect of environmental, social and governance (ESG) controversies on the cost of equity (COE) capital, exploring the moderating role of both…
Abstract
Purpose
This paper aims to investigate the effect of environmental, social and governance (ESG) controversies on the cost of equity (COE) capital, exploring the moderating role of both positive ESG performance and market securities regulation.
Design/methodology/approach
This paper adopts a sample of 2,599 time observations related to European listed companies for which the authors examine a set of 30 negative ESG scores across the three pillars in terms of controversies, compliance and other negative issues. This study uses the average of seven implied COE estimates.
Findings
The results show that negative ESG performance, particularly environmental controversies, increases the COE, although this impact is mitigated when associated with company efforts to improve environmental performance. Besides, environmental controversies are likely to increase the COE in countries where the market regulation is stronger, as a consequence of higher investors’ expectations towards the scrutiny role of more efficient markets against companies’ controversies.
Practical implications
Companies should take care seriously of environmental issues such as biodiversity, product impact and resource impact, because investors do react accordingly. As despite no direct effects of positive ESG performance are observed in terms of COE reduction, the mitigating role on the ESG controversies–COE relationship makes ESG practices still significant for European investors.
Social implications
The effects of ESG performance on company financial performance should be investigated under the assumption that bad events weight more than positive ESG performance.
Originality/value
Because no prior studies have specifically assessed the effect of the European listed companies’ ESG controversies on their COE, this paper delivers insights into the relationship between positive and negative ESG performance and their effects on capital market financing.
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Fabio Bertoni and Pier Andrea Randone
This chapter analyses how capital is raised and employed by a sample of 28 European biotechnology companies listed on Europe’s new stock markets from 1996 to 2000. We find that…
Abstract
This chapter analyses how capital is raised and employed by a sample of 28 European biotechnology companies listed on Europe’s new stock markets from 1996 to 2000. We find that biotechnology companies rely heavily on IPO proceeds in order to finance their growth. We compare the behaviour of European firms to a sample of comparable U.S. firms. The analysis reveals that European companies tend to raise more capital at the IPO and to invest more aggressively in the short-run, whereas U.S. biotech firms tend to have more cash available before the IPO and invest more conservatively in the short-run.
The purpose of this paper is to focus on Initial Public Offering (IPO) investments, performance and activity in times of the global financial crisis.
Abstract
Purpose
The purpose of this paper is to focus on Initial Public Offering (IPO) investments, performance and activity in times of the global financial crisis.
Design/methodology/approach
The paper utilizes, in a pioneering attempt, a modified regression model that is widely used in medical research (i.e. measuring the effectiveness of painkillers, aspects of breastfeeding, cancer research) but proved efficient and informative for the studied area. Embarking on Cox's Hazard Model perfectly mirrored investors' approach to IPO investments. Henceforth, the empirical findings reported in the paper became practical for IPO investors. The quantitative findings are then discussed with high‐profile practitioners, in order to inject more realism into the study. The qualitative research framework expands the empirical analysis to cover significant issues related to IPO activities and proves invaluable in the process of constructing practical implications.
Findings
Since the main purpose of the paper is to test the profitability of targeting IPOs from the Polish stock market, the main research question attempted in the paper refers to finding out whether IPO investments constitute an attractive alternative for direct equity investments, especially during the global financial turmoil. On this occasion, the current paper advises on trading strategies that involve targeting IPOs and shield investors from experiencing crisis‐induced losses. These findings remain topical as they contribute to the current debate on tailoring investment approaches to the global financial crises. Furthermore, focusing on the issues related to the overblown deficit reported by the transition economy delivers novel and important implications for policymakers striving to stabilize budget in the aftermath of the nascent financial crisis.
Originality/value
What distinguishes the paper from previous studies is the original methodology, three‐dimensional approach to IPO activities (adopting a company's, investor's and policymaker's perspectives) and focusing on the systemically important European market that somehow was overlooked by previous studies in this area but recently vaulted into prominence among international investors who regard the Polish stock market as a regional leading bourse.
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