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Based on signaling theory, this paper aims to explore the impact of supply chain transparency (SCT) on firms' bank loan (BL) and supply chain financing (SCF) in the context of voluntary disclosure of supplier and customer lists.

Based on panel data collected from Chinese-listed firms between 2012 and 2021, fixed-effect models and a series of robustness checks are used to test the predictions.

First, improving SCT by disclosing major suppliers and customers promotes BL but inhibits SCF. Specifically, customer transparency (CT) is more influential in SCF than supplier transparency (ST). Second, supplier concentration (SC) weakens SCT’s positive impact on BL while reducing its negative impact on SCF. Third, customer concentration (CC) strengthens the positive impact of SCT on BL but intensifies its negative impact on SCF. Last, these findings are basically more pronounced in highly competitive industries.

This study contributes to the SCT literature by investigating the under-explored practice of supply chain list disclosure and revealing its dual impact on firms' access to financing offerings (i.e. BL and SCF) based on signaling theory. Additionally, it expands the understanding of the boundary conditions affecting the relationship between SCT and firm financing, focusing on supply chain concentration. Moreover, it advances signaling theory by exploring how financing providers interpret the SCT signal and enriches the understanding of BL and SCF antecedents from a supply chain perspective.

Purpose: In reality, financial decisions are made under conditions of asymmetric information that results in either favorable or adverse selection. As far as financial decisions affect growth of the firm, the latter must also be affected by either favorable or adverse selection. Therefore, the core objective of this chapter is to examine the determinants of each financial decision and the effects on growth of the firm under conditions of information asymmetry.

Design/Methodology/Approach: This chapter uses data for the non-financial firms listed in S&P 500. The data cover quarterly periods from 1989 to 2014. The statistical tests include linearity, fixed, and random effects and normality. The generalized method of moments estimation method is employed in order to examine the relative significance and contribution of each financial decision on growth of the firm, respectively. Standard and proposed proxies of information asymmetry are discussed.

Findings: The results conclude that there is a variation in the impact of financial variables on growth of the firm at high and low levels of information asymmetry especially regarding investment and financing decisions. A similar picture emerges in the cases of firm size and industry effects. In addition, corporate dividen d policy has a similar effect on firm growth across all asymmetric levels. These findings prove that information asymmetry plays a vital role in the relationship between corporate financial decisions and growth of the firm. Finally, the results contribute to the vast literature on the estimation of information asymmetry by demonstrating that the classical and standard proxies for information asymmetry are not consistent in terms of the ability to differentiate between favorable or adverse selection (which corresponds to low and high level of information asymmetry).

Originality/Value: This chapter contributes to the related literature in two ways. First, this chapter offers updated empirical evidence on the way that financing, investment, and dividends decisions are made under conditions of favorable and adverse selection. Other related studies deal with each decision separately. Second, the study offers new proxies for measuring information asymmetry in order to reach robust estimates of the effects of financial decisions on growth of the firm under conditions of agency problems.

The operational framework of external financing in the correlation between the gender of entrepreneurs and firm performance remains to be resolved. This study aims to investigate the mediating effect of external financing on gender-based disparities in private firm performance and to explore its heterogeneity within the Chinese context.

Based on national data from the 10th to 13th Chinese Private Enterprise Survey, this study used a bootstrap-based mediation effect model to analyze the role of external financing as a mediator in the relationship between entrepreneur gender and firm performance.

This study found that external financing is a constructive mediator between entrepreneur gender and firm performance. Heterogeneity analysis revealed that external financing plays a complementary mediation role in the impact of entrepreneur gender on performance in West China. In the tertiary industry, external financing acts as the sole mediator for the impact of gender on firm performance. Notably, this mediating effect is present in non-startups but not in startups.

The findings suggest that external financing can improve the firm performance of female entrepreneurs. Governments and policymakers should strengthen financial support for female entrepreneurs in West China, tertiary industry and non-startup enterprises.

This paper contributes to the literature on gender and corporate governance by shedding light on the mediating role of external financing in the relationship between the gender of business owners and firm performance.

The main purpose of this paper is to empirically examine how firm-specific (idiosyncratic) and macroeconomic risks affect the external financing decisions of UK manufacturing firms. The paper also explores the effect of both types of risk on firms' debt versus equity choices.

The paper uses a firm-level panel data covering the period 1981-2009 drawn from the Datastream. Multinomial logit and probit models are estimated to quantify the impact of risks on the likelihood of firms' decisions to issue and retire external capital and debt versus equity choices, respectively.

The results suggest that firms considerably take into account both firm-specific and economic risk when making external financing decisions and debt-equity choices. Specifically, the results from multinomial logit regressions indicate that firms are more (less) likely to do external financing when firm-specific (macroeconomic) risk is high. The results of probit model reveal that the propensity to debt versus equity issues substantially declines in uncertain times. However, firms are more likely to pay back their outstanding debt rather than to repurchase existing equity when they face either type of risk. Of the two types of risk, firm-specific risk appears to be more important economically for firms' external financing decisions.

The findings of the paper are equally useful for corporate firms in making value-maximizing financing decisions and authorities in designing effective fiscal and monetary policies to stabilize macroeconomic conditions. Specifically, the findings emphasize on the stability of the overall macroeconomic environment and firms' sales/earnings, which would result stability in firms' capital structure that help smooth firms' investments and production.

Unlike prior empirical studies that mainly focus on examining the impact of risk on target leverage, this paper attempts to examine the influence of firm-specific and macroeconomic risk on firms' external financing decisions and debt-equity choices.

This paper aims to empirically examine the financing of small and medium sized enterprises (SMEs) through a financial growth lifecycle model.

Data in publicly available databases are generally unsuitable to examine the financial lifecycle model, thus a questionnaire survey was employed to collect data. Because of the well‐documented reticence of SME owners to reveal detailed financial information, data were requested in percentage form. This innovative methodology was successful, as 92 per cent of respondents disclosed detailed financing data. A response rate of 42.6 per cent across six industry sectors provided data to employ parametric techniques. Reporting and analysing the large primary data set across six age categories, a number of statistical tests were conducted to test the financial growth lifecycle model.

Analysis of respondents' capital structures across age groups indicates distinct changes in sources of finance employed by firms over time. Financing choices are consistent with Myers's pecking‐order hypothesis, and the importance of profitability in financing SMEs is emphasised. Contrary to conventional wisdom, respondents in the youngest age category report a relatively high use of debt financing. This is explained by the provision of firm owners' personal assets to secure firm debt.

The key contribution of this paper is to provide an empirical examination of the financial growth lifecycle model by combining a number of statistical tests. This approach is significantly different to that traditionally adopted in empirical investigations of SME financing, which is to examine the applicability of theories developed in corporate finance on panel data. Additionally, the paper presents data on personal sources of finance employed by firm owners, which is typically not available, even in comprehensive secondary databases.

The purpose of this paper is to investigate the impact of different sources of external financing and internal financial capabilities on competitiveness and sustainability. This paper also studies the nature of their relationships related to regulations on external financing in Chinese capital market.

Resource- and industry-based views provide a theoretical background. Based on balanced panel of 4,530 firm-year observations, hierarchical regressions were used to examine the research model.

Results support the idea that the strict Chinese regulatory regime allows some firms to access capital and debt markets for financing more than others. It was found that firms’ internal financing abilities do not offer a significant advantage compared to external financing abilities; firms’ abilities to raise capital from existing shareholders, the public and easy access to bank financing are related positively for an advantage on firm’s competitiveness within a industry. Firms with the ability to offer shares to existing shareholders, issue non-convertible and convertible bonds and access to bank financing are sustainable in long-run.

This study focuses on sources of financial capability of Chinese listed firm impact on competitiveness and sustainability. It is context specific to a regulated market. Hence, it is necessary to replicate this study in other contexts.

Implications include the need to mobilize external financial resources for small and privately-owned firms and to further reform security regulations to ensure fair competition and sustainability.

The authors originally investigate the effect of sources of financial capability impact on firms’ competitiveness and sustainability in a regulated market. The paper explains the relationships, and enhances the understanding of regulated capital market and existing literature.

This study aims to investigate the relationship between political connections, financing decisions and cash holding.

Based on historical data from 181 active non-financial firms listed on Gulf Cooperation Council (GCC) Stock Exchange Markets during the period of 2009–2016, this study uses ordinary least squares and dynamic system-generalized method of moments to test the research hypotheses. The final data set comprises a total of 1,448 firm-year observations from ten major non-financial industry classifications.

This study finds a positive relationship between political connections and each of internal financing proxied by retained earnings ratio and external financing proxied by short- and long-term debt to total asset. The findings also show a positive relationship between political connections and cash holding.

The findings of the study provide a better understanding of the role of politically connected directors in financing decisions and cash holding in the GCC. Investors can consider the presence of royal family members in the board of directors when making investment decision. Policymakers are encouraged to develop more effective policies that encourage listed firms to provide information on the political positions of the board of directors, managers and major shareholders/owners of companies.

This study contributes to the literature by providing empirical evidence on the relationship between political connections and financing decisions by focusing on the GCC region. This study also highlights that boards in connected firms in the GCC have lower monitoring role owing to political interventions, and that connected firms face higher agency problems as they have weak governance and boards compared with non-connected firms.

The purpose of this paper is to examine the various factors that influence a small and medium enterprise’s (SME) decision to apply for bank loans.

Data from survey responses of 145 SMEs from Selangor and the Federal Territory of Kuala Lumpur are used for this purpose. Exploratory factor analysis, logistic regression and SEM-PLS are used to analyze the data.

The findings from the survey show that an SME’s financial performance, its access to finance and its legal form play a significant positive role in its decision to apply for debt financing. Private limited SMEs that perform well and are able to access to various financing options are more likely to apply for financing. However, there is also evidence of a significant negative influence of credit history on the decision to apply for financing, as SMEs with a poor credit history are more likely to apply for financing. The age of an SME has weak influence while its size is found to be insignificant in influencing its decision to apply for financing.

The results imply the role of financial market imperfections such as adverse selection and information asymmetry in defining the SME’s demand for debt financing. The study contributes to a deeper understanding of the debt financing decisions of SMEs.

The aims of the paper are three‐fold: first, to analyse how small and micro firms finance themselves; second, to investigate what their financing preferences are; and third, to explore their opinions on how they evaluate the financing sources and the various obstacles they face in accessing those sources.

The paper uses a sample of Greek small and micro firms, which cover 99.6 per cent of the total number of firms operating in Greece. The data are derived from the answers in a structured questionnaire.

The main conclusions are as follows. Regarding equity financing, firms rely heavily on their own funds and would not raise new equity from sources outside the family; thus, there is a reluctance to use new outside equity (venture capital, business angels, etc.). Regarding debt financing, firms denoted that they would use more debt, specifically long‐term debt, than they currently do. Thus, there are limitations in accessing long‐term debt financing. Regarding grant financing, micro and small firms should be better informed and encouraged more to participate in state grants and co‐financed programs; thus, there is an informational gap in grant financing.

The paper uses a sample of Greek micro and small firms and a survey methodology to tackle the lack of quantitative published data for most small firms in Greece. It incorporates distinct sources of funds that are very important for small firms (family funds, grants provided by the state and micro‐loans). It investigates preferences, not just practices.

The purpose of this paper is to investigate the effect of financial factors on firms’ financial and tax reporting decisions. Firms often face the difficulties of accomplishing both financial and reporting goals. The extent to which reporting they put more value depends on the differential weighting of firms’ financial reporting and tax costs. The authors incorporate various financial factors as a source of cross-sectional differences in the weighing of both financial reporting and tax costs.

To examine firms’ decisions when fulfilling both the purposes of financial and tax reporting is difficult, the authors use a large set of firms in Korea, where book-tax conformity is high and aggressive tax shelters are restricted. The authors develop a new measure that can specify firms’ decision making between financial and tax reporting by considering both earnings management and tax avoidance.

The findings show that debt ratio affects firms’ financial and tax reporting decisions non-monotonically depending on the level of the debt ratio. The authors also find that firms with more long-term debt financing are more likely to be aggressive in financial reporting, while firms with higher financing deficit or better access to the capital market are more likely to be aggressive in tax reporting.

Thus, the findings provide more compelling evidence of firms’ decision making between two conflicting strategies, particularly when fulfilling both the purposes of financial and tax reporting is difficult. The authors expect that the results provide practical implications to standard setters, auditors and financial statement users who are interested in the ongoing debate over book-tax tradeoffs.

This paper fulfills an identified need to study how firms’ decision making between two conflicting reporting strategies are affected by the various financial factors, which are closely linked to a firm’s financial reporting and tax costs.