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Vietnam started significant transition policy since 1986 with the introduction of extensive policy of Doi Moi process. The transition from a centrally planned economy toward market-oriented economy has brought some significant results; however Vietnam has until recently stood out as a success story among the transitional economies from a developmental perspective. This requires further investigation of other factors relating to the viability assumption of neoclassical economics. This paper aims to investigate the relationship between corporate governance and firm value in Vietnam, a small and open neo-transitional economy. The result suggests a positive relationship of board size and the value of a firm, but it is not significant. The result also shows a lack of significant negative relationship of other two independent corporate governance variables (shareholder concentration and CEO duality) and the value of a firm. However, to some extent, too high shareholder concentration and CEO duality tend to have negative impacts to the firm value. Other control variables such as price-to-book value ratio and return on total assets have significant and positive impacts on the value of a firm, while the market capitalization has a negative relationship with the value of a firm.

This study aims to research examples of mergers and acquisitions of European and Latvian dairy firms, the motivation for these transactions and their results, and to show that mergers and acquisitions had a positive impact on the development of the dairy industry overall and on specific firms by increasing their competitiveness.

The authors analyze the reasons for, as well as the meaning and impact of, mergers and acquisitions on firm development, focusing on the example of dairy companies in Europe, and subsequently on these processes in Latvian dairy industry.

The study is based on the qualitative and quantitative analysis of firm financial reports as well as reports of the International Dairy Federation, publications of the United Nations Food and Agriculture Organization, annual reports of the International Farm Comparison Network, reports on the dairy industry in the European Union, Latvian Central Union of Dairy Producers, Lursoft firm registry data, as well as reports of the Ministry of Agriculture, and Latvian Farm Consultation and Education center.

The study relies on statistical comparisons of firm operations before mergers or acquisitions as well as during the process and afterwards. This allows identifying the impact of mergers itself on particular firms or the industry, while abstracting from exogenous factors. Mergers and acquisitions in Latvian dairy industry had begun in 2011 and continued until 2013. However, the geopolitical situation in Europe in 2015 had fully offset the positive impact of this process. The deterioration in the geopolitical climate due to developments in Russian–Ukrainian relations has had a big impact on the economic processes affecting the development strategy of dairy firms.

This study finds that often the problems of firm development are related to the lack of financial management especially deficiencies in decision making about firm mergers and acquisitions.

Historical and statistical analysis as well as comparisons of successful experiences in Europe and Latvia allows the authors to conclude that in evaluating decisions on the possibilities for mergers and acquisitions Latvian firms have to be guided by the most important results of this process: possible increases in foreign direct investment and the growth in market share. This will, in turn, give the firms an opportunity to acquire new technologies, reorganize manufacturing processes, and start producing goods with larger value added. Ultimately, this will allow increasing firm values.

We examine changes in controlling shareholder holdings, looking for evidence of financial tunneling (unfair wealth transfers from public investors to controlling shareholders). Our sample comprises yearly data during 2000–2011 on 75 large Israeli companies. We find that controlling shareholders are successful in timing the stock market – there exists a significant negative correlation between changes in the mean controlling shareholders’ equity holdings and market return. There is also some evidence that controlling shareholders increase (decrease) their holdings before years of positive (negative) excess returns in their shares. However, statistically significant mean excess returns are documented only after decreases in controlling shareholders’ holdings. Thus, we offer only limited support for the financial tunneling hypothesis.

This chapter investigates the effect of financial performance and corporate governance on market performance, using evidence from the companies listed on the IDX30 Index of the Indonesia Stock Exchange (IDX) from 2015 to 2018. The authors use six main independent variables and one dependent variable, controlled by using control variables in the regression analysis. Ordinary least square (OLS) regression methods are used to model the relationship between the dependent variable and the independent variables. The results show that the current ratio (CR) and Board Size (BS) have a significant negative effect on stock return (SR). In contrast, the quick ratio (QR) and debt to equity ratio (DER) have a significant positive impact on SR. Both the debt to asset ratio (DAR) and Independent Board of Commissioners (BOC) have an insignificant effect on SR. This evidence suggests that the CR, QR, DER, and BS are essential factors affecting SR.

Cross-border acquisitions play an important role in corporate strategic development and international expansion. During the past decades, mergers and acquisitions have been intensively researched through the lenses of strategic management, corporate finance, behavioral finance, etc. Despite the intense effort, the progress made is still fragmented and lacks unifying theories that approach the entire acquisition process on the one hand, and in-depth research of critical factors on the other. The intent of the research paper is to establish a vital link between academic research and practice of mergers and acquisitions, especially regarding the pre-acquisition evaluation.

In detail, the research paper investigates critical factors – and their inclusion in the pre-acquisition due diligence, before decision about acquisition is made. Pre-acquisition due diligence theoretically conforms to organizational learning theory, which proposes the more the acquiring firm learns about the acquisition target, the higher the probability of a successful acquisition. The central hypothesis states that due diligence, including the critical factors, in the pre-acquisition phase is related to acquisition success.

Using a multidimensional measure of critical factors, the empirical evidence is based on 85 cross-border acquisitions that took place between 2007 and 2013 in the European automotive industry. The quantitative analysis finds positive association between the Choice of Strategic Partner, Business Capabilities and HR Knowledge, and Financial Factors and Acquisition Premium as critical factors of due diligence and acquisition success. The strongest relationship is between business capabilities and knowledge transfer as the main asset for realization of synergy values and successful acquisition. In this context, the valuation of the business capabilities of the acquisition targets is classified as the main challenge for reflecting suitability of the acquisition price and establishing value generation from the combined firms in the post-acquisition phase.

By studying acquisition risk and critical factors – both success and failure reasons – this research tested and proved theoretically sound framework for successful acquisition. From a practical standpoint, the research results provide acquisition management with a proven model for pre-evaluating acquisition candidates by means of comprehensive due diligence.

This study investigates the impacts of operational risks and corporate governance on bond yield spreads, examining their impacts on bond yield spreads during the COVID-19 pandemic. The results indicate that operational risks significantly raise yield spreads, especially for high-leverage firms. Moreover, a higher independent director percentage reduces debt costs. Furthermore, the results reveal more pronounced effects of operational risks on yield spreads during the COVID-19 pandemic, with these risks increasing the financing costs for large firms. When the effect of the independent director percentage on the yield spreads increases, this consequently raises the debt costs for large firms.

As the influence of institutional investors over managerial decision-making grows, so does the importance of understanding the effect of institutional investor ownership (IO) on firm outcomes. The authors take a comprehensive approach to studying the effect of IO on earnings management (EM).

The authors study the relation between IO and EM using a sample of 59,503 listed U.S. firm-year observations from 1981–2019. The authors proxy EM with earnings surprises and with accrual-based and real activity measures. The authors test for nonlinear relations and analyze changes resulting from the passage of the Sarbanes–Oxley Act.

The findings support a positive IO-EM relation overall, but show that the relation is dynamic and heavily context-dependent with evidence of nonlinearity. The authors also find evidence that IO positively affects accrual-based EM and real activities EM negatively.

To the authors’ knowledge, this is the first study of the IO-EM relation to consider evidence of nonlinearity in the U.S. context, measuring changes to the relation over time, and with the use of several measures of EM.

Executive decisions regarding capital financing are an important management aspect, especially during financing constraints and growth opportunities. The current study examines the impact of managerial skills of a company on capital financing decisions. Furthermore, it analyzed this nexus in financing constraints and growth opportunity situations.

The authors use the GMM (generalized method of moments) estimation approach on a dataset of 20,651 firm-year observations of Chinese A-share companies from 2010 to 2019.

The authors’ findings are compatible with management signaling and reputation enhancement theories, since they show that managerial skill is connected with more substantial debt financing. Managers with high management skills are likely to have more debt financing as they can foresee the economic future of their companies and tactfully convey private information, lowering information inequality and enhancing their reputation. Furthermore, the authors also show that firms with restricted financial resources and growth opportunities make this relationship stronger. Capital structure and managerial skill findings are unaffected by alternative specifications, omitted factors, industry group bias and endogeneity.

This study sheds fresh light on the essential manager personality trait of managing ability and how it influences complicated corporate decision-making, particularly in the tough environment due to financing constraints and competitive growth. The authors argue that high-ability managers are compelled to use debt financing not only to lessen information asymmetry but also to guarantee that the market finds their superior ability. This work contributes significantly to the managerial ability literature and the capital structure literature supporting signaling theory.

This paper has a triple objective: first, to investigate the effect of the adoption of ethics codes on bank performance, second, to analyse the role played by the risk committee (RC) effectiveness in improving bank performance and finally, to assess the indirect role that the implementation of ethics codes exerts on the latter relationship.

The research questions are examined using an international sample of large banks worldwide from 2006 to 2017, applying the dynamic generalized method of moments (GMM) model for panel data.

The authors find that risk management committee size and independence have a positive and significant effect on bank performance. This highlights the importance of the risk governance function in enhancing bank performance. Most importantly results reveal that although larger RC tends to improve bank performance, this linkage is less strong when adopting ethical codes. They also find that the adoption of ethical codes by banks positively affects the relationship between the functioning of RC and performance.

Although it is well known that risk management, business ethics and performance are interrelated, there is no research that has dealt with this question.

The authors examine the impact of employee litigation on Securities Action Lawsuits. The authors study whether frequently sued firms are more likely to be investigated by Securities Exchange Commission (SEC). The authors study how labor relations are crucial to corporate governance.

The authors use hand-collected datasets of employee violations, misconducts and lawsuits and test whether bad employee treatment increases the likelihood of SEC probe. The authors' methodology includes panel fixed effects, as well as alternative measures of employee mistreatment and SEC case.

The authors find that with each increase in employee dispute increases the likelihood of the firm being investigated by the SEC. The authors find that geographically dispersed firms are more likely to be investigated by the SEC when facing employee disputes and that more labor union coverage and a higher unemployment rate triggers more employee allegations and labor-related lawsuits.

The authors' study is the first to investigate how employee relations affect firms involving federal investigation. The authors aim to contribute to the literature by studying (i) the relation between employee mistreatment and legal challenges, (ii) how firm characteristics affect the path from employee disputes to securities class actions and (iii) the impact of employee mistreatment on the corporate governance.