Search results

In this research, we explore the adverse impact of foreign ownership on operational security, a critical operational implication of the liability of foreignness (LOF).

The empirical analysis is based on a multi-country dataset from the World Bank Enterprises Survey, which contains detailed firm-level information from over 8,902 firms in 82 emerging market countries. We perform a series of robustness checks to further confirm our findings.

We find that a high ratio of foreign ownership is associated with an increased likelihood of security breaches and higher security costs. Our results also indicate that high levels of host countries’ institutional quality and firms’ local embeddedness can mitigate such vulnerability in operational security.

This study is one of the first to uncover the critical operational implication of the LOF, indicating that a high ratio of foreign ownership exposes firms to operational security challenges.

The security issue in supply chains is among the most pressing concerns that firms are currently facing. As a preliminary attempt to address this lack of empirical research, the primary purpose of this paper is to explore the relationship between security practices and the security operational performance with respect to security culture as a moderator.

With the resource-based view of the firm as the theoretical underpinning, the study utilizes survey data to test the propositions derived from the security literature and partial least squares for the analysis.

The research reveals four crucial practices of supply chain security that collectively affect a firm’s security operational performance among Malaysian service providers. It is also interesting to observe that security culture positively moderates the relationship between facility management and the security operational performance of the firm.

Firms in emerging countries need to realize that supply chain security practices can result in significant benefits to their firms that can give them additional incentives to adopt these initiatives. This study may also help policymakers in emerging countries, in general, in setting appropriate policies and strategies, and Malaysia, in particular, for ensuring that it is a secure location for exporting cargo and giving assurance to the local and international investors to continue their investment.

This study will assist supply chain managers and logisticians to re-examine their existing supply chain security model by considering the selected supply chain security practices, which have a significant impact on supply chain security operational performance. Individual firms need to strategize their business model with the inclusion of security aspects, which will surely create a competitive advantage over other players in the logistics industry. Firms can develop the best appropriate supply chain security model that will benefit the firm, customers, and business partners, such as suppliers and local authorities.

The study highlights is the important role of the supply chain security practices to deliver high quality of service in terms of supply chain security operational performance in emerging countries. In addition, it offers an empirical analysis of the moderating role of security culture on the relationship between supply chain security practices and security operational performance.

The purpose of this paper is to investigate the domain of security analysts' earnings forecasts as a valid measure of firm performance.

A survey instrument was developed and sent to 1,350 security analysts to ascertain the criteria they used in evaluating firm performance.

Factor analysis indicates strong support for organizational level variables, such as top management, CEO ability, corporate culture, size as opposed to environment and industry level variables.

The domain of security analysts' earnings forecasts is broader than traditional accounting‐ and market‐based measures and more closely matches the realm of the strategic management field.

The study presents new evidence that key organizational variables influence security analysts' earnings forecasts.

The present study is the first to the best of one's knowledge that ascertains the factors that security analysts utilize in making earnings forecasts for the firms they follow.

The paper investigates whether firms’ exposure to information security risk influences firms’ costs of capital. Most IT firms highly rely on computer systems and network appliances; it may cause disasters if firms are involved in great information security risk. In the sample of Taiwan’s semiconductor firms during 2005–2016, we show that ISO 27001-certified firms (a well-known information security certificate) have lower costs of debt, but whether firms are ISO 27001-certified is not associated with firms’ costs of equity. Our findings are consistent with modern financial theories: debt holders, as put writers to firms’ value, benefit from firms’ lower information security risk, and better corporate governance, and thus lower firms’ costs of debt. On the other hand, equity holders should hold efficient portfolio through diversification and thus firms’ costs of equity should not be influenced by firms’ information security risk, which belongs to idiosyncratic risk in the portfolio theory.

The purpose of this paper is to provide excerpts of selected Financial Industry Regulatory Authority (FINRA) Regulatory Notices issued from January to March 2008 and a sample of disciplinary actions during that period. In July 2007, FINRA Regulatory Notices replaced NASD Notices to Members.

The paper provides excerpts from Regulatory Notice 08‐04, Delta Hedging Exception; 08‐08, Auction Rate Securities; 08‐09 Portfolio Margin Accounts; 08‐10, Options Position and Exercise Limits; 08‐12, Principal Approval of Sales Material; and 08‐13, Short Interest Reporting Requirements.

The paper reveals current regulatory trends.

The paper provides direct excerpts designed to provide a useful digest for the reader and an indication of regulatory trends.

We provide evidence of stock market performance prior to announcements of the assuance or retirement of securities which is consistent with Myers and Majluf [1984] and Miller and Rock [1985]. Stocks of firms issuing seasoned common equity are significantly over‐valued in the market prior to the issue, but in the year following, decline to their original level. Stocks of firms issuing convertible debt also are over‐valued, but to a lesser degree than that of firms issuing seasoned equity. Stock of firms issuing straight debt appears to be neither over‐valued nor undervalued. The after‐market firm performance, measured by earnings, cash flows or dividends, is consistent with Miller and Rock. We document a decline in after‐market performance for firms issuing convertible or straight debt and an improvement for those repurchasng shares. However, contrary to predictions, we find that firms issuing seasoned equity do not have lower earnings or cash flows in the following year, and increase their rate of dividend payment as well. We document evidence indicating that firms issue equity to maintain or increase dividends. The market anticipates the dividend increase and shows no response to announcements of dividend changes following an equity issue. However, we are unable to explain why the market reacts in such a negative manner to equity issues, when the after‐market performance of the firm is as expected.

This paper compares firms purchasing and/or selling food products internationally to those with domestic supply chains in order to determine if international firms: place greater managerial importance on security; and are more likely to engage supply chain partners in security‐related verification and information exchange. The purpose of this paper is to explore the link between security initiatives and firm performance in terms of security outcomes, product quality, and customer service.

A series of one‐way ANOVA tests are used to assess the differences between firms with international and domestic supply chains. Additionally, cluster analysis is conducted to group firms based on their performance levels.

Initial results indicate respondents with international supply chains perceive that their firms place more importance on security and are more likely to assess the security procedures of supply chain partners. Results further indicate that, in general, respondents in international firms perceive better security performance is achieved in terms of the ability to detect and recover from security incidents. Once firms are grouped by performance, respondents in the high‐performance cluster, represented predominantly by international firms, perceived significantly higher performance in the areas examined.

This paper is the first to compare, the differences in security measures employed by firms maintaining internationally oriented as opposed to domestically oriented supply chains and also relates the implementation of supply chain security measures to security and firm performance.

This paper aims to report on an exploratory study investigating supply chain security orientation (SCSO), a firm‐level construct addressing companies' multiple approaches toward mitigation of supply chain security breaches and supply chain risk management.

Structured interviews were conducted with managers who were responsible for firms' supply chain security efforts. The resulting data were content analyzed and critical themes presented depicting SCSO.

Key antecedents, outcomes, and moderating conditions were identified based on the qualitative data. Four primary dimensions of the SCSO concept are revealed.

The major contribution of the paper is the delineation of the components of SCSO, which appear to be pervasive across firms. Additionally, several drivers of SCSO are identified, and SCSO is linked to positive financial and customer outcomes, as well as supply chain continuity.

Although brand risk management (BRM) is widely acknowledged as critical concern of business leaders, there exists little empirical evidence regarding what activities firms could do to make their brand secured in the increasingly competitive market. Moreover, previous studies find out the important role of innovation stimulus in firm performance, but little attention is paid on how firm's innovation stimulates the firm's brand security. This study aims at exploring the impacts of BRM activities on brand security with the innovation stimulus as a moderator.

Mixed method is applied in conducting this research. In the qualitative research, an interview with managers of 20 large-size foodstuff companies in Vietnam is conducted to obtain insights into their understanding BRM activities and brand security as well as the role of innovation stimulus in managing brand risk and developing measurements for new constructs. In the quantitative research, a sample of 258 respondents is collected for the tests of reliability and validity as well as all hypotheses using SPSS software.

The authors’ findings show that the level of implementation of BRM activities influences the brand security with the moderating effect of innovation stimulus. Specifically, four dimensions of BRM activities including: strategy, personnel, processes and investment have direct, positive and significant impact on brand security. Innovation stimulus including innovation in leadership and innovation in knowledge management could serve as a moderating variable.

The findings of the current study have contributed to BRM literature by highlighting the importance of the implementation of BRM activities and the key role of innovation stimulus in ensuring the brand security, on which previous studies have paid little attention. The study suggests some guidance for firms about how to improve the innovation stimulus in enhancing the effectiveness of BRM activities and, as a result, increasing the brand security of the firm.

The purpose of this summary is to provide excerpts of selected Financial Industry Regulatory Authority (FINRA) Regulatory Notices and Disciplinary Actions issued in April, May, and June 2010.

The paper provides excerpts from FINRA Regulatory Notice 10‐18, Master Accounts and Sub‐Accounts; 10‐22, Regulation D Offerings; 10‐23, Trade Reporting and Compliance Engine (TRACE); 10‐24, Trade Reporting; 10‐27, Customer Complaint Reporting; and 10‐30, Trading‐Pause Pilot Program; provides summaries of selected disciplinary actions.

(10‐18) If a firm has notice that the sub‐accounts of a master account have different beneficial ownership (but does not know the identities of the beneficial owners) or the firm is privy to facts and/or circumstances that would reasonably raise the issue as to whether the sub‐accounts, in fact, may have separate beneficial owners, then the firm must inquire further and satisfy itself as to the beneficial ownership of each such sub‐account. (10‐22) A broker‐dealer has a duty – enforceable under federal securities laws and FINRA rules – to conduct a reasonable investigation of securities that it recommends, including those sold in a Regulation D offering. (10‐23) On February 22, 2010, the SEC approved the second major proposed expansion of TRACE to include Asset‐backed Securities as TRACE‐Eligible Securities, to require the reporting of Asset‐backed Securities transactions and to establish reporting fees. (10‐27) Starting on July 1, 2010, the beginning of the third calendar quarter, firms must use revised and new product codes to report statistical information regarding written customer complaints relating to annuities and life settlement products. (10‐30) On June 10, 2010, FINRA began a pilot program in which it will halt trading otherwise than on an exchange with respect to securities included in the S&P 500® Index where the primary listing market has issued a trading pause due to extraordinary market volatility. Selected disciplinary actions: FINRA announced that it has settled charges with two additional firms relating to the sale of auction rate securities (ARS) that became illiquid when auctions froze in February 2008. FINRA announced that it has fined five broker‐dealers a total of $385,000 for the illegal sale of more than 8 billion shares of penny stock on behalf of their customers.

These are direct excerpts designed to provide a useful digest for the reader and an indication of regulatory trends. The FINRA staff is aware of this summary but has neither reviewed nor edited it. For further detail as well as other useful information, the reader should visit www.finra.org.