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Article
Publication date: 16 May 2019

Madhurima Bhattacharyay and Feng Jiao

The purpose of this paper is to identify and examine two contrasting mechanisms of information asymmetry for cross-listed firms with respect to the information environment…

Abstract

Purpose

The purpose of this paper is to identify and examine two contrasting mechanisms of information asymmetry for cross-listed firms with respect to the information environment and its impact on earnings response.

Design/methodology/approach

The study empirically assesses two mechanisms of information asymmetry (“seeing” and/or “believing”) by looking at abnormal returns and volume reactions to international firms’ earnings announcements pre- and post-listing in the USA from 1990 to 2012.

Findings

The authors’ findings indicate that investors “seeing” more (media and analyst coverage) decrease the earnings response; however, “believing” more or gaining more credibility has the opposite effects. Based on the results, both mechanisms of information asymmetry can take effect simultaneously.

Research limitations/implications

The study sheds light on the multi-dimensional impact of the improved information environment that non-US firms face when they list their securities on US exchanges.

Originality/value

This study identifies and reconciles these two mechanisms of information asymmetry (visibility and credibility) under one setting and estimates the magnitude of each effect empirically.

Details

Managerial Finance, vol. 45 no. 5
Type: Research Article
ISSN: 0307-4358

Keywords

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Article
Publication date: 30 September 2013

Yoon Koh, Seoki Lee, Sudipta Basu and Wesley S. Roehl

– The purpose of this study is to identify determinants of involuntary cross-listing (CL) of US restaurant companies on the Frankfurt Stock Exchange (FSE).

Abstract

Purpose

The purpose of this study is to identify determinants of involuntary cross-listing (CL) of US restaurant companies on the Frankfurt Stock Exchange (FSE).

Design/methodology/approach

The study utilizes a mixed method design with an interview and a pooled logistic regression analysis with panel dataset using the company-clustered standard error to develop and test the hypotheses.

Findings

The empirical investigation identified determinants of involuntary CL by examining ten factors, including size, firm growth opportunities, leverage, financial flexibility, international operation, profitability, overall German economic condition, industry growth opportunities, restaurant type, and local operation. The study found three determinants – large size, favorable economic condition in Germany and positive industry growth opportunities – utilizing the sample that covers the entire periods of involuntary CL of US restaurant companies on the FSE.

Originality/value

This paper uncovers the phenomenon of involuntary CL, which many stock exchanges have strategically adopted by simplifying listing requirements for companies already listed in other stock markets, focusing on US restaurant companies. The number of involuntarily cross-listed US restaurant companies greatly increased to 50 percent of domestically listed US restaurant companies while those companies are largely unaware of the phenomenon. The research advances understanding of involuntary CLs, which previously received little attention.

Details

International Journal of Contemporary Hospitality Management, vol. 25 no. 7
Type: Research Article
ISSN: 0959-6119

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Article
Publication date: 15 May 2017

Nida ul Habib Bajwa and Cornelius J. König

For a long time, researchers across the world have called for more generalizable frameworks in management research, which can be used to better understand local contexts…

Abstract

Purpose

For a long time, researchers across the world have called for more generalizable frameworks in management research, which can be used to better understand local contexts and to extend established theories in Western countries. However, research from non-Western countries is barely visible in high-impact management journals. Although most researchers have tried to understand this lacking visibility from a more technological perspective, this study aims to analyze the extent to which group psychological processes influence the selection of international publication strategies by non-Western researchers in this study.

Design/methodology/approach

Hypotheses were based on social identity theory. In total, 169 management researchers from India were surveyed and their social identities and the international publication strategy were assessed.

Findings

It could be confirmed that higher identification with non-Western researchers is negatively related to the intention to publish internationally.

Social implications

The findings suggest that current approaches to increasing the low visibility of non-Western research require a general revision.

Originality/value

This study adds a new angle to the center–periphery debate by incorporating the influence of social identities on the selection of an international publication strategy. Research socialization in the periphery seems to increase the likelihood of choosing local publication outlets rather than aiming for international publications. Therefore, it is necessary to implement strategies that aim at the psychological inclusion of peripheral researchers to increase their visibility in international journals and on international platforms.

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Article
Publication date: 9 March 2015

Mihail Miletkov, Sviatoslav Moskalev and M. Babajide Wintoki

The purpose of this paper is to examine the effect of board structure on non-US acquirer returns in 11,499 acquisition transactions from 60 countries during the period…

Abstract

Purpose

The purpose of this paper is to examine the effect of board structure on non-US acquirer returns in 11,499 acquisition transactions from 60 countries during the period from 2001 to 2011.

Design/methodology/approach

In this paper the authors employ event study methodology and regression analyses including instrumental variables two-stage least squares regressions.

Findings

The authors find that board independence in non-US firms is associated with significantly higher acquirer returns, but this effect is only present in countries with lower levels of investor protection. The authors contribute to the literature by documenting that due to the substitution effect between internal and external governance, when external governance mechanisms are not adequately developed, better internal governance (as measured by higher degree of board independence) reduces agency problems and leads to better firm decisions and outcomes (as measured by the quality of corporate acquisitions).

Originality/value

The paper is the first to empirically examine the relation between board independence and acquirer returns in non-US firms. The findings have important implications for both company managers and national policy makers who are debating the costs and benefits associated with increasing the degree of board independence in publicly traded companies around the world.

Details

Managerial Finance, vol. 41 no. 3
Type: Research Article
ISSN: 0307-4358

Keywords

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Article
Publication date: 6 September 2013

Olga Dodd

Financial markets’ integration and technological advances in equity trading may have reduced the potential benefits from listing a firm's shares on a foreign exchange…

Abstract

Purpose

Financial markets’ integration and technological advances in equity trading may have reduced the potential benefits from listing a firm's shares on a foreign exchange. Nevertheless, a significant number of firms continue to cross‐list every year. This paper examines the recent cross‐listing trends and reviews the literature on motives to cross‐list.

Design/methodology/approach

The literature review includes a summary of theoretical studies grouped into cross‐listing theories including market segmentation, liquidity, investor recognition, information disclosure, legal bonding, proximity preference and business strategy theories, and also includes a discussion of testable implications and empirical evidence for each of the above mentioned cross‐listing theories.

Findings

An extensive cross‐listing literature offers a number of theories on the motives to cross‐list that in most cases complement each other by encompassing different aspects of the complex cross‐listing behavior. Nevertheless, continuous market developments, such as significant regulatory and technological changes in the ways capital markets operate, raise new questions on why firms cross‐list and call for further research to continue.

Details

Review of Behavioural Finance, vol. 5 no. 1
Type: Research Article
ISSN: 1940-5979

Keywords

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Article
Publication date: 5 June 2007

Jamie Murphy and Arno Scharl

Draws upon Hofstede's cultural values and Rogers' diffusion of innovations to investigate relationships between search engine popularity and a company's preference for…

Abstract

Purpose

Draws upon Hofstede's cultural values and Rogers' diffusion of innovations to investigate relationships between search engine popularity and a company's preference for global versus local online branding.

Design/methodology/approach

Investigates the global versus local domain name selection strategies and web site popularity of multinational corporations based on their organizational characteristics and Hofstede's cultural values of their host countries.

Findings

Organizational size, industry and two cultural values – individualism and masculinity – relate to how companies adopt innovations, in this case selecting and promoting a global or local online identity. For their web presence, most Fortune Global 500 companies use the global.com domain rather than a local country domain. The results also suggest a virtual divide in online visibility, favoring.com companies over companies using country domains.

Research limitations/implications

Limitations of this study include the lack of a longitudinal perspective and a possible Google bias – towards English content – in its proprietary PageRank metric. Future research could validate the results with other third‐party data and enrich the independent variables through automated web content analysis.

Practical implications

In countries with strong cultural values of masculinity and collectivism, international business managers should consider paying homage to local domain names for web site and employee email addresses.

Originality/value

Extending diffusion of innovations and cultural research to domain name selection and search engine popularity, this study underscores the importance of culture in international branding research.

Details

International Marketing Review, vol. 24 no. 3
Type: Research Article
ISSN: 0265-1335

Keywords

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Article
Publication date: 5 June 2009

Claudia Champagne and Lawrence Kryzanowski

The purpose of this paper is to study the impact of cross‐listing and cross‐listing location on the terms of the private debt of firms not located in the USA…

Abstract

Purpose

The purpose of this paper is to study the impact of cross‐listing and cross‐listing location on the terms of the private debt of firms not located in the USA. Specifically, the paper examines the empirical relationship between three syndicated loan terms (pricing, maturity and amount) at loan initiation and the cross‐listed status of the borrower (cross‐listed in the USA, UK, through depository receipts or not at all), while (not) differentiating between the stage of economic development of the borrower's home country.

Design/methodology/approach

The three loan terms are modeled as a simultaneous system of equations and are estimated on a very extensive sample of 3,883 observations. The impact of endogeneity biases due to the sequential choices to and where to cross‐list are examined using the inverse Mill's ratios from a bivariate probit model.

Findings

All else held equal, foreign borrowers that are cross‐listed directly in the UK obtain loans with higher spreads, longer maturities and larger loan amounts if they are from economically developed countries. Borrowers from emerging economies pay lower spreads but receive shorter maturities on syndicated loans if cross‐listed in the UK. Cross‐listings in the USA are not associated with any significant differential impacts on the three loan terms.

Originality/value

This paper makes an important contribution to the cross‐listing and capital structure literatures by providing evidence that the net benefit from being cross‐listed for one debt component of the cost of capital (i.e. syndicated loans) depends on the listing destination and upon whether or not the borrower is from an emerging economy. The paper provides practical guidance to corporate financial officers on the benefits of international cross‐listing and the choice of cross‐listing venues on the terms of private debt issues.

Details

Managerial Finance, vol. 35 no. 7
Type: Research Article
ISSN: 0307-4358

Keywords

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Article
Publication date: 22 January 2021

Christian Pieter Hoffmann and Sandra Binder-Tietz

While several extant studies have discussed the strategic importance of investor relations (IR) for listed corporations, few have tried to apply findings from strategic…

Abstract

Purpose

While several extant studies have discussed the strategic importance of investor relations (IR) for listed corporations, few have tried to apply findings from strategic communication research to IR. Therefore, little is known about the planning and evaluation of IR programs, with even less data available on IR's involvement in top management decision-making. The purpose of this paper is to examine research on planning and evaluation practices in German Prime Standard corporations' IR departments.

Design/methodology/approach

The method entailed a survey of 51 heads of IR departments from the largest corporations listed on the Frankfurt Stock Exchange concerning the topic of measurement and evaluation.

Findings

The findings highlight an intermediate stage in the professionalization of the still-emergent IR function. While IR has been established as an independent function with some consideration in strategic leadership, strategic management of the function is still evolving. This study shows that while some form of planning is the norm, IR departments at smaller companies tend to focus more on departmental objectives than on deriving objectives from the corporate strategy. Also, systematic evaluation remains lacking in many smaller companies' IR departments. As a result, IR managers from smaller companies are consulted less frequently during top management meetings on corporate strategy.

Research limitations/implications

This study is based on data collected only from German Prime Standard corporations. While satisfactory in the context of quantitative IR studies, the response rate from the reported survey was only 32%. Furthermore, the average level of strategic IR management among German listed companies actually may be somewhat lower than reported in this paper, as large listed companies are somewhat overrepresented in the sample.

Originality/value

This study addresses an apparent research gap, i.e. to date, little is known about the strategic management of the IR function, especially in a non-US context. This analysis shows that theories and frameworks from strategic communication management can be applied to the IR function.

Details

Journal of Communication Management, vol. 25 no. 2
Type: Research Article
ISSN: 1363-254X

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Article
Publication date: 1 March 2012

Xiaoli (Charlie) Yuan, Dennis M. López and Dana A. Forgione

The purpose of this paper is to analyze the market for audit services for publicly traded companies operating in the US for-profit (FP) healthcare sector. Complex national…

Abstract

The purpose of this paper is to analyze the market for audit services for publicly traded companies operating in the US for-profit (FP) healthcare sector. Complex national and local healthcare laws and regulations suggest the importance of assessing fee effects of joint nationallevel and city-specific expertise among auditors. Using cross-sectional OLS regression analysis, we find that joint expertise significantly affects audit pricing in the healthcare sector. We find a fee premium of 33.6 percent on engagements where auditors are both national and city-specific specialists. We also find that Big-4 auditor reputation is significantly priced over and above the effects of joint auditor expertise, and a significant positive association exists between audit and non-audit service fees-indicating the presence of knowledge spillover effects among healthcare company auditors.

Details

Journal of Public Budgeting, Accounting & Financial Management, vol. 24 no. 4
Type: Research Article
ISSN: 1096-3367

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Article
Publication date: 5 March 2020

Shahid Khan, Khaled Abdou and Sudip Ghosh

The purpose of this study is to investigate if non-US/non-Canada (international) equity listings in the Canadian stock exchanges increased with the adoption of

Abstract

Purpose

The purpose of this study is to investigate if non-US/non-Canada (international) equity listings in the Canadian stock exchanges increased with the adoption of International Financial Reporting Standards (IFRS) in Canada. A question of interest is whether the adoption of common global accounting standards (IFRS) was beneficial in attracting international firms to the Canadian exchanges.

Design/methodology/approach

The authors use difference-in-difference ordinary least square methodology to conduct inter-country (between Canada and the USA) and intra-country (between the Toronto Stock Exchange [TSX] and the TSX Venture Exchange [TSXV]) tests to investigate whether there is increased listings of international firms on Canada’s exchanges associated with mandatory adoption of IFRS in Canada compared to such listings in the American exchanges.

Findings

The authors did not find evidence of a relative increase in listings by international firms on the TSX and the TSXV after Canadian adoption of IFRS, but they did find that listings by international firms on the TSX, Canada’s primary exchange, increased when the authors include the year before mandatory Canadian adoption as part of the IFRS adoption period. The authors also find that international listings from outside the North American, European and Australasian regions increased on the TSXV, consistent with IFRS adoption making the smaller Canadian exchange more attractive to listers from these regions.

Originality/value

With the increasing use of IFRS throughout the world, US regulators, the US Congress and other capital market participants seek to understand the costs and benefits of potential IFRS adoption in the USA. The authors contribute to this debate by examining the effect of Canada’s adoption of IFRS on growth in international stock listings in the Canadian stock exchanges.

Details

Journal of Financial Regulation and Compliance, vol. 28 no. 3
Type: Research Article
ISSN: 1358-1988

Keywords

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