Corporate Transparency and Firm Performance: Evidence from Venture Firms Listed on the Korean Stock Market

Kim, Young‐Hwan; Lee, Jungwoo; Yang, Taeyong

doi:10.1111/ajfs.12027

Cited by 14 publications

(15 citation statements)

References 46 publications

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“…By inserting such control variables into a model, researchers believe it will assist to reduce the omitted variable bias and the potential endogeneity problem (i.e. Kim et al , 2013).…”

Section: Methodsmentioning

confidence: 99%

Consequences of corporate sustainability reporting: evidence from an emerging market

Swarnapali

2020

IJLMA

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Purpose The purpose of this paper is to discover whether corporate sustainability disclosure has a potential impact on the market value and earnings quality of firms in an emerging market. Design/methodology/approach The data were collected from 220 companies listed in the Colombo Stock Exchange (CSE) in Sri Lanka during the period 2012-2016. Firm value proxies by Tobin’s Q, while earnings quality proxies by discretionary accruals (DAC). The study is premised on value-enhancing theory for firm value and transparent financial reporting perspective for earnings quality. Regression analyses are executed on the panel data to achieve the study objectives. Findings The results reveal a positive relationship between sustainability reporting (SR) and firm market value, accepting the value-enhancing theory while rejecting the value-destroying theory. This finding suggests that investors pay a premium in the financial markets for firms that perform in an environmentally and socially responsible manner, compared to firms that do not perform in a similar manner. In the same vein, the results reveal that sustainability disclosure and DAC are negatively and significantly associated, resulting in high-quality earnings. The result is consistent with the transparent financial reporting hypothesis, which is also in line with the managers’ integrity motivation. Originality/value This is the first study investigating the consequences of SR that is specific to the Sri Lankan context. Owing to the sparse studies on consequences of SR, this study contributes significantly to the extant literature by broadening the geographical coverage to include a developing country setting.

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“…By inserting such control variables into a model, researchers believe it will assist to reduce the omitted variable bias and the potential endogeneity problem (i.e. Kim et al , 2013).…”

Section: Methodsmentioning

confidence: 99%

Consequences of corporate sustainability reporting: evidence from an emerging market

Swarnapali

2020

IJLMA

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“…Fifth, few research on TDI have examined the model by considering the measurement items under their formative construct. Indeed, previous research by simplifying the index items into a couple of independent variables or using the average of items scores as the index value, just tested each item out of its formative construct index (for example, Bebczuk, 2007;Kowalewski et al, 2008;Cheung et al, 2010;Kim et al, 2013). This research by employing a formative second order construct index (Hair et al, 2013), addresses the main pillars of MCCG 2012 and use Partial Least Squares (PLS) as the analysis method to bridge the gap between the theory and practices of governance disclosure particularly in an emerging economy such as Malaysia.…”

Section: Introductionmentioning

confidence: 99%

The effects of corporate disclosure practices on firm performance, risk and dividend policy

Sharif

Lai²

2015

Int J Discl Gov

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This article examines the effects of disclosure in corporate governance practices on firm performance, bankruptcy risk, leverage and dividend policy in public listed companies. We propose an enhanced transparency disclosure index (TDI). To measure disclosure and transparency more accurately, we use the recommended practices of the Malaysian Code on Corporate Governance 2012 (MCCG 2012), using scores between 0 and 1 for each item. Although previous studies have simplified their transparency index into a couple of independent items, we develop a formative second-order index, which is known as the Modified Transparency Disclosure Index (MTDI). We test our hypotheses in a 2009 randomly selected sample of 95 listed companies in Bursa Malaysia using Partial Least Squares (PLS) path-modeling and bootstrapping techniques. The results show that corporate disclosure practices have positive effects on company performance and negative effects on company leverage. This study does not find any significant relationship between corporate transparency levels with bankruptcy risk and dividend payouts.

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“…Effective corporate governance can generate a good public image that can diminish short-term profit (Kim, Lee, & Yang, 2013;OECD, 2004b). Conversely, increasing public image policy through improving corporate governance practices can generate long-term earnings (Jo & Kim, 2008;Kim et al, 2013;Vander & Willekens, 2008) that can generate a higher intrinsic value of the firm (Letza, Sun, & Kirkbride, 2004).…”

Section: Corporate Governance and Firm Intrinsic Valuementioning

confidence: 99%

“…Their corporate governance index was based on the OECD (1999). To symbolize this, a firm following corporate governance practices was denoted by 0, and a firm not following the corporate governance was denoted by 1 (e.g., Kim et al, 2013).…”

Section: Measurement Of Corporate Governancementioning

confidence: 99%

Measuring Firms Intrinsic Values in an Emerging Economy: Evidence from Bangladesh

Dewri

Islam

Tuz-Johra

et al. 2021

Asian Economic and Financial Review

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This study considered three parameters to measure firms' intrinsic values: corporate governance, paid-up capital size, and dividend payout policy. These were used as independent variables, and market interest rate was used as the control variable. To measure these parameters, daily trade data was observed from both the Dhaka Stock Exchange (DSE) and the Chittagong Stock Exchange (CSE) data repositories and covered a total of 1475 firm years' disclosures from 2013 to 2017 to conclude the analysis. The study revealed that there is a significantly negative correlation with firms' intrinsic values and corporate governance due to the majority of firms failing to adhere to corporate governance guidelines and therefore generate higher intrinsic values. Also, firms in emerging economies are characterized by a high level of family ownership and lack of transparency. Similarly, there is a significant negative relationship with firms' intrinsic values and higher capital-based firms, and there is no significant relationship with the firms' intrinsic values and dividend payout policies in the emerging economy.Contribution/Originality: This study contributes to the existing literature on firms' intrinsic values by using new estimation methodology to investigate the intrinsic values of two different capital-based firms. This study is one of very few that has investigated firms' intrinsic values by considering corporate governance, paid-up capital, and dividend payout policy.

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Corporate Transparency and Firm Performance: Evidence from Venture Firms Listed on the Korean Stock Market

Cited by 14 publications

References 46 publications

Consequences of corporate sustainability reporting: evidence from an emerging market

Consequences of corporate sustainability reporting: evidence from an emerging market

The effects of corporate disclosure practices on firm performance, risk and dividend policy

Measuring Firms Intrinsic Values in an Emerging Economy: Evidence from Bangladesh

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