Marketisation, information transparency and the cost of equity for family firms

Guo, Jiaqi; Li, Changhong; Jiao, Wenting; Wang, Zhan

doi:10.1016/j.frl.2019.101394

Cited by 8 publications

(5 citation statements)

References 21 publications

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“…If true, the implications are bleak for global economic development. In 2014 it was estimated that around 65-80% of global enterprises are owned or operated by families, accounting for 70-90% of global GDP (Family Firm Institute, 2014;Guo et al, 2021) and 50-80% of jobs in most countries around the world (Alon et al, 2020). Family firms usually serve the dual objectives of creating economic efficiency whilst preserving family social interests.…”

Section: Introductionmentioning

confidence: 99%

Research and innovation and the role of competition in family owned and managed firms

Yin

Crowley

Doran

et al. 2022

IJEBR

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PurposeThis paper examines the innovation behavior of family-owned firms versus non-family-owned firms. The role of internal family governance and the influence of external stimuli (competition) on innovation are also considered.Design/methodology/approachThe data of 20,995 family and non-family firms across 38 countries are derived from the World Bank Enterprise Survey during the period 2019–2020. Probit models are used to examine the impact of family ownership, family governance, and competition on innovation outcomes.FindingsFamily firms are more likely to make R&D investments, acquire external knowledge, engage in product innovation (including innovations that are new to the market) and process innovation, relative to non-family firms. However, a high propensity of family member involvement in top management positions can reduce innovation. Competition has a negative impact on innovation outcomes for both family and non-family firms, but it has a positive moderating effect on the innovation activities of family firms where a higher level of family member involvement in management is present.Originality/valueThis paper provides novel insights into family firm innovation dynamics by identifying family firms as more innovative than non-family firms for all types of indicators, debunking the idea that family firms are conservative, reluctant to change, and averse to the risks in innovation activities. However, too much family involvement in decision making may stifle some innovation activities in family firms, except in cases where the operating environment is highly competitive; this provides new insights into the ownership-management dynamic of family firms.

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Section: Introductionmentioning

confidence: 99%

Research and innovation and the role of competition in family owned and managed firms

Yin

Crowley

Doran

et al. 2022

IJEBR

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“…Jak dotąd, badania na tym polu prowadzono, m.in. na przedsiębiorstwach z Azji Wschodniej (Boubakri i in., 2010), Indii (Houqe i in., 2017), Chin (Guo i in., 2021) czy na przedsiębiorstwach z rynków wschodzących (Fausal i in., 2020). W Polsce wpływ kontroli rodziny na koszt kapitału własnego spółek notowanych na GPW przeanalizował J.…”

Section: Koszt Kapitału Własnego W Badaniach Empirycznychunclassified

Koszt kapitału własnego spółek rodzinnych notowanych na Giełdzie Papierów Wartościowych w Warszawie

Puterko

2023

Finanse

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Streszczenie: Ze względu na mieszanie się sfery ekonomicznej z życiem prywatnym przedsiębiorstwa rodzinne coraz częściej stają się przedmiotem badań i dyskusji naukowców, w szczególności w aspekcie ich potencjalnych przewag ekonomicznych. Celem artykułu jest zbadanie wpływu kontroli rodziny na kształtowanie się kosztu kapitału własnego w przedsiębiorstwach rodzinnych i nierodzinnych. Badaniem objęto panel 42 spółek akcyjnych notowanych na Giełdzie Papierów Wartościowych w Warszawie na przestrzeni lat 2011-2020, a zależność tę przeanalizowano za pomocą 12 modeli regresji liniowej. Otrzymane wyniki nie pozwoliły na wyciągnięcie jednoznacznych wniosków i nie potwierdziły hipotezy stanowiącej, że koszt kapitału własnego w spółkach rodzinnych jest niższy niż w spółkach nierodzinnych.

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“…The decision of the Independent Board of Commissioner to improve company performance by implementing management's responsibility for financial reports (MRF) can reduce the cost of equity (Bangmek, Yodbutr, & Thanjunpong, 2018), as well as if it decides to use technology information (Dow et al, 2017). Meanwhile, the Independent Board of Commissioner whose investment policies and system implementation are tightly controlled by shareholders can increase the value of cost of equity (Guo et al, 2019). Based on this, the ninth hypothesis of this study is: H9: The influence of the Independent Board of Commissioner on Firm Value is weakened by the cost of equity.…”

Section: Moderating Cost Of Equity On the Independent Board Of Commismentioning

confidence: 99%

“…This is consistent with research conducted by Guo et. all (2019) where the control of shareholders can increase the value of cost of equity (Guo et al, 2019) but the decision of the independent board of commissioner can be intervened because it will make activities that can increase firm value can be reduced because of the high support needed management systems (Bangmek et al, 2018) and technology (Dow et al, 2017) that can increase firm value.…”

Section: Hypothesys Testingmentioning

confidence: 99%

“…Botosan (2006) states that the minimum return required by investors / shareholders to be willing to reinvest their capital into the company is the cost of equity (Falah & Meiranto, 2017). Therefore, the cost of equity affects the financial companies that affect firm value as in research related to the cost of equity in domestic companies that are smaller than outside companies (Boubaker, Boubakri, Grira, & Guizani, 2018), Corporate Social Responsibility (CSR) activities (Breuer, Müller, Rosenbach, & Salzmann, 2018), on the application of management's responsibility for financial reports (MRF) (Bangmek, Yodbutr, & Thanjunpong, 2018), investment in information technology (Dow, Watson, & Shea, 2017), and control of shareholders (Guo, Li, Jiao, & Wang, 2019). Based on this, the amount of cost of equity affects the firm value of a company.…”

Section: Introductionmentioning

confidence: 99%

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Untitled

2020

EJBIR

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This study aims to analyze the effect of non-financial measures, independent board of commissioners, and audit quality on firm value, with the cost of equity as a moderating variable. The method used in this research is descriptive and verification methods. The data source is secondary data from the annual reports of manufacturing companies in the 2013-2016 period which are listed on the Indonesia Stock Exchange as many as 97 companies with 388 companies. The results showed that there are non-financial measures of customer perspective and internal process perspective, independent board of commissioner, and audit quality significantly influence firm value. Cost of equity as a moderating variable makes the influence of the independent board of commissioner weak against firm value. While the growth and learning perspective variables do not really affect the firm value. Cost of equity strengthens the influence of non-financial measures customer perspective on firm value, while in the internal process perspective, growth and learning of non-financial measures and audit quality are weak. The cost of equity will strengthen variables that can support the wishes of shareholders and will weaken variables that are independent of board of commissioner and audit quality. Other results require large costs to increase firm value. Firm value can be increased by increasing non-financial activities, the number of independent board of commissioner shares and conducting audit quality by reducing the amount of cost of equity that can weaken the value of firm value.

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Marketisation, information transparency and the cost of equity for family firms

Cited by 8 publications

References 21 publications

Research and innovation and the role of competition in family owned and managed firms

Research and innovation and the role of competition in family owned and managed firms

Koszt kapitału własnego spółek rodzinnych notowanych na Giełdzie Papierów Wartościowych w Warszawie

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