Non-executive employee ownership and financial reporting quality: evidence from Europe

Adwan, Sami; Ismail, Alaa Alhaj; Jelic, Ranko

doi:10.1007/s11156-022-01058-8

Cited by 5 publications

(2 citation statements)

References 84 publications

(146 reference statements)

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“…On the one hand, scholars have paid attention to the important governance role of employees in enterprises. We find that existing studies have found the governance role of employees in enterprises, from employee stock ownership (Blasi, 2018;Bryson, 2019;Adwan, 2022) [40][41][42], salary incentives (Baliga, 1990;Sigler,2011) [43,44] and others have carried out research, and found that these factors can effectively mobilize the enthusiasm of employees, improve employee satisfaction, and thus improve enterprise performance. However, employee stock ownership plan and compensation incentive are only researched from a single perspective of long-term and short-term incentives.…”

Section: Discussionmentioning

confidence: 73%

An empirical research on employee welfare and internal control quality

Lin

Tang

et al. 2023

PLoS ONE

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Internal control is the key to achieve high-quality development of enterprises, but internal control failure cases frequently occur at home and abroad. Therefore, it is particularly important to explore ways to improve the quality of internal control and promote high-quality development of enterprises. Taking non-financial listed enterprises in China from 2015 to 2020 as research samples, this paper adopts empirical research methods to research the impact and mechanism of employee welfare on the quality of internal control of enterprises from the perspective of all-employee governance, aiming to explore ways for enterprises to improve the quality of internal control.The results showed that employee welfare can improve the quality of internal controls significantly. Furthermore, the effect is more significant in non-employee-intensive industries and high-marketization areas. Based on the analysis of internal control elements, the research found that employee welfare affects the quality of internal control mainly through two elements, risk assessment and control activities. However, the effects of employee welfare on the three other elements are insignificant. This paper enriched the relevant research on the economic consequences of employee welfare and the factors affecting the quality of internal control, and has certain enlightenment significance for the popularization of employee welfare, especially supplementary pension, and also provides a reference path for the improvement of the quality of internal control.

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Section: Discussionmentioning

confidence: 73%

An empirical research on employee welfare and internal control quality

Lin

Tang

et al. 2023

PLoS ONE

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“…Moreover, their results showed that "employee ownership appears to benefit the firm by not only aligning goals between the firm and its employees, but by also increasing disclosure from the firm to all of its stakeholders by mitigating the firm's need to keep information opaque". 2 Adwan et al (2022) focused on the impact of non-executive employee ownership and financial reporting quality. Using a sample of firms listed in Europe between 2006 and 2017, they found "a positive association between non-executive employee ownership and financial reporting quality".…”

Section: Channels Of Impact Of Esops On Firms' Market Value -Empirica...mentioning

confidence: 99%

How employee share ownership plans impact firms' market value: A conflict of interest theory approach

Tran

Lee

2023

European Management Review

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We investigated whether the market places a higher value on banks with employee share ownership plans (ESOPs) than on those without them. Using a variety of empirical models, we found that ESOPs increased the market value of banks. However, this positive effect occurred only when banks were transparent or located in countries with strong shareholder protection. Our findings demonstrated that if banks were opaque or shareholder protection was weak, outside investors' concerns about managerial entrenchment in widely held banks and behind‐the‐scenes relationships between majority shareholders and managers in closely held banks outweighed the perceived benefits of ESOPs. Our study contributes to the literature by proposing a novel approach to study the effects of ESOPs through the prism of conflict of interest theory. Our findings also shed light on stakeholders' rationales for opposing or adopting ESOPs.

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Employee ownership and corporate investment efficiency in Europe

Adwan,

Ahamed

2024

Rev Quant Finan Acc

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We investigate the effect of non-executive employee ownership (EO) on the efficiency of investment decisions for a sample of non-financial European firms over the period 2006–2017. We find a positive (negative) association between EO and investment for firms that are more likely to underinvest (overinvest). In addition, we find the impact of EO on underinvestment and overinvestment to be more pronounced for firms with lower analyst following and lower blockholding ownership. Overall, our findings suggest that employee ownership increases firm-level investment efficiency through two channels: reduced information asymmetry and improved monitoring of management. The results hold after using an alternative specification of investment efficiency, Heckman's two-stage procedure, instrumental variable regressions, and alternative proxies for information asymmetry and monitoring of management both at the firm and the country level.

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Non-executive employee ownership and financial reporting quality: evidence from Europe

Cited by 5 publications

References 84 publications

An empirical research on employee welfare and internal control quality

An empirical research on employee welfare and internal control quality

How employee share ownership plans impact firms' market value: A conflict of interest theory approach

Employee ownership and corporate investment efficiency in Europe

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