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on Corporate Finance |
| By: | Ahmadu U. Sanda |
| Abstract: | This study examined the relationship between board independence and firm financial performance, using data of varying sample size (ranging from 89 firms for regression to 205 firms for descriptive analysis) obtained from the Nigerian Stock Exchange for the period 1996 through 2004. The key results were that share ownership was highly concentrated inNigeria, and this structure tended to engender board structureswith close family affiliations in which the chief executive officers (CEOs) were activemembers of audit committees.While family affiliation of board members was found to support firm growth, we found evidence that audit committee membership of chief executives hurt firm performance. We also found that foreign chief executives performed better than their local counterparts. These results suggested the need for Nigerian firms to adopt better corporate governance mechanisms in order to make the boards of directors more independent, avoid unnecessary intervention of CEOs in important committees, and in that way aid financial performance. |
| Date: | 2011–01 |
| URL: | http://d.repec.org/n?u=RePEc:aer:rpaper:rp_213&r=cfn |
| By: | Hetland, Ove Rein (Dept. of Finance and Management Science, Norwegian School of Economics and Business Administration); Mjøs, Aksel (Dept. of Finance and Management Science, Norwegian School of Economics and Business Administration) |
| Abstract: | We study how firm-bank lending relationships affect firms' access to and terms of credit. We use bank mergers and acquisitions (M&As) as exogenous events that affect lending relationships. Bank M&As lead to organisational changes at the involved banks, which may reduce the amount of soft information encompassed in the firm-bank relationship. Using a unique Norwegian dataset, which combines information on companies' bank accounts, annual accounts, bankruptcies, and bank M&As for the years 1997-2009, we find that domestic bank mergers increase interest rate margins by 0.24 percentage points for opaque small and medium sized rms, relative to less opaque firms. Since, due to information asymmetries, opaque firms are typically more dependent on bank lending relationships, our results indicate that these relationships are advantageous for such borrowers, and the destruction of a relationship during the merger process has adverse effects for the firm. Conversely, the results are not consistent with a lock-in effect due to an information monopoly by the relationship lender that on average increases a firm's borrowing costs over its life cycle. The results are robust to the inclusion of variables that control for eects of market competition. |
| Keywords: | Bank Mergers and Acquisitions; Lending Relationships |
| JEL: | G00 G30 G34 |
| Date: | 2011–08–31 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhhfms:2011_013&r=cfn |
| By: | Paul Hewitt |
| Abstract: | The scope of this research is to examine the degree to which investors use their share voting rights to register their concerns with companies on corporate issues. Analysis has been hindered by poor disclosure by companies of turnout figures and more nuanced reporting of resolution outcomes (e.g. disclosing withheld votes). A country comparison which includes OECD countries and Brazil highlights patterns of dissent that suggest remuneration and issues of capital structure are the resolutions that attract most consistent shareholder dissent. Australia, Chile and Germany are singled out for enhanced analysis. The study points to the need for further research at the investor and issuer level about the role of voting in the engagement process and the barriers to the effectiveness and transparency of voting. |
| Keywords: | corporate governance, shareholder voting, shareholder rights, remuneration |
| JEL: | G30 G34 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:oec:dafaae:3-en&r=cfn |