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The peak of tensions between Russia and Ukraine occurred on 24 February 2022, the day the first attacks were carried out. This event caused turmoil on global financial markets, especially the G20 countries including Indonesia. Commodity sectors such as coal on the IDX gained sentiment from the outbreak of this event. This research uses an event study approach and will focus on the reaction of the Indonesian capital market in the coal sub-sector when the military conflict between Russia and Ukraine broke out. Market reaction in this study will be measured by abnormal returns and trading volume activity. This study used 29 samples from coal issuers. Data obtained from the IDX.CO.ID website. This study found that abnormal returns and trading volume activity in the coal sub-sector experienced significant differences between before and after the conflict occurred.

Clean technology (cleantech) is becoming increasingly important as firms and industries seek to address challenges around the global scarcity of resources and also achieve wider social and environmental goals. Yet there are underlying problems with how capital markets respond to this increasing demand for new and innovative cleantech investments. In this article, we use a large U.K. dataset to first consider the extent to which firms engaging with cleantech increase their demand for external capital. We then consider how different types of debt and equity financiers deal with this demand for funds. Our key findings are that: 1) businesses engaging with clean technologies have a higher demand for external capital and 2) these demands are not being fully met by traditional providers which forces firms to seek out alternative and nontraditional sources of finance.

We show that foreign capital liberalization reduces capital misallocation and increases aggregate productivity for affected industries in India. The staggered liberalization of access to foreign capital across disaggregated industries allows us to identify changes in firms' input wedges, overcoming major challenges in the measurement of the effects of changing misallocation. Liberalization increases capital overall. For domestic firms with initially high marginal revenue products of capital (MRPK), liberalization increases revenues by 23%, physical capital by 53%, wage bills by 28%, and reduces MRPK by 33% relative to low MRPK firms. The effects of liberalization are largest in areas with less developed local banking sectors, indicating that inefficiencies in that sector may cause misallocation. Finally, we propose an assumption under which a novel method exploiting natural experiments can be used to bound the effect of changes in misallocation on treated industries' aggregate productivity. These industries' Solow residual increases by 3–16%.

Resumen A partir de información empírica del sector minero del Perú, se propone un modelo que relaciona el conflicto social, la licencia social para operar, y el valor de las empresas extractivas para contribuir a la comprensión de la dinámica socioempresarial del sector extractivo. Las variables que se utiliza en el modelo son el precio de las acciones mineras, el registro oficial de los conflictos, y las licencias sociales. Por medio de una regresión lineal multivariada, se encuentra que el incremento de los conflictos sociales disminuye el valor de las empresas, y que la licencia social para operar tiene un efecto positivo sobre esta variable; además, modera el impacto del conflicto en el valor de la empresa. El estudio confirma empíricamente las relaciones sociales y económicas entre empresas extractivas y comunidades, y orienta a directivos, políticos y autoridades sobre acciones para prevenir conflictos. También contribuye a cerrar la brecha de estudios empíricos en países con menor nivel de desarrollo. Clasificación JEL: C51; G12; P28. Abstract Based on empirical information from the Peruvian mining sector, a model is proposed that relates social conflict, social license to operate, and the value of extractive companies, in order to contribute to the understanding of socio-entrepreneurial dynamics of the extractive sector. The variables used in the model are the price of mining shares, the official record of conflicts, and social licenses. Using multivariate linear regression, it is found that the increase in social conflicts decreases the value of the companies and that the social license to operate has a positive effect on this variable; moreover, it moderates the impact of the conflict on the value of the company. The study empirically confirms the social and economic relationships between extractive companies and communities, and guides managers, politicians, and authorities to prevent conflicts. It also contributes to closing the gap of empirical studies in less advanced countries. Resumo Com base em informações empíricas do setor de mineração peruano, propõe-se um modelo que relaciona o conflito social, a licença social para operar e o valor das empresas extrativistas para contribuir para a compreensão da dinâmica social empresarial do setor extrativo. As variáveis utilizadas no modelo são o preço das ações de mineração, o registro oficial de conflitos e as licenças sociais. Por meio de uma regressão linear multivariada, verifica-se que o aumento dos conflitos sociais diminui o valor das empresas, e que a licença social para operar tem efeito positivo sobre essa variável; além disso, modera o impacto do conflito no valor da empresa. O estudo confirma empiricamente as relações sociais e econômicas entre empresas extrativistas e comunidades e orienta gestores, políticos e autoridades para prevenir conflitos. Contribui também para fechar a lacuna de estudos empíricos em países menos avançados.

Employing a unique and hand-collected sample of 648 true sale loan securitization transactions issued by 57 stock-listed banks across the EU-12 plus Switzerland over the period from 1997 to 2010, this paper empirically analyzes the relationship between true sale loan securitization and the issuing banks’ non-performing loans to total assets ratios (NPLRs). We provide evidence for an NPLR-reducing effect during the boom phase of securitizations in Europe suggesting that banks in our sample (partly) securitized NPLs as the most risky junior tranche and did not (fully) retain NPLs as a reputation and quality signal towards less informed investors in imperfect capital markets. In contrast, we find the reverse effect during the crises period in Europe indicating that issuing banks provided credit enhancement and demonstrated `skin in the game'. Our baseline result remains robust when controlling for endogeneity concerns and a potential persistence in the time series of the NPL data. Moreover, results from a variety of sensitivity analysis reveal that the NPLR-reducing effect is stronger for opaque securitization transactions, for issuing banks exhibiting higher average levels of NPLRs and for banks operating from non-PIIGS countries. In addition, a reduction of NPLRs through securitization is observed for issued collateralized debt obligations, residential mortgage-backed securities, consumer and other unspecified loans as well as for non-frequently issuing, systemically less important and worse-rated banks. Our analysis offers essential insights into the loan risk allocation process through securitization and provides important implications for the vital debate on reducing NPL exposures and the process of revitalizing and regulating the European securitization market.

ilustraciones, diagramas La volatilidad y de manera más general la covarianza de los precios de las acciones es de gran interés para medir los posibles riesgos que pueda tener la compra y venta de éstas, además de proporcionar datos para determinar su rentabilidad. La escasa literatura sobre la implementación de modelos DCC-MGARCH (dynamic conditional correlation GARCH Multivariate) y RN-LSTM (long - short term memory recurrent network) en el mercado financiero colombiano para el pronóstico de la volatilidad de las acciones, llevó a la realización de este trabajo, en el que se comparan estos dos modelos utilizando los softwares R (R Core Team, 1990) y Python (Van Rossum & Drake Jr, 2009), para el pronóstico de la volatilidad del precio de cuatro acciones. Con los datos suministrados se estimaron las volatilidades y covarianzas para luego realizar pronósticos con ambas herramientas y realizar una comparación entre ambas. Del estudio se encontró que el desempeño de ambas metodologías tienen gran similitud, aunque algunas medidas del error de los pronósticos fueron levemente mejor con la RN-LSTM y otras con el modelo DCC-GARCH. Con el objetivo de profundizar más en los análisis de estas volatilidades es adecuado incrementar la cantidad de activos para conocer la incidencia que pueden llegar tener cada uno de éstas en los cálculos de las covarianzas. (Texto tomado de la fuente) The volatility and more generally the covariance of share prices is of great interest to measure the possible risks that the purchase and sale of these may have, in addition to providing data to determine their profitability. The scant literature on the implementation of DCCMGARCH (dynamic conditional correlation GARCH Multivariate) and RN-LSTM (long - short term memory recurrent network) models in the Colombian financial market for stock volatility forecasting led to the realization of this work, in which these two models are compared using R (R Core Team, 1990) and Python (Van Rossum & Drake Jr, 2009) software for forecasting the price volatility of four shares. With a total of 488 data, the volatilities and covariances were estimated to then make a forecast with both tools and make a comparison between them. The study found that the performance of both methodologies is somewhat similar, although some forecast error measures were slightly better with the RN-LSTM and others with the DCC-GARCH model. It is appropriate to establish a broader range of dates to determine the influence of other factors and increase the amount of assets to know the incidence that each one of these has on the others Maestría Magíster en Ciencias - Estadística Métodos estadísticos aplicados a finanzas Área Curricular Estadística

Interest rates are central determinants of saving and investment decisions. Costly financial intermediation distort these price signals by creating a spread between the interest rates on deposits and loans with substantial effects on the supply of funds and the demand for credit. This study investigates how interest rate spreads affect climate policy in its ambition to shift capital from polluting to low-carbon sectors of the economy. To this end, we introduce financial intermediation costs in a dynamic general equilibrium climate policy model. We find that costly financial intermediation affects carbon emissions in various ways through a number of different channels. For low to moderate interest rate spreads, carbon emissions increase by up to 7 percent, in particular, because of lower investments into the capital intensive clean energy sector. For very high interest rate spreads, emissions fall because lower economic growth reduces carbon emissions. If a certain temperature target should be met, carbon prices have to be adjusted upwards by up to one third under the presence of capital market frictions.

Environmental, social, and governance (ESG) disclosure is increasingly important for listed companies, representing a key factor that contributes to sustainable finance. However, whether and how the inclusion of ESG scores in investment decisions affects stock prices remains uncertain; the effect of ESG on intangible assets is a neglected area of investigation, and not all executives in global capital markets respond to ESG issues. Moreover, how each of the three dimensions of ESG affects the value of a company has yet to be fully determined. For the first time, this study takes Chinese listed companies from 2014 to 2018 as a sample to examine the impact of ESG on stock price, brand value, and executive compensation. These three main research objectives constitute three independent papers of this DPhil thesis, which address the motivation to engage in ESG disclosure and provide insight into the important role of ESG in financial markets, as well as how investors, entrepreneurs, and board members consider ESG strategies. Quantitative techniques are employed in this empirical research approach. While existing popular theories have limitations in explaining and predicting the impact of ESG on enterprise value, this study proposes a new theoretical framework, namely the reputation ecosystem. The reputation ecosystem is similar to Adam Smith's "invisible hand" metaphor that maintains a healthy economic order. To enhance the accuracy and efficiency of ESG data collection and scoring, language models and artificial intelligence (AI) are utilized. To address the inherent conflict of interest in ESG data collection and scoring, this study adopts an investor-paid model instead of the issuer-paid model of mainstream rating agencies. The study employs multivariate regression analysis on Chinese stock panel data to investigate their relationship with ESG performance across the E, S, and G dimensions, as well as stock return, brand value, and executive compensation. Cross-listing samples are used in the stock return analysis. Granger causality tests are employed in all three papers for causal analysis. The thesis identifies positive relationships between ESG performance and stock returns, brand value, and executive compensation, with additional tests suggesting these relationships are causal. Additionally, these positive relationships hold true for all three ESG dimensions, but their effects are not synchronized. It also demonstrates that firms with higher state ownership and those in a more competitive environment tend to have better stock performance and higher executive compensation with better ESG performance. The positive relationship between ESG and brand value only exists for firms in B2C industries, firms with higher state ownership, and firms located in economically developed regions. Specifically, in the mainland China and Hong Kong markets, every one-unit increase in score for overall ESG performance can increase the average annual stock return by 0.022 and 0.017, respectively; every one-percent increase in ESG score increases average brand value by approximately 0.354%; and the average executive compensation increases by approximately 2.65% with every one-unit increase in the total ESG score. Overall, these three substantive papers verified the new theoretical framework of the reputation ecosystem, proving that the impact of ESG on corporate value occurs through this reputation ecosystem mechanism, which in turn affects the realization of corporate revenue by improving brand value. Creating a framework for the reputation ecosystem and discovering the mechanism of ESG influence on a firm’s performance is my theoretical contribution, while using an investor-paid model and AI for ESG data collection and scoring is my methodological contribution. The new data and theory presented in this thesis also contribute to various literature streams, such as those concerning ESG, sustainable finance, financial geography, corporate finance, responsible investment, executive compensation, and brand management.

Penelitian ini merupakan penelitian kuantitatif yang memiliki tujuan untuk mengetahui nilai intrinsik suatu perusahaan dengan menggunakan pendekatan Dividend Discount Model (DDM), Price Earning Ratio (PER), dan Price to Book Value (PBV) yang akan dibandingkan dengan harga pasar untuk menentukan sebuah keputusan investasi. Populasi pada penelitian ini merupakan beberapa perusahaan yang tercantum pada BEI di periode 2019-2020. Sedangkan, sampel pada penelitian ini ialah perusahaan yang secara rutin menebar dividennya yang tercantum pada data statistik tahunan BEI periode 2019-2020 yang mana menghasilkan 15 perusahaan didapatkan dari teknik purposive sampling. Pengolahan data serta pengujian hipotesis dengan menggunakan uji Root Mean Square Error (RMSE) memanfaatkan aplikasi Microsoft Excel 2020. Hasil penelitian ini menunjukkan bahwa pendekatan DDM merupakan pendekatan yang memiliki hasil paling akurat untuk menentukan sebuah nilai intrinsik apabila dibandingkan dengan pendekatan PER serta PBV.

Seasoned equity offerings (SEOs) and return of capital (ROC) are activities carried out by listed companies in the capital market. The decision of the company manager to engage in SEOs and ROC is actually in the scope of the agency mechanism. This paper explores the characteristics of SEO and ROC companies and whether SEOs and ROC will affect the company's performance and whether the agency problem will (partially) mediate the impact of SEOs and ROC on company performance. We use the annual data of domestic (Taiwan) listed companies from the Financial Supervisory Commission website and the Taiwan Economic Journal for the 2000–2018 period and adopt the Fama-French three-factor asset pricing model to hierarchical regression analysis to study the mediating role of the agency problem. The empirical results support that SEO companies are mostly in the expansion or growth stage and SEOs reduce company performance, both in the short term and long term. After considering free cash flow, the effect of SEOs on performance declines. The results support that ROC companies are mostly in decline stage and ROC increases long-term company performance. However, free cash flow does not affect the performance of the companies engaging in ROC. This research combines SEO and ROC data, and it is based on the perspective of the agency problem so that we can understand the impact on company performance.

Between 2003 and 2006, the Federal Reserve raised rates by 4.25%. Yet it was precisely during this period that the housing boom accelerated, fueled by rapid growth in mortgage lending. There is deep disagreement about how, or even if, monetary policy impacted the boom. Using differences in exposure to the deposits channel of monetary policy, we show that Fed tightening induced a large reduction in banks’ deposit funding, which led banks to contract portfolio mortgage lending by 32%. However, this contraction was largely offset by substitution to privately-securitized (PLS) mortgages, led by nonbank originators. Fed tightening thus induced a shift in mortgage lending away from stable, insured deposit funding toward run-prone and fragile capital markets funding with little impact on overall lending. We find similar results during the most recent tightening cycle over 2014–2017 when PLS lending reemerged.

Shari’ah mutual funds has its own charm than other types of mutual funds. Shari’ah mutual funds is not limited only to Muslims as the general public, who are already seeing the benefits of investment that is based on the choice of sector and company specific criteria more promising and minimize risk. Islamic mutual funds are able to contribute the confidence of investors amounted to 3.31% in 2011, 4.31% in 2012 and 3.79% in 2013. So the value of the confidence of investors on mutual fund products sharia to 2013 is still around 3-4% . As for growth on Islamic mutual funds into one of the capital market products showed an increase in value in 2012 amounted to 3.79% later in the year 2013 to 4.32%. Investment portfolio management works based framework (framework) for investment management which covers the planning, implementation, evaluation, and adjustment. In mutual funds, investment managers responsible for investment activities, which includes the analysis and selection of investment types, and perform the necessary actions for the benefit of investors. Form of mutual fund performance measurement Shari’ah assessed net asset value (NAV) of the sub weekly. Showed a good performance rekasadana Shari’ah when in a period of return obtained is more positive. Keywords ; Reksadana Syari’ah, Manajemen Portofolio, Nilai Aktiva Bersih (NAB)

Although extant literature investigates the role of sell-side equity analysts in capital markets, most studies do not consider that sell-side equity analysts often work in hierarchical teams. Lead analysts manage a team of associate and junior analysts who participate in the team’s tasks. Building on the delegation theory in the management literature, we hypothesize and find a division of labor between lead and associate analysts, where lead analysts are more likely to delegate tasks (1) that are less significant, (2) that are simpler, (3) when the workload of the lead analyst increases, and (4) when the associate analyst is more competent. Our results further suggest that associate analysts play a significant role in forecasting. By contrast, lead analysts are the main contributors to the qualitative aspects of analyst reports and are more likely to participate in earnings conference calls. Overall, our study documents the significant role of associate analysts in forecasting and the division of labor between lead and associate analysts. This paper was accepted by Brian Bushee, accounting.

This study seeks to understand how environmental, social, and corporate governance (ESG) affects business performance and the diversification effect of cross-border mergers and acquisitions (M&A) by examining 129 events on cross-border M&A in the Korean Stock Price Index (KOSPI) market representing emerging capital markets between 2012 and 2018 in 38 target countries. The findings indicate that better ESG engagement has a positive effect on the business performance of cross-border M&A, supporting stakeholder theory and confirming that ESG can serve as a strategy for boosting business efficiency in cross-border M&A. The findings also confirm that diversification in cross-border M&A leads to a diversification discount on business performance, negatively affecting acquiring firms, but that ESG engagement can mitigate the diversification discount as a friendly channel. The study's main contribution is providing empirical evidence that ESG can serve as a friendly channel through which to address the diversification discount issue.

The management policy for Taiwan's corporate social responsibility (CSR) reporting was changed from elective to partial mandatory. Some companies that have already submitted their reports are also required to undergo assurance provided by accountants. The present study explores the influences of Taiwan's partial mandatory disclosure and partial mandatory assurance management policies for CSR reports on firms' investment to cash flow sensitivity which is used to measure the information transparency of the capital market. The results showed that investment to cash flow sensitivity decreased after mandatory disclosure and mandatory assurance. This implies that the partial mandatory disclosure and the partial mandatory assurance policies for CSR reports have a positive influence on mitigating information asymmetry and agency problems being experienced by firms. It also indicates that Taiwan's partial mandatory disclosure and partial mandatory assurance policies for CSR reports aid in increasing information transparency of its capital market.

The purpose of this paper is to determine whether environmental, social, and governance (ESG) practices affect corporate financial performance (CFP) indicators at Turkish listed companies. The impact of ESG disclosures on the firm-level CFP of companies listed on the Borsa Istanbul Corporate Governance Index (XKURY) over the period 2007–2017 is investigated using the corporate governance principles of the Capital Markets Board and Global Reporting Initiative (GRI) environmental indicators. The contribution of this study is that it explores the influence of twenty independent ESG variables, comprising company disclosures, on CFP in an emerging market. The results of the study reveal a negative effect of environmental disclosures on CFP. Stakeholder involvement in management contributes to operational efficiency in the social dimension of ESG. Provisions related to shareholder rights and the board of directors has a positive impact on CFP in the governance dimension.

This paper analyzes the swap-covered interest parity condition by comparing US Treasury bonds with USD-denominated foreign assets replicated using cross-currency basis swaps. We find that the deviations of these yield spreads declined substantially after the financial crisis, suggesting that the swap-covered interest parity still holds. To reconcile our paradoxical findings with the previous literature that insists upon the failure of covered interest parity, we empirically confirm that the regulatory costs of cross-currency basis swaps are cancelled out by the costs of swaps spread under swap-covered interest parity.

A literatura em história empresarial tem demonstrado que a liquidez dos títulos de propriedade das companhias teve consequências nas estruturas de distribuição do capital e do poder de decisão. Este artigo estuda as transações de ações das companhias coloniais pombalinas em comparação com a United East India Company. Encontrou uma distribuição do capital por acionista mais democrática do que em Inglaterra, mas também uma maior concentração do poder de voto e decisão. Conclui-se que a tendência plutocrática foi comum a uma monarquia absolutista ou parlamentar, mostrando que diferentes ordenamentos jurídicos tiveram impactos semelhantes na distribuição de poder. The literature in business history has shown that the liquidity of company shares had implications on distribution structures of capital and decision-making power. This paper examines the share transactions of the Pombaline colonial companies in comparison to the United East India Company. It finds a more democratic distribution of capital per shareholder than in England but also a higher concentration of voting and decision-making power. It concludes that there was an increasing trend toward a more plutocratic system in both an absolutist monarchy and a parliamentary regime, showing that different legal systems had similar impacts on the distribution of power.

Seit der globalen Finanzkrise von 2008 und 2009 ist klar geworden, dass Schattenbank-aktivitäten oder Kreditintermediationsaktivitäten ausserhalb des beaufsichtigten Bankensektors zu erheblichen System-, Funktions- sowie Individualrisiken führen können. Vor dem Hintergrund der verschiedenen Definitionsvorschläge, die in der Literatur nach der Krise und den globalen Standardsetzern vorgelegt wurden, werden Schattenbankaktivitäten in dieser Arbeit als komplexe Formen von Kreditintermediationsaktivitäten definiert, die durch rennbare (als runnable bezeichnet, kurzfristig einlösbare oder abziehbare) Instrumente finanziert und von Unternehmen (als Entities bezeichnet) ohne Banklizenz ausgeübt werden. Ob und inwieweit diese Aktivitäten in der Schweizer Finanzmarktgesetzgebung und im Aufsichtsrahmen (gemeinsam als Post-Crisis Swiss Regulatory Framework bezeichnet) verhältnismässig reguliert werden, ist bisher noch nicht im Detail untersucht worden. Deshalb wird in dieser Arbeit das Post-Crisis Swiss Regulatory Framework in Bezug auf vier Hauptbereiche eingehend geprüft und evaluiert: I) Datentransparenz der Aufsichtsbehörden, II) Beteiligung von offenen kollektiven Kapitalanlagen an komplexen Kreditintermediationsaktivitäten, III) Spezialregulierung der Anlagetechniken Verbriefung, Wertschriftenfinanzierung und Kreditderivate, IV) Regulierung von rennbaren Finanzinstrumenten (als Runnable Non-Bank Funding bezeichnet). Während die Untersuchung grundsätzlich einen risikobasierten Ansatz verfolgt, werden in der Würdigung die positiven Auswirkungen widerstandsfähigerer Formen (als More Resilient Forms bezeichnet) der untersuchten Aktivitäten auf das Finanzierungsangebot und die Kreditversorgung für die Schweizer Wirtschaft hervorgehoben. Unter der Berücksichtigung von vier Würdigungskriterien (als Evaluation Criteria bezeichnet), die auf den Schutzzielen der FINMA und den strategischen Prioritäten des Bundesrates beruhen, stellt die vorliegende Arbeit fest, dass die Schweiz einen umfassenden, weitgehend verhältnismässigen Regulierungsrahmen beibehält, in gewissen Bereichen jedoch einige Inkonsistenzen und Schwachstellen aufweist. Aus diesem Grund wird eine Reihe von Verbesserungsvorschlägen präsentiert und diskutiert. Insgesamt haben die Schweizer Behörden geeignete Massnahmen ergriffen, um das sehr begrenzte Volumen der inländischen Aktivitäten zu beobachten. Der Stand der Umsetzung der globalen Reformvorschläge des FSB entspricht denjenigen von anderen vergleichbaren Jurisdiktionen (z. B. der Mitgliedstaaten der Europäischen Union)., Since the global financial crisis of 2008 and 2009 it has become clear that significant systemic, market, and individual risks are prevalent in Shadow banking or credit intermediation conducted outside of the supervised banking sector. Against the background of the various definition proposals put forward within the post-Crisis literature and by the global-standard setting bodies, this thesis defines shadow banking activities as complex forms of credit intermediation activities funded by runnable (redeemable at short notice) financial instruments performed by entities without a banking license. Whether and to what extent the post-Crisis Swiss regulatory framework has responded proportionately to the risks inherent in said activities has not been explored in detail. This thesis therefore assesses the responses by the Swiss legislator and authorities, concentrating on four main areas within the post-Crisis regulatory framework: I) supervisory data transparency, II) open-ended investment funds involvement with complex credit intermediation activities, III) special regulation of investment techniques of securitization, SFT, and credit derivatives, and IV) runnable non-bank funding (funding side). While the examination follows a primarily risk-based approach, the benevolent effects of more resilient forms of relevant activities for the diversity of finance and credit supply for the Swiss economy are also taken into account. In consideration of four evaluation criteria based on the FINMAs supervisory objec-tives and the Federal Councils policy objectives, it may be maintained that the post-Crisis Swiss regulatory framework regarding shadow banking is comprehensive and largely proportional. Nonetheless, closer examination reveals a degree of disproportion-ality, insufficiencies, and inconsistencies in certain areas. Measures for corrective action are therefore proposed to tackle these shortfalls. Overall, the Swiss authorities have taken appropriate action in monitoring the very limited volume of domestic activities. The status of the implementation of the global reform proposals remains in line with other comparable jurisdictions (e.g., member states of the European Union).

Ratings seem increasingly central to the regulatory system of modern capitalism and therefore to governments everywhere. Getting credit ratings “right” therefore seems vitally important to many observers. But in pursuing improvement in the rating system one needs to appreciate the challenges and limits to rating. This article argues, after due attention to the origins and work of the agencies, that our expectations of the agencies are founded on a limited rationalist or machine-like understanding of the workings of capital markets. A more appropriately social (and dynamic) view of markets makes the challenge of effective rating even more daunting. The increasingly volatile nature of markets has created a crisis in relations between the agencies and governments, which increasingly seek to monitor their performance and stimulate reform in their procedures.

El Mercado de Valores en Colombia en el siglo XX, se ha destacado por ser un mercado centralizado el cual se constituye por compañías de inversión que operan en la Bolsa de Valores en Colombia, con la finalidad de capitalizar y generar rentabilidad a las inversiones y/o transacciones que se realizan en el mercado. Una particularidad al transar en el Mercado de Valores es lograr diferenciar las alternativas de inversión, dado el nivel de riesgo e incertidumbre que exista. Para el mercado bursátil en Colombia se crea un índice que se conoce como Índice General de la Bolsa de Colombia (IGBC), el cual es el principal índice bursátil y evalúa la variación que se presentó en los precios de las acciones más representativas del mercado, es decir, que a través de este se logre crear un portafolio de productos derivados. The stock market in Colombia in the 20th century has stood out for being a centralized market which is made up of investment companies that operate in the Colombian Stock Exchange, in order to capitalize and generate returns on investments and/or transactions that take place in the market. A peculiarity when trading in the stock market is to be able to differentiate the investment alternatives, given the level of risk and uncertainty that exists. For the stock market in Colombia, an index called the General Index of the Colombian Stock Market (IGBC) is created, which is the main stock market index and evaluates the variation in the prices of the most representative shares of the market, that is, through from this it is possible to create a portfolio of derivative products. Especialista en Finanzas Especialización

En el presente trabajo se realiza una recopilación histórica de las ofertas públicas de adquisición (OPA). Por lo tanto, se consideraron las características específicas que presentan los cuadernillos de oferta para sintetizar la información disponible en Colombia y analizar tanto el desarrollo de estas negociaciones como el comportamiento del mercado de capitales colombiano. Además, se comparó el desempeño de los mercados de capitales de los principales países de Latinoamérica con su respectivo desarrollo económico. Lo anterior se llevó a cabo con información disponible en los sitios oficiales de la Bolsa de Valores de Colombia, la Superintendencia Financiera de Colombia, el Banco Mundial, informes de gestión de las empresas involucradas y estudios previos. En Colombia, se hace notoria la disminución de empresas listadas en la Bolsa de Valores de Colombia, ya que variables como la inflación y las tasas de interés han provocado la salida de comisionistas de bolsa y emisoras de títulos, lo que puede causar que no sea atractivo invertir en acciones colombianas, aun cuando se han generado utilidades en las compañías., In the present work, a historical compilation of public acquisition offers (OPA) is carried out. The specific characteristics presented by the offer booklets are considered to synthesize the available information in Colombia and analyze both the development of these negotiations and the behavior of the Colombian capital market. Additionally, it compares the performance of the capital markets of the main countries in Latin America with their respective economic development. The above was carried out using information available on the official websites of the Colombian Stock Exchange, the Financial Superintendence of Colombia, the World Bank, management reports from the companies involved, and previous studies. In Colombia, the decrease in listed companies on the Colombian Stock Exchange is noticeable, as variables such as inflation and interest rates have led to the withdrawal of stockbrokers and issuers of securities, making it unattractive to invest in Colombian stocks, even though companies have generated profits.

Firm value is the company's performance which is reflected by the stock price which is formed by the demand and supply of the capital market which reflects the public's assessment of the company's performance. Several factors that can affect firm value include good corporate governance, corporate social responsibility, and sustainability reports. This study aims to analyze the influence of Good Corporate Governance, Corporate Social Responsibility, and Sustainability Report on Firm Value on the Indonesia Stock Exchange. The research population is manufacturing companies listed on the Indonesia Stock Exchange. The sample in the study of 46 companies was determined based on the purposive sampling method. The results showed that good corporate governance, corporate social responsibility had no effect on firm value while the sustainability report had no effect on firm value. The limitations and suggestions in this study are that this study uses a manufacturing company with an observation period of three years. Further researchers are expected to increase the observation period and increase the number of samples to expand the research results. For further research it is expected to develop and multiply the variations of the independent variables used such as environmental performance, company size

We investigate a firm’s information acquisition and voluntary disclosure decisions regarding demand forecast information. We study the interaction among the firm, its supplier, and the external capital market investors who assess the firm’s interim equity price. We first analyze when it is beneficial for the firm to acquire demand forecast information, and if such information is acquired, when the firm should disclose it to the supplier and investors. Then, we investigate how the firm’s information acquisition and disclosure decisions influence the investors’ and the supplier’s pricing strategies. We show that the optimal information disclosure policy for the firm is highly dependent on the corporate myopia level (CML): when the CML is low, the firm discloses low demand information only; when the CML is medium, the firm always withholds demand information; and when the CML is high, the firm discloses high demand information only. Our findings provide a novel plausible explanation to firms’ non-disclosure behaviors commonly observed in practice and highlight the importance of considering the interaction between the supply chain and the capital market.

Using a theoretical model, we develop an institution-based version of the Linder hypothesis for horizontal FDI; FDI is more likely to occur among countries with smaller institutional distance. We then use firm-level data to estimate the effect of institutional distance between China and the countries that host its FDI on horizontal outward FDI (OFDI) of Chinese multinational enterprises (MNEs). High-dimensional fixed effects (HDFE) estimation shows that the overall institutional distance has a positive effect on China's OFDI, which does not support the institution-based version of the Linder hypothesis. The positive effect of institutional distance on OFDI does not vary significantly across China's state-owned enterprises (SOEs) and private-owned enterprises (POEs). Further analysis based on four sectoral institutional distances shows that the effect of public sector and labour market institutional distances on OFDI of MNEs is negative and this effect is stronger for POEs than SOEs, which supports the institution-based version of the Linder hypothesis for horizontal FDI. However, the effect of the goods and services sector institutional distance and capital market institutional distance on horizontal OFDI is positive. The impact of the goods and services sector institutional distance on OFDI of SOEs is stronger than for POEs. While unravelling the black box of institutional effects, we find significant asymmetries in the effect of sectoral institutions on OFDI. We also find that the effect varies in size across ownership structures.

Using a sample of 14,245 firm-year observations from 2,579 listed firms in the Chinese capital market, this study investigates whether board directors with an educational background in science, technology, engineering, and mathematics (STEM) are associated with greater corporate innovation. The results suggest that such directors have significant beneficial effects on corporate innovation activities. This study provides novel empirical evidence supporting resource dependence theory and extends the labor economics literature regarding the value of STEM graduates for corporate innovation. The findings have significant implications for policymakers and practitioners, showing that firms with a strategic focus on innovation may find it beneficial to appoint more directors with a background in STEM.

This paper analyzes the relation between the announcement discount and the post-merger valuation of merger and acquisition transactions (MA and proposes that the two are linked by the implications of the information asymmetry hypothesis of Myers and Majluf (1984). We track the information asymmetry, value, and synergies of M&As over a three-year post-merger window. The analysis demonstrates that the announcement discount is proportional to the rise in information inequality around the announcement date (not the pre-merger information asymmetry). The announcement discount is also positively related to the post-merge gains which grow in tandem with the gradual decline in information asymmetry and improvements in internal capital market efficiencies, market power, and access to capital markets. Collectively, our findings suggest that M&As instigate a temporary spike in information inequality that results in temporary loss in shareholders' wealth. Over time, synergies materialize, information inequality fades away, and value improves. Our results are robust to several variations in specifications and assumptions including Heckman two-stage self-selection model. Our proposition suggests that management and outside investors should not be swayed by initial market reaction to deal announcements because the true gains of M&As materialize in the long-run. Nevertheless, management should disclose adequate information about future synergies to mitigate the market's initial negative reaction.

We examine the association between internal forecasting sophistication and end-of-the-year accounting misreporting. We draw on survey data from investment center managers of Dutch companies. Consistent with our hypothesis, results suggest that more sophisticated internal forecasting allows firms to reduce their costly accounting misreporting, as these firms make more accurate projections and create contingency plans such that they can revise operational plans in a more appropriate and timely manner. Cross-sectional analyses reveal that the benefits in terms of greater forecasting capabilities can vary across conditions. We find that investments in internal forecasting are less effective in reducing the demand for misreporting when environmental volatility is high, when capital market pressure to meet expectations is comparably high, and when within-firm information asymmetry is high. The paper especially speaks to the planning role of budgeting and forecasting, as opposed to the relatively more extensively studied evaluation and incentive role. JEL Classifications: M12; M41.

I identify effects of financial constraints on firms' product pricing decisions, using a sample of insurance groups (conglomerates) that contain both life and P&C (property & casualty) subsidiaries. P&C subsidiaries' losses can tighten financial constraints for the life subsidiaries through internal capital markets. I present a model that predicts following P&C losses, premiums should fall for life policies that initially increase insurers' statutory capital, and rise for policies that initially decrease capital. Empirically, I find that P&C losses cause changes in life insurance premiums as my model predicts. The effects are concentrated in more financially constrained groups. Evidence also indicates that life subsidiaries increase capital transfers to P&C subsidiaries following larger P&C losses. These results hold when instrumenting for P&C losses using data on weather damages, implying that P&C losses do cause changes in life insurance premiums and internal capital transfers. My findings suggest that when financial constraints tighten, firms change product prices to relax the constraints, and how prices change depends on the initial impact of selling the products on firms' financial resources.

Research aims: This paper discusses the effect of financial literacy and automatic investment technology on intention to invest in the capital market during the early pandemic.Design/Methodology/Approach: The research population was students studying economics and finance in institutions located in Yogyakarta Special Region Province. The sample of 384 respondents was obtained through questionnaires distributed online. To test the impact of financial literacy and automatic investment technology on intention to participate in the capital market, multiple linear regression was used.Research findings: The researchers found that financial literacy and automatic investment technology affected students’ intention to invest in the capital market. The number of students with a moderate level of financial literacy score dominated, followed by the students with low and high literacy scores. Besides, students’ background in economic and finance appeared inadequate to solely determine the financial literacy score.Theoretical contribution/Originality: This paper contributes to the investment area, especially related to the automatic investment technology “Robo advisor,” that is still rarely studied yet, which will be a significant issue in the future. It also provides empirical results, which explain the investment intention through financial literacy. Moreover, this study was conducted during the massive growth of investors in Indonesia during the pandemic.Practitioner/Policy implication: This study provides a useful reference to the financial sector, especially the capital market. Inclusive programs regarding financial literacy should be expanded for wider society to enhance their knowledge and dismiss lack of confidence in capital market participation. Private sectors providing automatic investment technology are suggested to continue developing a more convenient application to be accessible by a broader range of society.Research limitation/Implication: The research included only students as the sample; hence, further research may use a larger area of the sample with various backgrounds and ages. Other determinants, such as norms, environment, risk, and more advanced financial literacy measurement, can also be added to enrich future studies and literature.

Whether capital market opening improves the price discovery efficiency of stock market is an important issue. Shanghai-Hong Kong Stock Connect (hereafter, SHKSC) is a milestone event in the opening up of China’s capital market. Based on SHKSC, using the method of PSM + DID, we study the impact of capital market opening on the price discovery efficiency from two dimensions-stock price information content and price reaction speed to information. Our research shows that capital market opening did not increase stock price information content, but speed up the reaction of price to information. Therefore, capital market opening improves capital market’s price discovery efficiency in terms of response speed of stock price to information. Further analysis shows that capital market opening affects stock price reaction speed through improving market information environment and reducing insider trading, but it has not yet had a substantial impact on listed companies’ earnings quality, which is the main participant in the capital market, and therefore has failed to influence the stock price information content. In order to maximize the effectiveness of capital market opening, it is necessary to introduce more effective policies to improve the information disclosure quality of listed firms and reduce the level of insider trading.

Despite the advantages of debt, a significant number of firms that have an established leverage policy deliberately become all-equity. These firms eliminate a substantial amount of long-term debt as the average firm’s leverage ratio is approximately 30 percent at the year-end prior to debt elimination. Firm-level “shocks” such as CEO turnover and changes in credit ratings cannot explain the dramatic recapitalization decision. Consistent with the tradeoff theory, firms that eliminate debt have lower benefits (less tax shield benefits, agency costs) and higher costs (probability of financial distress, access to capital markets, etc.) of leverage in the three prior years compared to a matched sample. We also find that the factors influencing the decision to eliminate all debt is different from those to significantly reduce leverage or to have very low debt levels. Firms primarily finance the approximately $70 million of average long-term debt eliminated using proceeds from sales of relatively unproductive assets and from equity issues. Interestingly, over half of these firms issue significant amount of new debt within three years of becoming all-equity. Firms with lower liquidity and non-debt tax shields, higher potential overinvestment agency costs, and those that issue equity at the debt elimination year are more likely to relever quickly.

We detail how to extract factor risk, return, and correlation assumptions from a set of asset-class risk, return, and correlation assumptions. Such capital market assumptions are key tools in institutional and high net worth investment operations. Using an institutional investment consultant’s asset-class assumptions, we use our technique to evaluate the implied factor loadings for a demonstration asset class, hedge funds, and find that much of their return comes from factor exposures. Our analytical approach offers useful insight to the veracity of capital market assumptions, key inputs to investment decision making.

The topic about institutional investor being a monitoring role has been widely discussed but different results exist in previous empirical studies. Along with their progressively development, institutional investors are now playing more important role in Chinese capital market. Using samples from Chinese capital market, this paper collects fraud data and data of mutual funds’ ownership in listed firms between 2008 and 2015 to examine the monitoring function of institutional investors against accounting fraud. To go deep into the monitoring incentives of investors that fall into different categories, mutual funds are further classified as heterogeneous groups according to their investment strategy and investment durations. The monitoring role of mutual funds in different groups and their influence as the disincentive to accounting fraud of listed firms are investigated in the paper. Mutual fund ownership is found to be able to curb the incidence of accounting fraud. Active mutual funds are able to conduct more effective monitoring when compared with passive mutual funds. It is also reported that short-term mutual funds are more significant than long-term mutual funds in monitoring. Policy makers may need to normalize institutional investments by quantified indicators or in other reasonable ways. Key words: Accounting fraud, institutional investors, investment duration, monitoring role.

We develop a flexible and bias-adjusted approach to jointly examine skill, scalability, and value added across individual funds. We find that skill and scalability (i) vary substantially across funds, and (ii) are strongly related as great investment ideas are difficult to scale up. The combination of skill and scalability produces a value added that (i) is positive for the majority of funds, and (ii) approaches its optimal level after an adjustment period possibly due to investors' learning. These results are consistent with theoretical models in which funds are skilled and able to extract economic rents from capital markets.