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Copyright of Contemporary Accounting Research is the property of Canadian Academic Accounting Association and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Contemporary Accounting Research is the property of Canadian Academic Accounting Association and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Research suggests that most brand stakeholders react favorably to cause-related marketing (CRM), and CRM positively impacts the brand. However, a divergence of interests can create tension in the principal – agent relationship, as the owners may feel that managers are investing in CRM at the expense of maximizing profits. Along these lines, recent research suggests that shareholders negatively respond to CRM, which reduces shareholder value. Thus, there are concerns about whether expenses incurred via CRM partnerships create value for all stakeholders. Therefore, because CRM can benefit nonprofits and many of the firm’s stakeholders, the authors utilize agency theory and signaling theory to explore co-branding and competitive signals that mitigate the negative impact on shareholder value. The results provide insights into how nonprofit and brand managers can navigate CRM partnerships by designing campaigns that send signals designed to alleviate investor concerns and reduce shareholder disapproval yet still garner support from other stakeholders. [ABSTRACT FROM AUTHOR]

Executive remuneration has traditionally attracted the attention of scholars, regulators, and public opinion. In recent years, especially after epochal corporate scandals and financial crises, executive remuneration has polarized the political debate, leading to consequences for the way it was theorized, structured, and ultimately quantified within corporations. This article specifically examines the relationship between executive compensation and sustainability, with a focus on the influence of Environmental, Social, Governance (ESG) metrics in the context of European companies. The article provides a qualitative analysis of the historical debate on executive remuneration and considers the different theories informing corporate law. Furthermore, it offers a qualitative and empirical analysis of how executive compensation policies of the 300 largest companies by target capitalization in Europe – listed in the FTSE EuroFirst300 – take ESG parameters into account. Lastly, this article presents some policy considerations, particularly questioning whether executive remuneration is the right incentive for ESG compliance, and emphasizing the importance of a shift in corporate culture to effectively make corporate practices more sustainable. [ABSTRACT FROM AUTHOR]

With the globalization of markets, competition and performance pressure have accelerated. Investors rightfully expect a reasonable return on the capital they make available to others. Since companies often achieve their growth through capital obtained from new shareholders, the pressure on company profitability increases significantly. The capital market rewards companies' good performance and also punishes their bad performance. At this point, Economic Value Added (EVA), Cash Flow Return on Investment (CFROI), Cash Value Added (CVA) and Market Value Added (MVA), which ensure value maximization, have become increasingly important problems. For this reason, company profitability and growth potential are important. Within the scope of this study, the importance of EVA, CFROI, CVA and MVA indicators and their comparison with traditional methods are discussed in the introduction part. Studies on these indicators that embody value maximization are examined through a literature review. In the methodology section, the data of 11 companies active in the healthcare sector listed on Borsa Istanbul are analyzed through regression and correlation analyzes on the basis of the 2015-2021 period, and the effects of these indicators on stock returns. As a result, when MVA, CVA, CFROI and EVA are positive, economic profit is achieved and shareholder value is expected to increase. [ABSTRACT FROM AUTHOR]

This research investigates the strategic adoption of Bitcoin as a corporate asset in Indonesia, focusing on its potential as an inflation hedge and its impact on enhancing shareholder value. Employing a mixed-method approach combining qualitative interviews and the Analytical Hierarchy Process (AHP), the study explores the challenges, risks, and opportunities associated with integrating Bitcoin into corporate financial strategies. The findings reveal that risk mitigation emerges as the primary priority for companies considering Bitcoin adoption, underscoring the need for robust strategies such as investment diversification, hedging, and scenario analysis. Stakeholder acceptance, encompassing investors, regulators, and market sentiment, is identified as the second most crucial factor, highlighting the importance of a supportive regulatory environment and investor confidence. The research also highlights the significance of analyzing price trends and optimizing asset allocation strategies. The AHP analysis identifies the Strategic Diversification approach as the most preferred alternative, aligning with Modern Portfolio Theory principles. Additionally, the study addresses accounting and financial reporting challenges associated with Bitcoin adoption, emphasizing the need for clear guidance and standards. The implementation plan outlines key aspects such as infrastructure development, education initiatives, risk management frameworks, and regulatory collaboration to facilitate the responsible integration of Bitcoin into Indonesian corporate finance strategies. [ABSTRACT FROM AUTHOR]

The financial implications of the worldwide COVID-19 pandemic and the effective mitigation of the negative effects are the subject of an ongoing debate.Weaim to empirically substantiate this debate. Based on a sample of 4,032 publicly traded U.S. and Chinese firms, we conduct an event study and find that the COVID-19 pandemic is associated with a substantial decrease in shareholder value, significantly varying between U.S. and Chinese firms and across industries.Wefurther identify structureand supply chain-related firm factors that mitigate the negative impact. Specifically, we find that smaller firms experience a less negative impact on shareholder value, challenging established findings. Our results also suggest that a lower dependence on physical assets, a shorter trade cycle, and a higher degree of vertical integration attenuate the negative impact on shareholder value. Our findings provide important insights for managers and policymakers.Werecommend managers to reduce the dependency on business models that strongly rely on physical assets, to streamline trade cycles, and to reduce supply chain complexity. From a policy perspective, we emphasise the importance of more industry-specific granularity of public support measures. [ABSTRACT FROM AUTHOR]

We analyse the effects of changes in regulatory capital requirements under Basel III on the dynamic evolution of bank shareholder equity over time. Evidence from managerial and regulatory reports shows that bank shareholder equity stands between micro-prudential regulatory capital requirements and managerial pursuit of equity economising strategies. Shareholder value strategies see shareholders as the equity investment remuneration recipients. Micro-prudential regulators, in turn, address them as equity investment providers. With opposing cash streams, one orientation puts the other to a test. The article visualises this conflict by analysing the actual shareholder contribution to the bank equity position in nine case studies of European financial institutions between 2001 and 2017; our evidence-based financial analysis applies an innovative method to data directly extracted from financial statements, in order to measure this equity position evolution and assess bank equity dynamics in light of revised regulatory capital requirements and persistent assurance of shareholder value thriving in managerial reports. The choice of in-depth analysis of a sample of relevant case studies overcomes the absence of detailed data on changes in bank equity in existing databases. [ABSTRACT FROM AUTHOR]

Objective: The purpose of this research was to investigate the supply chain capabilities in the food industries by using indicators of competitive advantage, financial performance, and shareholder value to improve supply chain capabilities and ultimately design an appropriate structural model. Methodology: The present study is quantitative and descriptive-analytical in nature. The population of the study includes employees and experts in the food manufacturing industries, totaling 500 individuals. To determine the minimum sample size required, Morgan's table for limited populations was used, and ultimately, 217 completed questionnaires were returned and analyzed. The data collection tool was a researcher-made questionnaire. Data analysis was performed using structural equations and AMOS software. Findings: The results indicated significant relationships and components of the presented model. Factor analysis results showed that the paths and causal relationships between external and internal constructs in the structural model were confirmed with 95 percent probability. Conclusion: In general, initiatives based on cost reduction and productivity improvement are easier than others. For example, if an initiative focusing on reducing inventory levels leads to achieving previous sales levels, the benefits of this initiative are easily measurable. However, long-term growth requires an increase in revenue, and managers need to focus on all four methods mentioned above to enhance company value. [ABSTRACT FROM AUTHOR]

One plus one makes three: this equation is the special alchemy of a merger or an acquisition. The key principle behind buying a company is to create shareholder value over and above that of the sum of the two companies. Two companies together are more valuable than two separate companies - at least, that's the reason behind M&A. This rationale is particularly alluring to companies when times are tough. Strong companies will act to buy other companies to create a more competitive, cost-efficient company. The companies will come together hoping to gain a greater market share or to achieve greater efficiency. Because of these potential benefits, target companies will often agree to be purchased when they know they cannot survive alone. [ABSTRACT FROM AUTHOR]

This paper examines the impact of a firm's Corporate Social Responsibility (CSR) level on abnormal stock returns around merger and acquisitions (M&A) announcements. Using a sample of transactions announced by German DAX-listed acquirers from 2017 and 2022, the analysis assesses whether CSR creates value for acquiring firms' shareholders and offers a comprehensive discussion of potential factors supporting or opposing this notion. Our study seeks to fill a notable gap in the German literature on the relationship between CSR performance and abnormal stock returns surrounding M&A announcements. Building upon prior research findings in the US and in an international sample, our investigation focuses on the German market. Employing event study methodology, our results indicate that M&A transactions of German-listed acquirers did not yield significant negative or positive cumulative abnormal returns for event windows of 3 and 11 days. Furthermore, based on multiple linear regression, no evidence was found that CSR positively or negatively influenced abnormal stock returns following M&A announcements, suggesting that positive and negative effects potentially offset each other. The outcomes of our research have important implications for investors, as CSR initiatives do not serve as a positive trading signal, guaranteeing excess returns, which contrasts findings from previous studies in other developed countries. For managers, it is essential to concentrate on factors beyond CSR performance, such as synergies and fit. Finally, both managers and investors should not view CSR as a shareholder value-enhancing short-term investment but as an integral component of fostering sustainable business development. [ABSTRACT FROM AUTHOR]

This study documents the first large‐scale empirical evidence on the effects of differences in countries' environmental sustainability (ES) on cross‐border merger and acquisition (M&A) activity. Using 34,088 cross‐border mergers across 44 countries, we find that greater ES differences between acquirer and target countries stimulate the intensity of cross‐border mergers. The acquirer firms experience higher cumulative abnormal returns around merger announcements and pay higher merger premiums. Consistent with the pollution haven hypothesis, results on value effect are more pronounced for M&A deals in highly polluting industries such as petroleum, transportation and mining. The results are robust to a battery of robustness tests. [ABSTRACT FROM AUTHOR]

The purpose of this paper is to address a fundamental flaw in prominent approaches to managing businesses for sustainability. Current management strategies fail to recognize the fundamental differences between economic, social, and moral or ethical values. Economic values are instrumental, individual, and impersonal. Social values are reciprocal, communal, and personal. Moral values are altruistic, spiritual, and universal. These are not arbitrary definitions but expressions of basic differences among the three types of value. These differences reveal the fundamental flaws in attempts to assign economic value or objectively quantify the social and ecological costs and benefits of economic enterprises. The transactional, social, and moral economies are defined in ways that avoid compromising the differences in values. In addition, a natural hierarchy exists among nature, society, and economy that requires a corresponding hierarchy of moral, social, and economic values in managing sustainable organizations. The strategies, motives, and metrics that have dominated sustainable business management for the past several decades, and the related research and educational programs that support them, fail to reflect differences among economic, social, and moral values that are critical to sustainability. [ABSTRACT FROM AUTHOR]

We investigate the decision rules for corporate investment by designing a company value frontier. This company value frontier allows for balancing the financial value and social and environmental impacts. This article develops novel value concepts—ranging from shareholder value to shareholder welfare and integrated value—resulting in varying preferences for social and environmental impacts or values. Next, these preferences are incorporated in investment decision rules. The traditional net present value (NPV) rule optimises only the financial value. We propose a new integrated present value (IPV) decision rule that includes a preference for social and environmental values without neglecting the financial value. By applying the new IPV rule, responsible companies are able to achieve more sustainable outcomes. [ABSTRACT FROM AUTHOR]

Sports sponsorships are almost a $20 billion business in North America alone. Yet, despite the significant academic and corporate interest in such high financial stakes, the literature is equivocal on several key aspects. While some papers report that sports sponsorships enhance shareholder value, others dispute this. Furthermore, the marketing determinants of this value are unclear, particularly the role of firms' marketing capabilities. To address these, the authors first created a database of sports sponsorship announcements over 19 years by Canadian and U.S. firms, complementing it with the stock market and firm-level financial and marketing data. The authors then conducted an event study and found that investor response to sports sponsorship announcements is, on average, positive. The authors found that investors not only credit firms with higher marketing capabilities, amplifying their positive reaction, but that they also seem to use firms' marketing capabilities to offset the potential barriers to the value generated from these announcements. Specifically, for investors, the firms' marketing capabilities can compensate for the dampening effect of financial risk. Our results are robust to considerations of sample selection bias, endogeneity, and outliers. [ABSTRACT FROM AUTHOR]

The study empirically investigates the impact of green bonds issuance on listed firms operating in G7 (Japan, UK, USA, France, Germany, Italy, and Canada) economies. The sample consist of monthly data ranges from January 2015 to August 2022. Green bonds issuance data is collected from announcements, press releases, and semi-annual or yearly reports. Additionally, we use the official websites and credit rating agency portals of the particular country to find debt issuance. The subsequent findings imply that the issuance of green bonds cast a positive impact on shareholder wealth maximization moreover, sustainable financing practice increases firm value in a long run and thus is favored by shareholders. [ABSTRACT FROM AUTHOR]

This study aims to investigate two issues: The impacts of shadow banking activities on bank shareholder value, and the relationship between managerial ability and shadow banking engagement in China. Using the differences in the Basel II capital adequacy ratio to represent the extent commercial banks get involved in shadow banking activities, the authors regress the econometric models using the generalized method of moments. The robustness tests are conducted regarding different risk weights, alternative measures, and model specifications. Thence, the authors found growths in trust beneficiary rights increase banks’ shareholder values, thus suggesting that banks enrich their shareholder wealth while engaging in the shadow banking business. Further, we found that more able managers intend to join the shadow banking business. Given that the purpose of bank management is to enrich shareholder value, we contributed to the literature that joining the shadow banking business can benefit bank shareholders. [ABSTRACT FROM AUTHOR]

Copyright of Contemporary Accounting Research is the property of Canadian Academic Accounting Association and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

This article investigates the capacity of banks to create shareholder value amidst regulators and stakeholders’ growing demands for reductions in financing to greenhouse gas emitting companies. The purpose of the study is to evaluate the shareholder value creation capacity of banks amidst transition risks resulting from reductions in loans from high greenhouse gas emitters. The study compares reductions in balance sheet corporate loans to returns on equity from income statements. The comparison is done for periods during which interest rates move downwards as a way of stress testing banks’ capabilities to generate shareholder value. A risk-return analysis is conducted to determine the rate of change in risk compared to shareholder value. A hypothesis-testing focus is used to test a value-creation proposition concerning the rate of change in corporate loans and return on equity. The results of the study strongly suggest that banks can create shareholder value when faced with loan reductions to high greenhouse gas emitting companies, even within constrained repricing conditions such as negative interest rate movements. Of the cases analyzed 88% have a similar outcome of value creation, which is supported by a rejection of the null hypothesis at p-value ≤ 0.05, justifying statistical significance. Furthermore, 53% of the changes in return on equity is explained by the changes in loans to greenhouse gas emitting companies. The study concludes that banks could still create shareholder value if they reduce funding towards high greenhouse gas emitting companies, provided they devise prudent strategic portfolio tilts in assets.

China's markets gained 3.86% around December 4, 2012, when the Party announced anticorruption reforms. State-owned enterprises (SOEs) with higher past entertainment and travel costs (ETC) gained more. NonSOEs gained in more liberalized provinces, especially those with high past ETC, productivity, growth opportunities, and external financing. NonSOEs lost in the least liberalized provinces, especially those with high past ETC. These findings support investors' expect reduced official corruption to create value overall, reduce SOE waste, lower bureaucratic barriers to efficient resource allocation where markets function, and impede business in unliberalized provinces, where "getting things done" still requires investment in greasing bureaucratic gears. [ABSTRACT FROM AUTHOR]

Copyright of Unternehmung: Swiss Journal of Business Research & Practice is the property of Nomos Verlagsgesellschaft mbH & Co. KG and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

We examine the determinants of the disclosure of value-based (VB) performance measures in Germany. We argue that firms are more likely to disclose VB performance measures when information asymmetry is greater, as greater information asymmetry means firms have a greater need to credibly signal a shareholder value orientation. Using a hand-collected dataset of German listed firms covering 1,528 firm-years from 2004 to 2011, we demonstrate that firms are more likely to disclose a VB performance measure if the free float is larger than the blocking minority and also, when firms are large, if they have high foreign sales to total sales ratios and are not cross-listed internationally. Our results indicate that German firms use VB performance measures to improve investor communication and to substantiate their shareholder value orientation. Our results should be interpreted against a background of increased shareholder value orientation and sophisticated cost accounting in German firms. [ABSTRACT FROM AUTHOR]

Purpose: The article aims to analyse the theoretical foundations of value management in both large enterprises and small and medium-sized businesses. Design/methodology/approach: The achievement of the objective involved the critical review of both national and international literature as the primary research method. Originality/value: Financial management, in theory and practice of a developed market economy is characterized by high dynamics, high level of evolution of the subject, scope and determinants of decisions made. At the same time, the basic goal of all enterprises is effective financial management as a determinant of the success or failure of an economic unit. When analyzing the financial management process, first of all, it is necessary to define the main goals, functions and management instruments, and then compare the company's goals with the goals of financial management. In the literature on the subject and in practice, you can meet many goals of the company's activity, i.e. maximizing profit, maximizing sales, achieving a satisfactory level of profit, survival of the company, but all these categories are directly or indirectly related to the profitability. However, the qualification of profit maximization as the superior goal of the enterprise raises a lot of controversy. On the other hand, profit maximization should not be treated as the goal of the company's activity, as it focuses on current effects, ignoring such an important issue as the structure of revenues over time. This gap is filled by maximizing the value of the owners' wealth. Undoubtedly, the main goal of the company is to maximize the financial benefits of the owners. Therefore, the question arises if this issue can be treated as the primary goal in the group of small and medium-sized enterprises. Each unit that conducts business activity must have at its disposal adequate capital which is the basis for the initiation and development of the company's activity. This capital can be obtained in many ways, but a significant part has to be contributed by co-owners. Of course, there are many groups of co-owners ranging from shareholders to sole proprietorship. Each shareholder expects to achieve specific benefits. Thus, he wants to be entitled to a share in the company's profits. The investment will be made in such a unit that will allow to obtain the greatest benefits, and therefore obtain the highest rate of return. [ABSTRACT FROM AUTHOR]

Our study examines whether and how increased engagement in social responsibility activities by a firm affects movements in its stock prices during the COVID‐19 public health crisis, which is regarded as an exogenous shock to economic ties between focal firms and their customers, employees, and suppliers. We find that corporate social responsibility has an inverted U‐shaped relationship with shareholder value. The nonlinear relationship is more dominant at firms with higher cash‐flow constraints and weaker cost‐adjustment capabilities. Our research also generates meaningful implications for business practices. [ABSTRACT FROM AUTHOR]

Scholars have long suggested that CEOs can benefit from corporate philanthropy. However, little is known about this relationship in contexts of authoritarian capitalism such as China, where the state not only uses its control of economic entities to pursue social goals but also plays a key role in CEOs' careers. We theorize how corporate philanthropy among state-controlled firms increases the CEO's likelihood of receiving career benefits from the state in the form of outside directorships. Outside directorships represent an important form of social capital in the Chinese context, and corporate philanthropy is an important mechanism through which social capital can be acquired. In addition, we theorize how two factors—the degree of state ownership and the number of independent directors on the CEO's board—moderate this relationship. Analyzing a 12-year panel of state-controlled, publicly-listed firms in China comprising 6,594 firm-year observations, we find general support for our ideas. In so doing, we contribute to scholarship on the business–society relationship and corporate governance in the context of authoritarian capitalism. [ABSTRACT FROM AUTHOR]

We investigate the decision rules for corporate investment by designing a company value frontier. This company value frontier allows for balancing the financial value and social and environmental impacts. This article develops novel value concepts—ranging from shareholder value to shareholder welfare and integrated value—resulting in varying preferences for social and environmental impacts or values. Next, these preferences are incorporated in investment decision rules. The traditional net present value (NPV) rule optimises only the financial value. We propose a new integrated present value (IPV) decision rule that includes a preference for social and environmental values without neglecting the financial value. By applying the new IPV rule, responsible companies are able to achieve more sustainable outcomes.

This paper extends the previous research on strategic transactions (M&A) and focuses on the analysis of the relationship between the pre-event performance of acquiring companies and value creation in strategic acquisitions for growth. It identifies the prerequisites of successful transactions and tests empirically how the key fundamental determinants of the acquiring companies influence investors' reaction around the announcement and acquirers' financial performance in the years after. The results of the analysis confirm that the intrinsic pre-event performance of the acquiring firm can significantly impact the outcome and profitability of strategic M&A. [ABSTRACT FROM AUTHOR]

This study examines how corporate social responsibility and critical stakeholder (media and analyst) attention affect firm value when an environmental violation occurs. We discover that corporate social responsibility acts as a buffer in influencing firm value by analyzing 224 environmental violation events that occurred in China's publicly traded manufacturing industry firms between 2015 and 2020. Moreover, we find that the corporate social responsibility buffering effect is more substantial when media and analyst attention is high (vs. low). By studying the effects of corporate social responsibility on firm value at the onset of an environmental violation event, this study offers further support for the risk management and reputation insurance theory of corporate social responsibility. It also enriches our understanding of the relationship between corporate social responsibility and financial performance. [ABSTRACT FROM AUTHOR]

Employee treatment is an important but challenging element of corporate environmental, social, and governance policies. Satisfying employee needs can increase corporate productivity, but is also costly to shareholders. Using unique data of Chinese publicly listed firms, we show that having satisfied employees is valuable to the firm. Specifically, firms with higher employee satisfaction scores withstand COVID-19 better, in terms of stock market performance. Such an effect is more pronounced for firms with more intangible assets and in knowledge-based industries. Moreover, higher employee satisfaction scores predict better operating performance. While not fully revealed in tranquil times, the effect of employee satisfaction is materialized when the firms experience negative shocks, such as COVID-19. Our findings suggest that firms can do well in crisis periods by doing good in normal times. [ABSTRACT FROM AUTHOR]

Copyright of Multidiszciplináris Kihívások, Sokszínű Válaszok is the property of Budapest Business School / Budapesti Gazdasagi Egyetem and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Shareholder value orientation has commonly been considered a hallmark of corporate financialisation. Today, firms increasingly share their profits with shareholders in the form of cash dividends and share buybacks. Yet how the shareholder payouts are distributed by firms from various sectors, sizes and countries remain unexplored. To complement existing accumulation- and asset-centred approaches that focus, respectively, on how resources enter the firm and change its structure, we present a payouts-centred approach to corporate financialisation that focuses on how resources leave the firm. This paper analyses firm-level trends in shareholder payouts in OECD member countries for the period 2000–2019, differentiating between types of distributed payouts. We show that shareholder payouts are high across various sectors and geographical locations, and not limited to a small subset of large, US-American financial corporations, but include 'big pharma' and 'big tech' as well as Latin American and Israeli firms. The paper sheds light on the nature of the contemporary corporations and contributes to discussions on the increasing financialisation of non-financial firms and their rising shareholder value orientation. [ABSTRACT FROM AUTHOR]

Adding brand purpose to a brand offers the promise of creating real societal value and increasing the financial value of the brand at the same time. This paper discusses how, in order to fully realise this promise, brand purpose should be implemented in a way that is intrinsic to the brand. Intrinsic implementation requires aligning the brand purpose with the core positioning concept of the brand. Essential elements of the purpose must fit with the three critical components of any brand positioning. With an intrinsic implementation, consumers will perceive how the brand positioning extends to supporting what the brand does for others. [ABSTRACT FROM AUTHOR]

Many firms introduce both business-to-business service innovations (B2B-SIs) and business-to-consumer service innovations (B2C-SIs) and need to better allocate their resources. However, they are unsure about B2B-SIs' effects on firm value or risk, especially relative to those of B2C-SIs. The authors address this problem by developing hypotheses that relate the number of B2B-SIs and B2C-SIs to firm value and firm risk together with the moderators (the number of product innovations and customer-focus innovations). To test the hypotheses, the authors develop and estimate a model using unique panel data of 2,263 SIs across 15 industries over eight years assembled from multiple data sources and controlling for firm- and market-specific factors, heterogeneity, and endogeneity. They analyze innovation announcements using natural language processing. The results show that B2B-SIs have a positive effect on firm value and an insignificant influence on firm risk. Importantly, the effect of a B2B-SI on firm value is significantly greater than that of a B2C-SI. Unlike B2C-SIs, the effect of B2B-SIs on firm value is greater when the firm has more product innovations. Surprisingly, unlike B2C-SIs, the effect of B2B-SIs on firm value is less positive when the SIs emphasize customers. These findings offer important insights about the relative value of B2B-SIs. [ABSTRACT FROM AUTHOR]

Whereas research on corporate governance typically attends to the conflicting interests between shareholders and executives, in practice executives must frequently adjudicate the demands of multiple stakeholders. To investigate how executives cope with the divergent interests of workers and shareholders, the author examines how much firms claim they will earn on the assets in their defined benefit (DB) pension plans. In a DB arrangement, employees forgo wages in the present in order to receive postretirement income, and they rely on executives to properly fund and manage plan assets. Executives, however, can increase the amount they expect the firm to earn on plan assets, which increases firm earnings in the current period but may undermine workers' retirement security if expectations do not match actual returns over time. The author shows that the influence and interests of employees and shareholders as well as the decision-making schemas of the CEO affect whether executives exercise this discretion. [ABSTRACT FROM AUTHOR]

Value-appropriation activities enable a firm to extract more profits from existing customers. The authors examine how investments in two types of value-appropriation activities—advertising and receivables—are jointly associated with abnormal stock returns and idiosyncratic risk. Using data from 1,375 firms over the period of 2003–2015, the authors find that advertising investments and receivables investments interact as substitutes, such that increasing advertising (receivables) investments is detrimental to the beneficial effect of receivables (advertising) investments on firm shareholder value. They find that this association is contingent on firm business scope, such that the joint effect of advertising investments and receivables investments becomes weaker when firms have a broader business scope compared with a narrower business scope. [ABSTRACT FROM AUTHOR]

Cyber data breaches are an evolving risk facing all firms and threatens their ability to conduct business activity. Due to a lack of available information, very little is known about the frequency and severity of data breaches and the financial markets' responses to them. This study uses a unique proprietary data set that includes cyber data breach information for 3,992 publicly traded firms during the 1990 to 2019 period. We find cyber breaches vary with time and cyber criminals focus on particular industries, types of information, access sources, and countries. We find significant short run negative abnormal returns around the announcement of cyber events and larger negative returns in industries with higher frequencies of attacks and attacks involving personal financial information. Additionally, we find increasing negative cumulative abnormal returns up to 250 days after the announcement. [ABSTRACT FROM AUTHOR]

We empirically study the diffusion of value-based management (VBM) in small capital markets. Specifically, we analyse the factors that influence VBM adoption in Danish-listed firms. Based on a hand-collected data set covering 665 firm years from 2002 to 2010, we find that the same factors influence the diffusion of VBM in both large and small capital markets. Specifically, we find that large firms with a higher percentage of institutional ownership and with a CEO whose education is business-related are more likely to adopt VBM. Additionally, the control variables reveal a significant positive correlation between VBM adoption and leverage, capital intensity, liquidity, and the characteristics of top executives. Furthermore, we find that manufacturing and utility firms are more likely to adopt VBM than service or trade firms. Contrary to the mainstream opinion, we contribute to the literature that findings from large capital markets appear to be transferable to firms in small capital markets. [ABSTRACT FROM AUTHOR]

Using an international sample of firms, we investigate the career prospects of directors of firms experiencing negative ESG issues. By tracking the same director at the same firm over time, we document a significant drop in seats held at other public firms' boards following intense negative media coverage of an ESG problem occurring at a given director's focal firm. Losses of seats at other firms are concentrated among executive directors, among directors of firms located in countries with high environmental and social norms, and among directors of firms located in countries with bank‐based systems. Nonexecutive directors and directors of firms located in less stakeholder‐oriented countries are not penalized for ESG issues by the director labor market. [ABSTRACT FROM AUTHOR]

The power of foreign investors has become a key component in debates on sovereignty and globalisation. Here the mechanism of investor-state dispute settlement (ISDS), which allows firms legal recourse against host governments, has come to the forefront of debates over corporate rights in the contemporary era. While proponents laud ISDS as a neutral and efficient means of dispute resolution, critics claim that it shields transnational corporations from the oversight of national legal systems while enhancing their ability to interfere in host state policy matters. Despite the rich literature on ISDS, we know relatively little about the identity of corporate actors who use these mechanisms. Who are these foreign firms that take governments to court? Do different companies use these mechanisms to different effect? This article examines the impact of corporate ownership on ISDS outcomes in 241 cases from 1996 to 2014. Our results suggest that ownership matters. While public and private companies demonstrate similar propensities to settle, respondent states are less likely to win cases that are brought by a publicly traded company. For host-governments, this finding is particularly significant given that public companies demand more – and are likely to win more – in damages than private companies. [ABSTRACT FROM AUTHOR]