Large shareholders are a potentially very important element of firms’ corporate governance system. Whereas analytical research is typically vague on who these large shareholders are, in practice there are important variations in the types of large owners (and the different types of large owners could play very different governance roles). After briefly reviewing the standard agency cost argumen...

The aim of this research is the analysis of management ability using accounting and corporate governance criteria and also artificial intelligence. The primary independent variables in this study include regulatory variables (characteristics of corporate governance and audit committee) and accounting variables (performance and risk criteria). We took advantage of Demirjian index to measure mana...

The present study aims to assess the relationship between some corporate factors and managerial entrenchment in companies listed on the Tehran Stock Exchange during 2011-2017. Panel data regression models were used to test the hypotheses. The obtained results indicated that four corporate factors, namely real earnings management, predictable earnings management, institutional ownership, and boa...

Joint ventures, a particularly popular form of corporate cooperation, exhibit ownership patterns that are clustered around equal shareholdings for a wide variety of parent firms. In this paper, we investigate why 50-50 or “50 plus one share" equity allocations should be so prevalent. In our model, parent firms trade off control benefits and costs with incentives for resource contributions in th...

We investigate whether foreign institutional ownership impacts corporate innovation. Using firm-level data from 30 countries in 2001-2010, we find that higher foreign institutional ownership is associated with more investment in R&D and patents. Using the exogenous increase in foreign institutional holdings that follows a firm’s addition to the Morgan Stanley Capital International World Index, ...

Complex structure of ownership like cross-ownership, rings, and pyramids are common in Continental Europe, Eastern Europe, and in Asia. This paper aims at dissecting these complex features by a proper measurement of direct and indirect holdings. Building on Brioschi et al. (1989), we use the input-output matrix methodology and we add control considerations in the matrix calculations to derive a...

Coase (1937) was one of the first scholars who asked why firms exist and what precisely a firm was. Both questions are fundamental to understand corporate governance. Before the 1930s the firm was often seen as a “black box” which was assumed to behave like any other self-interested utility maximizing economic actor. Although Adam Smith already cited the problems like the separation of ownershi...

We examine the relation between a broad set of corporate governance factors and various measures of managerial behavior and organizational performance. Using a sample of 2,126 firms we distill 38 structural measures of corporate governance (e.g., board characteristics, stock ownership, anti-takeover variables etc.) to 13 governance factors using principal components analysis. For a wide set of ...