Impact Of Managerial Ownership Research Articles

DO INVESTMENTS AND INDEPENDENCY INFLUENCE FIRM PERFORMANCE IN LIGHT OF PERFORMANCE MANAGEMENT: A STUDY IN KUWAIT

There has been inconsistency and contradictory findings regarding the relationship between corporate governance mechanisms and performance. This study aims to introduce new concepts by evaluating the impact of board independence and board ownership (managerial ownership) on business success. The analysis in this study utilizes Structural Equation Modeling (SEM) and Partial Least Squares (PLS). The sample consists of 62 manufacturing companies listed on the Kuwait Stock Exchange in 2022. The findings demonstrate the relationship between return on assets and various indicators of company success, including board independence and managerial ownership. The study has practical implications, urging policymakers in Kuwait to prioritize internal control systems in manufacturing companies to contribute more effectively to the country's financial industry. By shedding light on under-researched areas such as the impact of managerial ownership and board independence on firm performance, this study contributes to the existing literature on corporate governance.

The Impact of Managerial Ownership and Financial Performance on Hedging Decisions

Hedging as a derivatives instrument is one of the practices in risk management. The hedging decision, among other things, comprises forwards, futures, options, and swaps. This study analyzes managerial ownership, financial distress, leverage, liquidity, profitability, and company size on hedging decisions. This study was conducted in a mining sector company listed on the IDX in 2016-2020. The samples were 27 listed companies that were selected based on the purposive sampling method. The logistic regression model was implemented to test the hypothesis. The results of this study are as follows: managerial ownership, financial distress, and company size significantly affected hedging decisions; liquidity variables have a significant adverse impact on hedging decisions; other variables, namely leverage, and profitability, do not affect hedging decisions because they are insignificant. This study suggests that the management prefers implementing hedging to reduce future risks.

Ownership Structure and Voluntary Disclosure among Nigerian Listed Non-financial Firms

Investors are concerned with the disclosure of information by management of firms to make relevant and timely decisions, therefore, this study investigates the influence of ownership structure on corporate voluntary disclosure of listed non-financial firms in Nigeria. The population of the study consists of all nonfinancial listed firms on the Nigerian Exchange Group. Using purposive sampling technique, the study selected a total of 67 listed non-financial firms having the required information necessary for the study between year 2011 to 2020. The study employed the dynamic panel Generalised Method of Moment (GMM) technique to analyse the data. The system GMM results revealed that block and institutional ownership exert positive significant influence on the disclosure of voluntary information by listed non-financial firms in Nigeria while the impact of managerial ownership was positive but not significantly associated with corporate voluntary disclosure.

Impact of Managerial Ownership on Corporate Social Responsibility in Korea

A firm’s corporate social responsibility (CSR) record improves its image and that of its managers. This ultimately can positively affect enterprise value. However, CSR investments do not necessarily lead to better firm performance, as long-term costs are incurred. Therefore, managers often make CSR investment choices based on personal incentives. This study analyzed the relationship between managerial ownership and CSR activities in Korean public companies based on different managerial CSR incentives and ownership levels. Using the Korean Economic Justice Institute’s CSR index, the results show that firms with higher managerial ownership had excellent CSR records. Higher managerial ownership led to alignment between managers and shareholders, with managers making CSR investments to enhance long-term enterprise value. However, in firms with lower accounting transparency, managers reduced CSR investments. Managers did not value their CSR reputations in firms with poor financial reporting quality and serious information asymmetry. Instead, they diverted CSR resources to other projects to meet their interests. As Korean firms increase their investment in CSR, CSR disclosure responsibility is strengthened. Our study results provide significant implications to academics, practitioners, investors, and other stakeholders, suggesting the importance of corporate ownership structure on investment in CSR.

Managerial Ownership, Leverage, Profitability, Corporate Value: An Interactive Effect In Indonesia Stock Exchange

Managerial ownership, firm value and financial characteristic have long been critical issue with regards to company’s financial decision making. If the profitability higher and more assignable profit there and it is the higher value of the firm. Purpose of this study to analyze how the impact of Managerial Ownership, Leverage, Profitability on the firm value. The population take from companies listed in Indonesian Stock Exchange 2015 - 2019. The population taking from property, real estate and building construction. This research method using for this study is a purposive sampling with multiple of regression analysis. The result of this research are managerial ownership affects the value of the firm, leverage does not affect the value of the firm and profitability affects on value of the firm. The simultaneous of managerial ownership, leverage and profitability have no significant on firm value. This study’s Implication will support for stakeholder theory that management as an agent must develop a relationship with stakeholders by embarking on environmental friendly practice to maintain a positive value. Besides, value of the company has created must be prioritized to help the companies enhance their competitive advantage to strengthen on financial performance.

PENGARUH KEPEMILIKAN MANAJERIAL, KEPEMILIKAN INSTITUSIONAL, DAN MANAJEMEN LABA TERHADAP KINERJA KEUANGAN

This research is aimed to investigate the impact of managerial ownership, institutional ownership and earning management to financial performance. This research using companies listed in Indonesia Stock Exchange (IDX) as sample in 2016-2018. Sample selected by purposive sampling method. Data type used in this study is quantitative data and analyzed using multiple linear regression analysis to analysis dependent variable, financial performance, and independent variable,managerial ownership, institutional ownership and earning management.The result of the research revealed managerial ownership and earning management has no significant effect on financial performance, but Institutional ownership has positiveandsignificant effect on financial performance

The Impact of Managerial Ownership, Institutional Ownership and Audit Committee toward Firm Value with Corporate Social Responsibility Disclosure as a Moderation of Listed Manufacturing Company in Indonesian Stock Exchange

This study aims to investigate the impact of managerial ownership, institutional ownership and audit committee towards the firm value with corporate social responsibility disclosure as a moderation of listing manufacturing company in Indonesia Stock Exchange (IDX) in 2011-2015. This study is categorized as a hypothesis testing research. The sample was chosen by using purposive sampling. There were 29 firms that fit the criteria as the sample; So, the observation data were 145. The data was analysed by using multiple regression linear analysis and Moderated Regression Analysis (MRA). The finding showed that managerial ownership, institutional ownership, audit committee and corporate social responsibility disclosure had significant impact to the firm value. The result of each variable such as managerial ownership, audit committtee and corporate social responsibility disclosure had positive impact towards the firm value; However, the institutional ownership had no significant impact on the firm value. The result of moderation testing from each variable indicated that corporate social responsibility disclosure had no influence on managerial ownership towards the firm value; While the influence of institutional ownership and audit committee towards the firm value of manufacturing company in Indonesia Stock Exchange (IDX) in 2011-2015 made it possible for the corporate social responsiblity disclosure used as moderation variable.

PENGARUH PROFITABILITAS TERHADAP NILAI PERUSAHAAN DENGAN PENGUNGKAPAN KEPEMILIKAN MANAJERIAL SEBAGAI VARIBEL PEMODERASI (Studi Empiris Pada Perusahaan Pertambangan Yang Terdaftar Di Bursa Efek Indonesia Tahun 2012-2016)

This research made to understand and to analyis if profitability have a relevant effect on firm value and the impact of managerial ownership on firm value with profitability. This research performed on mining companies that recorded in Indonesia Stock Exchanged in the year 2012-2016. Technique sampling using purposive sampling. Data analysis technique using multiple linier regression. And for the hyphotesis using t test with help from software SPSS statistics 23.0. The result of this research explains that profitability have a significant impact on firm value. It means if profitability increasing then the value firm will increase too and the otherwise if firm value is decreasing then profitability will decrease too. While managerial ownership have a significant and negatif effect to relationship on profitability with firm value. It means that if managerial ownership is increasing then it will decrease the firm value. This result support theory Demsetz (1983), Fama dan Jensen (1983) which shows that in some stages the firm value not always have positive linier related on managerial ownership level.

Convergence of Interest Hypothesis: Examining the Impact of Managerial Ownership on Audit Quality of Quoted Manufacturing Companies in Nigeria

The debate on the need for ownership of shares by management emanates as a result of the possible incongruence of objective that could happen among business executives and diverse shareholders when directors do not have shareholding stake in the companies they govern. Studies have shown that financial crisis reported across the global economy affect the credibility of financial information and confidence of stakeholders in quoted firms. This study examined the managerial ownership impact on audit quality of firms quoted on the Nigerian Stock Exchange from 2007 to 2017. The sample size was 36 manufacturing companies purposively selected from 185 firms listed on the NSE. The study used descriptive, correlational and experimental designs and multiple regressions for analysis. It was found that managerial ownership does not have a positive and significant impact on audit fees (β = -0.241; p = 0.287) while managerial ownership structure has a negative but significant impact on audit size (β = -0.562; p- value = 0.002). The study concluded that managerial ownership has significant influence on audit quality of Nigerian quoted firms. The study recommended that, boards of corporate organisations in Nigeria should hearten greater participation of executive directors in taking up some of the shares of the companies they preside over in order to promote convergence of interest in achieving overall corporate objective.

The impact of managerial ownership, institutional ownership, proportion of independent commissioner, and intellectual capital on financial distress

Financial distress is a phase of the decline in the financial condition experienced by a company before the bankruptcy or liquidation occurs. One of the causes of financial distress is the company’s operating losses, caused its operating cash flow to be negative. During 2014-2016, there was 24 percent of manufacturing companies listed in Indonesia Stock Exchange (BEI) that has a negative pretax profit. The purpose of this study was to obtain empirical evidence of the effect of managerial ownership, institutional ownership, the proportion of independent commissioner board, and intellectual capital on financial distress. The population of this research is all of manufacturing companies listed on Indonesian Stock Exchange (IDX) on 2014-2016. The sample was taken using a non-probability sampling with a saturated sample technique. The numbers of samples analyzed were 423 financial reports of manufacturing companies published on IDX during 2014-2016. The analysis technique used in this research is multinomial logistic regression. It was found that managerial ownership has a negative effect on financial distress, institutional ownership has a negative effect on financial distress, proportion of independent commissioner has a positive effect on financial distress, and intellectual capital has a negative effect on financial distress.

Does executive ownership lead to excess target cash? The case of UK firms

PurposeThe aim of this paper is to investigate the dynamics between executive ownership and excess cash policy in the UK.Design/methodology/approachThe authors identify firms adopting an excess policy using a joint criterion of high cash and cash higher than the target. Logit analysis is used to estimate the impact of executive ownership and other governance characteristics on the probability of adopting an excess cash policy.FindingsThe results suggest that, in the UK, the impact of the executive ownership on the probability of adopting an excess cash policy is non-monotonic, in line with the alignment-entrenchment hypothesis. The results are robust to different definitions of excess cash policy, to alternative specifications of the regression model, to different estimation frameworks and to alternative proxies of ownership concentration.Research limitations/implicationsThe authors’ approach provides a new measure of the excess target cash for the firm. They show the need to identify an excess target cash policy not only by using an empirical criterion and a theoretical target level of cash, but also by capturing persistence in deviation from the target cash level. The authors’ measure of excess target cash calls into questions findings from previous studies. The authors’ approach can be used to explore whether excess cash holdings of UK firms and the impact of managerial ownership have changed from before the crisis to after the crisis.Practical implicationsThe authors’ measure of excess target cash allows identifying in practice levels of cash which are abnormal with respect to an equilibrium level. UK firms should be cautious in using executive ownership as a corporate governance mechanism, as this may generate suboptimal cash holdings and suboptimal firm value. Excess cash policy might be driven not only by a poor corporate governance system, but also by the interplay between agency costs of managerial opportunism and cost of the external finance which further research could explore.Originality/valueActually, “how much cash is too much” is a question that has not been addressed by the literature. The authors address this question. Also, this amount of cash allows the authors to study the extent to which executive ownership contributes to explain the out-of-equilibrium persistency in the cash level.

Role of Focus and Managerial Ownership in Financial Performance of REITs: An Empirical Examination

In this research, we examine the effect of focus and managerial ownership on the financial performance of REITs. Results demonstrate a positive relationship between focus and financial performance in this sector that are consistent with the findings in current literature. Impact of managerial ownership, however, seems weak on REITs performance. Our findings provide direct support for the convergence-of-interests hypothesis. We also examine the curvilinear relationship between firm performance and managerial ownership already documented in the literature. Our results show that this relation is not supported in the REITs sector. Our results do not support the entrenchment hypothesis. In addition, when agency conflicts drive the increase in focus strategy is investigated, we find that the agency conflict explanation for increase in focus strategy is warranted.

Ownership and Capital Structure of Pakistani Non-Financial Firms

Existi ng literature has not yet defi ned a clear-cut relati onship between ownership structure and capital structure. This study aims to contribute to this controversial argument by examining the impact of internal (managerial) ownership and external ownership on fi nancing preferences using the case of non-fi nancial fi rms listed on Karachi stock exchange during the period of 2008-2012. Our results suggest that the external ownership has a signifi cant eff ect on capital structure in accordance with the presence of blockholders. In contrast, the internal ownership has a complicated eff ect; it shows signifi cant positi ve and negati ve relati onship to leverage at lower and certain higher proporti on of managerial shareholding respecti vely. Besides, the combined analyses suggest that the presence of blockholders negates the impact of managerial ownership on capital structure. This implies that the presence of large and dominant shareholders in Pakistani fi rms may have caused a bias for debt fi nancing to protect their voti ng power and returns.

Managerial ownership and performance of listed non-financial firms in Nigeria

The ongoing debate relating to the impact of managerial ownership on performance of firms has centred on whether managerial ownership has an incentive or entrenchment effect on performance of firms. In addition, the debate has also been extended to whether a nonlinear estimation method is appropriate for modelling the relationship rather than the linear specification adopted by earlier scholars. This study examined these issues in the context of a developing country using generalised method of moment (GMM) estimation on 63 non-financial firms quoted on the Nigerian Stock Exchange between 1998 and 2010. Our study found that managerial ownership did not have any significant impact on the performance of firms in both the linear and nonlinear specifications. Factors impacting on firm performance include the first lag of performance which is return on assets (ROAs) and index of monopoly power. These two factors had a positive and significant impact on ROA and therefore we conclude that managerial ownership may be a weak mechanism for mitigating agency problems among firms listed on the Nigerian Stock Exchange.

Impact of managerial ownership on operational performance of IPO firms: French context

The study investigates the change in performance of French public firms post to their Initial Public Offerings (IPOs) and its relationship with the changes in the managerial ownership around the time firms to their IPOs. We develop three hypotheses: (1) Agency theory, (2) Entrenchment, (3) Curve-linear link between managerial ownership and firm performance. Tests are conducted on a sample of 65 companies going public during 2000 to 2006 on the Paris stock exchange. Overall, we observe an average decrease in managerial ownership and accounting performance two years after going public. The majority of our results show there is a significant negative relation between post-IPO change in performance and equity detention by the managerial ownership. Therefore, the most of the results are opposed to the predictions resulting from the assumption of agency (alignment of interests) but contribute to retain the entrenchment hypothesis and specially the assumption of the timing in the sense that it is beneficial for manager to plan the introduction at a time when performance is particularly high to ensure its success. This facilitates later, his entrenchment. Accordingly, a steeper decline in performance after IPO for the group of companies, where owner-managers hold a large share of ownership. Some of our results support the alignment of interest hypothesis.

Impact of Managerial Ownership on Operational Performance of IPO Firms: French Context

The study investigates the change in performance of French public firms post to their Initial Public Offerings (IPOs) and its relationship with the changes in the managerial ownership around the time firms do their IPOs. Tests are conducted on a sample of 65 French companies placed on the stock market over the period 2000-2006. The majority of our results show there is a significant negative relation between post-IPO change in performance and equity retention by the managerial ownership. Indeed, several results are opposed to the predictions resulting from the assumption of agency but contribute to retain the assumption of the timing.

The Impact of Managerial Ownership, Monitoring and Accounting Standard Choice on Accrual Mispricing

We analyse to what extent the accrual anomaly is related to the choice of the accounting system as well as firm-level heterogeneity in corporate governance mechanisms. Using a unique dataset of listed German firms over the period 1995 to 2005 we first corroborate former results indicating that the accrual anomaly is also present in Germany. However, this anomaly seems to be driven mainly by firms with managerial ownership. In a second step, we test how different corporate governance mechanisms affect the anomaly. For the German experiment on voluntary adoption of IFRS our results confirm previous findings that the anomaly is less likely to be present under a conservative accounting system. While creditor monitoring is able to reduce the accrual anomaly, shareholder monitoring is not. Apart from offering evidence related to the cross-sectional difference in the degree of accrual mispricing, our results give also some insights related to the cross-country variation of this phenomenon.

The Impact of Managerial Ownership, Monitoring and Accounting Standard Choice on Accrual Mispricing

We analyse to what extent the accrual anomaly is related to the choice of the accounting system as well as firm-level heterogeneity in corporate governance mechanisms. Using a unique dataset of listed German firms over the period 1995 to 2005 we first corroborate former results indicating that the accrual anomaly is also present in Germany. However, this anomaly seems to be driven mainly by firms with managerial ownership. In a second step, we test how different corporate governance mechanisms affect the anomaly. For the German experiment on voluntary adoption of IFRS our results confirm previous findings that the anomaly is less likely to be present under a conservative accounting system. While creditor monitoring is able to reduce the accrual anomaly, shareholder monitoring is not. Apart from offering evidence related to the cross-sectional difference in the degree of accrual mispricing, our results give also some insights related to the cross-country variation of this phenomenon.

Impact of managerial ownership on capital structure: a survey of Turkish firms

This paper investigates the relationship between insider ownership and capital structure decisions made by managers for an emerging market. Therefore, we survey managers of 103 firms listed in the Istanbul Stock Exchange (ISE). Our findings lend considerable support to our expectation that leverage, debt maturity and dividend issues reduce ability of managers to divert resources from value maximisation. However the same monitoring and disciplining tax is not observed for stock issues. Also, our findings document that managers of firms listed in the ISE do not opt to dividend smoothing policy. Finally, the results are in line with our expectation that, the more willing are the managers to reduce asymmetric information between them and shareholders, the higher their ownership level in firms.

Managerial ownership, risk, and corporate performance

This study examines the impact of managerial ownership on risk‐taking and firm performance. The study utilizes data for thirty randomly selected companies from four industries in four different sectors. Industries are oil & gas and field services from energy sector; insurance, property, and casualty from the financial sector, drugs from the health sector; and computer and data processing from the technology sector. This yielded a total of 120 observations. Accounting measures and correlation analysis are used to determine the relationship between managerial ownership, risk‐taking, and firm performance in each industry and for the whole sample. We found no significant relationship between these variables in different industries and for the whole sample. Managerial ownership seems to be merely a reflection of the way in which managers receive their benefits. Managerial ownership does not seem to provide any incentive to work harder for improving the company’s performance in the accounting sense.