Institutional Ownership Research Articles

Investor attention and corporate financialization: Evidence from internet search volume

This paper investigates the relationship between investor attention and corporate financialization from a behavioral finance perspective. We use Internet search volume as a proxy for investor attention and find that investor attention is significantly and positively related to corporate financialization using a sample of listed firms in China over the period 2011–2022, and that this relationship is more pronounced in firms with higher levels of managerial myopia. A series of robustness tests still support our baseline findings, such as considering endogeneity issues, substituting core variables, and changing the model setting. We further discuss the mechanism of influence using two-stage regressions and find that investor attention promotes corporate financialization by increasing investor sentiment as well as heterogeneous beliefs. Finally, we perform a series of heterogeneity tests and find that the positive relationship between investor attention and corporate financialization is more pronounced among firms with higher information uncertainty, small firms, firms within monopolistic industries, and firms within high-tech industries. However, the relationship is not significantly different among firms with different levels of institutional ownership. This study provides new evidence for understanding investors' behavioral biases and how investor attention affects corporate investment strategies.

The Role of Company Age in Moderating the Effect of Political Connections, Audit Committees and Institutional Ownership on the Quality of Financial Reports

This study aims to determine the effect of Political Connections, Audit Committees and Institutional Ownership on the Quality of Financial Reports with Company Age as a moderating variable. Research is an exploratory study conducted to find out and explain more deeply and holistically the characteristics of the variables studied in a situation. The sample used in this study was the LQ45 companies listed on the Indonesia Stock Exchange for the period 2020-2022, while the technical data analysis used in this study was Panel Data Regression and Moderated Regression Analysis. The results of the study provide empirical evidence that Political Connections do not affect the Quality of Financial Reports, the Audit Committee affects the Quality of Financial Reports, Institutional Ownership affects the Quality of Financial Reports, Company Age moderation can strengthen the influence of Political Connections on the Quality of Financial Reports, Company Age moderation can strengthen the influence of the Audit Committee on the Quality of Financial Reports, Company Age moderation can weaken the influence of Institutional Ownership on the Quality of Financial Reports.

Targeting poverty alleviation and stock price crash risk

This study explores how participation in the Targeted Poverty Alleviation (TPA) program impacts the risk of stock price crashes among Chinese listed companies. The analysis demonstrates a significantly positive effect of TPA participation on price crash risk, with the results remaining robust across various tests. Mechanism analysis indicates that firms involved in the TPA campaign engage in higher earnings management, concealing negative information to maintain a positive reputation, which could trigger a price crash when the information is eventually disclosed. Moreover, we find that the effect of the TPA campaign is significantly stronger in companies with less institutional ownership.

PENGARUH KEPEMILIKAN INSTITUSIONAL, RISIKO PERUSAHAAN DAN BEBAN IKLAN TERHADAP TAX AVOIDANCE

This study aims to determine and provide empirical evidence regarding the effect of institutional ownership, company risk and advertising expenses on tax avoidance. This research was conducted on primary consumer goods sector companies listed on the Indonesia Stock Exchange during the 2018-2022 period. The data used in this study are secondary data. Sampling in this study was carried out using purposive sampling technique based on predetermined criteria, the research sample obtained the number of samples to be studied, which amounted to 17 companies with 5 years of observation, from the previous population of 113 companies. The panel data regression method is used as a research methodology in this study. Hypothesis testing was carried out using the 2th version of e-views. Based on the results of this study, it shows that simultaneously institutional ownership, company risk and advertising expense affect tax avoidance. then the results of this study also show that institutional ownership partially affects tax avoidance, company risk partially has no effect on tax avoidance and advertising expense partially has no effect on tax avoidance.

PENGARUH KEPEMILIKAN INSTITUSIONAL, KEPEMILIKAN MANAJERIAL DAN CAPITAL INTENSITY TERHADAP TAX AVOIDANCE (STUDI EMPIRIS PADA PERUSAHAAN BERINDEKS LQ-45 YANG TERDAFTAR PADA BURSA EFEK INDONESIA PERIODE 2018-2022)

This research aims to analyze the influence of Institutional Ownership, Managerial Ownership and Capital Intensity on Tax Avoidance. This research was conducted by analyzing the financial reports of companies with the LQ-45 index listed on the Indonesia Stock Exchange (BEI) during the period 2018 to 2022. The sample used in this research was 13 companies with the LQ-45 index listed on the Stock Exchange Indonesian Effect (BEI) using a purposive sampling technique. The data used in this research is secondary data in the form of financial reports from each company that has been used as a research sample. The panel data regression method was used as the research methodology in this study. Analysis of the results of this research using E-Views 12 Student Version Lite software. The results of this study show that Institutional Ownership partially has no effect on Tax Avodance, Managerial Ownership partially has an effect on Tax Avoidance, Capital Intensity partially has an effect on Tax Avoidance, and simultaneously Institutional Ownership, Managerial Ownership and Capital Intensity have an effect on Tax Avoidance.

Pengaruh Kebijakan Dividen, Kepemilikan Manajerial, Kepemilikan Institusional terhadap Nilai Perusahaan Sektor Perbankan yang Terdaftar di Bursa Efek Indonesia

This study aims to determine the influence of dividend policies, managerial ownership, and institutional ownership, both partially and simultaneously, on the value of banking sector companies listed on the IDX for the period 2018-2022. Sampling in this study uses a purposive sampling technique. So that research data was obtained as many as 140 data samples. The type of research used is quantitative and analytical observational research design with a cross-sectional approach, which is a study with the aim of analyzing the dynamics of inter-effects and effects, by collecting time-lapse data at a certain time (point time approach). The analysis methods used are multiple linear regression analysis, F test, t test, and determination coefficient (R2). The results of the partial study show that dividend policy has a positive and significant effect on the value of companies in the banking sector in Indonesia, in 2018-2022. Meanwhile, management ownership and institutional ownership have no effect on the value of banking sector companies in Indonesia in 2018-2022. Simultaneously, dividend policies, institutional ownership, and management ownership have a significant effect on the value of companies in the banking sector in Indonesia in 2018-2022. The determination coefficient shows the magnitude of the variation in the dependent variable due to the variation of the independent variable of 11.3% The change in the variation in the company's value is due to the influence of dividend policy, institutional ownership, and management ownership. While the remaining 88.7% was influenced by other variables outside this study. Such as fiscal, monetary, or national political stability in its influence on the rise and fall of the company's value.

PENGARUH TAX AVOIDANCE, DIVIDEND POLICY, DAN FAKTOR LAINNYA TERHADAP NILAI PERUSAHAAN

The increasing level of business competition in Indonesia causes every company to try to develop its firm value. One of which is through capital which can be obtained by selling shares. Firm value is an important influencing factor for making investment decisions because investors will pay attention to how well the company's performance is. This research was conducted with the aim of obtaining empirical evidence regarding the influence of the independent variables dividend policy, investment decision, leverage, profitability, firm size, liquidity, institutional ownership, and tax avoidance. The object of this research uses a population of all consumers non-cyclicals and consumer cyclicals sector companies listed on the Indonesia Stock Exchange (BEI) from 2020 to 2022. Sample selection was carried out using a purposive sampling method. Data analysis uses multiple linear regression. The data that passed the sample selection criteria was 33 company data out of a total of 99 company data. The testing results indicate that profitability and leverage influence firm value. A high level of leverage makes the company able to maximize its operational activities to obtain high profits so that it becomes a positive signal for investors and increases firm value. A high profitability serves as a signal that the company has good growth prospects in the future so that investors will be more interested in investing and contributing to an increase in the firm value. However, dividend policy, investment decision, firm size, liquidity, institutional ownership, and tax avoidance show no significant influence on firm value

PENGARUH INSTITUTIONAL OWNERSHIP, SALES GROWTH, DAN RASIO KEUANGAN LAINNYA TERHADAP NILAI PERUSAHAAN

The purpose of this research is to show empirically the factors that influence firm value. This research wants to test whether variables such as institutional ownership, sales growth, capital structure, return on assets, debt to asset ratio, current ratio, and dividend payout ratio have an influence on firm value. The sampling method used in this research was a purposive sampling technique with total data obtained from 2020-2022, namely 124 sample companies from the consumer cylicals, consumer non-cylicals and healthcare sectors that met the research criteria. The analysis technique applied is the multiple regression method. This research shows that sales growth and return on assets influence firm value, while institutional ownership, capital structure, debt to asset ratio, current ratio, and dividend payout ratio do not influence firm value.

Ownership structure, board composition and CEO dominance: what does really matters to corporate deleveraging policies?

Purpose The role played by corporate governance mechanisms on corporate deleveraging policies has not been clarified. Empirical evidence is confined to developed economies, even with conflicting and inconclusive results. This paper aims to examine the role of corporate governance mechanisms, such as ownership structure, board composition and CEO dominance, in explaining corporate deleveraging policies. Design/methodology/approach Using a sample of listed Pakistani firms between 2010 and 2022, this study resorts to binary response models to examine the effects of governance mechanisms on firms’ decision to go debt-free. Findings A greater ownership concentration, institutional ownership and family ownership increase the propensity for zero leverage. Board gender diversity decreases the propensity for deleveraging policies, which seems to indicate that the presence of females reinforces the monitoring function of the board. Finally, lower managerial ownership or CEO dominance decreases the propensity toward zero leverage (interest convergence hypothesis), but higher managerial ownership or CEO dominance increases the propensity toward zero leverage (managerial entrenchment hypothesis). Practical implications Risk-averse managers who prefer to control a firm using little or no debt will find it easier to implement these financing policies in firms with greater ownership concentration and where institutional holders have a substantial stake. For shareholders, this study suggests that investing in firms with females on board reduces the risk of corporate deleveraging policies being adopted for entrenched reasons. Social implications The presence of females on board seems to decrease the propensity of managers to adopt opportunistic actions and may also contribute to enhancing human welfare and society in developing countries. Originality/value To the best of the authors’ knowledge, this is the first study considering the effect of board diversity on zero leverage. Another singularity is that this study exhibits a nonlinear relationship between managerial ownership and corporate deleveraging policy.

Litigation Risk, Ownership Structure and Payout Policy: An Agency Theory Perspective

The study aims to investigate the relationship between litigation risk, ownership structure and payout policy in the light of agency theory. The study analyzed a data set of 690 non-financial Chinese firms spanning 2013–2021, by employing two-stage dynamic panel data methodology. The results reveal that litigation risk adversely impacts dividend payouts, while managerial ownership has a similar negative effect. Conversely, institutional and concentrated ownership exhibit positive associations with dividend yield. Furthermore, managerial and institutional ownership moderates the link between litigation risk and dividend payout ratio, while concentrated ownership strengthens this link. These findings confirm the presence of agency theory dynamics in emerging economies, providing valuable insights for corporate decision-makers, regulators and investors. By considering the moderating role of ownership structure, this research enhances our understanding of the multifaceted relationship between litigation risk and payout policy, facilitating better-informed strategic decisions and policy formulation. The study provides valuable implications for corporate managers and individual investors for constructing a diversified portfolio in the context of emerging economies.

The Quality of CSR Disclosure: Effect of Environmental Performance, Slack Resources, and Sensitivity Classification

This study aims to analyze the influence of slack resources, environmental performance, and industry sensitivity on the quality of Corporate Social Responsibility Disclosure (CSRD) in Energy and Basic Materials sector companies listed on the Indonesia Stock Exchange (IDX) during the period 2017 to 2023. Using a quantitative approach and explanatory research design, data was collected from annual reports, sustainability reports, and PROPER ratings from the Ministry of Environment. The results show that slack resources have a positive and significant effect on the quality of CSRD. Companies with higher slack resources tend to have better quality CSR disclosures. Environmental performance also has a positive effect on CSRD quality, where companies that achieve higher PROPER ratings show better CSR reporting. In addition, industry sensitivity has a positive effect on CSRD quality, which suggests that firms in environmentally sensitive industries tend to provide higher quality CSR disclosures to maintain legitimacy and reputation. Control variables Institutional Ownership and Company Size are not able to control the influence of the relationship between Environmental Performance, Slack Resources and Industry Sensitivity on the quality of Corporate Social Responsibility Disclosure (CSRD). These findings provide empirical evidence on the importance of slack resources, environmental performance, and industry sensitivity in improving the quality of CSRD, and offer valuable insights for corporate management and policy makers.

Pengaruh Financial Distress dan Good Corporate Governance terhadap Manajemen Laba

This research aims to examine the effect of financial distress and good corporate governance on earnings management in manufacturing companies listed on the Indonesia Stock Exchange (BEI). The sampling method used was a purposive sampling method based on predetermined criteria. The samples used in this research were 60 samples from manufacturing companies period 2022. The results of this research show that the variables financial distress, institutional ownership, and audit committee have no effect on earnings management. Meanwhile, managerial ownership has a negative effect on earnings management.

Does common institutional ownership mitigate hold‐up problems along the supply chain?

AbstractWe show that common institutional ownership (CIO) along the supply chain mitigates hold‐up problems faced by supplier–customer relationships resulting from incomplete contracts. Suppliers make more relationship‐specific investments (RSIs) measured by R&D and patent filings toward their customers that share common institutional investors. Such effect is stronger as the CIO network between a supplier and customer pair becomes wider and deeper. We establish causality by exploiting exogenous shocks to CIO using a broad sample of mergers between financial institutions and further find the CIO effects on suppliers’ innovation specificity are stronger for those who ex ante face severer hold‐up concerns. Lastly, we provide evidence that CIO involvement increases the combined valuations of supply chain pairs (mainly for customers). Our work sheds light on the hold‐up mitigation effect of CIO on firms’ decision to make RSIs along the supply chain.

Digital payments, ownership structure, and bank performance: insights from Jordan

PurposeThis paper aims to examine the connection between digital payments, ownership structure, and bank performance in Jordan, as well as investigate the moderating role of the independent director in the said relationship.Design/methodology/approachThe study uses data from 12 Amman stock exchange-listed commercial banks, covering the period from 2010 to 2023. This paper employs econometric analysis of panel data, including ordinary least squares (OLS) regression as the primary approach, as well as the generalised method of moments, the two-stage least square (2SLS), and the dynamic model to deal with causality and endogeneity issues in the proposed equations. This ensures that the results are valid.FindingsThe results indicate that digital payments and ownership structure have a significant positive connection with bank performance. Additionally, the independent director variable appears to play a substantial and positive moderating role in the link between ownership structure (e.g. institutional ownership) and bank performance. These results strengthen and support the claims of agency theory and the information systems success model.Practical implicationsOverall, this research helps stakeholders, bankers, managers, investors, customers, and policymakers, identify the influence of digital payment and ownership structure on bank performance in developing economies such as that of Jordan.Originality/valueThis investigation offers a unique understanding by illuminating how digital payment and ownership structure affect bank performance in a developing country such as Jordan. Additionally, it opens avenues for future research to delve into this literature domain in North African and Middle Eastern nations, with a particular focus on Jordan. This investigation is among the initial explorations in Jordan that aim to elucidate these relationships. On the theoretical level, it adds to the agency theory and IS model. It provides new insights into the dynamics of industry banking in developing nations (i.e. Jordan).

Common institutional ownership and corporate maturity mismatch

Using data from Chinese listed firms from 2003 to 2022, we find that common institutional ownership significantly increases maturity mismatches of investment and financing by reducing the aggressiveness of corporate strategy. This relationship remains qualitatively the same after a battery of robustness and diagnostic tests and becomes stronger in observations with lower industry competition or economic policy uncertainty. Our study has implications for promoting institutional investors in China and forestalling major financial risks.

Analisa Faktor-Faktor yang Mempengaruhi Penerapan Konservatisme Akuntansi pada Perusahaan Real Estate yang Terdaftar Di Bursa Efek Indonesia Tahun 2012 – 2016

The study aims to examine the effect of company size, capital investment, litigation, institutional ownership structure growth opportunity, tax. Against accounting conservatism this study population is all real estate companies listed on the Indonesia stock exchange in 2012-2016. The sample is determined based on the method purposive sampling, so as many as 45 companies were sampled. With a total of 225 observation data analysis techniques using multiple linier regression analysis with accounting conservatism as the dependent variable. Company size, capital investment, litigation, institutional ownership, structure, growth opportunity has no influence on accounting conservatism, which has an influence on accounting conservatism is only tax planing

Sustainable investing and ownership structure in international shipping companies

ABSTRACT Sustainable investing has been gaining momentum in recent years. This paper investigates the relationship between ownership structure, sustainability performance, and financial performance using a structural equation modelling (SEM) approach in the shipping sector by utilizing 56 listed shipping companies’ financial and Environmental, Social and Governance (ESG) ratings information. The results provide evidence that institutional ownership is positively associated with ESG scores, particularly from firms listed in the U.S. suggesting these investors’ consciousness in ESG investments in shipping stocks. Conversely, family ownership is negatively related to ESG ratings, while public ownership is more financially performance-driven, but not ESG-conscious. Additionally, firms with larger market capitalization tend to achieve higher ESG scores. However, this study finds no statistically significant relation between sustainability and financial performance. This research enhances the understanding of the investment behavior in the international shipping sector and has implications for investment strategy, investor relationship and policy development.

The Effect of Institutional Ownership on the Relationship between Managerial Overconfidence and Firm Performance of Egyptian Listed Company: An Empirical study

The Effect of Institutional Ownership on the Relationship between Managerial Overconfidence and Firm Performance of Egyptian Listed Company: An Empirical study

Pengaruh Carbon Emission Disclosure dan Good Corporate Governance terhadap Nilai Perusahaan: Studi Empiris pada Perusahaan Sektor Transportasi dan Logistik yang Terdaftar di Bursa Efek Indonesia Periode 2017-2022

Purpose: This study aims to identify the impact of carbon emission disclosure, independent commissioners, and institutional ownership on firm value. Research methodology: The population used in this study consists of transportation and logistics sector business entities registered on the Indonesia Stock Exchange during the period of 2017-2022, quatitative methods, and SPSS applications. Result: This study concludes that carbon emission disclosure has an effect on firm value. Meanwhile, independent commissioners have no effect on firm value and institutional ownership has an effect on firm value. Limitations: This study identified limitations, specifically in the examination where several business entities were not included in the research sample, resulting in an incomplete sample. Contribution: This study provides empirical evidence that contributes to the literature on the impact of carbon emission disclosures, independent commissioners, and institutional ownership on firm value. Additionally, this study is expected to inform policies related to environmental responsibility in compliance with the Republic of Indonesia Presidential Regulation Number 98 of 2021 on greenhouse gas emission control in national development and OJK Regulation No. 30/SEOJK.04/2016 on corporate obligations to include environmental disclosures in annual reports.

Asset pricing when social preference meets lottery preference: Evidence from China

There is substantial evidence indicating that stocks with lottery-like payoffs have lower returns. Unlike existing studies that focus on the role of investor behavior in accelerating lottery premiums, we propose that investors’ social preference toward corporate social responsibility (CSR) could alleviate the underperformance of lottery-like stocks. Using a sample of all Chinese listed A-share stocks, we show that a negative relationship between lottery preference and stock returns does not exist among stocks that behave well regarding CSR performance. Furthermore, we show that better CSR performance and higher institutional ownership mitigate the overpricing of lottery-like stocks. Our research contributes to CSR literature by showing that behaving socially responsible can prevent stock prices from being overpriced when the stock exhibits lottery-like payoffs.