Investor-owned Companies Research Articles

Carbon collusion: Cooperation, competition, and climate obstruction in the global oil and gas extraction network

While publicly-available datasets often document how much fossil fuel is extracted within oil-producing countries, they do not generally indicate who is responsible. To address this gap, we constructed the Global Oil and Gas Extraction Network, a dataset containing the extraction sites of the 26 largest oil and gas companies, and the quantities extracted annually from 2014 to 2018, accounting for 67% of total production. Using this dataset, we present a first-of-its-kind network analysis of global oil and gas extraction. We find fifty-eight percent of operations involved joint ownership across companies, demonstrating growing interdependence after industry-wide losses in 2016. Countries in which National Oil Companies (NOCs) were active were less likely to host Hybrid state-investor companies, and even less likely to host Investor-Owned Companies (IOCs), while certain Hybrids and IOCs tended to operate in the same countries; both trends became more pronounced between 2014 and 2018. Reflecting colonial legacies, the seven Big Oil companies, headquartered in either the US or Europe, extracted oil and gas from the most countries. These findings reveal a complex global network of strategically aligned actors, indicative of tacit and explicit transnational industry-state collusion to obstruct climate policies. These findings additionally underscore the need for comprehensive data to support a managed fossil fuel phaseout.

Time to pay the piper: Fossil fuel companies’ reparations for climate damages

Time to pay the piper: Fossil fuel companies’ reparations for climate damages

A New Look on Cooperative Identity in the Light of the EU Prospectus Regulation and Blockchain-Based Public Equity Financing

Сooperative identity has distinct features which formed over a century ago. Legislation of many countries recognises the value of traditional cooperatives by providing them with special regulatory regimes, like tax exemptions. These exact features make cooperatives unattractive when it comes to competing with investor-owned companies for public equity capital. The article looks into the traditional cooperatives within the legal framework of raising public equity capital through the offer of blockchain-based tokens (crypto-assets). The analysis focuses on existing non-blockchain EU regulations, the EU Prospectus Regulation specifically. The study looks into the distinct features of the cooperative identity, analyses the specifics of prospectus regulations, and applies the criteria underlying the initial disclosure obligation when making a public offer to sell equity-based blockchain tokens by cooperatives. The article concludes that complying with the traditional cooperative identity allows entities to access public equity financing using crypto-assets without publishing a prospectus under the Prospectus Regulation. This conclusion is only a first step in analysing the cooperative identity changes when membership is offered in transferable blockchain tokens. Blockchain, cooperative principles, Prospectus, public equity, investment, cooperative rebates, ICOs, MiCA, securities, information asymmetry

Women's participation on the boards of farmer-owned cooperatives.

Initiatives and specific measures aimed at increasing the presence of women on corporate boards have become widespread. However, not much academic attention has been paid to this subject up till now, when it comes to farmer-owned cooperatives. The article shows that farmer-owned cooperatives do have special problems when it comes to women on boards. The farmer-owned cooperatives in Denmark have been chosen as cases in this article, as they are quite big, exposed to international competition and have substantial market power. Based on annual reports from 25 farmer-owned cooperatives and two of their investor-owned subsidiaries in the years 2005-2022, inputs from present and former board members of farmer-owned cooperatives, CSR-reports etc. a number of conclusions are drawn. Cooperatives have particular challenges with regard to gender diversity on boards due to their specific structure and requirements-compared to investor-owned companies. Different types of barriers that limit women's representation on boards can be identified: (1) Institutional barriers in terms of statutes and cooperative principles. (2) Structural barriers in the form of a narrow or skewed recruitment base. (3) Historical and cultural barriers, where agriculture is typically a male-dominated business. Women's representation on boards of farmer-owned cooperatives is relatively low but increasing. From 2005 to 2021 the weighted average share of female board members has increased from about 1-20%. Gender diversity in farmer-owned cooperatives is consistently less than in listed companies. The increasing representativeness of women is primarily due to the presence of more female external members. Since 2013 the proportion of women has increased, and in 2021 there were more female than male external board members. Female board members are more common in the large farmer-owned cooperatives than in the small. A positive correlation between the size of the companies and the representation of women is identified. This is supported by large cooperatives' greater focus in annual reports and CSR strategies on women's representativeness. Based on the cooperatives' diversity policy, their explicit and specific goals for women's representativeness on boards, interviews with board members etc. a clear awareness of the challenge of gender diversity on the boards is identified.

A new look on cooperative identity in the light of the EU Prospectus Regulation and blockchain-based public equity financing

Сooperative identity has distinct features which formed over a century ago. Legislation of many countries recognises the value of traditional cooperatives by providing them with special regulatory regimes, like tax exemptions. These exact features make cooperatives unattractive when it comes to competing with investor-owned companies for public equity capital. The article looks into the opportunity for cooperatives to have competitive conditions in raising public equity capital through the offer of blockchain-based tokens. The analysis focuses on existing non-blockchain EU regulations, the EU Prospectus Regulation specifically. The study looks into the distinct features of the cooperative identity, analyses the specifics of prospectus regulations, and applies the criteria underlying the initial disclosure obligation when making a public offer to sell equity-based blockchain tokens by cooperatives. The article concludes that the Prospectus Regulation allows cooperatives that follow the traditional identity to access public equity financing using blockchain tokens without the need to publish a prospectus. This conclusion is only a first step in analysing the cooperative identity changes when membership is offered in transferable blockchain tokens.

White knights, or horsemen of the apocalypse? Prospects for Big Oil to align emissions with a 1.5 °C pathway

Greenhouse gas (GHG) emissions must decrease rapidly in order to keep temperatures from exceeding 1.5 °C above pre-industrial levels. It is unclear if the oil and gas majors will contribute towards this goal by decarbonising at the speed and scale required. Therefore, this study focuses on BP, Chevron, ExxonMobil, and Royal Dutch Shell, the top four investor-owned companies by size of direct and indirect historical GHG emissions. Scientists at these companies knew that their products contributed to global warming by the late 1970s or earlier. For decades these companies have used a variety of tactics to slow down and shape the low-carbon transition alongside continued exploration and extraction. Discussion about the potential for these companies to meet self-imposed GHG emissions reduction targets and shift towards low-carbon technologies have been a distraction from the central question of whether they will phase out exploration for, and extraction of, oil and gas. Despite the growing disruption of the oil and gas sector, accelerated by the Covid-19 pandemic, we conclude it is unlikely that the executives and directors at these four companies will decide to proactively decarbonise in line with climate science. This raises the need for further external pressure, in particular by governments, as policy makers have played a key role in previous energy transitions.

Measuring Financial Health of Selected Cooperatives in an ASEAN Province Using Altman Model

The application of the Altman model concentrated mostly on investor-owned companies. Only rare studies apply this model among cooperatives, particularly in the Philippine setting. This paper attempts to address this gap by using this model in measuring the financial health of cooperatives in a Philippine province. This study employs the document analysis method as it uses the financial information from the published annual reports covering from 2011 to 2015. This study applies a two-stage sampling technique in choosing the representative cooperatives. Findings revealed that large cooperatives fell into the gray zone that poses potential risks of business failure as contributed by low liquidity, profitability, and solvency measures even though these cooperatives have relatively more assets and high membership levels than medium and small cooperatives. Medium and small cooperatives fell into a safe zone in which getting bankrupt is very unlikely to happen. Findings also showed that the size and age of cooperatives have a significant inverse relationship with their financial health. Further analysis revealed that closed-type, small cooperatives exhibited better performance compared to medium and large, open-type cooperatives, as shown in its high scores in liquidity and solvency factors. In summary, this model can be a tool for gauging the financial health of cooperatives.

The Evolving Role of Oil and Gas Companies in the Energy Industry

This paper provides a review of the evolving role and characteristics of the global oil and gas companies, which increasingly come in a variety of flavors. It also surveys the different types of global oil and gas companies that include national oil companies (NOCs), international oil companies (IOCs), Independents, and oilfield services companies (OFSCs). The continued rise of NOCs, accelerated by high oil prices, has seen the balance of control over most of the world’s hydrocarbon resources shift decisively in their favor. Their ability to access capital, human resources and technical services directly from oil field service companies, and to build in-house competencies, allows them to operate independently of Investor Owned Companies in most instances. The demand on NOCs continues to evolve with the global energy landscape to reflect variations in demand, discovery of new ultra-deep water oil deposits, and national and geopolitical developments. NOCs, traditionally viewed as the custodians of their country's natural resources, have generally owned and managed the complete national oil and gas supply chain from upstream to downstream activities. Having secured their home base, NOCs have emerged as joint venture partners with the IOCs and increasingly as their competitors, seeking international upstream and downstream acquisition and asset targets. The key question is whether this emerging landscape will undermine the sustainability of the IOC resource-ownership business model. Are the challenges of declining production in existing oil fields replacing oil and gas reserves in restricted access or higher cost areas, and the declining of the operating profit margins yet sufficient to reach a tipping point?

Imposing cooperation: the impact of institutions on the efficiency of cooperatives in the Philippines

PurposeThe purpose of this study is to answer the research question: How do cooperative organizations perform when created by government fiat in an emerging market? Through the use of institutional and agency theory, this paper presents a comparative analysis of the efficiency of the cooperative form of organization and investor-owned firms-investigating how the social–political structures in a community affect the efficiency of cooperativesvis-à-visinvestor-owned firms. This paper also attempts to offer a better understanding of how government quality and organizational size influence performance outcomes between different organizational forms specifically in the Philippines.Design Methodology ApproachThe empirical analysis of this study was conducted among electric distribution utilities in the Philippines. Firm-level data was generated for 133 distributors, consisting of 119 electric cooperatives and 14 investor-owned companies. Panel data regressions were ran to test all hypotheses.FindingsCooperative organizations operate at a less efficient rate than investor-owned firms in the Philippines, even when controlling for firm-specific factors such as size, customer density and profitability. In addition, the efficiency of these cooperative organizations is more strongly influenced by the quality of the local government than investor-owned firms.Originality ValuePositive externalities generated by the propagation of cooperatives on local communities may be based primarily on our understanding of how cooperatives have functioned largely in western contexts. Within the context of Southeast Asia, where national socio-political structures may be more dysfunctional, this paper observes that there is an equivalent negative externality caused by the tendency of cooperatives to replicate the political mismanagement of the community around it.

Comparing extraction rates of fossil fuel producers against global climate goals

Meeting global and national climate goals requires action and cooperation from a multitude of actors. Current methods to define greenhouse gas emission targets for companies fail to acknowledge the unique influence of fossil fuel producers: combustion of reported fossil fuel reserves has the potential to push global warming above 2 °C by 2050, regardless of other efforts to mitigate climate change. Here, we introduce a method to compare the extraction rates of individual fossil fuel producers against global climate targets, using two different approaches to quantify a burnable fossil fuel allowance (BFFA). BFFAs are calculated and compared with cumulative extraction since 2010 for the world’s ten largest investor-owned companies and ten largest state-owned entities (SOEs), for oil and for gas, which together account for the majority of global oil and gas reserves and production. The results are strongly influenced by how BFFAs are quantified; allocating based on reserves favours SOEs over investor-owned companies, while allocating based on production would require most reduction to come from SOEs. Future research could refine the BFFA to account for equity, cost-effectiveness and emissions intensity.

Business cooperatives: when does sharing become a drawback?

PurposeCooperatives are relatively understudied compared with investor-owned companies, yet their economic impact makes them important to consider. This study is to focus on business cooperatives that gather firms or entrepreneurs that share the same social and economic motivations and need to ally to grow. The positive and negative consequences of membership on the members’ business models are detailed. Insights to address and prevent the detrimental influences of membership on members’ business model are provided.Design/methodology/approachThis conceptual study relies on several business cases to suggest that cooperative membership comes with positive and detrimental consequences for the three dimensions of members’ business models: their organization, resources and competences and value propositions (i.e. members’ offers).FindingsBecause organization, resources and competences, and value propositions are affected by membership in a cooperative, business members’ control over their own business models may diminish. This can offer positive consequences but may also be too constraining and harmful in the long term.Research limitations/implicationsOnly scant research has investigated the influence of cooperatives on members’ business models. Further studies could help firms and entrepreneurs maximize the advantages of their membership in cooperatives while limiting the detrimental consequences over time.Practical implicationsIf they are aware of the potential drawbacks of business cooperative membership, members can implement proactive efforts to avoid losing control of their business models.Originality/valuePrior literature mainly concentrates on how cooperatives work and develop. No prior study seems to have investigated the consequences of cooperatives’ membership on members’ business models.

Alliance success factors and performance in social economy enterprises

PurposeEstablishing alliances between social economy enterprises (SEEs) is considered to be a solution to the problem of providing enough resources and knowledge to compete in the global market and, at the same time, to maintain identity and ownership. Nevertheless, an important number of alliances breaks up after several years. Therefore, the purpose of this paper is to study the key factors that affect alliances’ development and outcome. In this study, the success factors that have been extensively tested in investor-owned companies are assessed in SEEs, which present important differences in organizational issues and corporate principles and values.Design/methodology/approachThis study defines a scale that includes the most important factors that might be controlled by SEE managers to develop successful alliances. These factors are grouped into three categories: relational capital, relationship governance and the partner selection process. The study also assesses the impact of these factors on alliance performance.FindingsStatistical analysis through structural equation modelling shows that relationship governance and the partner selection process have a significant impact on performance. Therefore, they can be considered success factors in alliances among SEEs.Originality/valueTaking into account the relevant contribution of the SEEs to the European economy, and having noted the scarce number of studies about alliances success factors in the social economy sector, this study offers a significant contribution to this research field. Moreover, findings will be also interesting for SEE managers and social economy authorities when designing programmes to empower and support alliances.

Investor-owned companies combine

Valtris Specialty Chemicals, which until 2014 was the polymer additives business of Ferro, has acquired Akcros Chemicals, a polymer additives maker that was once part of AkzoNobel. Valtris is owned by the private equity firm H.I.G. Capital, which has made four chemical acquisitions in the past two years. Akcros had been owned by GIL Investments. H.I.G. says Akcros will boost Valtris’s presence in Europe and add strong R&D capabilities.

A Performance Analysis of Long-term Acute-Care Hospitals Owned by Large, Multistate Investor-Owned Companies.

This study provides a descriptive assessment of the operating performance of for-profit long-term acute-care hospitals owned by multistate, investor-owned companies (large FP LTCHs) compared with FP LTCHs owned by smaller FP companies (small FP LTCHs) and nonprofit LTCHs (NP LTCHs). The study used the Centers for Medicare & Medicaid Services cost report data for 290 LTCHs from 2010 through 2012 to compare the financial performance of large and small FP LTCHs and NP LTCHs. The study found that the median operating profit margin for large FP LTCHs was 8.06%, which was twice as high as that of the small FP LTCHs and NP LTCHs (4.78% and 2.80%, respectively). Larger size, serving a greater proportion of private pay and more complex patients and incurring lower operating expenses, including salary expenses, may account for the higher operating margin of the large FP LTCHs.

Potential emissions of CO2 and methane from proved reserves of fossil fuels: An alternative analysis

Scientists have argued that no more than 275GtC (IPCC, 2013) of the world’s reserves of fossil fuels of 746GtC can be produced in this century if the world is to restrict anthropogenic climate change to ≤2°C. This has raised concerns about the risk of these reserves becoming “stranded assets” and creating a dangerous “carbon bubble” with serious impacts on global financial markets, leading in turn to discussions of appropriate investor and consumer actions. However, previous studies have not always clearly distinguished between reserves and resources, nor differentiated reserves held by investor-owned and state-owned companies with the capital, infrastructure, and capacity to develop them in the short term from those held by nation-states that may or may not have such capacity. This paper analyzes the potential emissions of CO2 and methane from the proved reserves as reported by the world's largest producers of oil, natural gas, and coal. We focus on the seventy companies and eight government-run industries that produced 63% of the world’s fossil fuels from 1750 to 2010 (Heede, 2014), and have the technological and financial capacity to develop these reserves. While any reserve analysis is subject to uncertainty, we demonstrate that production of these reported reserves will result in emissions of 440GtC of carbon dioxide, or 160% of the remaining 275GtC carbon budget. Of the 440GtC total, the 42 investor-owned oil, gas, and coal companies hold reserves with potential emissions of 44GtC (16% of the remaining carbon budget, hereafter RCB), whereas the 28 state-owned entities possess reserves of 210GtC (76% of the RCB). This analysis suggests that what may be needed to prevent dangerous anthropogenic interference (DAI) with the climate system differs when one considers the state-owned entities vs. the investor-owned entities. For the former, there is a profound risk involved simply in the prospect of their extracting their proved reserves. For the latter, the risk arises not so much from their relatively small proved reserves, but from their on-going exploration and development of new fossil fuel resources. For preventing DAI overall, effective action must include the state-owned companies, the investor-owned companies, and governments. However, given that the majority of the world's reserves are coal resources owned by governments with little capacity to extract them in the near term, we suggest that the more immediate urgency lies with the private sector, and that investor and consumer pressure should focus on phasing out these companies’ on-going exploration programs.

In Defense of Workplace Democracy

In the wake of the 2008 global financial crisis, an important conceptual battleground for democratic theorists ought to be, it would seem, the capitalist firm. We are now painfully aware that the typical model of government in so-called investor-owned companies remains profoundly oligarchic, hierarchical, and unequal. Renewing with the literature of the 1970s and 1980s on workplace democracy, a few political theorists have started to advocate democratic reforms of the workplace by relying on an analogy between firm and state. To the extent that a firm is an organization comparable to the state, it too ought to be ruled along democratic lines. Our paper tests the robustness of the analogy between firm and state by considering six major objections to it: (1) the objection from a difference in ends, (2) the objection from shareholders’ property rights, (3) the objection from worker’s consent, (4) the objection from workers’ exit opportunities, (5) the objection from workers’ (lack of) expertise, and (6) the objection from the fragility of firms. We find all of these objections wanting. While the paper does not ambition to settle the issue of workplace democracy at once, our goal is to pave the way for a more in-depth study of the ways in which firms and states can be compared and the possible implications this may have for our understanding of the nature of managerial authority and the governance of firms.

The Performance of Foundation-Owned Companies

A number of world class companies – such as the Tata Group, Robert Bosch, and Bertelsmann -- are majority owned by charitable nonprofit foundations. This structure places control of the company in the hands of a self-perpetuating foundation board that is immune to outside discipline through a proxy fight or hostile acquisition, and whose members receive no incentive compensation. Conventional economic theories of corporate governance predict that such companies would be riven with agency costs and therefore highly inefficient. Yet previous studies find that companies owned by industrial foundations seem to perform as well as more conventional investor-owned companies. In this paper we reassess the relative performance of foundation-owned companies by comparing a substantial sample of them from the Nordic countries with various different samples of investor-owned Nordic companies, including matched pairs of companies in the same industry and of comparable size. We find that, overall, foundation-owned companies have similar accounting profitability, take less risk, and grow more slowly than listed investor-owned companies. We offer alternative theories regarding the costs and benefits of foundation ownership that appear consistent with our results.

Examining the role of advertising on the behaviour of co-operative bank consumers

Even though the central role of advertising in consumer behaviour is well-documented, pertinent research on financial advertising is limited for both investor-owned companies and co-operatives. This becomes especially important in today's turbulent financial times. To this end, the study investigated the effect of advertising on the selection and perceived loyalty of Cypriot consumers of financial co-operatives, prior and during the financial crisis and the restructuring of the island's banking industry. The findings suggest that advertising has a marginal role in the said decision-making stages but essentially provide insights that open a window of opportunity for financial advertisers to develop effective advertisements. It is proposed that during the crisis, corporate and informational advertising should mainly be employed and such advertisements should communicate the service elements that, as a result of the increased perceived risk evoked by the crisis, have become salient. These service dimensions relate for the selection stage to reliability factors, and for the cementing of loyalty to solvency and process factors associated with relationship building.

The Role of National and International Oil Companies in the Petroleum Industry

This paper provides a review of the evolving role and characteristics of the oil and gas companies, which increasingly come in a variety of flavors. It also surveys the different types of oil and gas companies that include national oil companies (NOCs), international oil companies (IOCs), independents, and oilfield services companies (OFSCs). The continued rise of NOCs, accelerated by high oil prices, has seen the balance of control over most of the world’s hydrocarbon resources shift decisively in their favor. Their ability to access capital, human resources and technical services directly from oil field service companies, and to build in-house competencies, allows them to operate independently of Investor Owned Companies in most instances. The demand on NOCs continues to evolve with the global energy landscape to reflect variations in demand, discovery of new ultra-deep water oil deposits, and national and geopolitical developments. NOCs, traditionally viewed as the custodians of their country's natural resources, have generally owned and managed the complete national oil and gas supply chain from upstream to downstream activities. Having secured their home base, NOCs have emerged as joint venture partners with the IOCs and increasingly as their competitors, seeking international upstream and downstream acquisition and asset targets. The key question is whether this emerging landscape will undermine the sustainability of the IOC resource-ownership business model. Are the challenges of declining production in existing oil fields replacing oil and gas reserves in restricted access or higher cost areas, and the declining of the operating profit margins yet sufficient to reach a tipping point? NOCs and OFSCs have increasing power and influence in global oil markets. In parallel, IOCs’ significance and role in the oil markets has been in decline due to shrinking technical skills and expertise, reduced access to low cost reserves, and lower operating profit margins. As a result, IOCs have tended to focus on more challenging and less profitable domains, shale gas, unconventional oil, and deep-water operations. OFSCs have been offering NOCs more services and specialized operations with high technical experience at a lower cost than IOCs offer. As these trends continue, IOCs are likely to adopt a new business model that may require changes in collaborative efforts and cooperative relationships. Partnering with IOCs and OFSCs is a good step for NOCs that undertake a globalization strategy. In fact, this is a win-win strategy for all parties, as it will enable IOCs to gain more access to NOCs’ resources. Further, IOCs and OFSCs in partnership with NOCs should contribute to the socioeconomic development of the countries in which they operate.

Corporate campaign contributions and abnormal stock returns after presidential elections

Contributions by investor-owned companies play major roles in financing the campaigns of candidates for elective office in the United States. We look at the presidential level and analyze contributions by companies before an election and their stock market performance following US presidential elections from 1992 to 2004. We find that companies experienced abnormal positive post-election returns with (i) a higher percentage of contributions given to the eventual winner and (ii) with a higher total contribution given. Hypothetical portfolios of the 30 largest corporate contributors formed according to (i) the percentage of contributions given to the winner in a presidential election and (ii) the total contribution (divided by market capitalization) would have earned significant abnormal returns in the two years after an election. While all results hold for Bill Clinton and George W. Bush, they are stronger by a magnitude of two to three under W. Bush.