Ownership Structure Research Articles

The role of good project governance in PPP project for toll road infrastructure in Indonesia

The use of infrastructure as a catalyst for Indonesia’s economic growth faces significant challenges. One example is the construction projects, which have not reached the intended goal and have led to an increase in investment cost compared to the original plan. Additionally, the interaction between the government and companies involved in toll-road construction projects under the public-private partnerships (PPP) mechanism has yet to produce good quality project governance and expected project performance. This study aimed to find empirical data on the determination of Project Intellectual Capital and Project Ownership Structure through good project governance practices on Toll-Road Project Performance in Indonesia. This study adopted a quantitative approach that involved data collected through a survey conducted among toll-road projects from 2015 to 2019. The data was analyzed with Structural Equation Modeling Partial Least Square (SEM-PLS). The results showed that project intellectual capital and project ownership structure significantly affected good project governance practices. Good project governance Practices significantly affected project performance. Project intellectual capital and project ownership structure influenced project performance through the mediation of good project governance practices. Conversely, two hypotheses were not supported by the data, i.e., the effect of project intellectual capital and project ownership structure on project performance. The findings of this research contributed to the literature regarding the implementation of collaborative governance in PPPs toll road development projects in Indonesia by providing a framework and assessment tools, which could be valuable for researchers and policymakers in analyzing and evaluating the governance and performance of toll road construction PPP projects.

Equity ownership concentration and firm growth: the moderating role of industry growth

Purpose The effects of ownership concentration on firm performance usually considers two conflicting perspectives: monitoring and expropriation hypotheses. Past studies have produced mix findings. This study aims to shed light on this relationship by focusing on a specific measure of firm performance, firm growth. The moderating effect of industry growth in the aforementioned relationship is also considered, which advances knowledge on the role of moderators. Design/methodology/approach This study resorts to data from a sample of 21,476 Portuguese firms, which is examined using hierarchical linear modelling. This approach is adequate because the data has a hierarchical structure: the firms are nested within industries. Findings The results show that equity ownership concentration has a positive effect on firms’ growth and that industry growth amplifies this relationship. Ownership concentration can spur effective monitoring, thereby alleviating principal–agent conflicts of interest and speeding up decision-making, enabling timely competitive actions that promote growth. Research limitations/implications The research conceives ownership structure in two groups. However, equity ownership concentration often acquires more complex shapes. In addition, the data used is from a single country. Practical implications The results show that firms pursuing growing strategies and operating in growing industries benefit from equity concentration. Originality/value Different from past studies, this study focuses on firm growth performance and considers the moderating effect of industry growth.

Public fear or public sphere? A content analysis of user comments on Egyptian newspaper Facebook pages

This content analysis examined posts and user comments on four of the most followed Egyptian newspaper Facebook pages: Al-Masry Al-Youm, Al-Youm Al-Saba’, Al-Shorouk and Al-Ahram. The purpose of the analysis was to assess the extent to which Egyptians are able to navigate ongoing government authoritarianism to self-express online. Contrary to expectations, the results indicate that Facebook page size appears to be a much more important factor in dictating the conditions of Egyptian news spheres than editorial policies and ownership structures. Overall, this suggests that current authoritarian conditions in Egypt have rendered editorial lines relatively unimportant.

Unraveling the nexus of academic founders and innovation performance: The suppression effect of ownership structure within Sci‐Tech enterprises

AbstractThis paper aims to examine the influence of academic founders on firm innovation performance from the perspective of equity distribution in entrepreneurial teams. Based on the prospectus data of 466 science and technology enterprises that applied for registration on the STAR Market from 2016 to 2020, we use textual analysis to classify founder identities into academic founder, technical founder, and business founder. Our results show that the performance of technical innovation in Sci‐Tech enterprises is optimal for academic founder‐led firms, followed by technical founders, and finally business founders. Ownership structure suppresses the positive direct relationship between the academic founder and innovation performance.

The Value of Cash: Evidence from Indonesia Listed Firms

This study investigates the influence of Islamic law on the value of cash holdings. The empirical analysis was conducted using Indonesian-listed companies from 2012 to 2020 as the research sample. It is hypothesized that companies adhering to Islamic law will increase the value of cash holdings. Considering the ownership structure, it is hypothesized that higher ownership by institutions and corporate insiders in Islamic-compliant companies will lead to higher value of cash holdings. The empirical results of this study reveal that companies adhering to Islamic principles do indeed increase the value of cash holdings. Additionally, higher institutional and insider ownership in Islamic-compliant companies increase the value of cash holdings. The empirical implications of this study suggest that religious beliefs influence managerial decision-making, leading to more cautious control over cash. Both religion and ownership structure play important roles in the efficient use of cash by managers.
 Keywords: Islamic law, value of cash holdings, ownership structure

Strategic ambitions of external RDI funding in Finnish universities of applied sciences

ABSTRACT This article explores the strategic external funding goals and plans of action of Finnish universities of applied sciences (UASs) as articulated in their institutional strategies using the ecology-of-games metaphor. UASs are pressured to expand external funding sources compared to their previous student number-based funding history. The UASs’ institutional strategies reveal the objectives and actions to acquire external RDI (research, development and innovation) funding and potential externalities. UASs underscore cooperation, partnerships and expanding RDI and institutional images. Few UASs set goals for specific funding sources; instead, UASs’ strategies demonstrate commitment to their public RDI mission. UASs’ unique internal features are not prominently reflected in external funding goals and plans of actions. This study suggests that UASs’ strategies significantly align with the government’s core funding formula and implemented public funding cuts. Global pressures and increased performance competition have even led to new ownership structures, where traditional universities primarily own UASs in five cases. This introduces a new dynamic to Finnish universities and UASs, with implications for both sectors. This study’s main contribution is its conceptualisation of multiple strategic external funding goals and plans of action in Finnish UASs’ governance and funding contexts.

Ownership Structure and Firm Performance: A Comprehensive Review and Empirical Analysis

Ownership Structure and Firm Performance: A Comprehensive Review and Empirical Analysis

Creditworthiness pattern prediction and detection for GCC Islamic banks using machine learning techniques

PurposeBank creditworthiness refers to the evaluation of a bank’s ability to meet its financial obligations. It is an assessment of the bank’s financial health, stability and capacity to manage risks. This paper aims to investigate the credit rating patterns that are crucial for assessing creditworthiness of the Islamic banks, thereby evaluating the stability of their industry.Design/methodology/approachThree distinct machine learning algorithms are exploited and evaluated for the desired objective. This research initially uses the decision tree machine learning algorithm as a base learner conducting an in-depth comparison with the ensemble decision tree and Random Forest. Subsequently, the Apriori algorithm is deployed to uncover the most significant attributes impacting a bank’s credit rating. To appraise the previously elucidated models, a ten-fold cross-validation method is applied. This method involves segmenting the data sets into ten folds, with nine used for training and one for testing alternatively ten times changeable. This approach aims to mitigate any potential biases that could arise during the learning and training phases. Following this process, the accuracy is assessed and depicted in a confusion matrix as outlined in the methodology section.FindingsThe findings of this investigation reveal that the Random Forest machine learning algorithm superperforms others, achieving an impressive 90.5% accuracy in predicting credit ratings. Notably, our research sheds light on the significance of the loan-to-deposit ratio as a primary attribute affecting credit rating predictions. Moreover, this study uncovers additional pivotal banking features that intensely impact the measurements under study. This paper’s findings provide evidence that the loan-to-deposit ratio looks to be the purest bank attribute that affects credit rating prediction. In addition, deposit-to-assets ratio and profit sharing investment account ratio criteria are found to be effective in credit rating prediction and the ownership structure criterion came to be viewed as one of the essential bank attributes in credit rating prediction.Originality/valueThese findings contribute significant evidence to the understanding of attributes that strongly influence credit rating predictions within the banking sector. This study uniquely contributes by uncovering patterns that have not been previously documented in the literature, broadening our understanding in this field.

Beyond the bottom line: exploring the role of governance mechanisms in promoting corporate tax responsibility

Purpose Because of growing corporate tax scandals, there is an enhanced focus on corporate taxation by governments, institutions and the general public. Transparency in tax matters has been identified as critical for effectively managing and promoting socially responsible tax behaviour. This study aims to explore the impact of ownership structure, board and audit committee characteristics on corporate tax responsibility (CTR) disclosure. Design/methodology/approach This research collected data from the annual reports of Pakistani-listed firms over 12 years, from 2009 to 2020. Consequently, the data set encompasses a total of 1,800 firm-year observations. This study uses regression analysis to test the relationship between corporate governance and CTR disclosure. Findings The results show that board gender diversity, managerial ownership and audit committee independence promote tax responsibility disclosure. In contrast, family board membership, CEO duality, foreign ownership and family ownership negatively impact tax responsibility disclosure. Additional analyses reveal the specific information categories that produce the overall effects on tax responsibility disclosure and assess the moderating impact of family firms on the governance and CTR disclosure nexus. Practical implications Corporations can use the results to encourage practices that enhance transparency and improve the quality of disclosures. Regulatory authorities can use the findings to stipulate better protocols. Doing so will be vital for developing countries such as Pakistan to improve tax revenue and cultivate economic growth. Originality/value While this research represents, to the best of the authors’ knowledge, one of the first empirical investigations of the association between corporate governance and CTR, the results contribute to the corporate governance literature and offer fresh insights into CTR, an emerging dimension of corporate social responsibility.

Can call auction reduce closing price manipulation in the stock market?

ABSTRACT This paper tests whether the new trading mechanism reduces closing price manipulation in the Chinese stock market. The introduction of the closing call auction on the Shanghai Stock Exchange on 20 August 2018 can be considered a quasi-natural experiment. Using data from 2017 to 2018 for all companies listed on the main board of the Shanghai and Shenzhen Stock Exchanges, we provide robust evidence that the implementation of call auction on the Shanghai Stock Exchange can effectively reduce closing price manipulation in stock market. We further investigate the impact of various factors, including firm industry, ownership structure, secondary market trading, equity structure, and financial structure, on the effectiveness of call auction in mitigating closing price manipulation. Moreover, the mechanism study indicates that the introduction of closing call auction would improve the operation efficiency and information efficiency of stock market, thus reducing the closing price manipulation. Specifically, our results reveal that the closing call auction policy is effective in reducing manipulation and provides theoretical support for stock market institutional construction.

Does investor base affect the firm-level ex-ante cost of equity capital?

This research investigates how ownership structures affect the cost of equity capital (COE) in Indian companies, particularly in market conditions with weak investor protection and increased ownership concentration by promoters and families. Using ordinary least squares (OLS), panel fixed effects, and two-step system generalised method of moments (GMM) analysis on data spanning from 2016 to 2021, we discovered that a dispersed ownership structure is linked to a higher ex-ante COE. Our findings indicate that companies with dispersed shareholders have less motivation to monitor managers, which leads to the expropriation of minority shareholders and results in higher costs of equity capital.

Assessing the Role of Board Composition and Ownership Structure in Enhancing Corporate Governance Effectiveness in Indian Family-Owned Enterprises

Assessing the Role of Board Composition and Ownership Structure in Enhancing Corporate Governance Effectiveness in Indian Family-Owned Enterprises

Discretionary investment managers evaluation in pension fund: shared input dynamic network DEA approach

Investment trust corporations (ITCs) constitute one of the financial industry's subsectors, and their evaluations of fund management performance play a crucial role. With the recent increase in the number of ITCs and their assets, how the Public Service Pension Fund management board (PSPFMB) of Taiwan makes investment decisions regarding multiple companies has become a critical issue. Using the shared input dynamic network data envelopment analysis approach (SDNDEA), we empirically estimate the performance efficiency scores of the funds of 34 ITCs and analyze the performance of the manufacturing structures of their internal networks. Our results indicate that the PSPFMB should consider the effects of being entrusted with decisions on efficiency. Employing K-means clustering techniques, we investigate the operational characteristics of each group and identify the differences among them. Moreover, this research identifies significant externalities related to ownership structures, indicating that the PSPFMB should consider the effects of such structures on efficiency in the context of entrusting decisions. Thus, the PSPFMB can make optimal investment decisions based on our ITC evaluation and selection model and help pension funds achieve stable long-term investment benefits.

ECONOMIC DEVELOPMENTS OF THE NEW ORDER PERIOD AND ITS INFLUENCE ON INDUSTRIALIZATION IN INDONESIA

The development of the New Order era, or what is usually called the New Order Era, is the term for the reign of General Soeharto, which replaced the Old Order, which refers to the era of Soekarno's reign. The New Order lasted from 1966 to 1998 and was marked by rapid economic development but also by practices of corruption, nepotism, and suppression of human rights. The New Order emerged as a result of the political and economic instability experienced by Indonesia during the Old Order. After the military coup that overthrew Sukarno's government, During the New Order era, there were several significant changes in the Indonesian economy. Political Stability. One aspect that was considered positive during the New Order period was the political stability that was created after a period of political and economic crisis at the end of Sukarno's reign, marked by transformation. significant economy, with a primary focus on industrial development as a pillar of economic growth. The policy of opening up to foreign investment became a characteristic of this era, influencing the structure of industrial ownership and having an impact on the industrialization process. This article discusses economic changes during the New Order era and their impact on the industrial sector in Indonesia. The New Order government pursued industrial infrastructure development, encouraged modernization, and prioritized export-oriented industrial sectors. Despite positive achievements, criticism of the unequal distribution of wealth and environmental impacts is highlighted. Dependence on foreign investment and foreign technology also creates its own challenges. In this context, this research outlines the economic dynamics and role of industrialization during the New Order period, highlighting its positive and negative consequences for industrial development in Indonesia.

Real earnings management, CEO experience, family ownership, and external audits: A meta-analysis

This article analyses the relationship between real earnings management (REM) and corporate governance variables, including family ownership, external audit quality, and CEO experience. The studies analysed were published between 2006 and 2021. The Sarbanes-Oxley Act of 2002 and the implementation of international financial reporting standards have led companies to reduce the use of accrual earnings management (AEM), and instead adopt real earnings management. However, many authors claim that using REM might harm a company’s long-term wellbeing, which accentuates the need to study the determinants of REM. The variables analysed in this paper are extensively covered in the literature, however, there is still ambiguity regarding their relationship with REM due to conflicting findings; some studies indicate a positive relationship, while others show a negative one. To resolve this ambiguity, meta-regression analysis is employed. The results indicate a positive relationship between family ownership and REM. This highlights the need to explore other forms of ownership to determine the most effective ownership structure that does not increase REM. This is of interest to legislators. The results provide no evidence to support the statistical or economic significance of CEO experience and external audit in relation to REM.

Board gender diversity and ownership structure: Are they substitutes or complementary? Evidence from Palestine

Board gender diversity and ownership structure: Are they substitutes or complementary? Evidence from Palestine

The Influence of Islamic Social Reporting, Managerial Ownership and Capital Structure on Firm Value

Increasing competition in the business world makes companies strive to increase the prosperity of shareholders. one of which can be done to increase the prosperity of shareholders by increasing the value of the company. The purpose of this study is to determine the effect of Islamic social reporting, managerial ownership and capital structure on firm value. This study uses secondary data with a population of 30 companies registered on the Jakarta Islamic Index (JII) for the 2016-2020 period. Sampling was carried out using a purposive sampling technique with nine companies that met the criteria in this study. Based on the results of the t (partial) test that the Islamic social reporting variable has a significant positive effect on firm value, the managerial ownership variable has a significant positive effect on firm value, the capital structure variable has an insignificant positive effect on firm value. Keywords: islamic social reporting, managerial ownership, capital structure, firm value

Ownership Structure And Risk Management Moderated By Audit Committee On Firm Performance

Ownership Structure And Risk Management Moderated By Audit Committee On Firm Performance

The role of multiple directorships in minimizing idiosyncratic risk due to the presence of large shareholders: Evidence from Indonesian companies

This study aims to evaluate the role of multiple directorships in the relationship between large shareholders and idiosyncratic risk in Indonesian companies for 2017-2021. The study model included dynamic panel data for estimation and a two-step GMM system to address endogeneity issues. Multiple directorships and long-term shareholders have low-frequency data whereas idiosyncratic risk is associated with high-frequency data. The robustness test employed the Fama-Frenchhee factor model while the single factor model was used to evaluate idiosyncratic risk.  Indonesia adheres to a two-tier system that separates the roles and functions of the board of directors and the board of commissioners. Furthermore, the concentrated ownership structure of Indonesian companies can cause agency problems between large and small shareholders. The study results show that large shareholders can strengthen the relationships of busy directors to reduce idiosyncratic risk. As a result, this research recommends increasing the role of multiple directorships in monitoring and predicting business conditions internally and externally to minimize interference from large shareholders which can cause expropriation due to agency problems.

Corporate Governance and Ownership Structure Effect on Corporate Social Performance: Evidence from Non-Financial Industries of Pakistan

This paper will examine the diversified associations between corporate governance and ownership structure impact on corporate social performance in dissimilar industries across Pakistan non-financial.  The OLS models regression are estimation to using data from 2011 to 2020, that the non-financial industries of Pakistan. Corporate governance including board independence (BINDP), board size (BSIZE), and audit size and committee (A&COM), and structure ownership including, ownership managerial (MOWN), ownership family (FOWN), and ownership concentration (COWN), inspires of organizations corporate social performance with environmental and social risk market capitalization. Generally, the outcomes significant of ownership structure and corporate governance is recognized in industries of non-financial different at a joint level while examines the organizations with a risk whole risk market capitalization disclosure.  That suggest to identifying the ownership structure and corporate governance can risk mitigate the market capitalization disclosure non-financial industries in term of correlation the corporate social performance improving and the developed the benefits with the calculation of identical female director in women on board and family ownership organizations (independent or executive) to the panel. This study also demand consideration to the corporate governance and improve structure ownership to enhance the corporate social responsibility in industries non-financial with market risk capitalization analysis, whereas risk control performance of industries analysis after complement by critical mass and independent directors properties.