Proportion Of Shareholders Research Articles

The Effect of Beneficial Controller Characteristics on True Surplus Management

Surplus management, as a hot issue in economy, accounting, securities and other industries, is not only a simple accounting problem, but also a complex social problem. Surplus management and accounting information exist in a unity of opposites, the study of the impact of surplus management factors, is conducive to controlling and solving the enterprise surplus management problems brought about by the damage to the enterprise value. According to the purpose of surplus management and the theory of generating motives, we can know that surplus management is essentially a kind of specific means of the game of multiple interests. At the present stage, the way of surplus management has shifted, that is, from accrual to real surplus management, and the latter is difficult to be observed, which is more harmful to the enterprise. This paper selects China's A-share listed companies from 2013 to 2019 as a sample to empirically analyze the impact of the characteristics of the actual controller on real surplus management. The actual controller characteristics are categorized into the nature of equity, and the proportion of shareholding. It is found that (1) state-owned enterprises have a positive facilitating effect on the true surplus management of enterprises, while non-state-owned enterprises have a negative inhibiting effect on the true surplus management of enterprises; (2) the proportion of control has a negative effect on the true surplus management of enterprises. For the conclusion (2) also conducted a sample division to further verify the role of the control ratio on the management of corporate real surplus in enterprises with different equity nature, and the conclusion is consistent with the above.

Multi-period share pledging with sequential three-way proportion decision

Considering the potential loss of decision-making power associated with share pledging, shareholders need to pledge appropriate share proportion based on their own shareholding situation. To assist shareholders in handling this decision-making challenge, we design a share pledging decision-making method with three-way decision, which fully considers the characteristics of share pledging. Firstly, we construct a novel calculation method of conditional probability based on left-tail systemic risk and share return data, which appropriately measures the probability of share price plummeting. Then, we propose a learning method of loss functions with shareholding proportion information, which considers pledged share proportions. To enhance the flexibility of the proposed method in handling practical share pledging issues, we discuss two scenarios including complete shareholding proportion information and limited shareholding proportion information. Furthermore, we design three-way proportion decision (TWPD) through introducing particle swarm optimization algorithm, which can determine the share proportion of pledge and redemption with minimizing the loss of decision-making power, and develop TWPD to sequential three-way proportion decision (STWPD) for solving multi-period share pledging problem. Finally, we apply the proposed method to deal with share pledging problem of a Chinese firm based on real data collected from China Stock Market & Accounting Research Database, and provide implications for shareholders and firms in risk management during share pledging based on the results of comparison experiments and sensitivity analysis.

Retracted: Minimum Shareholding Proportion of Equity Funds and Stock Volatility Evidence from a Quasi-Natural Experiment

Retracted: Minimum Shareholding Proportion of Equity Funds and Stock Volatility Evidence from a Quasi-Natural Experiment

Emission-reduction contract with cost information asymmetry for emission reduction service providers: Loose or tight

The asymmetry in emission reduction cost information introduces challenges to the supply chain of emission reduction outsourcing. To address this challenge, we construct principal–agent models of a manufacturer and an emission reduction service provider (ERSP), analyze loose two-part tariff and tight equity contracts, and investigate the contract design and decision distortion change of the manufacturer with information disadvantage when the ERSP faces the moral hazard of hiding emission reduction cost information. Results suggest that the manufacturer should adopt a tight equity contract to obtain higher profits in the presence of symmetric information, especially when the proportion of shareholding is high. However, when the shareholding ratio is low, the manufacturer should adopt a loose two-part tariff contract. Low-cost ERSP has more advantages than high-cost ERSP in concluding transactions. Before a deal is reached, the high-cost ERSP is motivated to hide emission reduction cost information to cooperate with the manufacturer. However, after a deal is reached, the low-cost ERSP is motivated to hide emission reduction cost information to gain higher emission reduction benefits. As a result, manufacturers are placed at an information disadvantage, which leads to the decision distortion of the two contracts. In other words, when cooperating with low- or high-cost ERSP and when the proportion of low-cost ERSP is relatively low, the emission reduction price and level are distorted upward. However, when cooperating the high-cost ERSP and when the proportion of low-cost ERSP is relatively high, the emission reduction price and level are distorted downward, and the tight equity contracts emerge as the dominant strategy.

Does the Shareholding Proportion of Large Shareholders Affect the Horizontal Organizational Structure? Evidence from Listed Companies in China

ABSTRACT This paper examines how the shareholding proportion of large shareholders affects the horizontal organizational structure of business groups. We empirically find that as the shareholding proportion of large shareholders increases, the number of subsidiaries decreases, which provides evidence of the alignment effect and risk aversion of large shareholders. Our results are robust to various robustness tests. The mechanism tests further verify the alignment effect and risk aversion of large shareholders, showing that as ownership becomes more concentrated, large shareholders tend to reduce agency problems and avoid risks. This study enhances the understanding of horizontal expansion in pyramidal organizational structures.

The Impact of Loan Portfolio Management on Credit Risk: Evidence from Banking Sector of Afghanistan

This article empirically examined the effects of loan portfolio diversification on commercial banks' credit risk in Afghanistan from 2007 to 2019. In this paper, the annualized data is used to run the regression model, and the least-squares method was followed; meanwhile, the Hirschman-Herfindahl index is used as a diversification index. Eventually, the estimation results in compliance with the traditional theory of portfolio management represent that loan portfolio diversification has a negative-significant impact on credit risk, while the capital adequacy ratio coefficient according to the moral hazard hypothesis indicates that the amount of non-performing loans decreases when the proportion of the shareholders' capital in the total capital of the bank's increases. Therefore, commercial banks have to promote their portfolio diversification and increase the proportion of shareholders' capital in the banks` financing resources to efficiently manage their credit portfolio and reduce the credit risks associated with their loan portfolios.

Research on the Effectiveness of Deep Learning−Based Agency Cost Suppression Strategy: A Case Study of State−Owned Enterprises in Mainland China

The mixed ownership reform aims to improve the property rights structure of the state−owned enterprises (SOEs) and reduce agency costs, and the current mixed reform strategies mainly include equity blending by introducing external non−state capital, executive assignments, and employee stock ownership. In this paper, 953 valid data of A−shares listed in Shanghai and Shenzhen from 2008 to 2020 are used as samples to construct the indicators of mixed reform strategy by the literature statistics method. After obtaining multiple impact indicators, the regression impact model of corporate agency cost suppression strategy is constructed by MATLAB software using a machine learning algorithm. On this basis, the performance of multiple machine learning algorithms is compared, and it is found that the integrated optimization−based bag−boosting model is used to study the effect of hybrid reform strategy to reduce the agency costs of SOEs, and the proportional setting of indicators when the effect is optimal is also explored. Finally, the laws of different influencing factors on the agency costs of enterprises are explored separately by the eigenvalue method. The results of the study show that the proportion of shareholding of the first largest non−state shareholder is sin−functional with the agency costs of SOEs when non−state majority shareholders are introduced into SOEs’ equity mix, and the agency costs tend to decrease after SOEs become privately held enterprises. The greater the number and proportion of supervisors appointed by non−state shareholders, the greater the supervisory restraint effect on SOE managers and the better the effect of suppressing agency costs. The participation of non−state−owned shareholders in the company’s business decisions by appointed executives and the special resource advantages of SOEs intensify the occurrence of the self−interest of appointed executives and the increase of agency costs of SOEs. The implementation of an employee stock ownership plan plays the role of employee supervision and restraint on SOE managers, which reduces the agency costs of SOEs. Based on this, it can provide support for the government to improve the hybrid reform policy and promote the process layer by layer, and also provide theoretical reference for SOEs to deepen the equity mix, incentivize employee shareholding, and empower non−state shareholders to govern and thus reduce agency costs.

Minimum Shareholding Proportion of Equity Funds and Stock Volatility Evidence from a Quasi-Natural Experiment

China’s fund market is getting bigger and bigger. By September 2021, the number of funds in the market had exceeded 8000, with a net value of nearly 24 trillion yuan. Among them, the number of equity funds has doubled compared with 2015, and the net value has increased four times compared with 2015, and it still maintains a rapid growth momentum. Do mutual funds play a role in market stabilization? To demonstrate this issue, we combined the passive trading technique with the positive and negative feedback trading strategies and explained how the minimum position ratio of equity funds affects stock price volatility. Then, using empirical data, we apply the difference-in-differences model to analyze how shifting proportions of the equity funds’ lowest shareholding affects stock volatility. The result shows that the volatility of high-institutional stocks was significantly reduced in comparison with other stocks after 2014. This result is further confirmed in the stocks held by large-scale funds. We used PSM-DID to solve potential endogenous problems and found that the results still support the hypothesis. This evidence supports the point of statement that the equity funds in the Chinese capital market can stabilize the market especially after 2014.

Research on the Risk Aversion Strategy of Manufacturers Share Holding Energy Service Company

Considering the constraints of carbon trading policy, manufacturers have strengthened joint emission reduction with energy service company (ESCO). In view of the capital constraint of ESCO and the demand risk of the manufacturer, in order to promote better cooperation between the manufacturer and ESCO, the influence of manufacturer's risk aversion on supply chain performance is studied. In this paper, we use the mean-variance (MV) model to construct the two-echelon supply chain models of manufacturer's non-shareholding ESCO, manufacturer's shareholding ESCO and manufacturer's shareholding ESCO under risk aversion, respectively. This paper studies the risk aversion strategy of manufacturer's shareholding ESCO, discusses the influence of relevant parameters on decision variables, and analyses the influence of different shareholding proportion and risk aversion coefficient on profit through numerical analysis. The results show that the emission reduction of ESCO and the selling price of the manufacturer are increased when the manufacturer chooses the appropriate shareholding proportion, and interestingly, the manufacturer's shareholding in ESCO will also increase its emission reduction price. However, in order to avoid the risk of equity investment, manufacturers adopt the strategy of reducing the price of emission reduction and sales price, but this behavior will not only reduce their own profits, but also make the emission reduction lower.

Takeover Resistance: A Global Games Analysis

The ability of a Board to defend itself from a takeover bid is reduced the greater the proportion of shareholders who sell-out early. Shareholders therefore face a coordination problem; and their actions generate a novel feedback loop between the volume of shareholder sales and takeover outcomes. We use global games to derive and analyse the unique threshold-equilibrium. We show that rules which strengthen Boards' discretion to make takeover judgments, or which weaken new shareholders' voting power, encourage shareholders to sell early; and that incentives to politically pressure Boards are greatest in jurisdictions with the greatest respect for shareholder rights.

Institutional Investors Holding, Market-Maker System, and Stock Liquidity: An Empirical Study Based on the NEEQ Market

This paper demonstrates the influence of institutional investors shareholding on stock liquidity by means of samples from the NEEQ market from 2014 to 2016. The results of this study suggest that, first, institutional investors shareholding will reduce the liquidity of stocks under agreement trading, and the higher the proportion of shareholding, the worse will become the liquidity. Second, shareholding by institutional investors significantly increases the liquidity of stocks under market-making trade. Third, owing to the function of class market making, the influence of private ownership on liquidity is more positive than that of other kinds of institutional shareholding.

Top Management Team Heterogeneity, Shareholding Proportion of the Largest Shareholder and Innovation Performance: A Study Based on a Panel Smooth Transition Regression Model

Research highlights the role of the shareholding proportion of the largest shareholder (TOP1) in the relationship of top management team (TMT) heterogeneity and corporate innovation performance. The empirical study makes use of a panel smooth transition regression model (PSTR) to investigate the nonlinear relationship between top management team (TMT) heterogeneity and corporate innovation performance in listed companies of household appliance industry. Data from a sample of 18 China listed household appliance industry from 2004-2014 provides us with a good opportunity to explore empirical evidences for the relationship. Following this idea, we propose to detect innovation performance by focusing on the proportion of the largest shareholder. We reveal that as the shareholding proportion of the largest shareholder becomes different, a nonlinear transition is found in relationship between TMT heterogeneity and innovation performance. The result shows that the model is divided into low regime and high regime at the point of TOP1 = 0.3144. Since equity structure and equity concentration varies in different regimes, the influence of TMT heterogeneity on corporate innovation performance has nonlinear changes as well.

Research on Non-Performing Loans Ratio’s Controlling: Evidence from 13 Commercial Banks

The People’s Bank of China in 2013 released a report revealing that the balance of non-performing loans of Chinese banking financial institutions had rebounded for the first time since 2005. In this situation, establishing early warning models – to recognize the factors that influence non-performing loans, and take effective measures to prevent defaults and control the banks’ credit assets – has become a major new issue. This paper examines the determinants of the non-performing loans (NPL) ratio in the Chinese banking sector from 2005 to 2011 using a panel data model. This model incorporates a new factor called distance to default (DD). The results show that the rates of change of total asset size, commercial loan ratio, and distance to default correlate negatively with NPL. There are positive correlations between capital return ratio, net interest margin, and single-lag NPL with NPL. However, there is no significant correlation between the proportion of shareholders’ equity, or the proportion of total loans, and NPL. In conclusion, this study suggests that regulators should consider and pay more attention to all these banks’ operational indicators to control NPL.

Supporting Community Governance in Boreal Forests by Introducing Participatory GIS through Action Research

1. IntroductionParticipatory governance of natural resources, especially forests, has received a great deal of attention worldwide in recent years: highlighted by studies in Japan (McKean, 1992a); South Asia (Adhikari, 2005; Adhikari & Lovett, 2006; Agrawal & Ostrom, 2001); and Western Europe (Bravo & Moor, 2008; Holmgren, Keskitalo, & Lidestav, 2010) to name a few. The increasing interest and importance of this area of study has also been underscored by the economics Nobel Prize to Elinor Ostrom in 2009 her analysis of economic governance, especially the commons.1 Notwithstanding the difficulties associated with the governance of the commons, particularly due to the subtractability of the resources such as forests and fisheries, and high cost of exclusion of non-members (Becker & Ostrom, 1995; McKean, 1998), studies worldwide have shown that many of the locally and traditionally managed commons can perform as good as or even better than public and private resource management institutions under certain conditions. These conditions have been promulgated as the design principles for successful and longenduring commons (Becker & Ostrom, 1995; McKean, 1992b, 1998; Ostrom, 1990). A more recent meta-analysis pointed out many of the same characteristics for successful community-managed forests around the world (Pagdee, Kim, & Daugherty, 2006). More importantly, commons share more characteristics with 'private property' than often assumed. McKean and Ostrom (1995) make this explicit when they state: It is crucial to recognise that common property is shared private property and should be considered alongside business partnerships, joint-stock corporations and cooperatives (emphasis original). This 'private property' characteristic is more nuanced in the case of modern forest commons in Sweden, as they are constituted from part of the private estates to which the shares are tied and cannot be owned or sold in isolation (see below).While the institutions such as forest commons should be participatory by definition, they often exclude large sections of their stakeholders in governance and in benefits sharing. These very stakeholders are, on paper, members of those institutions, a phenomenon Agarwal (2001) terms 'participatory exclusions'. She presents a 'typology of participation' where most of the marginalised sections' participation is limited to 'nominal' or 'passive' participation (ibid., pp. 1624-1625). Although the case of Swedish forest commons is rather different from many of these cases from developing countries, as we shall see later, the issue related to participation (or lack thereof) in the governance and decision-making-is rather similar, where the overwhelming proportion of shareholders' participation is limited to 'nominal' or 'passive' participation.Although participation in community-based forest governance in itself does not guarantee success of such institutions (Agarwal, 2001), active and dynamic participation of the members in the management, governance and has been linked to the success of forest commons (Agrawal & Chhatre, 2006). However, previous studies of some of the Swedish forest commons have not only pointed out the diminishing role of shareholders in terms of governance (i.e. decision-making rights) of their commons (Stenman, 2009), but they have also pointed to the fact that the shareholders in Swedish forest commons do not bear costs proportional to the benefits they obtain (Carlsson, 1997). Moreover, a more recent study has highlighted that although the resident shareholders seem to be generally satisfied in the way their forest commons is govemed/managed, the participation in management, governance and is rather low among the shareholders (Lidestav, Poudyal, Holmgren, & Keskitalo, 2013). Overall, previous research indicates a need to stimulate participation among the existing shareholders in these forest commons, in order to make them truly participatory forest governance institutions. …

Absent neighbours and passive shareholders – The issue of residency and involvement in the management of a forest common

The Swedish forest commons can be regarded as self-organized community groups which jointly manage a forest resource. However, previous studies point out the diminishing role and engagement of shareholders in terms of governance, thereby challenging some vital design principles of robust common-pool resource institutions. We assume that major reasons for this is associated with socio-demographic changes meaning a large proportion of shareholders do not live in the area. Therefore this study compares resident and non-resident shareholder participation in and perceptions about their common, as well as assesses their engagement in the management of one major forest common in Northern Sweden. To this end a questionnaire survey was conducted together with regular consultations with the common's board and staff to discuss shareholder participation and other major issues concerning the common.The study shows that the common has a low shareholder engagement and a high proportion of non-resident shareholders. Even though a large proportion of resident shareholders acknowledged benefits from the common, they were also less satisfied with the cooperation among shareholders and less optimistic about the possibilities to influence management decisions. In contrast, the majority of non-resident shareholders saw ‘no disadvantages’ of the common. Although most of the shareholders regularly visit the common, hardly any participate in the general meetings. While residency outside the municipality certainly seems to have an impact on the engagement of non-resident shareholders, our study suggests that simple strategies from the board including accessible information and better timing and/or location of meetings might even increase the participation among all shareholders.

Shareholder Votes on Auditor Ratification and Subsequent Auditor Dismissals

SYNPOSIS The Advisory Committee on the Auditing Profession (ACAP [DoT 2008]), appointed by the U.S. Department of Treasury, recommended that regulators require public companies to have shareholder voting on auditor ratification. However, the SEC has sided with companies that sought to exclude proposals from shareholders seeking greater say in the auditor selection process. We use data from 12,664 shareholder votes on auditor ratification during 2011–2014 and find that subsequent auditor dismissals become more likely with increases in the proportion of shareholders not ratifying the auditor. The findings should be of interest to corporate governance activists and regulators, and reinforce suggestions that even small changes in shareholder votes can be associated with significant corporate changes.

Effects of ownership concentration on firm performance: Pakistani evidence

Purpose– This paper aims to present an analysis of the association between five categories of concentrated ownership and firm performance in Pakistan. The connection between high ownership concentration and firm performance has attracted much attention, especially in emerging market, yet yielded many inconsistent empirical results.Design/methodology/approach– Karachi Stock Exchange (KSE)-100 Indexed companies listed in KSE from 2007 to 2011 were selected as the sample, and correlation coefficient and regression model were used to inspect the relationship between ownership concentration degree and corporate performance.Findings– It was found that there is no significant association with ownership concentration and accounting-based performance, market-based performance measures and economic profit, in general.Originality/value– The first demonstration that the shareholding proportion of the single largest shareholder is the only variable having positive association with market-based performance measures.

Shareholder Types, Their Concentration and its Effects on Exchangess Operating and Financial Results An Empirical Study

Scholars are divided over whether listing the shares of stock exchanges improves their financial performance. Applying simple OLS regressions, I test the hypothesis that exchanges’ post-IPO owners are value maximizers. However, recently demutualized exchanges have a high proportion of shareholders with conflicts of interest. Therefore, I also test whether different types of shareholders have different effects on performance. I find that investment managers behave like true value maximizers. The results also show that a higher fragmentation of share ownership is associated with lower performance. The proportion of brokers, who are the most conflicted shareholders in exchanges (since they are large customers as well as owners), is too small to have a measurable effect on performance. Most interestingly I find, by way of an inductive approach to shareholding structure, that strategic shareholders, a wide array of investors with various agendas, are on balance detrimental to shareholder value. This chapter is the first in a trilogy of articles that make up my Ph.D. dissertation. It is followed by an in-depth study of the shareholding structure of individual stock exchanges, notably in order to understand more clearly who these strategic investors are and what effects they have on exchanges.

Shareholder types, their concentration and its effects on demutualized exchanges’ operating and financial results - An empirical study

Scholars are divided over whether listing the shares of stock exchanges improves their financial performance. Applying simple OLS regressions, I test the hypothesis that exchanges’ post-IPO owners are value maximizers. However, recently demutualized exchanges have a high proportion of shareholders with conflicts of interest. Therefore, I also test whether different types of shareholders have different effects on performance. I find that investment managers behave like true value maximizers. The results also show that a higher fragmentation of share ownership is associated with lower performance. The proportion of brokers, who are the most conflicted shareholders in exchanges (since they are large customers as well as owners), is too small to have a measurable effect on performance. Most interestingly I find, by way of an inductive approach to shareholding structure, that strategic shareholders, a wide array of investors with various agendas, are on balance detrimental to shareholder value. This chapter is the first in a trilogy of articles that make up my Ph.D. dissertation. It is followed by an in-depth study of the shareholding structure of individual stock exchanges, notably in order to understand more clearly who these strategic investors are and what effects they have on exchanges.

The Influence of Top Management Team's Corporate Governance Orientation on Strategic Renewal Trajectories: A Longitudinal Analysis of Royal Dutch Shell plc, 1907–2004

abstractUsing the upper echelons perspective together with corporate governance and strategic renewal literature, this paper investigates how top managers' corporate governance orientation influences a firm's strategic renewal trajectories over time. Through both a qualitative analysis (1907–2004) and a quantitative analysis (1959–2004), we investigate this under‐researched question within the context of a large incumbent firm: Royal Dutch Shell plc. Our results indicate that top managers having an Anglo‐Saxon corporate governance orientation are more likely to pursue exploitative and external‐growth strategic renewal trajectories, while those having a Rhine corporate governance orientation are more likely to pursue exploratory and internal‐growth strategic renewal trajectories. We also found a positive moderating effect of the proportion of shareholders from the Anglo‐Saxon countries on exploitative and external‐growth strategic renewal trajectories. Our findings indicate that top managers' corporate governance orientation can be an important antecedent of strategic renewal and of organizational ambidexterity, both of which influence corporate longevity.