Spanish Corporations Research Articles

Strategic Corporate Social Responsibility and Value Creation among Large Firms: Lessons from the Spanish Experience

Can corporate social responsibility (CSR) be a source of good and a wellspring of innovation, competitive advantage and value creation for the firm? Although CEOs and government leaders insist in public that CSR projects create value for the firm, privately they admit that they do not know if CSR pays off. To address this question and drawing on experience for the Spanish context, we test one of the few efforts to model how the strategic management of CSR may contribute to improving firm profitability (Burke and Logsdon, 1996). To do this, we examine the impact of three strategic CSR variables – visibility, appropriability, and voluntarism – on value creation among large Spanish corporations. The conclusions from these findings suggest that managers need to understand how CSR is similar to and different from other traditional corporate market activities if they are to pursue value creation through CSR. We also suggest avenues for future research to explain how CSR may be integrated into firm processes to create resources (assets) and capabilities (routines) that may lead to competitive advantage and superior economic performance.

The Internationalization of Spanish Corporations

The Internationalization of Spanish Corporations

Net Worth at Risk

The Study Group of the European Committee of Central Balance Sheet Data Offices (ECCB) examines in the third study of the group the newly developed concept of Net Worth at Risk (NWaR). This concept analyses the function of equity as a protective cushion against losses in a recession period. The equity levels of French, German, Italian and Spanish corporations in manufacturing are compared to a potential loss - called Net Worth at Risk which might affect a corporation with a small but specified degree of probability in a two-year recession as a worst-case scenario. The difference between NWaR figures and the equity levels give an indication on the number of companies with inadequate equity in a recession period. The results of this study suggests that NWaR can be of interest in explaining, at least partially, the capital structure of companies and can be used as one of several tools for studying the risk profile of specific sectors. The results obtained from the cross-country analysis have to be interpreted with caution as they are influenced by differences in the institutional framework in the four countries such as tax systems, the degree of legal protection of creditors, the banking systems in each country or the accounting regimes. The study covers the period 1987-2002. An examination of size effects as well as an analysis of selected sub-sectors of the manufacturing sector complete the study. About the ECCB and its Study Group The European Committee of Central Balance Sheet Data Offices (ECCB) brings together central banks, statistical offices and similar institutions within the European Union which maintain significant databases of financial statements of non-financial companies. The objective of the ECCB is to interchange viewpoints in order to improve the analytical methods of company accounting data in various fields, in particular for statistical and credit rating purposes. In co-operation with the European Commission the ECCB provides the BACH Database, which is publicly available and contains harmonised financial statements statistics of corporations. In addition the ECCB administers the European Sectoral Reference database. The research of the Study Group of the ECCB has been dedicated since its creation in 1993 on the subject of equity and financial structures of European corporations. The databases include small, medium-sized and large companies far beyond listed corporations.

Corporate Social Responsibility and Corporate Citizenship: Towards Corporate Accountability

Corporate Social Responsibility and Corporate Citizenship: Towards Corporate Accountability

Stock market response to the formation of global alliances: evidence from Spanish corporations

This paper analyzes the stock market reaction to global alliance formation in the Spanish context. For the purposes of this study, global alliances are those which are established with international partners in order to coordinate actions in several countries, seeking the development of complementary relationships on a global scale. Using a sample of 72 global alliances formed between 1987 and 1997 by Spanish firms listed on the Madrid Stock Exchange, it shows that the Spanish firms gained an average abnormal return of 0.2 percent on the day of the announcement.

European vs. American approaches to institutionalisation of business ethics: the Spanish case

This paper reports on a study of the largest Spanish corporations concerning the status of corporate ethics policies. The research project, the first of its kind in Spain, has two parts. First, the types of formal documents the companies use are analysed, including those dealing with ethical values or norms. Three groups of companies are distinguished: the first group has no formal documents dealing with ethical values, and the reasons given for not having any ethical statement are discussed. A second group has one document mentioning ethical values (generally the vision and/or mission statement), and a third group has in place two or more documents (one generic and the other more detailed, such as a code of conduct). The findings show that the latter group is more proactive than the former in implementing measures for promoting business ethics throughout the organisation. In the second part of the research, the study analyses the differences between companies whose headquarters are in Spain, Europe and USA regarding the arguments, the focus and the practices used to formalise business ethics.

Corporate Governance in Spain (with an Application of the Power Indices Approach)

This paper describes the governance system of Spanish listed firms in the early 1990's. Although the institutional setting of the Spanish Stock Exchanges differs little from other European national markets, we found important differences in several aspects of corporate governance. In particular, some of the standard mechanisms of control (e.g. boards and institutional shareholders) do not play an active role, whereas ownership is relatively concentrated. Moreover, power indices suggest that controlling blocs of large shareholders are very likely to form. We thus conclude that the ownership of shares is a pivotal mechanism in the governance of Spanish corporations.

Stability and Complexity of Inter-Firm Co-operation:: The case of Multi-Point Alliances

The authors examine alliances involving inter-firm co-operation which they term ‘multi-point alliances’. These are first defined and considered in varying degrees of complexity. A typology of multi-point alliances is produced, and interviews conducted with French and Spanish corporations followed by a two-stage questionnaire survey of France's largest corporations. The dynamics of multi-point co-operation were then examined. The results include support for the authors' research hypothesis that both business complexity (scope) and organizational complexity (structure) impact the evolution of co-operation: the higher the complexity, the more likely the co-operative arrangement will diverge from its initial objective.

Une analyse des déséquilibres financiers des collectivités locales en Espagne

Résumé Dans les Collectivités Locales espagnoles, divisées en Communautés Autonomes, Provinces -départements au sens francais- et Communes) l’autonomie limitée et l’insuffisance financière, comme nous le montrerons, constituent une caractéristique pratiquement permanente de leur évolution au cours du temps. Un consensus se dégage pour mener à bien une réforme ayant pour cause essentielle la possible détérioration financière qui n’avait eu jusque là pour limites que des actions transitoires ou coujoncturelles. Les conséquences de cette insuffisance de ressources et du manque d’autonomie financière font que les déséquilibres financiers influencent notablement le comportement des gouvernements successifs. Dans ce document, nous nous proposons d’analyser de manière théorique et empirique la situation en dynamique des Collectivités Locales. Nous utilisons pour cela une base de données qui nous permet d’interpréter la situation des Collectivités Locales quant au niveau d’autonomie et de suffisance financière et d’en tirer les conséquences au niveau de l’équilibre ou du déséquilibre comptable. Nous disposons également d’un instrument d’analyse formelle qui permet une approximation simple des relations interspatiales (modèle ADRI). Pour obtenir les résultats, nous avons mis en avant à travers différents secteurs d’un repère cartésien, les diverses situations qui expriment la réalisation ou non des principes d’autonomie (relation entre ressources propres et totales avec les emplois totaux) et de suffisance (relation entre ressources totales et emplois) dont la signification théorique relève du premier point. À travers l’analyse permise pour le modèle ADRI, nous pouvons partiellement expliquer la situation financière des Collectivités Locales espagnoles.

Verringern Management-Entlohnungssysteme die Agency-Kosten? — Empirische Evidenz von netzwerkorientierten und marktorientierten Unternehmenskontrollsystemen

Abstract In the UK, the top executive remuneration policy is not geared towards the creation of value but compensation revisions are rather driven by changes in corporate size, measured by sales growth. This suggests that managing larger firms requires special managerial skills. Even in UK companies with high concentration of control, no significant pay-for-performance relation has been discovered. In Spain, CEOs of larger firms receive higher cash-based compensation than those of small companies. For Spanish listed firms, we find that increases in corporate value are followed by increases in implicit (cash-based) CEO remuneration. However, this positive pay-for-share price performance elasticity is not present in all Spanish corporations: a remuneration policy aiming at the maximisation of corporate value is present in companies with a high degree of shareholder control. Only strong blockholders seem to be able to impose their share price related compensation scheme upon management. It should be noted th...

The Storm Over Our Heads: The Rendering of Legal Services by Audit Firms in Spain

The papers dwells on the thorny debate which is nowadays being held in the Spanish legal profession regarding the rendering of legal services by audit firms. Compared with other countries, the debate in Spain has been rather belated, and it is currently at its zenith due to the discussion of new regulatory measures of the legal profession (Estatuto General de la Abogacia) - which would expressly prohibit the joint rendering of legal and audit services by the same firm - and the approval of the so called Olivencia Code on Good Corporate Governance, in which the auditor's duty of independence when certifying the financial statements of Spanish public corporations is stressed. In this article the different arguments on that debate are analysed, evaluating their soundness. The examination of the different positions gives way to an alternative proposal of regulation which underlines the role of an informed market on disciplining excessive auditors' dependence on their clients. Moreover, the potential conflicts of interests should be prevented by the strict observance and enforcement of the respective professional legal and ethical duties.