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Article
Publication date: 31 December 2020

Catarina Afonso Alves, Ana Paula Matias Gama and Mário Augusto

This study examines how stewardship might mediate the influence of family ownership on firm financial performance. The authors argue that differences in financial performance may…

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Abstract

Purpose

This study examines how stewardship might mediate the influence of family ownership on firm financial performance. The authors argue that differences in financial performance may reflect not only the family's influence but also the prevalence of a stewardship-oriented culture, across varying degrees of family influence.

Design/methodology/approach

The measure of family influence uses the F-PEC scale: family [F], power [P], experience [E] and culture [C]. It supports cross-firm comparisons of different levels of family influence. To capture the multidimensional nature of family influence, this study uses structural equation modelling and measures the meditating effects of stewardship.

Findings

The results reveal a mediating effect of stewardship; family firms achieve better performance when they take advantage of and encourage stewardship attitudes among owners and leaders. Factors associated with stewardship behaviour, including stewardship motivation and stewardship culture, help explain why some family firms perform better than others.

Practical implications

When analysing the behaviour of family firms, interested entrepreneurs, managers and consultants should acknowledge that the family's influence entails both financial and emotional capital. The survival of the family businesses depends on balancing these aspects.

Originality/value

In response to calls for research into mediators of the complex relationship between family influence and firm outcomes, this study provides a novel explanation for performance-maximizing behaviours by organizations, in which pro-organizational attitudes coexist with self-serving motives.

Details

Journal of Small Business and Enterprise Development, vol. 28 no. 2
Type: Research Article
ISSN: 1462-6004

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Article
Publication date: 14 November 2016

Joaquim Ferrão, José Dias Curto and Ana Paula Gama

The purpose of this paper is to provide new insights into the low-leverage phenomenon by analyzing the dynamics of firms’ financing policies. The authors explore three theoretical…

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Abstract

Purpose

The purpose of this paper is to provide new insights into the low-leverage phenomenon by analyzing the dynamics of firms’ financing policies. The authors explore three theoretical explanations of firms’ motivations to switch among different levels of debt aversion: financial constraints, financial flexibility and financial distress.

Design/methodology/approach

The authors apply a multilevel mixed-effects model to a panel data sample of 9,005 US listed firms during 1987-2014. To use a multinomial ordered logit model, the authors break down the low-leverage firms into several levels of debt aversion.

Findings

The empirical analysis provides four main findings. First, there is a dynamic behavior regarding leverage policy: after five years, 39.4 per cent of initial zero debt firms remain all-equity firms, 14.2 per cent are leveraged firms and approximately 19.7 per cent still adopt a low-leverage policy. Second, greater asset volatility increases the expected likelihood that firms will be debt averse. Third, when firms grow bigger and older, they show a greater likelihood of moving toward a higher leverage level. Fourth, results derived from the investment variables of research and development, acquisitions, and capital expenditure provide strong evidence in favor of the financial flexibility hypothesis.

Practical implications

These findings suggest that conservative debt policy is integrated with corporate investment decisions.

Originality/value

This paper contributes to extant literature by emphasizing the dynamic process associated with a low-leverage policy, unlike prior studies that focus on the determinants and characteristics of low-leverage firms. It also applies an econometric methodology that is new to the field: multilevel models.

Details

Review of Accounting and Finance, vol. 15 no. 4
Type: Research Article
ISSN: 1475-7702

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Article
Publication date: 13 July 2012

Ana Paula Matias Gama and Helena Susana Amaral Geraldes

The purpose of this paper is to develop a credit‐scoring model as an aggregate valuation procedure that integrates various financial and non‐financial factors and thereby improves…

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Abstract

Purpose

The purpose of this paper is to develop a credit‐scoring model as an aggregate valuation procedure that integrates various financial and non‐financial factors and thereby improves small to medium‐sized enterprises' (SMEs) knowledge about their default risk.

Design/methodology/approach

Using panel data from a representative sample of Portuguese SMEs operating in the food or beverage manufacturing sector, this paper develops a logit scoring model to estimate one‐year predictions of default.

Findings

The probability of non‐default in the next year is an increasing function of profitability, liquidity, coverage, and activity and a decreasing function of leverage. Smaller firms and those with just one bank relationship have a higher probability of default. The findings suggest that a main bank has incentives to engage in hold up by increasing margins that ex post are too high.

Practical implications

Because SMEs differ from large corporations in their credit risk (e.g., riskier, lower asset correlations), this study has implications for both banks and supervisory actors. Banks should consider qualitative variables when setting internal systems and procedures to manage credit risk. Supervisory institutions should claim mixed credit ratings to determine regulatory capital requirements.

Originality/value

This paper offers a new model, focused specifically on SMEs, and explores the role of financial and non‐financial factors in determining internal credit risks.

Details

Management Research Review, vol. 35 no. 8
Type: Research Article
ISSN: 2040-8269

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Article
Publication date: 1 March 2003

José Paulo Esperança, Ana Paula Matias Gama and Mohamed Azzim Gulamhussen

The capital structure decision can be considered a difficult problem for academics as well as for managers. Corporate debt policy has been studied in the context of both large and…

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Abstract

The capital structure decision can be considered a difficult problem for academics as well as for managers. Corporate debt policy has been studied in the context of both large and small firms in developed countries, but comparatively less developed countries have received much less attention in the literature. This is particularly true in the case of medium income economies with an above average weight of financial intermediaries. This paper tests the factors affecting the capital structure decision of small firms in one such country. The pooled time series cross‐section regression estimates for 995 firms and four years, suggests variables such as taxes, bankruptcy costs, size, collateral, age and growth opportunities affect the capital structure decisions of small firms. These findings have significant implications, both at the firm level and for the support of policies that redefine the financial infrastructure that may foster the emergence of local entrepreneurs in these economies.

Details

Journal of Small Business and Enterprise Development, vol. 10 no. 1
Type: Research Article
ISSN: 1462-6004

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Article
Publication date: 2 August 2013

Ana Paula Matias Gama and Cecília Rodrigues

Combining ownership and management might lead concentrated shareholders, such as families, to wealth expropriation. The lack of external monitors and disciplinary agents

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Abstract

Purpose

Combining ownership and management might lead concentrated shareholders, such as families, to wealth expropriation. The lack of external monitors and disciplinary agents potentially permits them to pursue this path. Thus, monitoring activity is one of the major drawbacks in family controlled firms. The purpose of this paper is to provide an integrated analysis of the governance roles of various block‐holders, institutional investors and corporate boards in firm performance in the context of publicly‐listed family‐controlled firms.

Design/methodology/approach

Using a multi‐industry data set of 208 firms listed on the Milan Stock Exchange (MSE), this study employs the generalized method of moments (GMM) to address the issue of endogeneity on panel data over the period 200‐2006.

Findings

The results show that family firms have better accounting performance than non‐family firms. So, active family involvement in management positions seems to reduce managerial opportunism. However, higher accounting performance does not translate into an increase in valuation levels, and thus might not accrue to minority shareholders. Additionally, the results also show an alignment incentive between a coalition of large shareholders (two families) and firm value.

Research limitations/implications

This study provides empirical evidence consistent with a block‐holder coalition framework that sustains an incentive alignment effect of the coalition of large shareholders (two families) and the firm value. Additionally, the results also support evidence that board dominance is another channel through which families can extract private benefits.

Originality/value

This study contributes to understanding that the family firm performance depends on the efficiency of various governance mechanisms. Thus, it offers insights to policy makers to verify board appointment mechanisms used by family firms. Since external board members might be vetted and approved by the family or other dominant block‐holders, what is the extent of their independence from the dominant owners?

Details

Corporate Governance: The international journal of business in society, vol. 13 no. 4
Type: Research Article
ISSN: 1472-0701

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Article
Publication date: 6 April 2012

Ana Paula Matias Gama and Jorge Manuel Mendes Galvão

Most countries often have public companies with large controlling owners, typically a family. This empirical evidence aims to contrast with the classical view of the largest

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Abstract

Purpose

Most countries often have public companies with large controlling owners, typically a family. This empirical evidence aims to contrast with the classical view of the largest dispersed firm presented by Berle and Means and challenge the findings by Bhattacharya and Ravikumar, who predict that the shares held by families will decrease if an efficient financial market is put in place. Therefore, family firms represent an important group in the stock market today. Thus, the purpose of this paper is to analyze the effect of the family as a controlling owner on firms' performance, valuation and capital structure.

Design/methodology/approach

The paper reviews the current literature related to how family (taking into account specific governance characteristics such as family ownership, family control and family management) affects firms' performance and value.

Findings

The literature review showed that founder family control and professional (outside) management increase performance, whereas excess control via control enhancing mechanisms (such as dual class shares and pyramidal structures) and descendent management produce both lower valuation and performance. This evidence suggests that families have the incentives and the power to systematically expropriate wealth from minority shareholders.

Originality/value

Previous research shows that family firms on average perform better than non‐family firms. But this is a non‐linear relation due the fact that the relationship between family ownership and performance cannot be identified without distinguishing between control and cash‐flow rights. Thus, the literature review as a whole emphasizes that the incentives for the controlling shareholder to engage in expropriation are a function of the institutional framework in which the firm operates. So, for further research, it is important to investigate how family firms perform in different corporate governance systems. A policy implication is the necessity to improve minority shareholders' protection from the risk of expropriation by large shareholders.

Details

Corporate Governance: The international journal of business in society, vol. 12 no. 2
Type: Research Article
ISSN: 1472-0701

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Article
Publication date: 20 February 2020

Anete Alberton, Ana Paula Kieling, Franciane Reinert Lyra, Estela Maria Hoffmann, Mariana Pires Vidal Lopez and Silvio Roberto Stefano

This study analyzes the competencies toward sustainability in hotel facilities in order to identify the level of implementation of sustainability practices, as well as individual…

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Abstract

Purpose

This study analyzes the competencies toward sustainability in hotel facilities in order to identify the level of implementation of sustainability practices, as well as individual competencies for sustainability in the hospitality companies.

Design/methodology/approach

Interviews and a survey with hotel employees were conducted in two important touristic Brazilian cities, Florianopolis, and Rio de Janeiro, considering the TBL (triple bottom line) dimensions. The data were analyzed with content analysis and descriptive statistics and conjoint analysis.

Findings

Preventive competencies in the companies' management were identified. The research also revealed that competencies for sustainability are fairly present in the hospitality context yet, which demonstrates the urgency to discuss the theme in both academic and business practices.

Research limitations/implications

The access to the hotel managers impaired the performing of a robust statistical analysis; the study provided new insights about the topics investigated and generated information for the theoretical framework about competencies for sustainability.

Practical implications

The research results emphasized the need for the hotel industry to invest in sustainable strategies to meet its target audience, but also to raise the level of its staff and reduce costs in the long term, offering benefits to society, the environment, and, to their businesses.

Social implications

The research socially contributes through promoting discussion on sustainability, which is one of the most challenging and relevant issues for society. Besides, it can assist the diffusion of the competencies for sustainability in the hotel industry, as an attempt to decrease their negative externalities on the environment and primary audiences.

Originality/value

It was identified a distance between practice and the triple bottom line concept, which is linked only to environmental practices. Besides, it was found limited knowledge about the concepts of competencies in the companies.

Details

Employee Relations: The International Journal, vol. 44 no. 3
Type: Research Article
ISSN: 0142-5455

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Article
Publication date: 19 June 2018

Malte Thiede, Daniel Fuerstenau and Ana Paula Bezerra Barquet

The purpose of this paper is to review empirical studies on process mining in order to understand its use by organizations. The paper further aims to outline future research…

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Abstract

Purpose

The purpose of this paper is to review empirical studies on process mining in order to understand its use by organizations. The paper further aims to outline future research opportunities.

Design/methodology/approach

The authors propose a classification model that combines core conceptual elements of process mining with prior models from technology classification from the enterprise resource planning and business intelligence field. The model incorporates an organizational usage, a system-orientation and service nature, adding a focus on physical services. The application is based on a systematic literature review of 144 research papers.

Findings

The results show that, thus far, the literature has been chiefly concerned with realization of single business process management systems in single organizations. The authors conclude that cross-system or cross-organizational process mining is underrepresented in the ISR, as is the analysis of physical services.

Practical implications

Process mining researchers have paid little attention to utilizing complex use cases and mining mixed physical-digital services. Practitioners should work closely with academics to overcome these knowledge gaps. Only then will process mining be on the cusp of becoming a technology that allows new insights into customer processes by supplying business operations with valuable and detailed information.

Originality/value

Despite the scientific interest in process mining, particularly scant attention has been given by researchers to investigating its use in relatively complex scenarios, e.g., cross-system and cross-organizational process mining. Furthermore, coverage on the use of process mining from a service perspective is limited, which fails to reflect the marketing and business context of most contemporary organizations, wherein the importance of such scenarios is widely acknowledged. The small number of studies encountered may be due to a lack of knowledge about the potential of such scenarios as well as successful examples, a situation the authors seek to remedy with this study.

Details

Business Process Management Journal, vol. 24 no. 4
Type: Research Article
ISSN: 1463-7154

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Article
Publication date: 23 October 2023

Alan Bandeira Pinheiro, Joina Ijuniclair Arruda Silva dos Santos, Ana Paula Mussi Szabo Cherobim and Andréa Paula Segatto

This study aimed to investigate the role of the country's institutional quality on the environmental, social and governance (ESG) performance of its companies.

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Abstract

Purpose

This study aimed to investigate the role of the country's institutional quality on the environmental, social and governance (ESG) performance of its companies.

Design/methodology/approach

Over a four-year period (2016–2019), the study examined the ESG performance of 412 organizations situated in 19 countries. ESG performance was the dependent variable, and the independent variables were rule of law, economic freedom, education index and international trade freedom. These factors described the institutional quality of countries in the authors’ study.

Findings

The findings reveal that institutional quality has a major impact on ESG performance. Companies engage in more ESG practices when they operate in countries with greater economic freedom and international trade freedom. The authors corroborated the core assumption of institutional theory (IT), which argues that organizational behavior is determined by the country's institutional setting.

Research limitations/implications

The findings, like all research, should be interpreted with caution. The authors’ research focused solely on large energy corporations. As a result, the conclusions cannot be applied to small companies or other industries. ESG performance can also be measured using different datasets.

Practical implications

If managers want their companies to perform better in terms of ESG, the authors recommend that they form a CSR committee and sign the Global Compact. This study may be valuable to international policymakers because they can underline that greater economic freedom, better education and greater international trade freedom all promote higher ESG performance.

Originality/value

To the best of the authors' knowledge, nearly all of research explores the relationship between ESG and financial performance. As a result, this study built on past research by investigating how national aspects affect corporate ESG performance.

Details

Management of Environmental Quality: An International Journal, vol. 35 no. 2
Type: Research Article
ISSN: 1477-7835

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