Search results

1 – 8 of 8
Article
Publication date: 20 November 2024

Sonal Kumar, Rahul Ravi and Nilanjan Basu

This paper offers a fresh perspective on this debate by exploring the direct relationship between a firm’s stock price performance and its CSR activities, placing particular…

Abstract

Purpose

This paper offers a fresh perspective on this debate by exploring the direct relationship between a firm’s stock price performance and its CSR activities, placing particular emphasis on the underlying intent or motive behind the CSR initiatives.

Design/methodology/approach

This research examines the relationship between a firm’s stock price and its corporate social responsibility (CSR) activities, distinguishing between responsive and adaptive CSR. While responsive CSR, often a response to negative events, elicits immediate positive stock performance, adaptive CSR initially triggers negative stock performance. However, long-term analysis reveals adaptive CSR leads to positive stock performance, especially for family firms. The study challenges the notion of market myopia, suggesting the market values responsive CSR in the short term but recognizes the long-term benefits of adaptive CSR over time. Clear communication about adaptive CSR intentions and benefits may help in accurate market valuation.

Findings

This research examines the relationship between a firm’s stock price and its CSR activities, distinguishing between responsive and adaptive CSR. While responsive CSR, often a response to negative events, elicits immediate positive market reactions, adaptive CSR initially triggers negative reactions. However, long-term analysis reveals adaptive CSR leads to positive returns, especially for family firms.

Practical implications

The study challenges the notion of market myopia, suggesting the market values responsive CSR in the short term but recognizes the long-term benefits of adaptive CSR over time. Clear communication about adaptive CSR intentions and benefits may help in accurate market valuation.

Originality/value

First, it expands on previous studies by exploring how the different motivations behind CSR activities lead to varying effects on stock returns. Second, it sheds new light on the subject of market myopia. The findings demonstrate that adaptive CSR initiatives can initially trigger market reactions similar to those caused by perceived over-investment, in contrast to the more favorable response to responsive CSR activities.

Details

Managerial Finance, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0307-4358

Keywords

Book part
Publication date: 1 October 2015

Nilanjan Basu, Imants Paeglis and Mohammad Rahnamaei

We examine the influence of ownership structure on a blockholder’s power in a firm. We first describe the presence and ownership stakes of blockholders in a comprehensive sample…

Abstract

We examine the influence of ownership structure on a blockholder’s power in a firm. We first describe the presence and ownership stakes of blockholders in a comprehensive sample of US firms. We develop a measure of the influence of the ownership structure on a blockholder’s power and show that an average blockholder loses 12% of her potential power due to the presence and size of the ownership stakes of other blockholders. Further, the influence of ownership structure varies systematically with a blockholder’s rank and identity, with the second and nonfamily manager blockholders experiencing the largest loss of power.

Details

International Corporate Governance
Type: Book
ISBN: 978-1-78560-355-6

Keywords

Article
Publication date: 23 February 2010

Nilanjan Basu and Orlin Dimitrov

The purpose of this paper is to examine the effect of the passage of the Sarbanes‐Oxley Act (SOX) on a number of governance and governance‐related characteristics, such as board…

1333

Abstract

Purpose

The purpose of this paper is to examine the effect of the passage of the Sarbanes‐Oxley Act (SOX) on a number of governance and governance‐related characteristics, such as board structure and committee composition, as well as the effect of those changes (if any) on both accounting performance and company value.

Design/methodology/approach

The paper derives its results using a series of statistical analyses performed on the universe of firms comprising the S&P 500 index. To better gauge the effect of governance changes on firm performance, it uses four different performance measures.

Findings

The paper finds that as a direct consequence of the passage of SOX, the fraction of outsiders on corporate boards and all major board committees has gone up significantly. In addition, total chief executive officer compensation relative to sales as well as the amount of illegal insider trading (measured by a proxy based on the abnormal profits derived from insider trades) have declined. Finally, board size has declined marginally. None of these changes, however, is associated with any improvement in corporate performance or value.

Originality/value

The paper contributes to the brewing debate on the usefulness of SOX regulations. It examines several performance and governance‐related variables that have been previously overlooked. In addition, unlike most previous studies that look at the effect of SOX on governance, or valuation, the paper controls for the incremental effect of stock exchange regulations.

Details

Journal of Financial Regulation and Compliance, vol. 18 no. 1
Type: Research Article
ISSN: 1358-1988

Keywords

Article
Publication date: 31 January 2011

Nilanjan Basu and Mathieu Chevrier

The purpose of this paper is to examine the impact of the distance between the acquiror and the target on merger outcomes.

2158

Abstract

Purpose

The purpose of this paper is to examine the impact of the distance between the acquiror and the target on merger outcomes.

Design/methodology/approach

The authors use the distance between acquiror and target headquarters for a sample of 134 Canadian mergers to proxy for the impact of information asymmetry due to distance. They use an ordinary least squares regression to examine the impact of this distance on the abnormal returns earned by the acquiror and the operating performance of the acquiror. They also use a logistic regression to test for the impact of distance on the choice of the medium of exchange.

Findings

The results suggest that a larger distance between the acquiror and the target is related to lower abnormal returns for the acquiror, poorer post‐merger operating performance, as well as to a greater use of stock as the medium of exchange. The results are robust to several alternate specifications.

Research limitations/implications

The findings of this paper extend existing research that suggests that distance affects investment decisions. Moreover, by analyzing the choice of the medium of exchange, this paper provides evidence that indicates that the distance matters due to its impact on information. As such, the paper suggests a potential empirical approach to measuring information asymmetry. Future research could help us better understand the role of distance in various other aspects of corporate decision making.

Originality/value

This paper, by analyzing a sample of Canadian firms, provides an out‐of‐sample test for prior research that has focused almost exclusively on US firms. Moreover, by looking at the choice of the medium of exchange, it provides direct evidence that distance affects corporate decision making.

Details

Managerial Finance, vol. 37 no. 1
Type: Research Article
ISSN: 0307-4358

Keywords

Article
Publication date: 1 December 2014

Nilanjan Basu

The purpose of this paper is to review recent research on the structure of equity ownership and its impact on firm value. In doing so, the paper outlines the main issues, surveys…

Abstract

Purpose

The purpose of this paper is to review recent research on the structure of equity ownership and its impact on firm value. In doing so, the paper outlines the main issues, surveys the more recent work, and highlights the most promising developments on this topic.

Design/methodology/approach

The paper is a survey – as such there is no relevant research design.

Findings

The paper commences from multiple surveys done a decade ago that find that the evidence on this topic is inconclusive. Since then, researchers have developed several promising lines of inquiry. These approaches – specifically the new focus on the identity of the blockholders, multiple blockholder interactions, as well as the use of structural modeling, and the use of changes in insider ownership – hold some promise of being able to provide more definitive answers.

Research limitations/implications

The paper suggests that current researchers focus on newer approaches to analyzing the structure of equity ownership. Specifically, for research on blockholder ownership, the identity of blockholders as well as the interaction between blockholders are promising approaches to this topic. For research on insider ownership, structural models that have become recently popular as well as an emphasis on changes rather than levels of insider ownership are promising avenues of inquiry.

Originality/value

The paper summarizes the state of research on the structure of equity ownership and in doing so provides a quick introduction to a researcher new to this topic. In addition, the paper highlights the most promising areas of inquiry on this topic.

Details

Managerial Finance, vol. 40 no. 12
Type: Research Article
ISSN: 0307-4358

Keywords

Content available
1492

Abstract

Details

Managerial Finance, vol. 40 no. 12
Type: Research Article
ISSN: 0307-4358

Content available
Book part
Publication date: 1 October 2015

Abstract

Details

International Corporate Governance
Type: Book
ISBN: 978-1-78560-355-6

Book part
Publication date: 16 August 2023

Debasish Batabyal, Nilanjan Ray, Sudin Bag and Kaustav Nag

India is the birthplace of four major religions which are Hinduism, Jainism, Buddhism, and Sikhism. It is a country where people of all religions live in peace and harmony. Many…

Abstract

India is the birthplace of four major religions which are Hinduism, Jainism, Buddhism, and Sikhism. It is a country where people of all religions live in peace and harmony. Many tourists experience different forms of harassment during their pilgrimage journey, for example, fleecing, extortion of money, harassment by beggars, persistence by vendors and priests, fraud, sexual harassment, and other unacceptable behaviors. In order to appreciate the extent of harassment encountered by tourists, an in-depth study was conducted on the reviews provided by tourists on TripAdvisor's (Indian) website. This study characterizes harassments through ethnographic research approach of published reviews. A total of 260 reviews of 28 top Hindu temples are considered for all the states and union territories where the top Hindu pilgrim centers are located, (excluding Nagaland) according to TripAdvisor. The concerned reviews are categorized and further investigated through a primary data collection in proportion with the reviews received in respective temple sites in the study. through structural equation modeling (SEM). Important factors have been identified for future policy issues and recommendations in these most crowded places with unique mass tourism practices.

1 – 8 of 8