PurposeThe UK government argues that the benefits of public private partnership (PPP) in delivering public infrastructure stem from transferring risks to the private sector within a structure in which financiers put their own capital at risk, and the performance‐based payment mechanism, reinforced by the due diligence requirements imposed by the lenders financing the projects. Prior studies of risk in PPPs have investigated “what” risks are allocated and to “whom”, that is to the public or the private sector. The purpose of this study is to examine “how” and “why” PPP risks are diffused by their financiers.Design/methodology/approachThis study focuses on the financial structure of PPPs and on their financiers. Empirical evidence comes from interviews conducted with equity and debt financiers.FindingsThe findings show that the financial structure of the deals generates risk aversion in both debt and equity financiers and that the need to attract affordable finance leads to risk diffusion through a network of companies using various means that include contractual mitigation through insurance, performance support guarantees, interest rate swaps and inflation hedges. Because of the complexity this process generates, both procurers and suppliers need expensive expert advice. The risk aversion and diffusion and the consequent need for advice add cost to the projects, impacting on the government's economic argument for risk transfer.Originality/valueThe expectation inherent in PPP is that the private sector will better manage those risks allocated to it and because private capital is at risk, financiers will perform due diligence with the ultimate outcome that only viable projects will proceed. This paper presents empirical evidence that raises questions about these expectations.
The purpose of this paper is to document the prevalent ownership concentration, structure and control in the top 100 companies listed on the Istanbul Stock Exchange. The results are discussed in the context of emerging corporate governance trends in Turkey. Where appropriate, comparisons with other countries are provided. Copyright Blackwell Publishing Ltd 2003.
PurposeThe purpose of this paper is to discuss the themes emerging from the first studies exploring accounting, accountability and management practices during the COVID-19 pandemic and coming from a diversity of experiences, across countries, organizations and individuals. In so doing, the paper gives an overview of the most recent findings about the role of accounting and accountability in times of crisis that are hosted in this special issue of Accounting, Auditing and Accountability Journal (AAAJ).Design/methodology/approachThe paper draws together and identifies emerging themes related to the current COVID-19 pandemic and its impacts on accounting, accountability and management practices and considers how the studies in this issue extend one’s knowledge of accounting and contribute to accounting research.FindingsThree emerging themes are drawn and their contribution to accounting scholarship is discussed. The first theme deals with the role of accounting and numbers in supporting governmental responses to COVID-19. The second theme considers accounting practices used to make exceptional decisions at the organizational level in times of crisis. The third theme addresses a relevant frontier of research into accounting and inequalities.Practical implicationsIn considering the diverse contributions of this special issue, the paper points out how uncertainty and change can impact the design, use and understanding of accounting, management and accountability practices and can be accepted by scholars and practitioners as part of such practices.Originality/valueThis paper provides a timely and comprehensive picture of the first reflections and research findings on the impacts of the COVID-19 pandemic on one’s interpretation of accounting, accountability and management practices.
This study is based on three Irish operational toll road Public Private Partnership (PPP) case studies, including interviews with 38 key stakeholders. Our findings show that the Irish Government's treatment of risk and its transfer to the private partner in PPPs are changing over time. Regulatory changes, which have led to increased finance costs, coupled with a severe global economic crisis, have exacerbated the difficulties in funding PPPs. The goalposts in Irish PPPs appear to be changing in favour of the private partner at the expense of the taxpayers, who are the losers in the PPP game. The Government are suggesting that they may potentially step in, if projects experienced financial difficulty and the Special Purpose Vehicle (SPV) may require specific guarantees in order to participate in future PPP projects. Pricing of demand risk also differs from the Government's rhetoric that it is being priced realistically. In practice, we find that it is priced aggressively by the SPV in order to win PPP contracts. The paper discusses the possible implications of these findings for Value for Money (VFM) and, ultimately, taxpayers.
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