Purpose -In the aftermath of the global financial crisis (GFC) governments lost confidence in market fundamentalism and realised the inadequacies of regulatory measures. The purpose of this paper is to outline the proximate causes of the financial crisis of 2007-2009 and to investigate the role of the shareholder wealth maximization (SWM) objective in the GFC. Design/methodology/approach -The methodological procedure used in this paper is based on the historical case-study approach. Case reviews of individuals and world-level role models of the financial crisis have been cited in this paper. From this aggregated material, the paper examines the side effects of the SWM objective in order to develop the argument that the SWM objective played a role in the present crisis. Findings -The case studies revealed that unethical behaviour, agency issues, CEO compensation, creative accounting and risk shifting are some of the side effects of SWM. These cases indicate that the assumptions on which SWM are based are questionable. Further, it can be argued that the root cause of the GFC is excessive greed and the single-minded pursuit of SWM. Originality/value -Though many studies have attempted to identify the proximate causes of the GFC, this paper is novel in highlighting the impact of the SWM objective function.
This article explores internal discussions of a performance measurement tool called the balanced scorecard (BSC) for potential application in a suburban church. Interviews were conducted with church leaders exploring issues they face if a BSC was adopted to assess church performance. A significant finding was the difficulty church leaders had incorporating a finance perspective into their organizational thinking as a performance measurement factor because of the church’s primary focus and function as not-for-profit orientation to spiritual mission. This article argues churches like other organizations need a performance measurement tool, such as a BSC, to regularly monitor their organizational well-being, if they are to survive in a highly competitive and complex environment, even as non-commercial institutions with transcendent goals. The findings suggest the value for churches incorporating a finance perspective in measuring performance since finance sets the possibilities for the sustainability of the organization, even though religious or faith-based objectives are themselves not financial.
Purpose The purpose of this paper is to study whether mergers and acquisitions (M&As) create value in Indian and Chinese markets. Design/methodology/approach The authors study abnormal returns (AR) created by the acquiring firms in Indian and Chinese markets relating to M&A announcements, using the following three different statistical methods: i.e. mean, market and ordinary least squares adjusted return models. Findings On average, M&A announcements do not create value for the firms in Chinese and Indian economies. For the mean model, M&As create value for Chinese firms, whereas for the Indian firms no such value is created for the same event windows. The regression results showed that debt has a positive impact on the AR and cumulative average abnormal returns at 1, 5 and 10 per cent significance levels, respectively. Research limitations/implications This study suggests increasing the sample size and period and using the instrumental variables regression to ensure the estimator’s impartiality, consistency and efficiency. With the investigative period surrounding a financial crisis, the estimators may have omitted bias. Originality/value Multiple methods used in this paper made it possible to capture the level of method variance in the AR, which is unusual in the Chinese and Indian context. Hence, the current study provides local knowledge and further strengthens the literature about M&As. The authors also regress AR with firm-specific factors, the consideration of which is scarce in the previous literature. Furthermore, much of what the authors know about M&A is relevant to developed economies.
Purpose -The purpose of this paper is to explore the nature and significance of flexibility in decisions about education and training options. This is done through an examination of the relevance of real options valuation (ROV) to our understanding of educational and training choices. Through this examination, the paper aims to contribute to the debate about how we can better advise and support people making such decisions. Design/methodology/approach -The research involved three overlapping stages: a critical examination of the theoretical work on flexibility in decisions; a review of the literature on the role and significance of flexibility in education and training decisions; and an application of the lessons of ROV to the analysis of decisions about education, training and careers. Findings -The analysis of the theoretical work on flexibility alongside the review of the literature on education and training decision-making, demonstrated that there was little current application of theory to the analysis of such choices. Reviewing the literature, it was discovered that ROV held significant lessons for the analysis of education and training decisions, and important practical implications for the support and guidance of people making these choices. Originality/value -This is the first study to apply the principles of ROV to educational and training choices. This paper examines the importance of understanding and valuing flexibility in postsecondary educational and training choices. Our definition of flexibility is "the degree to which a decision leading to action allows further choices over time". This is a crucial, though neglected, aspect of choosing training and educational programmes, for while some decisions "lock" students into particular training and career pathways, others involve more diverse opportunities to train or work. We thus argue that understanding and addressing the flexibility in such choices should be an integral part of any career counsel or advice.The paper is relevant to the two classes of adviser who counsel on study choices and career selections: secondary school (high school) counsellors; and further education and tertiary college counsellors. Both of these professionals are in the business of advising students about their training/educational choices, and providing information about the consequences of these choices in terms of career. Therefore, for the purposes of this paper, we make no distinction between these two types of counsellors, focusing more on the content of counselling and advising, rather than on the person providing it.Many variables influence individual study choices and career selection, some of which are difficult to quantify, or even to characterise. In a recent study, for instance, The current issue and full text archive of this journal is available at
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