Does corporate hedging affect firm valuation? Evidence from the IPO market

Qiao, Zheng; Xia, Chongwu; Zhang, Lei

doi:10.1002/fut.22098

Cited by 5 publications

(1 citation statement)

References 59 publications

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“…This result does not appear to support the H2a hypothesis. One possible explanation for this result is a lack of industry-specific knowledge and expertise compared to insiders and others close to the company who have such knowledge that would aid effective oversight of the financial reporting process, or if the information environment is ambiguous, preventing audit committee independence from performing their monitoring and advising duties effectively (Armstrong et al , 2014; Bronson et al , 2009; Juhmani, 2017; Qiao et al , 2020). Table 6 also shows that the revised MCCG has a significant positive moderation impact on the association between ACSIZ and ILQ.…”

Section: Resultsmentioning

confidence: 99%

Audit committee characteristics and the moderating effect of Malaysian code of corporate governance on IPO liquidity

Al-Masawa

Mohd‐Rashid²,

Al-Jaifi

et al. 2021

MRR

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Purpose This study aims to investigate the link between audit committee characteristics and the liquidity of initial public offerings (IPOs) in Malaysia, which is an emerging economy in Southeast Asia. Another purpose of this study is to examine the moderating effect of the revised Malaysian code of corporate governance (MCCG) on the link between audit committee characteristics and IPO liquidity. Design/methodology/approach The final sample consists of 304 Malaysian IPOs listed in 2002–2017. This study uses ordinary least squares regression method to analyse the data. To confirm this study’s findings, a hierarchical or four-stage regression analysis is used to compare the t-values of the main and moderate regression models. Findings The findings show that audit committee characteristics (size and director independence) have a positive and significant relationship with IPO liquidity. Also, the revised MCCG positively moderates the relationship between audit committee characteristics and IPO liquidity. Research limitations/implications This study’s findings indicate that companies with higher audit committee independence have a more effective monitoring mechanism that mitigates information asymmetry, thus reducing adverse selection issues during share trading. Practical implications Policymakers could use the results of this study in developing policies for IPO liquidity improvements. Additionally, the findings are useful for traders and investors in their investment decision-making. For companies, the findings highlight the crucial role of the audit committee as part of the control system that monitors corporate governance. Originality/value To the authors’ knowledge, this work is a pioneering study in the context of a developing country, specifically Malaysia that investigates the impact of audit committee characteristics on IPO liquidity. Previously, the link between corporate governance and IPO liquidity had not been investigated in Malaysia. This study also contributes to the IPO literature by providing empirical evidence regarding the moderating effect of the revised MCCG on the relationship between audit committee characteristics and IPO liquidity.

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Section: Resultsmentioning

confidence: 99%

Audit committee characteristics and the moderating effect of Malaysian code of corporate governance on IPO liquidity

Al-Masawa

Mohd‐Rashid²,

Al-Jaifi

et al. 2021

MRR

View full text Add to dashboard Cite

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Do derivatives benefit shareholders? Evidence from India

Chaudhry

Gupta

2023

Finance Research Letters

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Pricing and performance of initial public offerings: directions for future research

Siwach,

2024

QRFM

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Purpose This study aims to outline the research field of initial public offerings (IPOs) pricing and performance by combining bibliometric analysis with a systematic literature review process. Design/methodology/approach The study uses over three decades of IPO publication records (1989–2020) from Scopus and Web of Science databases. An analysis of keyword co-occurrence and bibliometric coupling was used to gain insights into the evolution of IPO literature. Findings The study categorized the IPO research field into four primary clusters: IPO pricing and short-run behaviour, IPO performance and influence of intermediaries, venture capital financing and top management and political affiliations and litigation risks. The results offer a framework for delineating research advancements at different stages of IPOs and illustrate the growing interest of researchers in IPOs in recent years. The study identified future research potential in the areas of corporate governance, earning management and investor sentiments related to IPO performance. Similarly, the study highlighted the opportunity to test multiple theoretical frameworks on alternative investment platforms (SME IPO platforms) operating under distinct regulatory environments. Originality/value To the best of the authors’ knowledge, this paper represents the first instance of using both bibliometric and systematic review to quantitatively and qualitatively review the articles published in the area of IPO pricing and performance from 1989 to 2020.

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Does corporate hedging affect firm valuation? Evidence from the IPO market

Cited by 5 publications

References 59 publications

Audit committee characteristics and the moderating effect of Malaysian code of corporate governance on IPO liquidity

Audit committee characteristics and the moderating effect of Malaysian code of corporate governance on IPO liquidity

Do derivatives benefit shareholders? Evidence from India

Pricing and performance of initial public offerings: directions for future research

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