Does goodwill pressure drive business restructuring based on subsidiary disposal?

Xu, Jingjing; Huang, Haijie; Lee, Edward; Petaibanlue, Jirada

doi:10.1016/j.irfa.2023.102511

International Review of Financial Analysis

2023

DOI: 10.1016/j.irfa.2023.102511

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Does goodwill pressure drive business restructuring based on subsidiary disposal?

Jingjing Xu

Haijie Huang

Edward Lee

et al.

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Cited by 2 publications

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Dual‐board governance and board independence: Conglomerate affiliate versus standalone firms

Uddin,

Najaf,

Hassan

et al. 2023

Int. J Fin Econ

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We argue that the corporate board of an exchange‐listed firm cannot make an independent business decision if it has an affiliation with a conglomerate group. This is because the corporate board of a conglomerate‐affiliated firm (CAF) has high moral hazard exposure due to its accountability to the superior parent board at the apex of the conglomerate structure. Based on a sample of 304 listed firms from 18 countries, we find a CAF board is less independent than a standalone board with no superior reporting body. A firm's affiliation with the conglomerate per se affects its board independence, regardless of the parent shareholding level. The additional analysis finds that the lack of board independence significantly impacts a CAF's financial performance, although the market impact is insignificant.

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Dual‐board governance and board independence: Conglomerate affiliate versus standalone firms

Uddin,

Najaf,

Hassan

et al. 2023

Int. J Fin Econ

View full text Add to dashboard Cite

show abstract

Excess goodwill and enterprise litigation risk

Wang,

Zhang

2024

Finance Research Letters

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Does goodwill pressure drive business restructuring based on subsidiary disposal?

Cited by 2 publications

References 64 publications

Dual‐board governance and board independence: Conglomerate affiliate versus standalone firms

Dual‐board governance and board independence: Conglomerate affiliate versus standalone firms

Excess goodwill and enterprise litigation risk

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