Enhancing financial reporting: challenges and opportunities in corporate governance statements

Nerantzidis, Michail

doi:10.1108/cg-10-2018-302

Cited by 9 publications

(8 citation statements)

References 17 publications

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“…Since 2004 the process of implementation of corporate governance rules has been taking place in an environment of significant regulatory impact from the European Union, pressure from investors and stakeholders, and a growing awareness among the general public (Pott et al, 2008). With the code amendments, the transition of selected code provisions into law, pressure from regulatory authorities (Djokic and Duh 2018;Nerantzidis 2018) and the dialog between WSE and the listed companies, the compliance record has been improving, supporting findings from other countries (Lepore et al 2018). The longitudinal analysis reveals the evolution of reporting practice from a strategy of rejection to one of acceptance, and a development from the avoidance approach, preferred by companies in the early stage of code implementation, to acquiescence.…”

Section: Discussionmentioning

confidence: 61%

Responses to corporate governance code: evidence from a longitudinal study

Aluchna

Kuszewski²

2021

Rev Manag Sci

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Drawing upon neo-institutional theory as the perspective for research on corporate governance, we present the results of empirical studies on compliance with best practice codes. We view the declarations of conformity as the organizational response to institutional pressure and address questions on (1) how companies respond to recommendations on board best practice and (2) how these reactions evolve over time. The study employs the mixed method approach and is based on a time-series sample of conformity declarations published by 126 companies listed on the Warsaw Stock Exchange during the period 2006–2019. Descriptive statistics indicate an increase in the number of complying companies, an improvement in compliance quality and the growing length of conformity declarations. In the content analysis we identify two main reaction strategies (acceptance and rejection) with seven selected responses. We discuss the contribution to the existing literature on reactions to new practices in corporate governance.

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Section: Discussionmentioning

confidence: 61%

Responses to corporate governance code: evidence from a longitudinal study

Aluchna

Kuszewski²

2021

Rev Manag Sci

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“…Retaining cash is valuable to managers as well. Higher cash holdings make for financial flexibility, so that managers are able to invest in opportunities as they come (Nerantzidis 2018). Furthermore, cash holdings can help avoid financial distress in difficult times.…”

Section: The Effect Of Cash Holdings On Financial Performancementioning

confidence: 99%

The Effect of Cash Holdings on Financial Performance in German and Dutch Multinationals

POST¹

2022

CEREM

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Aim: A global rise in inflation has sparked a renewed interest in the matter of cash holding decisions in firms. Increasing inflation makes for different cash holding practices, but the effect of cash holdings on firm performance remains unclear. This study aims to determine what the effect of higher cash holdings is on financial performance in German and Dutch multinational corporations (MNCs) Design / Research methods: The sample consists of 105 MNCs, 69 of which are from Germany, while 36 firms are Dutch. Through a standard OLS regression, financial performance, measured in return on assets, is regressed on cash holdings, measured in a cash-to-assets ratio. Conclusions / findings: A negative relationship is found between cash holdings and financial performance. This is because agency costs are more considerable when pools of cash become larger. Moreover, the relationship is significantly negative in the German subsample, but not in the Dutch subsample. This could be explained by differences in masculinity in national culture. Originality / value of the article: The effect of cash holdings on firm performance has been neglected in the literature. By focusing on two similar countries, and introducing national culture into the discussion of cash management, the study is valuable to both management and literature. Limitations: Research design is rather limited. Findings are preliminary, and need to be verified through the use of more extensive studies. JEL: G30

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“…Hassan et al (2020), Henry and Leone (2016), McDonald (2011, 2016) include broad analysis of linguistics in the accounting and finance disciplines, while they also incorporate financial data. In addition, at a rapidly accelerating pace during the past decades, market participants and academics investigate voluntary/narrative disclosures by management to appreciate more effectively corporate performance (Bueno et al, 2018;Nerantzidis, 2018;Nerantzidis and Tsamis, 2017).…”

Section: Literature Reviewmentioning

confidence: 99%

Corporate liquidity, supply chain and cost issues awareness within the Covid-19 context: evidence from us management reports’ textual analysis

Fassas

Bellos

Kladakis

2021

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Purpose The purpose of this study is to assess the management responses and intentions of 3,279 US firms from all industries, before and after the coronavirus outbreak, to identify the level of managerial concern about specific financial issues and potential economic costs of the COVID-19 pandemic. Design/methodology/approach This paper uses textual analysis of official management reports to search for specific single words in five domains related to corporate finance and governance. This paper focuses on the relative frequency of single words using a weighting scheme that adjusts for document length and for the inverse document frequency. This paper then uses t-tests to investigate the univariate differences across groups of reports before and after the US stock market crash in February 2020. Findings The applied textual and empirical analysis provides evidence that firms’ primary concerns relate to the disruption in supply chains, liquidity need and coronavirus-led recession. This paper also shows that the main cost reduction measure they are considering is salary reduction, rather than workforce reduction. This paper also shows evidence that firm managers are rather swift to provide coronavirus-related information in the US Securities and Exchange Commission (SEC) corporate filings. Practical implications The findings provide a primary view of the directions, on which US firms will move in the near future, and thus, they can be used as tools for the formulation of appropriate government policies in the corresponding sectors, which could mitigate the economic risks related to the pandemic. At the business level, the disseminated knowledge can assist firms either in the same sector or in similar/related sectors to “locate” themselves within the map of the pandemic and to adjust or align correspondingly their strategies and decisions as they will have a view of the bigger picture. Originality/value The empirical analysis divulges US firms’ management primary concerns after the COVID-19 outbreak, and thus, offers insights to the processes taking place in the US business community and the formulating new corporate and economic reality.

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Enhancing financial reporting: challenges and opportunities in corporate governance statements

Cited by 9 publications

References 17 publications

Responses to corporate governance code: evidence from a longitudinal study

Responses to corporate governance code: evidence from a longitudinal study

The Effect of Cash Holdings on Financial Performance in German and Dutch Multinationals

Corporate liquidity, supply chain and cost issues awareness within the Covid-19 context: evidence from us management reports’ textual analysis

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