Idiosyncratic risk, risk-taking incentives and the relation between managerial ownership and firm value

Florackis, Chris; Kanas, Angelos; Kostakis, Alexandros; Sainani, Sushil

doi:10.1016/j.ejor.2019.11.027

Cited by 18 publications

(9 citation statements)

References 68 publications

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“…Research on managerial ownership of firm value has found mixed results. (Benson, Chen, James, & Park, 2020) Benson et al (2020) and Florackis et al (2020) found significant positive results on the relationship between the number of shares owned by managers and firm value. The The Companyi Value Nilai perusahaan researcher's argument states that the higher the managerial ownership, the less agency conflict because the manager now has two positions: a shareholder (principal) and manager (agent).…”

Section: Introductionmentioning

confidence: 91%

Ownership Structure, Firm Value and Mediating Effect of Firm Performance

Sahrul

Novita²

2020

Jurnal Akuntansi

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This study aims to examine and analyze the mediating effect of firm performance on ownership structure on firm value. The independent variables are ownership concentration and managerial ownership. The dependent variable is firm value, while the mediating variable is firm performance. The research sample is mining sector companies listed on the IDX in 2016-2018. Data analysis uses Eviews 10. The results show that ownership concentration positively affects company performance, while the opposite results are found in managerial ownership. Then, direct managerial ownership and firm performance positively affect firm value, while ownership concentration does not affect firm value. Firm performance mediates the relationship between ownership concentration and firm value, but firm performance fails to mediate the relationship between managerial ownership and firm value.

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Section: Introductionmentioning

confidence: 91%

Ownership Structure, Firm Value and Mediating Effect of Firm Performance

Sahrul

Novita²

2020

Jurnal Akuntansi

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“…Therefore, we also examine how managerial ownership moderates the effect of top executive turnover on enterprises' R&D investment. In this study, referring to Florackis et al (2020), the managerial ownership variable is continuous. It is measured by the proportion of the company's shares held by top executives (directors, supervisors, senior managers) to the total number of issued shares of the company.…”

Section: Moderation Effect Of Managerial Ownershipmentioning

confidence: 99%

Impact of top executive turnover on firms’ R&D investment: evidence from China

et al. 2020

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Though top executive turnover's economic consequence is highlighted in earlier studies, its link with innovation behaviour has remained relatively underexplored. This study aims to fill this gap through investigating whether, and if so, how, top executive turnover event influences firms' R&D investment. Based on a sample of 2,810 A-share listed companies in China for the period 2008-2016, our results suggest that top executive turnover is negatively related to enterprises' R&D investment. This is mainly because top executive turnover increases the departure rate of R&D personnel, which worsens enterprises' internal R&D environment. The findings also indicate that the negative effect of top executive turnover on R&D investment is accentuated for family enterprises and non-stateowned corporations. Our results have implications for the literature on top executive turnover and enterprises' innovation behaviour and can inform practice, particularly with respect to the selection of top management team members.

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“…Managerial ownership serves as a potential mechanism for aligning managers and shareholders (Jensen & Meckling, 1976). Managerial ownership also has a valuedestroying effect by transferring risk to managers and replacing risk-taking (Florackis et al, 2020). Research conducted by Pramukti et al (2019) shows that public ownership positively and significantly affects company value.…”

Section: Introductionmentioning

confidence: 99%

“…01, 2021 Tse, 2016). Other empirical research projects that examine the relationship between risk and firm value are Stulz (2015), Panaretou (2014), Rampini et al (2014), andFlorackis et al (2020).…”

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

The Role of Profitability, Company Size, Capital Structure, and Liquidity Risk on Firm Value of Indonesian Banks

Fauziah¹,

Rafiqoh

2021

OJSMA

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The main objective of any firm is to maximize shareholder's wealth, which can be seen from firm value. This study aims to analyze and explain the effect of profitability, company size, capital structure, and liquidity risk on firm value banking companies in Indonesia. The population of this study is all banking companies listed on the Indonesia Stock Exchange, with an observation period of 2017-2018. The sample selection using a purposive sampling method. Data have both cross-section and time variation. Analysis and hypothesis testing were carried out by using a linear regression analysis using Eviews 11. The results showed that investors viewed that the company's overall profits from its business activities could increase its share price. The capital structure owned by the public relatively small, which meant that the company could provide a source of funds from within the company in the form of the owner's capital or retained earnings. Funds obtained from loans, if they were not followed by the ability to manage funds or were not channeled back to the community, would cause interest expenses and destroy profits. This condition results in investors selling their shares. Investors in making investment decisions paid attention to one indicator at a time and paid attention to all the factors that determined the company's value.

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Idiosyncratic risk, risk-taking incentives and the relation between managerial ownership and firm value

Cited by 18 publications

References 68 publications

Ownership Structure, Firm Value and Mediating Effect of Firm Performance

Ownership Structure, Firm Value and Mediating Effect of Firm Performance

Impact of top executive turnover on firms’ R&D investment: evidence from China

The Role of Profitability, Company Size, Capital Structure, and Liquidity Risk on Firm Value of Indonesian Banks

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