Multinationals as Vectors of Corporate Governance Improvement in Emerging Economies in Eastern Europe: A Case Study

Albu, Nadia; Lupu, Ioana; Sandu, Raluca

doi:10.1007/978-3-642-44955-0_13

Cited by 6 publications

(3 citation statements)

References 25 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…By implementing OMV's vision, Petrom tried to increase its legitimacy that was negatively impacted by the privatization contract and its unfavourable conditions (Lupu & Sandu, 2017). In an emerging economy characterized by the lack of transparency (Albu & Gîrbină, 2015), Petrom differentiated itself from local practices and it became a benchmark in corporate reporting and corporate governance (Albu et al, 2011;Albu et al, 2014b).…”

Section: Causal Explanations Outcomesmentioning

confidence: 99%

Self-serving performance attributions in the letters to shareholders: A longitudinal case study

Săndulescu¹

2019

JAMIS

View full text Add to dashboard Cite

Research Question: How are post-privatization corporate narratives used by the companies in framing their financial performance? Motivation: This research departs from previous literature that scrutinized the use of narratives in the context of corporate privatizations (Craig & Amernic, 2008). The study adopts a socialpsychology perspective on impression management (Leary & Kowalski, 1990), drawing on the attributional repertoire developed by Aerts ( 2005) in order to analyse the causal explanations of performance outcomes. Idea: This paper relies on the case of OMV Petrom with a view of analysing the evolution of the messages used in framing the success of the company. Data: The letters to shareholders issued by the company from 2005 to 2011 were considered. Tools: A manual content analysis was performed in order to identify the causal attributions of performance outcomes. The enriched self-serving explanatory patterns (i.e. entitlement, enhancement, excuse, justification and causality denial) were evaluated. Findings: The results confirm the use of assertive and defensive tactics in framing performance upturns and downturns. Moreover, the decrease in the financial performance was presented by highlighting the negative influence of external factors which was counterbalanced by remedial actions. Contribution: The paper contributes to the impression management literature by using the context of a forced privatization as a means of providing explanations. The study illustrates the use of additional techniques in framing negative results which may further extend the attributional repertoire developed by previous researchers.

show abstract

Section: Causal Explanations Outcomesmentioning

confidence: 99%

Self-serving performance attributions in the letters to shareholders: A longitudinal case study

Săndulescu¹

2019

JAMIS

View full text Add to dashboard Cite

show abstract

“…The transfers (know-how, staff, and technology) from the parent and its commands usually reshape the organizational structure of the subsidiary and improve its performance (Fey & Bjorkman, 2001;Luo, 2003). In many cases, such subsidiaries are the largest companies in the local economy (Albu, Lupu & Sandu, 2014), thus creating benchmarks for other companies not only in terms of financial performance, but also in regard of corporate governance, including tax discipline.…”

Section: Introductionmentioning

confidence: 99%

Tax-in or Tax-out? Evidence from the relation of financial performance and effective taxation of Czech subsidiaries under foreign control

Procházka

2019

View full text Add to dashboard Cite

The paper evaluates the financial performance of Czech entities under control of companies listed in the EU and its relation to effective tax rates. Using individual corporate data, empirical evidence of 4,917 year-firm observations indicates a wide dispersion both in performance and taxation. The domicile of the parent has an impact on the subsidiary’s effective tax rate and the effective taxation of Czech subsidiaries under control of foreign listed parents is significantly lower than for other Czech companies. Despite exhibiting tax avoidance to some extent, the data reveal significant variability in relative tax rates suggesting that the majority of foreign parents from western and northern EU countries prefer to tax profits in the Czech Republic rather than elsewhere. Shifting profits to the Czech Republic results in superior reporting performance of the affected subsidiaries. In contrast, empirical evidence shows that parent companies from southern EU countries seek ways to avoid taxation. The unclear tax motives of both parent company groups hinder an appropriate assessment of the financial performance of subsidiaries from being conducted.

show abstract

“…Secondly, if a subsidiary is located in a transition country, then transfers and implementation of global business practices from the parent can be expected (Procházka, 2012). The replacement of local practices as well as the emphasis on continuous improving of financial performance can have positive impact not only on a respective subsidiary, but on the whole economy (Albu et al, 2014). However, the results can differ significantly across countries, depending for example on the approach to privatisation selected by particular transition country (Mickiewicz, 2009).…”

Section: Introductionmentioning

confidence: 99%

The impact of ownership and other corporate characteristics on performance of V4 companies

Procházka¹

2017

Journal of International Studies

View full text Add to dashboard Cite

Abstract. The objective of this paper is to assess financial performance of Czech, Hungarian, Polish, and Slovak unlisted companies. The sample retrieved from the Amadeus database contains 171,095 firm-year observations for the period of 2010-2014. A linear regression model (weighted least squares with robust correction for standard errors) is run to regress Return on Assets (ROA) as the dependent variable against selected entity-specific factors, including ownership characteristics. Empirical evidence uncovers several findings. Firstly, the performance of V4 companies is comparable except for Hungary, where companies report lower ROA on average. Secondly, firms established after the failure of communist regimes outperform the privatised companies. Thirdly, the ownership characteristics do matter. Having domestic owners is not a disadvantage, as only the companies with controlling shareholders from the Anglo-Saxon countries perform better. Other jurisdictions of parents lead either to comparable (e.g., old EU members, developed Asian countries) or even worse (e.g., new EU members, post-Soviet bloc) performance as compared to domestic ownership. Similarly, family firms perform significantly better than the companies controlled by institutional owners or by public sector, but worse than the firms controlled by financial institutions. The listing status of a parent is not an influential factor of performance. Fourthly, the size of a company also matters, as small enterprises report better performance in their financial statements than medium and large undertakings. Fifthly, higher leverage undermines performance. Finally, there is a wide dispersion in average performance across the industries. The study results might be relevant for policy makers while choosing between direct and indirect support for diverse types of businesses.

show abstract

Multinationals as Vectors of Corporate Governance Improvement in Emerging Economies in Eastern Europe: A Case Study

Cited by 6 publications

References 25 publications

Self-serving performance attributions in the letters to shareholders: A longitudinal case study

Self-serving performance attributions in the letters to shareholders: A longitudinal case study

Tax-in or Tax-out? Evidence from the relation of financial performance and effective taxation of Czech subsidiaries under foreign control

The impact of ownership and other corporate characteristics on performance of V4 companies

Contact Info

Product

Resources

About