Public pension fund ownership and firm performance

Jiao, Yawen; Ye, Pengfei

doi:10.1007/s11156-012-0288-x

Cited by 18 publications

(12 citation statements)

References 27 publications

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“…Therefore, the hypothesis H2a cannot be accepted, while the hypothesis H2b is accepted. Our evidence is consistent with Jara-Bertín et al (2012), Jiao and Ye (2013) and Navissi and Naiker (2006), who report an inverted U shaped association between pressure-resistant directors and company value. The findings support the thesis that pressure-resistant institutional directors are an effective mechanism in mitigating agency problems reducing the CEO total pay, but up to a certain critical value, as the incorporation of more pressure-resistant on boards beyond this point will increase the CEO total pay, playing an entrenchment role rather than a monitoring role.…”

Section: Table 4 Correlation Matrixsupporting

confidence: 93%

“…However, when they reach a certain point in terms of increased presence, they perform a monitoring role more effectively, mitigating the potential for other pressure-resistant directors to take part in tunnelling activities (contest hypothesis) and challenging boards and managers to engage in CSR activities as these are essential to boost company performance. These results are in line with Jiao and Ye (2013), who also argue that these two opposite roles are played by pressure-resistant directors in analysing the association between pressure-resistant directors and company value.…”

Section: Table 6 Correlation Matrixsupporting

confidence: 90%

“…Hence, we extend the arguments that support a non-linear association between pressure-resistant directors and firm value to the analysis between pressure-resistant and CEO compensation. Thus, we posit, in line with institutional directors as a whole, that efficient monitoring will result in a negative relationship between pressure-resistant institutional directors and CEO compensation to some extent, but when their presence on boards reaches a certain point, both conflicts of interest and coordination problems may appear between pressureresistant directors, and these may be exploited by CEOs to ensure their own aims are met, for example obtaining greater compensation, since efficient monitoring may be lost, and the CEO may achieve more control and power and may collude with pressureresistant directors (Jiao and Ye, 2013). Accordingly, there might be a non-linear (a U shaped) influence of pressure-resistant on CEO compensation, rather than a linear relationship.…”

Section: H1b: Institutional Directors Influence the Ceo Fix Compensatmentioning

confidence: 99%

“…Thus, previous research displays the ability of these investors to influence on business issues such as firm performance (Jiao and Ye, 2013), debt (García-Meca et al, 2013) or strategic decisons (Neubaum and Zahra, 2006), among others, evidencing the importance that institutional investors are acquiring in corporate governance of companies (Ferreira y Matos, 2008;Gillan y Starks, 2003;Ruiz-Mallorquí y SantanaMartín, 2009;.…”

Section: Introductionmentioning

confidence: 98%

“…Así pues, estudios previos ponen de manifiesto la capacidad de estos inversores en influir en asuntos empresariales tales como el rendimiento de la empresa (Jiao and Ye, 2013), el endeudamiento (García-Meca et al, 2013) o las decisiones estratégicas (Neubaum and Zahra, 2006), entre otros, evidenciando la importancia que los inversores institucionales están adquiriendo en el gobierno corporativo de las empresas (Ferreira y Matos, 2008;Gillan y Starks, 2003;Ruiz-Mallorquí y Santana-Martín, 2009;.…”

Section: Introductionunclassified

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El Consejero Dominical y el Gobierno Corporativo / Institutional Directors and Corporate Governance

Ortells¹

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Section: Table 4 Correlation Matrixsupporting

confidence: 93%

Section: Table 6 Correlation Matrixsupporting

confidence: 90%

Section: H1b: Institutional Directors Influence the Ceo Fix Compensatmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 98%

Section: Introductionunclassified

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El Consejero Dominical y el Gobierno Corporativo / Institutional Directors and Corporate Governance

Ortells¹

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The role of directors representing institutional ownership in sustainable development through corporate social responsibility reporting

Pucheta‐Martínez

Chiva-Ortells

2018

Sustainable Development

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In this paper, we analyze the effect that directors representing controlling shareholders, specifically institutional investors, have on corporate social responsibility (CSR) given that these investors are the core shareholders in civil law countries, owing to their high presence on boards. Thus, we analyze the effect of institutional directors on CSR disclosure, but also the impact of their classification between pressure‐sensitive and pressure‐resistant institutional directors, depending on if they maintain only an investment relationship with the firm or both an investment and a commercial link, respectively. We hypothesize that these directors may perform opposite roles (monitoring or aligning with managers) regarding CSR disclosure. We show a curvilinear relationship between institutional directors/pressure‐resistant directors and CSR reporting, suggesting the two opposite roles mentioned. However, pressure‐sensitive directors do not affect CSR disclosure. These findings indicate that there is an association between board members and strategic decisions. Moreover, our evidence shows that institutional directors do not act in an identical way. Finally, the enhancement of corporate governance depends on the proportion of institutional and pressure‐resistant directors on boards.

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Female Institutional Directors on Boards and Firm Value

2016

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The aim of this research is to examine what impact female institutional directors on boards have on corporate performance. Previous research shows that institutional female directors cannot be considered as a homogeneous group since they represent investors who may or may not maintain business relations with the companies on whose corporate boards they sit. Thus, it is not only the effect of female institutional directors as a whole on firm value that has been analysed, but also the impact of pressureresistant female directors, who represent institutional investors (investment, pension and mutual funds) that only invest in the company, and do not maintain a business relation with the firm. We hypothesise that there is a nonlinear association, specifically quadratic, between institutional and pressureresistant female directors on boards and corporate performance. Our results report that female institutional directors on boards enhance corporate performance, but when they reach a certain threshold on boards (11.72%), firm value decreases. In line with female institutional directors, pressureresistant female directors on boards also increase firm value, but only up to a certain figure (12.71% on boards), above which they have a negative impact on firm performance. These findings are consistent with an invertedU shape relationship between female institutional directors and pressureresistant female directors and firm performance.

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Public pension fund ownership and firm performance

Cited by 18 publications

References 27 publications

El Consejero Dominical y el Gobierno Corporativo / Institutional Directors and Corporate Governance

El Consejero Dominical y el Gobierno Corporativo / Institutional Directors and Corporate Governance

The role of directors representing institutional ownership in sustainable development through corporate social responsibility reporting

Female Institutional Directors on Boards and Firm Value

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