New Issue of the Corporate Ownership and Control Journal is Published

The recent issue of the journal Corporate Ownership and Control pays attention to issues of business competition; agency conflicts; capital structure determinants; participative finance; transport governance; socially responsible banks etc. More detailed issues are given below:

Per-Olof Bjuggren, Johan E. Eklund and Daniel Wiberg aim to investigate how institutional investors influence investment decisions and returns on investment. To measure investment performance, authors use marginal q, which measures the ratio of the return on investment to the cost of capital. Institutional owners are found to have a positive but marginally diminishing effect on performance. This paper uses longitudinal data on Swedish firms from 1999 to 2005; during this period, the ownership structure of Swedish firms underwent dramatic changes as institutional investors increased their ownership shares, while ownership by Swedish households decreased.

M.C. Cant reports on Business Plan Competitions, which are a powerful learning tool that can stimulate creativity but more importantly, prepares participants for the real world of entrepreneurship. It can be argued that such competitions reflect the imperative elements of any successful entrepreneurship program by fostering experiential learning, networking, mentoring, partnership with entrepreneurship organisations and community involvement. Globally, there has been an enormous growth in encouraging entrepreneurship and innovation as a means to foster economic health. As this is not the only concern within nations, these Business Plan Competitions are seen to provide a platform for emerging entrepreneurs to learn through actual participation. South Africa, as a developing country, has embraced this platform and has developed its own competitions.

Nomalinge Amelia Pita, Chengedzai Mafini and Manilall Dhurup investigate the association between corporate succession planning practices, internal succession barriers and intentions to leave within a public service in South Africa. The study was inspired by the absence of documented evidence of corporate succession planning initiatives, the barriers to succession planning and turnover intentions of employees in the public sector in the South African context. The study is located within a quantitative research paradigm in which a three-section structured questionnaire was administered to a sample of 243 public service employees. Two factors; namely, replacement planning and employee development/grooming were extracted using exploratory factor analysis. The Pearson correlation coefficient showed that corporate succession planning practices and internal succession barriers are negatively related to intentions to leave in the public service. Regression analysis showed that replacement planning and employee grooming are predictors of intention to quit.

Sang-II Kim, Won-Wook Choi and Ho-Young Lee examine whether or not affiliated firms in Korean chaebols that transformed their ownership structure into a holding company enable creditors to make more independent decisions on the cost of debt than before. Extant studies state that the arbitrary utilization of resources in affiliated firms by influential majority shareholders within a conglomerate group may result in additional entrenchment of their minority shareholders within affiliated firms. Korea’s holding company system may improve the independence of affiliated firms’ financing decisions because it restricts circular and horizontal equity investments among affiliated firms, thus considerably blocking the propping channel in a conglomerate group.

Flávio C. Sanematsu and Ricardo P. C. Leal investigate the behavior of equity mutual funds at calendar semester ends in Brazil between 2004 and 2013. Results suggest that the sampled funds present positive abnormal returns on the last trading day of calendar semesters, followed by negative abnormal returns on the subsequent day. Funds oriented to retail investors and those that charge incentive fees are more likely to display this abnormal return behavior. Exclusive funds present the smallest incidence of abnormal returns. There seems to be evidence of portfolio pumping.

Majed Alharthi estimates efficiency and its determinants in 190 Islamic (IBs), conventional (CBs), and socially responsible banks (SRBs) in 22 countries during the period 2005-2012. The study first uses non-parametric approaches to estimate the efficiency measures (scale efficiency (SE), technical efficiency-constant returns to scale (CRS), and technical efficiency-variable returns to scale (VRS)) and second employs ordinary least squares, fixed effects, random effects, and TOBIT models to get the efficiency determinants. The findings indicate that the average efficiency is 0.966, 0.952, and 0.983 for the SE, CRS, and VRS, respectively.

Kelly Chan examines the improvement in multiple-based valuations from using a composite of price to earnings (P/E) and price to book (P/B) ratios and firm-specific regression-based weights. The results support that composite benchmark multiples lead to improved valuations over single multiples and further improvement is achieved by incorporating firm characteristics to derive firm-specific regression-based weights. The unrestricted regression-weighted composite multiples perform better than other approaches in predicting year one to year three share prices.

WJ (Wessel) Pienaar identifies and describes the most commonly used rail freight wagons for commercial purposes internationally. The investigation has indicated that subsequent to the economic deregulation of freight transport, there are nine rail wagon types manufactured and commonly used internationally. They are: (1) covered wagon/van; (2) refrigerated wagon/van; (3) flat wagon; (4) tank wagon; (5) container wagon; (6) open wagon; (7) hopper wagon; (8) side stanchion and centre partition wagon; and (9) motorcar wagon.

Ntoung A. T. Lious, Huarte G. Cecilio and Puime G. Felix show that leverage is positively and statistically significant with size, non-debt tax shield and industry-effect. The findings illustrate that profitability; growth opportunity and volatility are negatively and statistically significant with the debt issues on the balance sheet of these public traded firms. The authors discuss the extent to which these results are consistent with empirical evidence illustrated by prior studies with reference to the 2008 financial crisis.

Adil ELFakir and Mohamed Tkiouat test whether PLS contracts are representative of a prisoner’s dilemma game. The authors have identified different parameters which are used to calculate the payoffs of the bank and the enterprise which seeks financing. Each agent in this simulation has some strategies that he/she can use through the game.

To access papers in the issue follow this page.