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on Corporate Finance |
| By: | Quentin Belot Couloumies (UGA - Université Grenoble Alpes); Céline Baud (Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres) |
| Abstract: | Through a longitudinal case study spanning 1965 to 2020, this article scrutinizes the evolution of the influential French Peugeot family's ownership strategies. It elucidates how the family transitioned from industrial management to becoming a significant player in international financial investment. By delving into archival materials and conducting interviews with key executives and family members, this study illustrates the family's adeptness at maintaining control over its industrial empire by associating external financiers and in fine unlocking resources for other lucrative financial ventures. This transformation was facilitated by a sophisticated three-tiered holding structure, which served dual purposes: overseeing capital control and managing private wealth, often through private equity mechanisms. Given the widespread adoption of such financial structures among European corporations and wealthy families, we advocate the need to pierce this "holding veil" to understand capital accumulation transformations for large families in the long run. |
| Keywords: | Capital Accumulation, Holding company, Family ownership, Corporate financialization, Business economics, Governance, Accounting, Sociology of elites |
| Date: | 2025–03–11 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04911536 |
| By: | Soane, Emma |
| Abstract: | Risk influences organisational structures and processes in ways that have consequences for performance and competitive advantage. Prior research suggests actors engage in strategic risk positioning that orients organisations in relation to uncertainty to create beneficial outcomes, including firm survival. Although strategic risk positioning takes place within the social and structural contexts that are established elements of organisations’ systems, the theorising is not integrated. Rather, theorising about organisations’ systems characterises them as comprising strategy, structure, culture, leadership, and high-performance work practices, with different models explaining different elements and their connections with risk. By connecting studies of risk positioning and organisations’ systems, I develop the concept of a risk position that is a consequence of managers’ agentic choices and actions arising from combinations of risk appetite and risk management that create exposure to risk in relation to goals. My analysis shows how the risk position concept provides managers with language and meaning to enable risk positioning that involves intentional shifts in system elements. These shifts create orientations to both risk and goals in ways that enhance performance and competitive advantage. Thus, my modelling contributes to studies of organisational risk and organisations’ systems. |
| Keywords: | risk; organisational systems; strategy; culture; leadership |
| JEL: | J50 G32 |
| Date: | 2025–04–04 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:127665 |
| By: | Yang Jiao (Fanhai International School of Finance, Fudan University); Ohyun Kwon (School of Economics, Drexel University) |
| Abstract: | This paper investigates firm-level linkage between international finance and trade. Specifically, we present evidence that Korean firms rely more on financing in foreign currency if there is a positive export shock. We address the crucial endogeneity problem by capitalizing on South Korea’s as well as its trading partners’ demand shocks. We further show that global supply chains also play an important role as higher imported intermediate input shares induce lower foreign currency debt shares. Our findings point to a firm-level hedging channel and are pertinent to exchange rate policies that aim to reduce a (developing) country’s vulnerability to exchange rate shocks. |
| Keywords: | Trade Shocks, Debt Finance, Currency Composition, Exchange Rate Risk, Global Supply Chains |
| JEL: | F14 F31 G32 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:drx:wpaper:202518 |
| By: | Giulia Canzian; Elena Crivellaro; Tomaso Duso; Antonella Rita Ferrara; Alessandro Sasso; Stefano Verzillo |
| Abstract: | The Covid-19 pandemic caused a global economic crisis, leading governments to provide substantial State Aid to support firms. This paper examines the effectiveness of Covid-related financial support in Spain and Italy, focusing on its impact on firm recovery. Using a difference-in-differences (DiD) approach combined with propensity score weighting, it compares outcomes of similar firms receiving aid to those without. The results show significant benefits for micro-firms, including mitigated turnover declines and increased investments in both tangible and intangible assets. The findings highlight the critical role of government support in business survival and recovery, especially for SMEs, during the pandemic. . |
| Keywords: | State aid, aid effectiveness, temporary framework, Covid, firm growth, investment, difference-in-differences |
| JEL: | D04 D22 L25 L52 P43 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:diw:diwwpp:dp2116 |
| By: | Jun Cui |
| Abstract: | This study explores the impact of entrepreneurial motivations on ESG performance in Chinese stock exchange listed automobile companies. Using quantitative methods and empirical analysis via STATA software, the research examines baseline stability, endogeneity, heterogeneity, and mediation/moderation mechanisms. A sample of 50 firms from the Shanghai and Shenzhen Stock Exchanges 2003 and 2023 was analyzed. Results indicate that entrepreneurial motivations positively influence ESG performance. mediated by innovation capability and moderated by market competition intensity. These findings offer theoretical and practical insights, aligning with Stakeholder and institutional theories. The study provides a robust framework for understanding strategic ESG behavior in Chinas automobile sector. |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2503.21828 |
| By: | Darren Shannon; Jin Gong; Barry Sheehan |
| Abstract: | Public announcement dates are used in the green bond literature to measure equity market reactions to upcoming green bond issues. We find a sizeable number of green bond announcements were pre-dated by anonymous information leakages on the Bloomberg Terminal. From a candidate set of 2, 036 'Bloomberg News' and 'Bloomberg First Word' headlines gathered between 2016 and 2022, we identify 259 instances of green bond-related information being released before being publicly announced by the issuing firm. These pre-announcement leaks significantly alter the equity trading dynamics of the issuing firms over intraday and daily event windows. Significant negative abnormal returns and increased trading volumes are observed following news leaks about upcoming green bond issues. These negative investor reactions are concentrated amongst financial firms, and leaks that arrive pre-market or early in market trading. We find equity price movements following news leaks can be explained to a greater degree than following public announcements. Sectoral differences are also observed in the key drivers behind investor reactions to green bond leaks by non-financials (Tobin's Q and free cash flow) and financials (ROA). Our results suggest that information leakages have a strong impact on market behaviour, and should be accounted for in green bond literature. Our findings also have broader ramifications for financial literature going forward. Privileged access to financially material information, courtesy of the ubiquitous use of Bloomberg Terminals by professional investors, highlights the need for event studies to consider wider sets of communication channels to confirm the date at which information first becomes available. |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2504.03311 |
| By: | Domenica Di Virgilio; Duarte Maia |
| Abstract: | In this paper, the authors introduce a dividend prudential target rule (DPT) à la Muñoz (2021) in a DSGE model, by Clerc et al. (2015), where banks can default, and extend the model by introducing bankers’ preference for dividend smoothing. Both versions of the model - the original by Clerc et al. (2015) and the extension to banker dividend smoothing – shed light on the same transmission channels of the DPT. However, the results are quantitatively more pronounced in the extended version. The results show the beneficial impact of the DPT on bank resilience and in mitigating the credit downturn and supporting the economic recovery in response to shocks, originating either from the financial system or from the real economy. Moreover, the paper shows the existence of complementarities between the DPT and the countercyclical capital buffer (CCyB) in smoothing the credit cycle and in improving the social welfare. Compared to the original version of the model, in presence of the more realistic assumption of bankers’ preference for dividend smoothing the benefits of the synergy between the CCyB and the DPT rule appear to be bigger. |
| JEL: | C53 G21 G28 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ptu:wpaper:w202504 |