This volume is based on presentations delivered at a symposium held in March 2016 at the University of Tokyo. It seeks to reinvigorate the scholarly exchange which can be traced back to the late 19th ...century between company law academics in Germany, China, Japan and South Korea. Contributions from all four jurisdictions include papers on corporate divisions and valuation of shares and its procedure as well as studies on the civil liability of the company and its directors for false financial statements and the corporate law rules on the squeeze-out of minority shareholders.
Since its establishment in 2011, the European Securities and Markets Authority (ESMA) has become a pivotal actor in EU financial market regulation and supervision. Its burgeoning influence extends ...from the rule-making process to supervisory convergence/coordination to direct supervision. Reflecting the now critical importance of ESMA to how the EU regulates and supervises financial markets, and with ESMA at an inflection point in its evolution, particularly in light of the Commission’s 2017 proposals to reform ESMA and the UK’s withdrawal from the EU, The Age of ESMA maps, contextualises, and examines ESMA’s role and the implications for EU financial market governance.
A buying firm might in the future incur costs associated with a supplier’s carbon dioxide emissions, safety violations, or other social or environmental impacts. Learning about a supplier’s impacts ...requires costly effort, but it is necessary (and sometimes sufficient) to reduce those impacts. The capital market valuation of a buying firm reflects investors’ estimate of future costs associated with a supplier’s impacts, as well as any costs that the buying firm incurs in order to learn about and reduce a supplier’s impacts. This paper analyzes a game theoretic model in which a manager—with the objective of maximizing the capital market valuation of the buying firm—decides whether to learn about a supplier’s impacts, how much cost to incur to reduce the supplier’s impacts, and whether to disclose the supplier’s impacts to investors. The investors have rational expectations (e.g., that a manager might withhold bad news about the supplier’s impacts) and value the buying firm accordingly. The paper considers a mandate to disclose information learned about a supplier’s impacts. The paper shows that the disclosure mandate deters learning and thus, under plausible conditions, results in higher expected impacts. The disclosure mandate can result in lower expected impacts only if buying firms face moderately high future costs associated with suppliers’ impacts. In contrast, a disclosure mandate always increases a buying firm’s expected discounted profit and capital market valuation. A disclosure mandate can induce cooperation among buying firms with a shared supplier, yet result in higher expected impacts by the supplier. When a buying firm has alternative suppliers, the disclosure mandate favors commitment to a supplier to facilitate learning about that supplier’s impacts (instead of searching for a lower-impact supplier).
This paper was accepted by Serguei Netessine, operations management.
The recent crisis highlighted the importance of globally active banks in linking markets. One channel for this linkage is through how these banks manage liquidity across their entire banking ...organization. We document that funds regularly flow between parent banks and their affiliates in diverse foreign markets. We show that parent banks, when hit by a funding shock, reallocate liquidity in the organization according to a locational pecking order. Affiliate locations that are important for the parent bank revenue streams are relatively protected from liquidity reallocations in the organization, while traditional funding locations are more extensively used to buffer shocks to the parent bank balance sheets.
► Global banks manage liquidity globally. ► Core funding locations are a source of internal capital markets. ► Core investment locations are a destination for internal capital markets.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UL, UM, UPCLJ, UPUK
Objetivo: O objetivo deste trabalho foi verificar as decisoes de financiamento pelas empresas brasileiras nas crises financeiras de 2002, 2008 e 2015, e identificar os impactos dessas crises, assim ...como a influencia das fontes de financiamento--fontes bancarias, subsidiadas e mercado de capitais--sobre a alavancagem e a maturidade das dividas das empresas nesses periodos. Originalidade/valor: Crises estabelecem oportunidades para o estudo de fatores determinantes e seus impactos sobre as empresas. Nao existem evidencias empiricas sobre os impactos de crises sobre a estrutura de capital de empresas brasileiras levando em consideracao a comparacao entre as crises de 2002, 2008 e 2015, o que motivou o presente trabalho. Design/metodologia/abordagem: Foram feitas analises descritivas e estimadas regressoes por dados em painel. Resultados: Os resultados mostraram relacao estatisticamente positiva entre crises financeiras e alavancagem das empresas, bem como sobre dividas de curto e longo prazos. Com relacao a alavancagem, recursos bancarios, recursos dos mercados de capitais e subsidiados mostraram relacao estatisticamente positiva com o nivel de alavancagem das empresas apenas na crise de 2008. Considerando a maturidade das dividas, a crise de 2002 foi um determinante importante para as decisoes de endividamento de curto prazo das empresas, ante a participacao predominante de recursos bancarios naquele momento. As fontes de financiamento foram importantes na determinacao do endividamento de longo prazo das empresas na crise de 2008. PALAVRAS-CHAVE Estrutura de capital. Crises financeiras. Mercado de credito. Fontes de financiamento. Alavancagem. Purpose: The purpose of this study is to verify the financing decisions by Brazilian companies in the financial crises of 2002, 2008 and 2015, and to identify the impacts of these crises, as well as the influence of the funding sources--banking, subsidized sources and capital markets--on the leverage and maturity of companies' debts in these periods. Originality/value: Crises establish opportunities for the study of determining factors and their impacts on companies. There is no empirical evidence on the impacts of crises on the capital structure of Brazilian companies taking into account the comparison between the crises of 2002, 2008 and 2015, which motivated the present study. Design/methodology/approach: We performed descriptive analyzes and estimated regressions by panel data. Findings: The results showed a statistically positive relationship between financial crises and corporate leverage, as well as short and long-term debt. With regard to leverage, banking resources, resources from capital and subsidized markets showed a statistically positive relationship with the level of leverage of companies only in the 2008 crisis. Considering the maturity of debts, the 2002 crisis was an important determinant for companies' short-term debt decisions, in view of the predominant participation of banking resources at that time. Financing sources were important in determining companies' long-term indebtedness in the 2008 crisis. KEYWORDS Capital structure. Financial crises. Credit market. Funding sources. Leverage.
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CEKLJ, IZUM, KILJ, NUK, PILJ, PNG, SAZU, UL, UM, UPUK
Originalidade/valor: Crises estabelecem oportunidades para o estudo de fatores determinantes e seus impactos sobre as empresas. Nao existem evidencias empiricas sobre os impactos de crises sobre a ...estrutura de capital de empresas brasileiras levando em consideracao a comparacao entre as crises de 2002, 2008 e 2015, o que motivou o presente trabalho.
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CEKLJ, IZUM, KILJ, NUK, PILJ, PNG, SAZU, UL, UM, UPUK
We examine the capital-market effects of changes in securities regulation in the European Union aimed at reducing market abuse and increasing transparency. To estimate causal effects for the ...population of E.U. firms, we exploit that for plausibly exogenous reasons, such as national legislative procedures, E.U. countries adopted these directives at different times. We find significant increases in market liquidity, but the effects are stronger in countries with stricter implementation and traditionally more stringent securities regulation. The findings suggest that countries with initially weaker regulation do not catch up with stronger countries, and that countries diverge more upon harmonizing regulation.
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BFBNIB, INZLJ, NMLJ, NUK, PNG, SAZU, UL, UM, UPUK, ZRSKP
This paper analyzes waves in international capital flows. We develop a new methodology for identifying episodes of extreme capital flow movements using data that differentiates activity by foreigners ...and domestics. We identify episodes of “surges” and “stops” (sharp increases and decreases, respectively, of gross inflows) and “flight” and “retrenchment” (sharp increases and decreases, respectively, of gross outflows). Our approach yields fundamentally different results than the previous literature that used measures of net flows. Global factors, especially global risk, are significantly associated with extreme capital flow episodes. Contagion, whether through trade, banking, or geography, is also associated with stop and retrenchment episodes. Domestic macroeconomic characteristics are generally less important, and we find little association between capital controls and the probability of having surges or stops driven by foreign capital flows. The results provide insights for different theoretical approaches explaining crises and capital flow volatility.
► We develop a new method to identify episodes of extreme capital flow movements. ► Using gross instead of net flows yields very different results than previous work. ► Global factors, especially global risk, are correlated with all types of episodes. ► Contagion through trade, banking and region are correlated with certain episodes. ► Domestic factors are less important. Capital controls do not reduce capital waves.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UL, UM, UPCLJ, UPUK
Using data from 44 countries, we document a new channel through which a family business group’s internal capital market supports its members. We find that groups use internal capital to incubate ...difficult-to-finance projects, making it feasible for them to rapidly scale up, thus facilitating their initial public offering (IPO) market access. This IPO support role is particularly valuable when groups find capital-raising through seasoned equity offerings less attractive because of control-retention concerns and in capital markets with high new-firm financing barriers. Unlike carve-outs employed as a corporate restructuring strategy, group-affiliated IPOs primarily appear to serve a group’s expansion goals rather than its liquidation needs.
This paper was accepted by Gustavo Manso, finance.
This review paper delves into the intricate interplay between capital markets, investor protection, portfolio strategies, and behavioural aspects in investments. The VOSviewer 1.6.19 software is ...utilised to perform a bibliometric analysis and a exhaustive systematic literature review on a sample of 248 papers published in journals in Web of Science databases. Our comprehensive analysis reveals the emergence of key themes, shedding light on the critical role of behavioural finance in shaping investment choices and outcomes. We explore how investor behaviour often deviates from traditional models of market efficiency and how these deviations impact portfolio construction and investment strategies. Our paper contributes to a deeper comprehension of the complexities that drive investment decisions and helps academics, society, investors, and regulators by providing a structured analysis of literature strands. Builds a basis for better regulation and protection of investors in the capital markets, with relevant information for future studies on investor behaviour.
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