Ownership Concentration and Institutional Quality: Do They Affect Corporate Bankruptcy Risk?

The objectives of this study are to predict bankruptcy risk among SMEs in the hospitality industry for a three-year horizon period and to investigate the factors that are significant in determining bankruptcy. The contribution of SMEs in the hospitality industry is essential as businesses in the hospitality industry are dominated by SME operators. However, the failure rate among SMEs is relatively high and almost 50 percent of hospitality establishments do not survive beyond five years of operation. The Stepwise logistic model was employed to determine significant predictors that could predict bankruptcy for the period of one year, two years and three years before bankruptcy. Return on assets and firm age were found to be significant in all periods while other variables were identified to be important at a specific period prior to bankruptcy. In addition to return on assets and firm age, debt ratio and total assets turnover were found to be significant predictors of bankruptcy one-year prior to bankruptcy. However, in the two years prior to bankruptcy, debt ratio and total assets turnover were no longer important but current ratio, ownership concentration and gender diversity were found to be significant. As for the three years prior to bankruptcy, additional variables namely debt-to-equity ratio and board size were found to be significant, but ownership concentration and gender diversity ceased to be important. The findings of this study contribute to the limited literature in predicting the bankruptcy risk of small firms for a three-year horizon period by providing empirical evidence from SMEs in the hospitality industry of Malaysia.

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Corporate Bankruptcy Prediction in Poland Against the Background of Foreign Experience

e-Finanse ◽

10.2478/fiqf-2019-0002 ◽

2019 ◽

Vol 15 (1) ◽

pp. 10-19

Author(s):

Błażej Prusak

Keyword(s):

Developed Countries ◽

The United States ◽

Bankruptcy Prediction ◽

Corporate Bankruptcy ◽

Bankruptcy Risk ◽

Global Trends ◽

Financial Variables ◽

Selection Of ◽

Scientific Achievements ◽

Corporate Bankruptcy Prediction

AbstractIn highly developed countries, research in the field of bankruptcy risk prediction has been conducted for many years. For example, in the United States, which can be considered a pioneering country, the first publications appeared in the early twentieth century. In Poland, due to political and economic reasons, the interest in this issue dates back to the early 1990s. For this reason, this publication attempts to answer the following questions: 1) What is the level of advancement of the research into predicting bankruptcies of enterprises in Poland? 2) How does it compare to worldwide trends? Therefore, the main aim of this study is to present and evaluate the scientific achievements of Polish authors in the field of corporate bankruptcy prediction and compare them to global trends. Literature analysis was adopted as the research method and shows that initially in Poland only very simple tools were used to assess the risk of bankruptcy of enterprises. With time, however, advanced methods began to be introduced and new models included non-financial variables. Also, research on the selection of the samples was conducted. Currently, the level of research and applied tools do not differ from those used in highly developed countries.

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Relationship non-executive board and ownership concentration with corporate bankruptcy

AFRICAN JOURNAL OF BUSINESS MANAGEMENT ◽

10.5897/ajbm11.2993 ◽

2012 ◽

Vol 6 (16) ◽

Author(s):

Ali Pourkazemi

Keyword(s):

Ownership Concentration ◽

Corporate Bankruptcy ◽

Executive Board

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The Impact of Property Characteristics on Economic Performance of Russian Industrial Enterprises

Voprosy Ekonomiki ◽

10.32609/0042-8736-2005-2-53-68 ◽

2005 ◽

pp. 53-68 ◽

Cited By ~ 3

Author(s):

R. Kapeliushnikov ◽

N. Demina

Keyword(s):

Detailed Analysis ◽

Economic Performance ◽

Ownership Concentration ◽

Corporate Sector ◽

Concentrated Ownership ◽

Industrial Enterprises ◽

Russian Industry ◽

Control Premium ◽

And Performance ◽

The Impact

The paper provides new survey evidence on effects of concentrated ownership upon investment and performance in Russian industrial enterprises. Authors trace major changes in their ownership profile, assess pace of post-privatization redistribution of shareholdings and provide evidence on ownership concentration in the Russian industry. The major econometric findings are that the first largest shareholding is negatively associated with the firm’s investment and performance but surprisingly the second largest shareholding is positively associated with them. Moreover, these relationships do not depend on identity of majority shareholders. These results are consistent with the assumption that the entrenched controlling owners are engaged in extracting "control premium" but sizable shareholdings accumulated by other blockholders may put brakes on their expropriating behavior and thus be conductive for efficiency enhancing. The most interesting topic for further more detailed analysis is formation, stability and roles of coalitions of large blockholders in the corporate sector of post-socialist countries.

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