Effects of Director and Officer Equity Compensation and Liability Insurance on Corporate Diversification and Performance

2012 ◽  
Author(s):  
Hsin-Yi Chi ◽  
James Jianxin Gong ◽  
Tzu-Ching Weng ◽  
Guang-Zheng Chen
Keyword(s):  
Liability Insurance ◽  
Corporate Diversification ◽  
Equity Compensation ◽  
And Performance

When does corporate diversification matter to productivity and performance? Evidence from East Asia

2003 ◽  
Vol 11 (3) ◽  
pp. 365-392 ◽  
Author(s):  
Stijn Claessens ◽  
Simeon Djankov ◽  
Joseph P.H Fan ◽  
Larry H.P Lang
Keyword(s):  
East Asia ◽  
Corporate Diversification ◽  
And Performance

Geographic and Industrial Corporate Diversification: The Level and Structure of Executive Compensation

2002 ◽  
Vol 17 (1) ◽  
pp. 1-24 ◽  
Author(s):  
Augustine Duru ◽  
David M. Reeb
Keyword(s):  
Executive Compensation ◽  
Ceo Compensation ◽  
Performance Criteria ◽  
Corporate Diversification ◽  
Geographic Diversification ◽  
Compensation Contracts ◽  
Industrial Diversification ◽  
Diversification Strategies ◽  
Ceo Pay ◽  
And Performance

We explore the relation between corporate diversification and CEO compensation. We document that geographic diversification provides a compensation premium, while industrial diversification is associated with lower levels of CEO pay. We also examine the effect of corporate diversification on the structure and performance criteria of CEO compensation contracts. We find that both diversification strategies are associated with a greater use of incentive-based compensation and with a greater reliance on market-based, rather than accounting-based measures of firm performance. Finally, we address the question of whether shareholders reward CEOs for corporate diversification. We document that while value-enhancing geographic diversification is rewarded, non-value-enhancing industrial diversification is penalized.

Corporate Diversification, TMT Experience, and Performance

2010 ◽  
Vol 50 (1) ◽  
pp. 35-56 ◽  
Author(s):  
Deeksha A. Singh ◽  
Ajai S. Gaur ◽  
Florian P. Schmid
Keyword(s):  
Corporate Diversification ◽  
And Performance

Corporate Diversification: Entry, Strategy, and Performance

1984 ◽  
Vol 9 (4) ◽  
pp. 772
Author(s):  
James J. Chrisman ◽  
Charles W. Hofer ◽  
E. Ralph Biggadike
Keyword(s):  
Corporate Diversification ◽  
Entry Strategy ◽  
And Performance

Determinants of Corporate Diversification: Evidence From the Property-Liability Insurance Industry

2011 ◽  
Vol 79 (2) ◽  
pp. 381-413 ◽  
Author(s):  
Thomas R. Berry-Stölzle ◽  
Andre P. Liebenberg ◽  
Joseph S. Ruhland ◽  
David W. Sommer
Keyword(s):  
Insurance Industry ◽  
Liability Insurance ◽  
Corporate Diversification

Corporate diversification and firm performance: an empirical investigation of causality

2018 ◽  
Vol 26 (2) ◽  
pp. 202-225 ◽  
Author(s):  
Aparna Bhatia ◽  
Anu Thakur
Keyword(s):  
Firm Performance ◽  
Causal Relationship ◽  
Simultaneous Equation ◽  
Equation Model ◽  
Product Diversification ◽  
Corporate Diversification ◽  
Content Type ◽  
And Performance ◽  
Diversified Firms ◽  
Index Measure

Purpose The purpose of this paper is to investigate the causal relationship between extent of diversification and performance among Indian companies. The key issue is to find out whether diversification provides irresistible opportunities to increase firm performance or is it the superior profitability that motivates management to diversify. Design/methodology/approach Product diversification is calculated by using Entropy index measure. To measure joint endogeneity of corporate diversification and firm performance, both variables are treated as endogenous in a simultaneous equation model. Findings The results report that the association between diversification and performance turn strongly significant and positive after controlling the issue of endogeneity. The study finds a strong two-way relationship between extent of diversification and firm performance. As indicated by the results, the extent of diversification is positively related to performance, thereby implying that diversified firms experience a significant diversification premium. The study also demonstrates a positive relation of performance and total diversification indicating that good performance leads to greater diversification. Research limitations/implications Certain variables such as R&D intensity, export intensity and risk could not be included in the analysis for want of data. Inclusion of these independent variables could have strengthened the model and its implications. Practical implications The results strongly implicate/recommend the managers of developing countries to adopt the strategy of diversification to overcome institutional inefficiencies prevailing in their domicile environment. Corporate heads must also capture the correct timings/dynamism in environment before pursuing diversification as a strategy of growth. There exists causality between diversification and performance; hence, profitable firms should capitalize synergetic effects of diversification strategy and use it as a medium of growth. Originality/value There was hardly any literature available on causal relationship between diversification and performance with respect to emerging countries. There was even a wider gap specifically in relation to India where none of the researchers has so far studied causality between diversification and performance controlling endogeneity.

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