Using Put Warrants to Reduce Corporate Financing Costs

The Study of Comprehensive Risk Management and Corporate Finance Constraints

Frontiers in Business, Economics and Management ◽

10.54097/fbem.v2i3.217 ◽

2021 ◽

Vol 2 (3) ◽

pp. 133-135

Author(s):

Qingqing LuoChen ◽

Mengyuan Chen ◽

Jie Liao ◽

Zhongqi Xu

Keyword(s):

Risk Management ◽

Corporate Finance ◽

Developed Countries ◽

Financing Constraints ◽

Theoretical Level ◽

Corporate Financing ◽

The Us ◽

Financing Costs ◽

Finance Constraints ◽

The Relationship

The reasons why companies implement comprehensive risk management and the benefits it can bring to companies have been a subject of academic interest. However, there is still room for further exploration of this topic for the following three reasons: firstly, most of the existing literature is focused on the study of corporate performance and value, and there is less research on the level of corporate financing constraints; secondly, a few papers have initially explored the relationship between the implementation of comprehensive risk management and corporate financing costs, but the research on the intrinsic impact mechanism remains at the theoretical level and lacks empirical testing Finally, comprehensive risk management has been a hot topic in recent years, but most of the literature has focused on developed countries such as Europe and the US, and domestic research is still very limited. Therefore, this paper attempts to empirically test how the implementation of comprehensive risk management affects corporate financing constraints, in the hope that it can complement the existing literature.

Download Full-text

Qualitative Research on Critical Issues In Halal Logistics

Journal of Emerging Economies and Islamic Research ◽

10.24191/jeeir.v1i2.9125 ◽

2013 ◽

Vol 1 (2) ◽

pp. 131 ◽

Cited By ~ 10

Author(s):

Mohamed Syazwan Ab Talib ◽

Lim Rubin ◽

Vincent Khor Zhengyi

Keyword(s):

Capital Structure ◽

Agency Theory ◽

Random Effect ◽

Random Effect Model ◽

Order Theory ◽

Specific Factor ◽

Pecking Order ◽

Pecking Order Theory ◽

Corporate Financing ◽

Financing Decision

This is a preliminary study developed to explore the determinants of capital structure of Shariah-compliant firms listed in Bursa Malaysia. This study is primarily motivated by the issue of the determinants still being inconclusive in the area of capital structure. The study is performed using the static models namely Pool Ordinary Least Square, Fixed Effect and Random Effect Model. Empirical analysis on the determinants reveals that country specific factor which is GDP and sector specific factor which is industry concentration are also significant in influencing the corporate financing decisions in this country along with firm specific factors such as efficiency, bankruptcy risk, profitability, tangibility, liquidity and size of the firm. The findings revealed that results are sensitive to models employed in the study. Nevertheless, the applicability of capital structure theories such as the trade-off theory, agency theory and pecking order theory diverge across sectors in Malaysia. The pecking order theory and agency theory are found to be the dominant theories governing the corporate financing decision in the country as well. It indicates strong evidence of hierarchy practised in firms’ financing decision. The finding on agency theory being dominant justifies the function of short-term debt as a controlling mechanism to mitigate the agency problem arises within firms across sectors.

Download Full-text