scholarly journals Corporate Opacity and Cost of Debt for Family Firms

2015 ◽  
Author(s):  
Liangbo Ma ◽  
Shiguang Ma ◽  
Gary Gang Tian
Keyword(s):  
Family Firms ◽  
Cost Of Debt ◽  
Corporate Opacity

scholarly journals Corporate Opacity and Cost of Debt for Family Firms

2015 ◽  
Vol 26 (1) ◽  
pp. 27-59 ◽  
Author(s):  
Liangbo Ma ◽  
Shiguang Ma ◽  
Gary Tian
Keyword(s):  
Family Firms ◽  
Cost Of Debt ◽  
Corporate Opacity

Do Family Firms’ Specific Governance Mechanisms Moderate the Cost of Debt?

2018 ◽  
Vol 29 (1) ◽  
pp. 49-63 ◽  
Author(s):  
Antonio Duréndez ◽  
Antonia Madrid‐Guijarro ◽  
Ginés Hernández‐Cánovas
Keyword(s):  
Family Firms ◽  
Cost Of Debt ◽  
Governance Mechanisms ◽  
The Cost

scholarly journals Pound of Flesh? Debt Contract Strictness and Family Firms

2017 ◽  
Vol 42 (2) ◽  
pp. 259-282 ◽  
Author(s):  
David Hillier ◽  
Beatriz Martínez ◽  
Pankaj C. Patel ◽  
Julio Pindado ◽  
Ignacio Requejo
Keyword(s):  
Firm Value ◽  
Lower Risk ◽  
Family Firms ◽  
Lower Cost ◽  
Cost Of Debt ◽  
Agency Conflicts ◽  
Publicly Traded ◽  
Debt Contracts ◽  
Value Maximization ◽  
Debt Contract

While past work finds support for both higher and lower cost of debt among family firms, whether lower shareholder–creditor agency conflicts in family firms translate into greater ex-ante contracting efficiency (i.e., lower debt contract strictness) remains unexplored. Drawing on a shareholder–creditor agency framework and costly contracting theory, creditors, expecting firm value maximization rather than shareholder value maximization from family firms, may offer less strict debt contracts to increase contracting efficiency. We find in a sample of 716 publicly traded U.S. firms (2001–2010) that family firms have less strict debt contracts, which are even less strict when family firms have higher asset tangibility. Although increases in R&D investments could lead to more pronounced shareholder–creditor agency conflicts, given family firms' preferences for lower risk and growth, debt contract strictness among family firms is not positively associated with higher R&D intensity.

Corporate governance mechanisms and cost of debt

2016 ◽  
Vol 31 (3) ◽  
pp. 314-336 ◽  
Author(s):  
Hafiza Aishah Hashim ◽  
Muneer Amrah
Keyword(s):  
Board Of Directors ◽  
Audit Committee ◽  
Family Firms ◽  
Cost Of Debt ◽  
Composite Measure ◽  
Sultanate Of Oman ◽  
Full Sample ◽  
Content Type ◽  
The Board Of Directors ◽  
The Cost

Purpose – The purpose of this study is to determine whether there is any difference in the association among the board of directors, audit committee effectiveness and the cost of debt between the family- and non-family-owned companies in the Sultanate of Oman. Design/methodology/approach – This study uses a panel data set that has multiple observations on the same economic units. Each element has two subscripts: the group identifier, i (68 companies listed on the Muscat Securities Market), and within the group index denoted by t, which identifies time (2005-2011). The regression model of this study is based on the random effects model, which, according to the Hausman and Breusch-Pagan (LM) (Breusch and Pagan, 1980) tests, is an appropriate model. Findings – This study finds that the association between a board of directors’ effectiveness and cost of debt is negative and significant for the full sample and non-family firms. This relationship, however, is weak and not significant for family firms. Additionally, this study indicates that audit committee effectiveness has a significant effect on the cost of debt based on the full sample and family firms, but is not significant for non-family firms. Originality/value – This study examines firms in the Sultanate of Oman, where family ownership control is common. Based on a framework conceptualized according to the agency theory, using data from Oman enables a comparison between family and non-family firms with respect to the effect of the board of directors’ and audit committee’s characteristics as a composite measure. This composite measure captures their combined effect on the propensity of the cost of debt.

scholarly journals Listing status, family firm and the cost of bank loan financing.

2012 ◽  
Vol 9 (2) ◽  
pp. 56-66
Author(s):  
Wan-Ying Lin
Keyword(s):  
Corporate Governance ◽  
Family Firms ◽  
Lower Cost ◽  
Good Governance ◽  
Bank Loans ◽  
Bank Loan ◽  
Cost Of Debt ◽  
Private Firms ◽  
Financing Cost ◽  
The Impact

This research examines the impact of firm’s listing status on the relationship between corporate governance and cost of bank loans. The analysis yields four major findings after controlling for firm characteristics and prime interest rate. First, the financing cost of debt is higher for private firms. This result confirms that information risk is higher for private firms. Second, family firms enjoy lower cost of debt. The result found is consistent with the literature that family firms are related to a lower cost of debt financing. Third, that family firms having lower cost of debt is only found in listed firms. This evidence supports the prediction based on the lack of market perspective which suggests that the family effect requires a capital market to make it substantiate. Finally, strong corporate governance helps reduce financing cost of debt. However, these governance effects are not affected by the listing status. In other words, commercial lenders in this study price indifferently for good governance mechanisms regardless of public or private firms.

Family Firms and Stock Price Crash Risk

2019 ◽  
Vol 10 (4) ◽  
pp. 77-86
Author(s):  
Hae-Young Ryu ◽  
Soo-Joon Chae
Keyword(s):  
Stock Price ◽  
Family Firms ◽  
Crash Risk

What Every Small Business Can Learn From Great Family Firms: The 4C Advantage

IESE Insight ◽  
2015 ◽  
pp. 33-40
Author(s):  
Danny Miller ◽  
Isabelle Le Breton-Miller
Keyword(s):  
Small Business ◽  
Family Firms
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