Major Investments, Firm Financing Decisions, and Long-Run Performance

2006 ◽  
Author(s):  
Ralf Elsas ◽  
Mark J. Flannery ◽  
Jon A. Garfinkel
Keyword(s):  
Financing Decisions ◽  
Long Run ◽  
Firm Financing

The Influence of Regulation Fair Disclosure on Firm Financing Decisions

2010 ◽  
Author(s):  
Susan M. Albring ◽  
Monica L. Banyi ◽  
Dan S. Dhaliwal ◽  
Raynolde Pereira
Keyword(s):  
Regulation Fair Disclosure ◽  
Financing Decisions ◽  
Fair Disclosure ◽  
Firm Financing

scholarly journals CEO-shareholder incentive alignment around SEOs

2015 ◽  
Vol 41 (1) ◽  
pp. 45-66
Author(s):  
Yilei Zhang ◽  
Yi Jiang
Keyword(s):  
Stock Price ◽  
Wealth Effect ◽  
Seasoned Equity Offerings ◽  
Equity Offerings ◽  
Equity Financing ◽  
Compensation Policy ◽  
Incentive Alignment ◽  
Content Type ◽  
Financing Decisions ◽  
Long Run

Purpose – The purpose of this paper is to examine CEO wealth changes around seasoned equity offerings (SEOs) to explore the shareholder-manager incentive alignment in major corporate equity financing decisions. Design/methodology/approach – The authors decompose CEO wealth into three major components: price effect, board compensation grant, and CEO’s own portfolio adjustment. The authors then compare SEO-event sample vs non-event samples; and evaluate the dynamic and long-run CEO wealth effect. Findings – The authors find when market reacts negatively to SEO announcement leading to losses in CEO’s existing firm-related wealth, CEO gets additional grants to offset the losses. Although this appears to be a rent-seeking activity, the authors find that the additional grants are mainly in the form of stock options which would have no value if stock price failed to pick up in the future. In this sense, the additional grants align the interests between shareholders and managers. Consistent with this argument, the authors show that the additional grants motivate CEOs to promote the stock performance, benefiting themselves as well as shareholders in the long-run. Originality/value – The study explicitly calculates the contribution of each wealth component to CEO total wealth effect. The results improve the understanding of CEO compensation policy change after major corporate event and contribute to the literature of the optimality explanation of prevailing compensation policy.

scholarly journals Impact of Financial Signaling and Information Asymmetries of Macroeconomic Covariates on Capital Structure

2019 ◽  
Vol 5 (4) ◽  
Author(s):  
Rana Shahid Imdad Akash ◽  
Iqbal Mahmood ◽  
Kashif Hamid
Keyword(s):  
Capital Structure ◽  
Financial Sector ◽  
Information Asymmetries ◽  
Macroeconomic Policies ◽  
Financial Decisions ◽  
Asymmetry Of Information ◽  
Financing Decisions ◽  
Extreme Bounds Analysis ◽  
Long Run ◽  
Econometric Technique

Present study investigates the existence of macroeconomic variables effect on capital structure and to evaluate the behavioral aspects of financial signaling and asymmetry of information on the non-financial sector of Pakistan. Extreme bounds analysis an econometric technique is used to analyze the robustness of financial signaling and information asymmetry covariates of macroeconomic factorson capital structure policies and to compute the empirical findings.The resultsconclude that interest rate is significantly influencing the decisions of the managers regarding to the composition of long run financing decisions. Hence it is identified that corporate non-financial sector has lesser signaling effect generated by the macroeconomic forces in financial decisions. However the null hypnosis cannot be rejected as this study identified. This study is meaning full and leads toward the practical version of financing decisions by the corporate sectors with the changing policies of the macroeconomic forces in Pakistan. There must be coherence between the macroeconomic policies and corporate sector policies, therefore information asymmetries may overcome.

Firm Financing Decisions

2005 ◽  
Author(s):  
Long Chen ◽  
Xinlei Shelly Zhao
Keyword(s):  
Financing Decisions ◽  
Firm Financing

The profit versus loss heuristic and firm financing decisions

2013 ◽  
Vol 38 (6-7) ◽  
pp. 420-439 ◽  
Author(s):  
Matt Pinnuck ◽  
Chander Shekhar
Keyword(s):  
Financing Decisions ◽  
Firm Financing
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