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Biodiversity is important to human's future survival and global sustainability. One way to achieve corporate sustainability is for firms to report its impacts on biodiversity. However, fear of litigation arising from reporting potentially deters corporations to disclose such information. Motivated by the importance of biodiversity and mixed evidence of shareholder litigation rights as a corporate governance tool, we explore whether the universal demand laws (UDLs) have any effect on corporate biodiversity reporting in the United States. Supporting our short‐termism, risk aversion and agency hypotheses, we find that an exogenous decline in the threat of derivative litigation, reducing a chance for shareholders to file a lawsuit against top management and intensifying agency costs, economically and significantly decreases a corporate's biodiversity reporting by 87%. When the disciplining effect of shareholder litigation drops, the self‐interest manager may want to live a quiet life and disclose less information of biodiversity impact. A proactive business strategy to mitigate litigation and reputational risks is to voluntarily disclose more biodiversity‐related information. Regulators around the world should also promote rigorous reporting requirements to reverse biodiversity loss and save our humanity. [ABSTRACT FROM AUTHOR]

As the concept of balancing environmental protection and maintaining sustainable economic development has been widely recognized, the green bond is assuming an increasingly significant role within China's financial market. We utilize the data from China's A-share listed enterprises that issued bonds in the period 2010 to 2021 and try to examine whether and how green bond issuance facilitates the spillover effect of green technology innovation in industry. The results show that: (1) Green bond issuance can generate a spillover effect, greatly enhancing green technology innovation within the industry. (2) The spillover effect of green technology innovation from green bond issuance within an industry is more pronounced for state-owned enterprises, and relatively weaker for enterprises in Northeast China in the same industry. Relative to non-high-pollution industries, high-pollution industries reinforce the spillover effect. (3) Financing cost and agency cost are important influencing mechanisms for green bond issuance to improve peer enterprises' level of green technology innovation. Overall, the results provide theoretical support for encouraging the market for green bonds to maintain their development over the long term and for effectively promoting the transformation of the economy and society to a green and low carbon one. [ABSTRACT FROM AUTHOR]

Stock Prices Crash RiskThe of risk the stock price crash, which indicates the possibility of a sharp and sudden drop in price, is affected by the risk of financial distress, and agency costs intensify this relationship. Empirical investigation of this issue is the aim of the present studyTo achieve the goal of the research, the data of 211 corporations active in the Tehran Stock Exchange were selected during a 10-year period from 2012 to 2021, and multivariate linear regression method and mixed data model were used to test the hypothesis. The findings showed that the risk of financial distress (criterion based on market information) does not increase the risk of stock prices crash. .Also the existence of agency costs does not intensify the relationship between the risk of financial distress and risk of stock prices crash. In addition to this test and additional analyzes showed that the risk of financial distress (criterion based on Altman's accounting information) increases the risk of stock prices crash (criterion of negative skewness of stock returns). Investigating the effect of agency costs on the relationship between the risk of financial distress and risk of stock prices crash and measuring the risk of crash with the two criteria of negative skewness of stock returns and downward volatility, the risk of financial distress with the two criteria of Merton and Altman, as well as adjusting the agency costs of each company. With industry average, research innovation is considered

This paper investigated how hiring one of the Big 4 auditing firms helps initial public offering (IPO) owners attract venture capitalists' (VCs) backing when going public to address the gap in auditing and venture capital literature. For this, the paper examined a large dataset from 1995 to 2019 consisting of 33,536 IPO firms from 22 countries with diverse socioeconomic, political, and cultural contexts. The study found that hiring Big 4 auditors increases IPO owners' chances of recruiting VCs by up to 50%. The analysis also supports prior findings, which state that IPO owners strategically choose Big 4 audit firms to lower agency costs and send quality signals to improve openness and disclosure as well as boost VCs' confidence in the IPO market. This research offers multiple benefits to academics, policymakers, investors, and issuers. [ABSTRACT FROM AUTHOR]

This study investigates the relationship between institutional investor association and stock price crash risk, using data from all listed non-financial sector companies in the Chinese capital market. The findings indicate a significant positive correlation between institutional investor association and stock price crash risk. Moreover, property rights and agency costs play significant moderating roles in this relationship. Specifically, the impact of institutional investors on stock price crash risk is more pronounced in non-state-owned enterprises (non-SOEs) than in state-owned enterprises (SOEs). Furthermore, this impact is more pronounced in firms with high agency costs and prominent agency problems compared to firms with low agency costs. This research contributes to financial regulators being able to identify better and prevent stock price crashes, ensuring the stability of investors' returns from their invested enterprises. [ABSTRACT FROM AUTHOR]

The implementation of the Ecological Conservation and High-Quality Development of the Yellow River Basin (YBCD) can provide the institutional context for economic outcomes of environmental regulations and influences on corporate financial asset allocation. The basic objective of this study is to examine the impact of the YBCD on corporate financialization, analyzing the influencing mechanisms and heterogeneity. Using the data of A-share listed companies spanning 2015 to 2022 in China, this study employs the differences-in-differences method to investigate the impact of the YBCD on corporate financialization. The findings reveal that (1) the YBCD could significantly inhibit corporate financialization and suppress financial asset allocation driven by arbitrage motivation. It will help corporate financial asset allocation shift towards physical businesses, emphasizing long-term development. (2) The YBCD could inhibit corporate financialization by reducing corporate agency costs and fostering environmental, social, and governance (ESG), leading to crowding-out effects on financial assets. (3) The heterogeneity analysis indicates that the YBCD could generate significant inhibitory effects on corporate financialization in non-state-owned enterprises, high-polluting companies, and companies located in regions with stronger environmental regulations. [ABSTRACT FROM AUTHOR]

The agricultural industry in Russia demonstrated a notable growth since 2010. Russian policymakers strive to further increase agricultural production and set new targets for the industry for the years ahead. While agroholdings are regarded as one of the main driving forces behind the recent success in the agricultural sector, they are also believed to be the main locomotive that will move agriculture towards the set goals. In spite of their growing importance, the literature on agroholdings is still relatively immature and fails to provide clear evidence of their financial efficiency as opposed to non-agroholding farms. The current study utilizes a manually sourced longitudinal dataset of 203 corporate farms in Russia and provides a new empirical evidence on the financial performance of agroholding farms through the prism of an agency problem. Our findings reveal a significant positive relationship between agroholding membership and financial performance, as indicated by two accounting indicators – return on assets (ROA) and return on sales (ROS). We further observe that agroholdings face lower agency costs, which to a certain extent, explain their higher financial performance compared to stand-alone farms. The study offers empirical recommendations for policymakers and corporate executives in the Russian agricultural sector.

The food and beverage industry is a vital contributor to Indonesia's economy, yet faces challenges in optimizing performance. This study investigates the impact of operating capacity, agency costs, and intellectual capital on firm performance within this sector. Analyzing financial data from 12 out of 26 listed companies spanning 2018 to 2022, with convenience sampling, panel data regression in EViews 12 reveals significant findings. Higher operating capacity positively influences revenue generation, marketing efficacy, and customer satisfaction. Agency costs serve as incentives for managerial alignment with shareholders' interests, enhancing governance and transparency practices. Intellectual capital fosters innovation, operational efficiency, and brand reputation, driving firm performance. The study underscores the strategic importance of these factors in managing firms within the food and beverage industry. For practitioners, insights gleaned from this research offer guidance in formulating effective strategies to enhance operational capacity, manage agency costs, and bolster intellectual capital. Moreover, investors gain valuable insights into assessing investment opportunities in this sector. Policymakers can utilize these findings to formulate policies conducive to fostering growth and sustainability within the food and beverage industry. By addressing these key determinants, firms can bolster their competitive edge and achieve sustained success in the dynamic landscape of the food and beverage sector in Indonesia.

In 2025, forecasts indicate that Asian companies, especially from China and India, will dominate the IPO market. Understanding global capital cost drivers is essential, particularly as energy sector costs increase. Research highlights that superior accounting information can narrow the investor-management gap, reducing equity and debt. This study investigates the impact of Other Comprehensive Income (OCI) volatility, Research and Development (R&D) investment, and earnings management on cost of capital, considering the potential moderating effect of agency costs. The analysis includes 1,565 observations across 313 firms from 2018 to 2022, focusing on the energy sector in China, India, the United States, and Indonesia. The study uses panel data regression to examine the relationships between OCI volatility, R&D investment, earnings management, and cost of capital, focusing on agency costs’ moderating role. Initial findings reveal that earnings management significantly and negatively influences cost of capital. Further, R&D investments in China and Indonesia show a negative and significant impact on cost of capital, contrary to positive and significant findings in India and the United States. Companies are advised to sustain efficient, future-oriented project selections. [ABSTRACT FROM AUTHOR]

With the increasing public attention being paid to corporate social responsibility and global advocacy of sustainable development, corporate governance issues centered on corporate social responsibility, especially the relationship between corporate social responsibility and financial sustainability, are important topics of concern for managers. By taking companies listed in Shanghai and Shenzhen A-share indices between 2010 and 2020 in China as samples, this study investigated the effect and mechanism of corporate social responsibility implementation on financial sustainability, examined the intermediate roles of agency cost and green innovation on this effect, and explored the heterogeneity in different contexts. The results indicated that: (1) implementing corporate social responsibility has significantly promoted financial sustainability, and fulfilling responsibilities to shareholders showed the most significant effect; (2) active pursuit of corporate social responsibility objectives can alleviate corporate agency conflicts, increase green innovation, and thus promote corporate financial sustainability; and (3) the positive impact of implementing corporate social responsibility on financial sustainability is more significant in non-state-owned enterprises and non-heavily polluting enterprises. This study revealed the specific effect of fulfilling corporate responsibility objectives for different stakeholders on financial sustainability, confirmed the mediating role of agency cost and green innovation on this effect, and discussed the intensity of the impact of fulfilling corporate social responsibility objectives on financial sustainability in different contexts. This study enhances the understanding of the effect and mechanism of fulfilling corporate social responsibility obligations on financial sustainability, which can guide the advancement of future theory-building in corporate governance. [ABSTRACT FROM AUTHOR]

In this study, we explore the impact of ownership structure on a firm's earnings quality in emerging markets. Using the Chinese manufacturing industry sample set, we demonstrate that higher profitability performance could increase earnings quality. Higher concentrated shareholding and institutional shareholding reduce information asymmetry and improve external monitoring, improving earnings quality. Well-studied independent board members do not improve but contribute negatively to earnings quality. Such a result may be due to the lack of variation in the number of independent board members in each list of firms. Almost all firms choose to have three independent board members. Finally, bond debt increases asset size and agency costs; the impact of bond debt on earnings quality is negative. When considering the interaction between bond covenants and external monitoring, including independent board members and institutional shareholdings, the interactive effects reduce the negative effect of the bond debt on earnings quality. This study contributes to discovering that both direct and indirect monitoring of ownership structure contributes to the firm's management and provides some useful insight to reduce agency costs.

This paper examines the impact of debt in the capital structure on agency costs and therefore on the performance of a company. The efficiency of companies was estimated using two parametric techniques: Ordinary Least Squares (OLS) methods and a Stochastic Frontier Analysis (SFA). The estimated efficiency represents a measure of (inverse) agency costs. Agency costs cause a lower level of efficiency compared to companies that have minimized these costs, and companies that reach the efficiency frontier, in the observed context of this research, are viewed as those that have minimized agency costs. A panel regression model was applied in order to determine the direction and intensity of the influence of leverage and control variables on the initially estimated efficiency of the company. The results of this research on Serbian manufacturing companies show the expected positive effect of capital structure (leverage) on the efficiency of the company, which is in accordance with the predictions of the agency cost theory. The contribution of this research is reflected in the application of efficiency as a performance indicator in the observed context of examining the theory of agency costs, bearing in mind that the measure of efficiency is closer to the theoretical view of these costs. [ABSTRACT FROM AUTHOR]

Acquisitions constitute substantial corporate investments, often leading to changes in ownership and top management giving rise to possible conflicts of interest. The impacts of such conflicts following an acquisition are absorbed by the acquirer and are referred to as agency costs. This study focuses on exploring the influence of the target companies on changes in the post-acquisition agency costs of acquiring companies. A panel fixed effects model is used to analyze acquisitions that took place between 2008–09 and 2019–20. The study's findings indicate that post-acquisition changes in the agency costs of acquirers significantly vary based on the presence of domestic and foreign promoters in the target company. Further promoter groups such as domestic promoters and foreign promoters contribute to conflicting interests, exacerbating post-acquisition agency costs. The monitoring role assumed by foreign promoters of target companies plays a pivotal part in reducing the post-acquisition agency costs of acquirers. Foreign promoters also positively influence post-acquisition profitability by adversely affecting operating expenses, suggesting that they mitigate agency costs by exerting control over management through the monitoring of debt, cash, and profitability. The post-acquisition utilization of the target's cash reserves positively correlates with the operating expenses of the acquirer. It is observed that the acquisition of larger targets magnifies agency costs. [ABSTRACT FROM AUTHOR]

An agency problem is defined as a conflict of interest arising due to a misalignment of interests among the managers and other stakeholders of the company. This article aims to review the articles addressing the agency problem and their impact on business performance. This article reviews the contributions of prominent theorists on agency problems and agency costs. Using bibliometric attributes of 740 articles from the Scopus database, this study highlights the publishing trend and outlets, along with leading contributors and collaborators in terms of authors, institutions, and countries. This study identifies the clusters through the bibliographic coupling technique and a trend topics analysis. Most researchers have focused on corporate governance and expressed the agency problem as one of the impact areas. This study is unique as no study to date specifically focuses solely on agency theory or the agency problem through the lens of bibliometric analysis. Future research directions on agency problems and their solutions conclude this study. [ABSTRACT FROM AUTHOR]

Using listed companies from 2010 to 2019 in China, we investigate whether firms engage in opinion shopping activities when firms dismiss the auditors following a goodwill impairment. We find that firms tend to dismiss the incumbent auditors after receiving a goodwill impairment opinion and engage in opinion shopping with their successor auditors. Furthermore, the successor's auditor quality is similar to the predecessor's audit quality following a dismissal. Moreover, firms with low-quality internal control system and low analyst coverage level are more motivated to engage in opinion shopping subsequently after receiving a goodwill impairment opinion. Our findings would be of interest to corporate governance activists, auditors, investors and regulators. [ABSTRACT FROM AUTHOR]

This study is to analyze the effect of dividend policy, good corporate governance mechanisms, and audit quality on agency costs in manufacturing companies that conduct IPOs on the Indonesia Stock Exchange in the 2017-2020 period. In Indonesia, there are many companies that have relationships with agency costs, especially companies whose managers and owners of capital are different, such as companies listed on the Indonesia Stock Exchange (IDX). This research is essentially a form of quantitative research that uses secondary data, namely the company's annual report. This study used a sample of 132 companies in the manufacturing sector. The technique for analyzing the data in this study test a regression model selection test, classical assumption test, multiple linear regression, f test, and individual hypothesis testing (t test). According to the results of data analysis, it can be concluded that dividend policy, audit committee, audit quality, and institutional ownership has no effect on agency costs. In the other hand, independent commissioners have a significant negative effect on agency costs.

ABSTRACTUsing listed companies from 2010 to 2019 in China, we investigate whether firms engage in opinion shopping activities when firms dismiss the auditors following a goodwill impairment. We find that firms tend to dismiss the incumbent auditors after receiving a goodwill impairment opinion and engage in opinion shopping with their successor auditors. Furthermore, the successor’s auditor quality is similar to the predecessor’s audit quality following a dismissal. Moreover, firms with low-quality internal control system and low analyst coverage level are more motivated to engage in opinion shopping subsequently after receiving a goodwill impairment opinion. Our findings would be of interest to corporate governance activists, auditors, investors and regulators.

Objective: In the competitive business landscape, companies seek a distinctive competitive edge by diverging from conventional industry strategies and embracing alternative methods that prove more advantageous. This departure from traditional approaches is termed strategic deviation in accounting literature. According to this, our study aimed to investigate the relationship between strategic deviation and audit quality. In addition, the consequences of choosing high-quality auditors in firms with strategic deviation were investigated, too. In this research, the consequences of choosing high-quality auditors include investigating its effect on earning management, accumulation of capital in the hands of the institutional investors, cost of capital, and market value of listed firms.Methods: The research methodology is characterized as descriptive and correlational, with a practical orientation in terms of its purpose. To test the hypotheses, the regression model was used. Based on this, the financial statements of listed firms for a 9-year period from 2012 to 2019 were examined. In this research, the statistical sample was selected by the systematic elimination method. According to this, 134 firms were selected based on the consolidated/combined data of the test and statistical analysis. For this purpose, five regression models were defined.Results: Firms with high levels of strategic deviance were chosen quality auditors due to controlling the high level of agency conflict. This showed that firms with high levels of strategic deviation have most likely selected quality auditors. Therefore, based on agency theory, it seems that the high level of information asymmetry in firms with high levels of strategic deviation led firms to choose and employ quality auditors. In addition, in firms with strategic deviation, the selection of quality auditors has led to the reduction of the capital cost and the market value. Employing and selecting quality auditors was not found to be effective in limiting capital accumulation in the hands of major shareholders and earning management, especially in firms with high levels of strategic deviation, but audit quality was proved to be effective in explaining the status of firms’ earning management.Conclusion: Firms with high levels of strategic deviation chose quality auditors due to the high level of agency conflict and reducing the firms’ capital costs. In addition, the selection of quality auditors led to a decrease in the market value of the firms. In other words, shareholders are also aware of the effect of strategic deviation of firms in competitive conditions and the possibility of more restrictions in such firms by highly qualified auditors. Also, in firms with strategic deviation, the selection of quality auditors led to limiting the amount of earning management, and the selection of quality auditors led to the reduction of the company's capital cost. In other words, auditor quality, along with strategic deviation, has been an effective factor in reducing a firm’s capital costs.

One of the biggest issues in organization in centuries is problem raised by the relationship between actor inside. This problem called principal-agent problem which explained by principal agent theory (PAT). The emerged new technology disruption called blockchain technology (BCT) receive the challenge to offers the solution for principal agent problem, it claims empirically could reduce or even eliminate the problem, thus lead to lower cost to solved the problem, called agency cost. This technology application wide spread in several sectors, the example is the implementation of Decentralized Autonomous Organization (DAO). DAO is the blockchain based new form of organization, who run based on a smart contract or algorithm run in the computer network. This paper is conceptual paper, we explained about the basic of blockchain, and we analyzed the correlation between blockchain and principal agent theory.

At present, there are few studies exploring the impact of market-based environmental regulation on ESG performance based on the perspective of carbon emission trading scheme (CETS). This paper aims to supplement this research field through empirical analysis. Taking Shanghai-Shenzhen A-share listed companies from 2012 to 2022 as the research object, this paper studies the impact of CETS, a market-based environmental regulation tool, on the ESG performance of enterprises by constructing a time-varying DID model and examines the mediating roles of green technology innovation, agency cost and analyst attention. The results show that the implementation of CETS can significantly boost ESG performance, and green technology innovation, agency cost, and analyst attention play a partial intermediary role between the two, while the mediating effects of green total factor productivity and green total factor energy efficiency are not significant. In terms of heterogeneity analysis, the study shows that CETS implementation has a more substantial promotion effect on ESG performance in non-state-owned enterprises, non-politically connected enterprises and non-high-tech enterprises. In this paper, the robustness test was carried out through PSM-DID, placebo test and replacement of explained variables, and the test results further supported the hypothesis in this paper. This study enriched the research on the impact of market-based environmental regulation on ESG from the perspective of CETS. It provided enlightenment for enterprises to improve ESG performance to a strategic level, improve the level of green technology innovation, and the government to implement differentiated environmental governance policies.

Taking China's A-share listed manufacturing enterprises from 2014 to 2020 as objects, this paper discusses the impact and mechanism of corporate digital transformation on supply chain relationship transactions from the perspectives of information asymmetry and agency costs. The findings show that digital transformation significantly inhibits the supply chain relational transactions; the mechanism testing results reveal that digital transformation is conducive to the alleviation of information asymmetry and agency costs, which thereby reduces the degree of supply chain relational transactions; the regulatory effect analysis demonstrates that the impact of digital transformation on supply chain relationship transactions becomes more significant in non-high-tech enterprises and enterprises with less fierce industry competition. Finally, this paper confirms that a decline in the proportion of supply chain relationship transactions can significantly reduce the operational risk of enterprises. [ABSTRACT FROM AUTHOR]

In this study, we explore the impact of ownership structure on a firm's earnings quality in emerging markets. Using the Chinese manufacturing industry sample set, we demonstrate that higher profitability performance could increase earnings quality. Higher concentrated shareholding and institutional shareholding reduce information asymmetry and improve external monitoring, improving earnings quality. Well-studied independent board members do not improve but contribute negatively to earnings quality. Such a result may be due to the lack of variation in the number of independent board members in each list of firms. Almost all firms choose to have three independent board members. Finally, bond debt increases asset size and agency costs; the impact of bond debt on earnings quality is negative. When considering the interaction between bond covenants and external monitoring, including independent board members and institutional shareholdings, the interactive effects reduce the negative effect of the bond debt on earnings quality. This study contributes to discovering that both direct and indirect monitoring of ownership structure contributes to the firm's management and provides some useful insight to reduce agency costs. [ABSTRACT FROM AUTHOR]

This paper applies the contract theory to study the role of National Development Bank (NDB) in financing infrastructure investment. We first show that to mitigate overrun issues resulting from the agency problem during the infrastructure construction, the government uses mixed financing strategy combining fiscal funding with NDB loans. We then endogenize the NDB investment strategy to study the determinants of NDB profit and use cross-country panel data to empirically test our model predictions. [ABSTRACT FROM AUTHOR]

Purpose: This study aims to investigate the link between debt structure and future external financing and investment, existing empirical literature suggest various features of debt structure such as maturity structure, seniority and security profile might affect firms’ future financing and investment opportunities. However, literature is vague as to which way these characteristics of debt are actually related to observed financing and investment; this is partly due to the fact that the assumptions in theoretical predictions lack in terms of channels they consider relating to debt structure and future external financing and investment. This study investigates how debt structure is associated to financing and future growth opportunities in terms of fund raising, whether debt structure of oil and gas sector of Pakistan. Design/Methodology/Approach: Dynamic analysis were used to analyze the data Findings: The results provide interesting insights, as traditional positive relationship in between short-maturity of debt external financing has revealed negative relation, which is in conflict with existing literature from agency cost but supports the rollover risk. The sector might be better off if it opts out to equity financing, which will open up new investment avenues for future financing and investment. Interestingly secured-debt does not appear to be beneficial owing to differing leveraging patterns within the sector. Implications/Originality/Value: The paper provides new insights in terms of investment and financing patterns particularly in context of maturity structure of debt.

This paper explores the relationship between market concentration, agency cost and firm performance using an unbalanced panel of 1911 publicly listed manufacturing firms in India for the period 2001 to 2020. It classifies firms according to ownership types and evaluates the effects of agency cost and market concentration on performance of firms. The study considers agency costs that result from principal-agent (PA agency costs) as well as from principal-principal conflicts (PP agency cost). Additionally, it shows how the interaction between various concentration indices and agency costs (PP and PA agency prices) affects performance. Using a generalized methods of moments technique to estimate three dynamic models, the study finds that both types of agency costs have a strong negative impact on performance, market concentration has a negative impact but is limited to certain types of firms and the combined effects between concentration and agency cost are strong which shows that an increase in market concentration causes a decline in performance due to an increase in agency cost. Thus, our findings support the prediction that competition acts as a disciplining device to reduce agency costs which in turn helps to reduce managerial slack and improve firm performance. Our study has several policy implications. [ABSTRACT FROM AUTHOR]

Objective: In the competitive business landscape, companies seek a distinctive competitive edge by diverging from conventional industry strategies and embracing alternative methods that prove more advantageous. This departure from traditional approaches is termed strategic deviation in accounting literature. According to this, our study aimed to investigate the relationship between strategic deviation and audit quality. In addition, the consequences of choosing high-quality auditors in firms with strategic deviation were investigated, too. In this research, the consequences of choosing highquality auditors include investigating its effect on earning management, accumulation of capital in the hands of the institutional investors, cost of capital, and market value of listed firms. Methods: The research methodology is characterized as descriptive and correlational, with a practical orientation in terms of its purpose. To test the hypotheses, the regression model was used. Based on this, the financial statements of listed firms for a 9-year period from 2012 to 2019 were examined. In this research, the statistical sample was selected by the systematic elimination method. According to this, 134 firms were selected based on the consolidated/combined data of the test and statistical analysis. For this purpose, five regression models were defined. Results: Firms with high levels of strategic deviance were chosen quality auditors due to controlling the high level of agency conflict. This showed that firms with high levels of strategic deviation have most likely selected quality auditors. Therefore, based on agency theory, it seems that the high level of information asymmetry in firms with high levels of strategic deviation led firms to choose and employ quality auditors. In addition, in firms with strategic deviation, the selection of quality auditors has led to the reduction of the capital cost and the market value. Employing and selecting quality auditors was not found to be effective in limiting capital accumulation in the hands of major shareholders and earning management, especially in firms with high levels of strategic deviation, but audit quality was proved to be effective in explaining the status of firms' earning management. Conclusion: Firms with high levels of strategic deviation chose quality auditors due to the high level of agency conflict and reducing the firms' capital costs. In addition, the selection of quality auditors led to a decrease in the market value of the firms. In other words, shareholders are also aware of the effect of strategic deviation of firms in competitive conditions and the possibility of more restrictions in such firms by highly qualified auditors. Also, in firms with strategic deviation, the selection of quality auditors led to limiting the amount of earning management, and the selection of quality auditors led to the reduction of the company's capital cost. In other words, auditor quality, along with strategic deviation, has been an effective factor in reducing a firm's capital costs. [ABSTRACT FROM AUTHOR]

One of the biggest issues in organization in centuries is problem raised by the relationship between actor inside. This problem called principal-agent problem which explained by principal agent theory (PAT). The emerged new technology disruption called blockchain technology (BCT) receive the challenge to offers the solution for principalagent problem, it claims empirically could reduce or even eliminate the problem, thus lead to lower cost to solved the problem, called agency cost. This technology application wide spread in several sectors, the example is the implementation of Decentralized Autonomous Organization (DAO). DAO is the blockchain based new form of organization, who run based on a smart contract or algorithm run in the computer network. This paper is conceptual paper, we explained about the basic of blockchain, and we analyzed the correlation between blockchain and principal agent theory. [ABSTRACT FROM AUTHOR]

Abstract This article intends to review the theoretical aspects and current research on agency theory. It aims to explore the main ideas, problems, and issues related to agency theory through a survey of the current literature. Agency theory is caused by agency relationships and information asymmetry which causes agency problems and agency costs. This article not only categorizes agency problems into six categories representing various concepts and problems but also solutions offered related to agency theory research over the last five years. This literature survey will enlighten practitioners and researchers in understanding, analyzing, mitigating agency problems, and guiding future research on agency theory. Abstrak Artikel ini bermaksud untuk meninjau aspek teoretis dan riset terkini tentang teori keagenan. Hal ini bertujuan untuk mengeksplorasi ide-ide utama, masalah, dan isu-isu yang terkait dengan teori keagenan melalui survei literatur saat ini. Teori keagenan disebabkan oleh hubungan keagenan dan asimetri informasi yang menyebabkan masalah keagenan dan biaya keagenan. Artikel ini tidak hanya mengkategorikan masalah keagenan ke dalam enam kategori yang mewakili berbagai konsep dan masalah tetapi juga menawarkan solusi terkait dengan riset teori keagenan selama lima tahun terakhir. Survei literatur ini akan mencerahkan praktisi dan peneliti dalam memahami, menganalisis, mengurangi masalah keagenan, dan membantu memandu riset selanjutnya tentang teori keagenan.

This paper aims to examine the effect of dividend regulation on cost stickiness (i.e. the asymmetric change in firm expense between sales increase and sales decrease) and explore the underlying mechanism. Based on the quasi-natural experiment of the Guideline for Dividend Policy of Listed Companies issued by the Shanghai Stock Exchange (SSE) in 2013, the authors employ a difference-in-difference model to investigate the impact of dividend regulation on cost stickiness. The authors find that the cost stickiness of treatment group firms has decreased significantly when compared with control group firms after the dividend regulation. Moreover, this effect is more pronounced among firms in lower marketization regions, in lower competition industries and those with less analyst coverage and lower cash flow levels. Further analyses show that dividend regulation reduces the cost stickiness of firms by mitigating agency problems. Finally, the conclusion holds after several robust tests, including controlling for firm fixed effect, propensity score matching (PSM), placebo test and reconstruction of expense variable. This paper confirms that dividend regulation serves an important role in corporate governance, which reduces firms' agency costs and thereby decreases cost stickiness. The conclusions shed light on the dividend policies of listed companies and capital market regulation in the future.

The impact of digital transformation on green innovation is widely discussed. However, existing studies mainly focus on the impact of the digital transformation of enterprises and fintech company development on environmental green innovation, while ignoring the effect of the digital transformation of commercial banks (DTCB) on corporate green innovation. Therefore, to fill the research gap, this paper explores the impact of DTCB on environmental green innovation in companies based on the data of listed companies from 2010 to 2019. This study finds that DTCB has significantly promoted enterprises' environmental green innovation. Mechanism analysis shows that DTCB can promote green environmental innovation by increasing R&D expenditures and reducing agency costs. The heterogeneity analysis indicates that DTCB can only promote the green environmental innovation of private enterprises and enterprises with a high degree of digital transformation, but it cannot promote the green environmental innovation of state-owned enterprises and enterprises with a low degree of digital transformation. From the perspective of DTCB, this paper enriches the research on the relationship between digital finance and enterprise environmental green innovation. The government should promote the digital transformation of enterprises to utilize the green innovation effect of DTCB. [ABSTRACT FROM AUTHOR]

Given the rapid development of financial technology, the off-balance-sheet business innovations of banks may potentially impact bank risk-taking. This issue is of great importance to commercial banks and financial regulators. This paper analyzed the relationship between off-balance-sheet business innovation (OBI) and Bank Risk-Taking (BRT) in Chinese commercial banks, as well as the mediation role of the Bank Agency Cost (BAC), the impact of a bank's Internal Control Quality (ICQ) on this relationship, and the moderating role of Bank Competition (BCMP) by analyzing panel data from a sample of 130 Chinese commercial banks from 2009 to 2019. The results of this empirical exercise showed that (1) OBI has a significant negative correlation with BRT, evidencing that off-balance-sheet business innovation can improve bank risk management processes and enhance the bank's operating performance, thereby reducing their willingness to transfer risks, restraining the BRT level. Compared with state-owned and joint-stock banks, OBI has a more significant inhibitory effect on BRT in urban and rural commercial banks. (2) BAC showed a mediation role in the relationship between OBI and BRT levels. Bank OBI can inhibit BRT levels by BAC reduction, demonstrating an effective mediation channel. (3) The degree of BCMP displayed a positive moderation effect on the relationship between the explained and explanatory variables, which means that, at higher BCMP levels, the inhibitory effect of OBI on BRT levels becomes more significant. (4) Additionally, this exercise also found that a bank's ICQ can enhance the impact of OBI on BRT. The research contributions of this paper constitute an important theoretical significance and reference value for researchers exploring mechanisms that can improve innovation in the commercial banking industry and give importance to financial supervision and financial system risk control. [ABSTRACT FROM AUTHOR]

Historically, it was common for companies to issue assessable stock. With assessable stock, a company's board of directors could request additional payments beyond the initial stock price. Typically, shareholders forfeited their stock ownership if assessments remained unpaid; defaulted shares were sold at auction. This form of securitization became popular in extractive industries, such as gold and silver mining. In this article, I provide a description of its legal history and a detailed case study of large companies with mining claims on the Comstock lode between 1860 and 1877, considered an exemplar of successful mine development with assessable stock. I also examine several hypotheses used to explain the practice of issuing assessable stock, such as limiting agency and information costs. [ABSTRACT FROM AUTHOR]

The mixed ownership reform aims to improve the property rights structure of the state−owned enterprises (SOEs) and reduce agency costs, and the current mixed reform strategies mainly include equity blending by introducing external non−state capital, executive assignments, and employee stock ownership. In this paper, 953 valid data of A−shares listed in Shanghai and Shenzhen from 2008 to 2020 are used as samples to construct the indicators of mixed reform strategy by the literature statistics method. After obtaining multiple impact indicators, the regression impact model of corporate agency cost suppression strategy is constructed by MATLAB software using a machine learning algorithm. On this basis, the performance of multiple machine learning algorithms is compared, and it is found that the integrated optimization−based bag−boosting model is used to study the effect of hybrid reform strategy to reduce the agency costs of SOEs, and the proportional setting of indicators when the effect is optimal is also explored. Finally, the laws of different influencing factors on the agency costs of enterprises are explored separately by the eigenvalue method. The results of the study show that the proportion of shareholding of the first largest non−state shareholder is sin−functional with the agency costs of SOEs when non−state majority shareholders are introduced into SOEs' equity mix, and the agency costs tend to decrease after SOEs become privately held enterprises. The greater the number and proportion of supervisors appointed by non−state shareholders, the greater the supervisory restraint effect on SOE managers and the better the effect of suppressing agency costs. The participation of non−state−owned shareholders in the company's business decisions by appointed executives and the special resource advantages of SOEs intensify the occurrence of the self−interest of appointed executives and the increase of agency costs of SOEs. The implementation of an employee stock ownership plan plays the role of employee supervision and restraint on SOE managers, which reduces the agency costs of SOEs. Based on this, it can provide support for the government to improve the hybrid reform policy and promote the process layer by layer, and also provide theoretical reference for SOEs to deepen the equity mix, incentivize employee shareholding, and empower non−state shareholders to govern and thus reduce agency costs. [ABSTRACT FROM AUTHOR]

Research background: In the digital era, digital transformation has become a strategic imperative for leadership agenda. Many firms have accelerated their pace in digital transformation to improve their performance and competitiveness. Despite increasing attention in the literature on the role of digital transformation in firms' operations, understanding the effect of digital trans formation on corporate finance remains limited. This study focuses on cash holdings, which are essential for firms to survive and thrive. Purpose of the article: The aim of this paper is to examine the critical role of digital transformation on the cash holdings of listed firms in China and provide micro evidence regarding the economic consequences of the digital economy from firm level. This study also aims to deepen our understanding of the influence of digital transformation on firms' operation and financial policy. Additionally, this paper attempts to provide relevant guidance for implementing policies to promote digital transformation and devise corresponding cash holding strategies. Methods: The text analysis method is used to measure the degree of digital transformation of China's A-share listed companies. The sample covers 19,337 observations from 2007-2020. A multiple regression model with firm and year fixed effect is developed to investigate the relationship between digital transformation and corporate cash holdings. In the robustness test, this paper substitutes the independent and dependent variables, and adopts instrumental variable estimation method. In the mechanism test, this paper uses the sub-sample regression method in the mechanism test. Findings & value added: This study reveals that digital transformation can significantly reduce corporate cash holdings by alleviating the precautionary motive, agency motive and transaction motive of cash holdings. Further analysis shows that the negative effect of digital transformation on cash holdings is more profound in high-tech firms and non-state-owned enterprises. The methodology applied in this paper can be used in other economic research of firms. This study provides insights into the effects of digital transformation on corporate financial policy. This provides a solution for reducing firms' cash holdings. This study also deepens the understanding of digital transformation from a corporate perspective. [ABSTRACT FROM AUTHOR]

By employing the Chinese listed firm's data from 2010 to 2017, this study explores the impact of share pledging on firms' corporate social responsibility (CSR) performance. Empirical results indicate a negative relationship between share pledging and CSR performance. This effect is robust after using alternative measures and different regression methods, and also consistent after tackling the endogenous issues. Furthermore, we find that risk-taking and agency cost are two possible underlying mechanisms through which share pledging reduces CSR. In addition, CSR reduction caused by share pledging leads to poorer economic performance and lower market value of firms. [ABSTRACT FROM AUTHOR]

Purpose - The author examines the role of board structure and institutional investors in dealing with the agency issues for the Indian firms by taking the data of NSE-500 nonfinancial firms for the period 2010–2019. Design/methodology/approach - The author applies dynamic panel data methodology to deal with endogeneity concerns prevalent in corporate finance variables. Findings - The agency view is consistent with the board size in the context of India. The author observed that the board size has a harmful effect on agency cost. A larger board size may create a coordination problem, or CEO may find it easy to thrust his or her decisions on board. The author also noticed that firms should have sizeable institutional ownership, particularly pressure-insensitive investors, in equity as they can reduce agency-related issues. Originality/value - This study focuses on one of the largest emerging economies, i.e. India.

The Environmental, social, and governance (ESG) disclosure is an important aspect of firms’ strategies. Therefore, exploring how to facilitate the firms’ ESG disclosure is necessary. This paper examines the role of multiple large shareholders (MLS, hereafter) in facilitating a firm’s ESG disclosure. Using a sample of Chinese listed firms during 2011–2020, we compare the ESG disclosure of firms having MLS with that of firms having a single large shareholder (SLS, hereafter) and find that having MLS associated with significantly higher ESG disclosure. After addressing endogeneity and altering the measurement of MLS, the benchmark results still hold after. Additional analysis shows that MLS exerts a more prominent positive effect on ESG disclosure in SOEs. We also examine the role of the other large shareholders in facilitating firms’ ESG disclosure. Our findings reveal a bright side of MLS: it facilitates ESG disclosure by monitoring. Therefore, this paper’s conclusion sheds new light on the bright side of MLS from the perspective of firms’ ESG disclosure and provides insights into how to improve ESG disclosure.

The present study endeavours to perform a systematic review of the literature related to the impact of corporate governance on dividend policy in the last two decades. This study uses the systematic literature review process . 143 articles were identified initially and subsequently further narrowed down to 66 most relevant articles for the scope of this study. This paper critically examines the influential studies in the literature related to the impact of corporate governance on dividend policy. The literature review related to corporate governance is analysed from two broad perspectives i.e. (a)Impact of Shareholder protection on dividend pay-out and (b) Impact of Controlling stakeholders on dividend pay-out. Our findings are as follows. Firstly, a vast majority of studies have found a positive relationship between better corporate governance practice and higher dividend pay-out. Secondly, the study finds that the majority of the research has been done in the USA and Europe while limited studies have focussed on emerging markets. Finally, our reviews show that there is a dearth of studies that evaluate the impact of the structural changes in corporate governance in various emerging markets. This study contributes to the extant literature in several ways. It highlights the research gaps in this field and provides a potential agenda for academicians and research organizations for future research.

This study aims to examine the influence of agency costs on financial performance and women on the board of commissioners on the influence of agency costs on financial performance. The sample in this study is a non-financial company listed on the Indonesian stock exchange in 2014-2018. Data analysis was performed using panel data regression. This study indicates that agency costs negatively influence financial performance, and the existence of women on the board of commissioners can reduce the negative influence of agency costs on financial performance. It is indicated that women on the board of commissioners increase the alignment of principals and management. Women in the board of commissioners increase the board's ability to monitor the agent when making the decision, and women have characteristics such as risk-averse, conservatism, and ethics. JEL: G23, G32, J16

As the number of “ownerless” enterprises in China’s capital market increases, so does the importance of paying attention to their behavior. From the perspective of enterprises’ control rights allocation, we find that non-actual controllers can inhibit corporate innovation by intensifying agency conflicts, reducing corporate risk-taking and strengthening financing constraints. We also find that a larger proportion of independent directors, higher audit quality, greater managerial ownership and less environmental uncertainty weaken the negative effect of non-actual controllers on corporate innovation. In contrast, multiple large shareholders strengthen the inhibitory effect of non-actual controllers on corporate innovation, but this inhibitory effect comes from over-supervision rather than from collusion. We further divide non-actual controllers into real and hidden types and find that real non-actual controllers still have a significant inhibitory effect on corporate innovation. Finally, we rule out the competitive explanation of equity dispersion, whereby non-actual controllers inhibit corporate innovation. This study enriches the literature on the factors influencing corporate innovation and provides evidence of the adverse impact of non-actual controllers.

The research focuses on the annual report readability and agency cost of Nigeria's listed deposit money banks. The research aimed to study the connection between annual report readability and agency cost of Nigerian deposit money banks. It used secondary data derived from the annual reports of the selected banks. Two-panel OLS were carried out, along with a correlation matrix and some descriptive analysis. The results were positive, which indicated annual report readability had a significant relationship with agency cost and the study recommends the firms should employ proper procedures when preparing their reports and further research should be done on the topic. [ABSTRACT FROM AUTHOR]

This study aims to determine the effect of readability based on the length of the annual report and the value relevance of the financial information on agency costs. The sample used in this study were 263 firm-year from Kompas100 index. Data were analyzed using multiple linear regression method. The result of this study indicate that the higher the number of pages, words and characters, which reflects the poor readability of the annual report, has a negative effect on the asset turnover ratio, which is an inverse proxy for agency costs. Furthermore, the presence of the analyst coverage variable is able to moderate the positive effect between the number of pages, words and characters in the annual report on the asset turnover ratio. However, no significant effect was found during both test between value relevance to asset turnover ratio and that are moderated by analyst coverage.

The effectiveness of environmental, social, and corporate governance (ESG) performance has been widely discussed and is often linked to corporate financial performance or firm value by academics and practitioners. However, a significant research gap remains unexplored; specifically, prior scholars have ignored path research about the effect of ESG performance on corporate innovation, and they have also ignored the impacts of the heterogeneity of stakeholders. Therefore, taking China's A-share listed companies as an example, the research applied linear regressions with panel data, using the ESG rating of SynTao Green Finance Agency as a proxy variable of ESG performance. The results show that ESG performance significantly promotes the quantity and quality of corporate innovation and is mediated by alleviating the financial constraints and agency cost. Internal and external governance plays different roles; the higher institutional investors' attention as an external governance form does not help enterprises improve the quantity and quality of corporate innovation; however, CEO duality as an internal governance form strengthens the effect of ESG performance on corporate innovation. This study provides scientific evidence for the effect and effect path of ESG performance on promoting proactive innovation based on sustainable development in China; furthermore, the study reveals the heterogeneity factors of ESG performance on the innovation effect under stakeholder theory. [ABSTRACT FROM AUTHOR]

Research Background: The concept of risk is of great importance in any financial system, due to unstable economic situations and fluctuating environmental factors. Like other variables, risk has a significant effect on firms’ returns and profit.

With the development and application of e-commerce in the process of supply chain integration, the choice of supplier centralized strategy or decentralized mode and how to use supplier financing have become significant contents of supply chain management. This study investigates the effect of competition and cooperation on the corporate cash dividend policy under the influence of the supplier relationship strategy and its mediating mechanism based on Chinese data. The motivation of this study is to provide a basis for enterprises to grasp the dynamic evolution process of the economic consequences of supply chain relationships based on big data and adjust the relationship strategy in time to maximize the positive effects of supplier relationships. This study considers supplier concentration and supplier financing as two dimensions to measure the supplier relationship strategy and selects the balanced panel data of Chinese A-share listed companies from 2007 to 2020 as samples by applying the Logit and Tobit model. The results demonstrate that the supplier relationship is negatively correlated with the cash dividends. The intermediary effect found that the competition effect of the supplier relationship aggravates the agency conflict of enterprises and intensifies the degree of financing constraints, and thus acts on the cash dividends of enterprises. This study expands the economic consequences of relational transactions and provides an explanation of dividend policies from the perspective of a supply chain.