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Objective: All developed and developing countries emphasize the importance of human resource efficiency in companies as one of the necessities in economic development and gaining competitive advantage in the international arena. Nowadays, thanks to the approval of various laws, the issue of labor force protection has been widely spread worldwide, including in Iran, and it is expected that such protection for the labor force improves the efficiency of the investment of human resources in companies. Based on this, the main purpose of the current research is to investigate the relationship between labor protection and labor investment efficiency in companies listed on Tehran Stock Exchange, taking into account the role of state ownership. Method: This research is an applied study and post-event type. All the companies listed on the Tehran Stock Exchange constitute the statistical population. The statistical sample includes 141 companies that were investigated from 2017 to 2021. In this research, the data was extracted through the 3rd edition of Rahvard Navin software; then, variables were summarized, classified and in some cases calculated using Excel software, and finally the research hypotheses were tested through Eviews software version 10, an econometric software. According to the objectives of this study and the existing theoretical and experimental literature, the research hypotheses are designed as follows: First hypothesis: A significant relationship exists between labor protection and investment efficiency. Second hypothesis: State ownership leads to a more prominent relationship between labor protection and labor investment efficiency. It should be noted that to test the research's first hypothesis, the multivariable regression model is used as follows. Also, to test the second hypothesis, regression model 1 is examined separately for state ownership in two stances of more than the median and less than the median. Ab_Net_Hireit = β0 + β1D_LaborIntit + β2BMit + β3ROAit + β4LnSizeit + β5Quickit + β6Tangibleit + β7Levit + β8Std_CFOit + β9St_Salesit + β10Std_Eit + εit (1) In the above model, Ab_Net_Hire indicates the labor investment efficiency, D_LaborInt indicates labor protection, MB indicates book value to market value, ROA indicates the return on assets, LnSize indicates the size of the company, Quick Indicates the quick ratio, Tangible indicates tangible assets, Lev indicates financial leverage, St__CFO indicates the standard deviation of cash flows, Std__Sales indicates the standard deviation of sales and Std_E indicates the standard deviation of the number of employees. The independent variable of this research is labor protection, which was measured using a dummy variable based on labor intensity. First, the annual median of the ratio of employees to the company's fixed assets in the industry is considered a criterion. If the labor intensity of a sample company is greater than the annual median of the industry, it takes the value of one; otherwise, it takes zero. Also, labor investment efficiency is the dependent variable of this research, which is measured according to Pinnuck and Lillis's (2007) model. The moderating variable of this study is state ownership, which was used as the percentage of state ownership from the total shares held by governmental and quasi-governmental organizations. Following Gao et al. (2021), it divides into the upper median (state companies) and less than the median (non-state companies). It should be noted that in this work, the variables of book value to market value, return on assets, company size, current ratio, tangible assets, financial leverage, standard deviation of cash flows, standard deviation of sales and standard deviation of the number of employees were used as control variables. Results: This research showed a negative and significant relationship between labor protection and the companies' labor investment efficiency at the 95% confidence level. Improving the protection of the labor force leads to a decrease in the efficiency of human capital investment of companies on the Tehran Stock Exchange. Also, the results at the level of each state and non-state companies also showed a negative and significant relationship between labor protection and the companies' labor investment efficiency. Therefore, it can be said that state ownership leads to the highlight of the negative relationship between labor protection and labor investment efficiency. Conclusion: The research results indicate that labor protection has different economic consequences for transforming human capital structures in companies and can reduce the efficiency of human capital investment. Considering this issue, it is suggested that companies pay more attention to making decisions regarding employment to prevent inefficient human resource use by protecting the labor force. Also, investors and capital market analysts are suggested to pay attention to labor protection in addition to financial variables when making investment decisions and include it in their decision-making models as an effective factor in reducing the companies' labor investment efficiency. [ABSTRACT FROM AUTHOR]

Purpose: Existing research on uncertainty and bank lending has focused entirely on aggregate uncertainty (i.e., economic policy uncertainty) and its subcomponents, but not considering other uncertainty measures from the specific perspective of financial markets, especially the banking sector. The paper tests the influence of uncertainty on loan growth using bank-level data in Vietnam during 2007-2019. Design/methodology/approach: The paper focuses on a new uncertainty measure in banking computed by the dispersion of shocks to key bank-level variables. The study also fixes the issues of potential endogeneity bias by using dynamic panel models with the generalized method of moments (GMM) estimator. Findings: Uncertainty in banking hampers loan growth. The adverse influence of uncertainty on lending is more pronounced for banks that are smaller, more poorly capitalized, less liquid, riskier, and less profitable. In addition, the paper also provides evidence that bank lending under uncertainty is not moderated by bank ownership, i.e., the paper does not find a discrepancy in the banking uncertainty-bank lending nexus between state-owned banks and private counterparts. Research limitations/implications: Regulatory bodies should enhance their scrutiny concerning uncertainties within the banking sector, recognizing their potential to adversely affect bank lending, a critical catalyst for fostering economic activity. Simultaneously, it is imperative to implement concurrent policies aimed at mitigating the deleterious consequences of uncertainty in bank lending. Originality/value: First, this paper is interested in an emerging market, given that the evidence from emerging markets has remained remarkably scarce. Second, this paper approaches the banking sector's uncertainty and assesses its link with bank lending. Third, this study contributes to the literature by investigating the nuanced conditions influencing the impact of uncertainty through an extensive array of moderating factors. Interestingly, this paper is the first to examine the conditional role of state ownership thus far.

Purpose – Using imbalanced panel data of nonfinancial Vietnamese listed firms from 2005 to 2021, this paper explores the potential effect of ownership on firms' cash levels. Design/methodology/approach – Two hypotheses are tested using different methods, including pooled ordinary least squares (POLS) and system-generalized method of moments (GMM), to investigate the ownership–cash holding relationship for various firm scenarios. Both book and market measures of the cash ratio are examined. Findings – Results show that foreign and state ownership encourages firms to increase their cash reserves. The positive relationship between ownership and cash holding is, especially, pronounced for firms in the financial deficit. Research limitations/implications – This research suggests that in this emerging market, outside ownership substantially accelerates cash to hedge against the unexpected issues caused by poor investor protection, low political accountability and information asymmetry. Originality/value – The study contributes to the existing understanding of the relationship between ownership and corporate cash holdings in the context of a typical emerging market. Besides, it expands the existing knowledge to the extent of such relations in the event of a financial shortage.

Although emerging market multinational enterprises (EMNEs) face substantial liabilities of origin (LoO) that hinder their global expansion, under-researched is whether trust-building with foreign partners in host markets can help them reduce these liabilities and enhance their subsidiary performance. Drawing on the relational exchange view and institutional theory, our study examines how interfirm trust affects EMNEs' subsidiary performance in host countries, and how this effect is moderated by factors reflecting the regulative, normative, and cognitive institutional pressures that confront EMNEs in host countries. The results from a survey of 146 senior managers of overseas subsidiaries of Chinese multinational enterprises show that interfirm trust is positively related to subsidiary performance, and this positive effect is stronger when host countries' legal systems are deficient but financial markets are munificent, and when EMNEs partner with state-owned foreign firms or possess rich international experience. [ABSTRACT FROM AUTHOR]

In this paper, we identify product market competition as a driver of privatization. Using product market shocks caused by trade liberalization of China, which has the world's largest state sector, we find that subjecting state-owned enterprises (SOEs) to higher competition leads to an increase in private ownership. This response is strengthened when SOEs operate in industries with large technology or productivity gaps from those in the frontier economies or when SOEs impose large fiscal burdens on local governments. Our findings are consistent with politicians' incentives to boost economic growth for better career development and to shed burdens when rents decrease. This paper was accepted by Tomasz Piskorski, finance. Funding: C. Lin acknowledges financial support from the National Natural Science Foundation of China [Grant 72192841]. Q. Hu acknowledges financial support from the Fundamental Research Funds for the Central Universities and the Renmin University of China [Grant 21XNF002]. W. Li acknowledges financial support from the Major Project of the Ministry of Education [Grant 22JZD007] and the National Natural Science Foundation of China [Grant 72132002]. L. Wei acknowledges financial support from the Research Grants Council, University Grants Committee [Grant 13501619]. Supplemental Material: The data files and online appendix are available at https://doi.org/10.1287/mnsc.2023.4847. [ABSTRACT FROM AUTHOR]

Green innovation plays an increasingly significant role in sustainable development. We use the data of Chinese listed firms from 2010 to 2019 to investigate the impact of investor sentiment on corporate green innovation. The result indicates that optimistic investor sentiment significantly promotes corporate green innovation. Mechanism analysis shows that the higher the financial constraints, institutional ownership ratio, and analyst coverage of a firm, the stronger the impact of investor sentiment on green innovation, indicating that optimistic investor sentiment promotes green innovation through external financing and managerial catering channels. In addition, the impact of investor sentiment on corporate green innovation is more pronounced for state-owned firms. The study sheds light on a novel determinant of corporate green innovation and offers policy recommendations to advance green innovation, environmental protection, and sustainable development. [ABSTRACT FROM AUTHOR]

Objective: This study analyzes the impact of free cash flow and state ownership on the Earnings Response Coefficient (ERC) in the Brazilian capital market. Method: A sample of 210 companies from 2011 to 2019 was obtained from the Economatica database, with the Earnings Response Coefficient being the dependent variable, free cash flow and state control being the main independent variables, in addition to control variables, which were analyzed using panel data regression with the Pooled Ordinary Least Squares (POLS) method. Results: The results show that free cash flow accounting information has relevant marginal implications on the earning response coefficient and state ownership. The interaction between free cash flow and state ownership reinforces that increases in unexpected earnings are due to the presence of these two elements. Contributions: The findings contribute to the literature on emerging markets by reporting that free cash flow (accounting data) and state monitoring (governance aspect) are informative items for the earnings response coefficient. Consequently, this can improve investors' financial analysis and company evaluation process and make managers pay attention to the effects of the decision to maintain cash surpluses. Therefore, it allows these stakeholders to understand that the existence of available resources (free cash flow) in a business indicates prospects of future earnings. [ABSTRACT FROM AUTHOR]

AbstractThe Chief Executive Officer (CEO) is pivotal in firm governance and is tasked with policy implementation and maximizing shareholder benefit. However, predicting CEO behaviour remains challenging, especially when considering CEO power (CEOP). Hence, this study explores the link between CEOP and firm risk-taking (FRT) in selected firms on the stock market in Vietnam from 2010 to 2020. Utilizing the Entropy weight methodology, a CEOP index combines structural, ownership, and expert power indicators. The SYS-GMM approach mitigates potential endogeneity issues, revealing a positive correlation between CEOP and FRT. Interestingly, CEO risk aversion increases in state-owned firms’ participants, suggesting heightened supervision. Moreover, each characteristic of the CEOP index uniquely influences FRT. The findings offer theoretical and practical insights for enhancing governance and supervision mechanisms to optimize stakeholder benefits.

Objective: This study empirically examines the impact of ownership structure on the financial performance of listed airlines in Africa. Design/Methods/Approach: The research utilized quantitative techniques to collect secondary data from listed airlines over ten years (2010-2019). Descriptive statistics and multiple regression were used for analysis. Findings: The results revealed that airlines with the majority of private domestic and private foreign ownership showed a significant positive effect on financial performance (ROA and ROE). In contrast, state ownership had an insignificant impact on airlines' financial performance. The study supports the property rights theory, emphasizing the importance of private ownership in airlines. Originality/Value: This study adds to the existing literature by providing evidence on how ownership structure influences financial performance in African airlines, contributing to aviation research. Practical/Policy Implication: The findings suggest that private and foreign investors should consider acquiring controlling airline stakes to enhance financial performance. Policymakers should aim to create flexible laws and regulations that attract domestic and foreign private investors to the aviation sector, potentially fostering improved management practices and policy developments.

Objective: This study empirically examines the impact of ownership structure on the financial performance of listed airlines in Africa. Design/Methods/Approach: The research utilized quantitative techniques to collect secondary data from listed airlines over ten years (2010-2019). Descriptive statistics and multiple regression were used for analysis. Findings: The results revealed that airlines with the majority of private domestic and private foreign ownership showed a significant positive effect on financial performance (ROA and ROE). In contrast, state ownership had an insignificant impact on airlines' financial performance. The study supports the property rights theory, emphasizing the importance of private ownership in airlines. Originality/Value: This study adds to the existing literature by providing evidence on how ownership structure influences financial performance in African airlines, contributing to aviation research. Practical/Policy Implication: The findings suggest that private and foreign investors should consider acquiring controlling airline stakes to enhance financial performance. Policymakers should aim to create flexible laws and regulations that attract domestic and foreign private investors to the aviation sector, potentially fostering improved management practices and policy developments. [ABSTRACT FROM AUTHOR]

The level of state ownership in corporations is still a controversial topic because of its duality: on the one hand, it brings resource advantages, and on the other hand, it causes agency problems. Thus, our study aims to investigate the relationship between state ownership and corporate performance within the Vietnamese context, unraveling the impacts of state ownership's non-linear and provincial business environment. Analyzing financial data spanning over a decade from 359 listed corporations on the Vietnamese stock markets (2010–2021), our empirical findings derived through the General Method of Moments (GMM) reveal that state ownership emerges as a potent "strategic asset" with a positive influence on corporate performance. However, a critical point is identified when state ownership surpasses the threshold of 32 percent and a decline in corporate performance ensues—a confirmation of an inverted U-shaped impact. These results substantiate the necessity of the equitization process and underscore the imperative of judiciously managing state ownership in Vietnam. Notably, our study unveils a more critical dimension: the enhanced provincial business environment bolsters corporate performance and amplifies the positive impact of state ownership. Thus, a strategic dual approach is suggested to improve corporate performance: improving the business environment and recalibrating the percentage of state shareholders. Our study serves as empirical evidence, referencing Vietnam and other transitional economies, toward mannerly policy decision-making related to state ownership and the business environment to boost corporate performance. [ABSTRACT FROM AUTHOR]

In a 2010 special report, The Economist magazine termed the resurgence of state-owned, publicly listed enterprises "Leviathan Inc." and criticized the poor governance and low efficiency of these firms. We compile a new comprehensive data set of state ownership of publicly listed firms in 44 countries over the period of 2004–2017 and show that state-owned enterprises are more responsive to environmental issues. The effect is more pronounced in economies lacking energy security and strong environmental regulation, and among firms with more local operations and higher domestic government ownership. We find a similar effect on corporate social engagement but not on governance quality. These results suggest a different role for "Leviathan Inc.," especially in dealing with environmental externalities. This paper was accepted by Colin Mayer, Special Section of Management Science on Business and Climate Change. Funding: H. Liang acknowledges the DBS Sustainability Fellowship from Singapore Management University. P.-H. Hsu acknowledges the fellowship from the Batten Institute of Darden School of Business of the University of Virginia and the financial support from the E.SUN Academic Award and Ministry of Science and Technology and Ministry of Education in Taiwan [Grants MOST108-2410-H-007-099-MY2, MOST109-2628-H-007-001-MY4, MOST109-2634-F-002-045, MOE109J0321Q2, and MOE109L900202]. P. Matos acknowledges financial support from the Richard A. Mayo Center for Asset Management at the University of Virginia's Darden School of Business. Supplemental Material: The data files and online appendix are available at https://doi.org/10.1287/mnsc.2021.4064. [ABSTRACT FROM AUTHOR]

This paper addresses the effects of state ownership on decisions of port development companies, through a case study of Port of Rotterdam (PoR). This issue is relevant, given the economic impact of port development and the important role of ports in the transition towards a more sustainable economy. The insights from this case study thus can be useful for shaping port (governance) reform. The paper reviews the rationale for state ownership of the port development company, and describes the case of PoR, focused on the public interests that the public shareholders aim to promote through ownership, and mechanisms through which the consideration of the public interests is incorporated in PoR's decisions. The following conclusions are drawn. First, the two public shareholders of PoR (the city of Rotterdam and the Dutch state) have made an explicit choice to 'permanently' use state ownership to achieve public interests. Second, PoR's shareholders have identified specific public interests and have developed specific mechanisms to secure that PoR takes these public interests into account in decision-making. Third, there are clear indications that PoR's decisions indeed have advanced the public interests as identified by the shareholders. [ABSTRACT FROM AUTHOR]

Announcements of corporate misconduct can trigger negative market reactions. However, our understanding of mechanisms that shape variations of investors' responses across different disclosed-firms is underdeveloped. From the legitimacy theory perspective, this study focuses on the impact of state ownership on market reaction to misconduct announcements. Using a sample of misconduct announcements of Chinese listed firms from 2010 to 2021 and employing a combination of an event study method and a Heckman two-stage model, this study finds that market reaction to misconduct announcements is weaker if state ownership of the disclosed firm is larger. Furthermore, the affiliation level of SOEs (central SOEs versus local SOEs) weakens the positive association between state ownership and market reaction. The main positive effect is strengthened when the disclosed firms are located in regulated industries. [ABSTRACT FROM AUTHOR]

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AbstractThis study examines the impacts of powerful CEOs and state ownership on commercial banks’ corporate social responsibility (CSR) in Vietnam, a transitional market in Asia. Given the differences between emerging and developed markets in terms of their institutions and governance, it is essential to explore the impact of CEO power on CSR disclosure in emerging markets. This study collects data from 37 Vietnamese commercial banks from 2010 to 2020. We employ a dynamic system Generalized Method of Moments to overcome endogeneity and heterogeneity issues. The findings show that powerful CEOs negatively reduce CSR programs. CEO power tends to focus less on CSR investments because CSR expenses reduce the operating free cash flow. Meanwhile, our findings indicate a positive relationship between state ownership and CSR developments. This study reports a moderating role of state ownership in empowering powerful CEOs to develop CSR programs in commercial banks. We also perform a robustness test to confirm the persistence of our main findings across subsamples by CEO ages. Our robustness test results indicate that CEOs have the lowest motivation to improve CSR when their ages are from 40 to 60. Our findings align with agency theory, stakeholder theory and prior literature. Finally, our study contributes practical implications for management and policymakers to develop CSR programs sustainably.

Prior research on the relationship between financial resource availability and corporate social responsibility (CSR) has presented contrasting theoretical arguments and evidence. While the relationship has been theorized to be positive in developed countries, it has been argued to be negative in emerging economies due to institutional differences. However, prior theorization in the context of emerging economies has failed to consider the possibility of a non-monotonic relationship between financial resources and CSR. Although due to the high costs of obtaining external finance in emerging economies, firms may choose to prioritize capital retention over engaging in CSR activities when financial resource availability is low, this behavior is likely to change beyond a point when the level of available financial resources has crossed a reasonable threshold. In this paper, we develop this perspective and predict a U-shaped relationship between financial resource availability and CSR in emerging economies. We test and find support for this prediction on a sample of the top 500 listed firms in India. Further, we also predict and find that three dominant ownership structures (i.e., family ownership, business group affiliation, and state ownership) differentially condition this relationship. [ABSTRACT FROM AUTHOR]

Drawing on organizational learning theory and taking an institutional perspective, this study investigates (1) the dynamic relationship between internationalization and innovation in emerging market enterprises (EMEs), and (2) how state ownership moderates the focal relationships. Using a panel dataset of listed Chinese firms from 2007 to 2018, we find that internationalization encourages innovation input in EMEs, which in turn transforms into more innovation output. Higher innovation output leads to further international commitment, creating a dynamic upward spiral of internationalization and innovation. Interestingly, state ownership positively moderates the innovation input-innovation output link but negatively moderates the relationship between innovation output and internationalization. Our paper enriches and refines our understanding of the dynamic relationship between internationalization and innovation in EMEs by integrating the knowledge exploration, transformation, and exploitation perspectives, with the institutional perspective of state ownership. [ABSTRACT FROM AUTHOR]

AbstractThis study examines the effect of the characteristics of the board of directors (BOD), the characteristics of the sharia supervisory board (SSB), and state ownership on CSR disclosure (CSRD) of Islamic commercial banks (ICBs) in Indonesia for the 2008–2021 period. The estimation results for the Generalized Least Squares model show that the presence of women in the BOD and SSB as well as the frequency of the two boards’ meetings play an important role in increasing CSRD. In addition, the interaction variables between age and tenure of the chairman of the SSB and state ownership have a positive effect on CSRD. This study contributes to the development of the corporate governance and Islamic corporate governance literature. In addition, it provides insight for practitioners regarding the main factors that influence the CSRD of ICBs in Indonesia.

This study examines the effect of the characteristics of the board of directors (BOD), the characteristics of the sharia supervisory board (SSB), and state ownership on CSR disclosure (CSRD) of Islamic commercial banks (ICBs) in Indonesia for the 2008–2021 period. The estimation results for the Generalized Least Squares model show that the presence of women in the BOD and SSB as well as the frequency of the two boards' meetings play an important role in increasing CSRD. In addition, the interaction variables between age and tenure of the chairman of the SSB and state ownership have a positive effect on CSRD. This study contributes to the development of the corporate governance and Islamic corporate governance literature. In addition, it provides insight for practitioners regarding the main factors that influence the CSRD of ICBs in Indonesia. [ABSTRACT FROM AUTHOR]

This study investigates the effect of ownership type (state and family ownership versus non-state and non-family ownership) on labour cost stickiness in companies listed on the Tehran Stock Exchange (TSE). The study examines the labour cost stickiness in state and family businesses versus non-state and non-family companies within a different environment with unique labour market characteristics. The sample consists of 151 companies listed on the TSE, spanning from 2011 to 2020. After controlling for industry and year fixed effects, the results of multiple regression analysis revealed that labour cost stickiness is higher in state and family companies compared to non-state and non-family businesses. This research contributes to the existing literature by being the first to investigate the impact of the type of ownership on labour cost stickiness in a developing country. [ABSTRACT FROM AUTHOR]

This study aims to ascertain the determinants affecting the liquidity of Vietnamese Commercial Banks by their bank ownership structures, CEO characteristics, and bank-specific variables. Using panel data consisting of 29 Vietnamese commercial banks, we measure liquidity using the most up-to-date method - the Net Stable Funding Difference (NSFD), according to Basel III standards. Correlating to the relationship between CEOs' characteristics and bank liquidity, we found that CEOs with longer tenure will control liquidity better due to their higher managerial power and entrenchment. Moreover, the findings of the present study show that local market power, bank age, bank size, and loan loss provision positively impact bank liquidity. In contrast, further investigation reveals the adverse impact of state ownership on bank liquidity. This study provides insights into the prudential supervision of Vietnamese commercial banks, which has implications for policymakers, by applying the latest liquidity measurement method and new findings on liquidity determinants. [ABSTRACT FROM AUTHOR]

This study examines the degree of state ownership on corporate bribery. Integrating the theories of state ownership and corporate corruption, we propose that state ownership influences bribery propensity and bribery intensity in different ways; it lowers a firm's tendency to pay bribes but increases the relative amount of bribery payment. Building on the control rights/bargaining hypotheses, we demonstrate that state ownership shields firms from bribery demands by reducing administrative hurdles that include bureaucratic requirements of obtaining licenses or settling taxes in business operations. However, state ownership elevates the level of bribes by weakening their capital mobility. Using a sample of 23,018 firms from 54 countries covering 2006 to 2013, we find evidence to support our hypotheses. This article contributes to corruption research by drawing attention to an important channel of corruption and by highlighting the importance of considering not only the propensity but also the intensity of bribe payments. [ABSTRACT FROM AUTHOR]

Under the increased global uncertainty, this study extends prior research on sustainable supply chain management (SSCM) and firm performance by investigating the divergent performance outcomes between state-owned enterprises (SOEs) and non-SOEs, before and after the US–China trade conflict. Based on a sample of 7647 firm-year observations of Chinese listed firms, we found that SOEs experienced less severe performance impact from the trade conflict. Moreover, SOEs with more SSCM practices, including supplier management and customer cooperation, could harvest more performance improvement after the trade conflict, while non-SOEs receive performance reduction by doing so. Theoretical and practical implications are provided. JEL classification: C12, D21, F51, L33 [ABSTRACT FROM AUTHOR]

Launched in 2017 the Green Belt and Road policy acts as an important upgrade to China’s recent core foreign strategy (i.e., the Belt and Road Initiative) and aims to balance the economic development and environmental harmony in countries along the routes. In this paper, we take the implementation of this green policy as a quasi-natural experiment and employ a difference-in-difference method to identify the impact of the policy on Chinese outward direct investment (ODI) firms. We find that the policy has a significant and robust effect on improving the overall performance of ODI firms. Under the same policy roof, however, the seemingly similar impact masks the distinct responses of state-owned and non-state-owned enterprises. Non-state-owned enterprises improve their performance by pursuing green credits and technology upgrades. State-owned enterprises achieve improved performance through better compliance with the green policy and the accompanying government subsidies, in addition to technology upgrades.

Earning is valued because of the information it provides to the capital market. But managers use abnormal Items to manipulate earning to achieve their intended goal, such as maintaining stock prices. Since the manager's benefit depends on the value of the company, he tries to maintain the status quo. So at first it uses accruals abnormal to manipulate earning, but accruals are reversible in nature, so they use abnormal items in later years. On the other hand, this may be different in state-owned companies. The present study examines the relationship between highly-valued firms and abnormal accruals items with emphasis on state ownership. In this regard, samples including 130 companies listed on the Tehran Stock Exchange during the period 2014-2020 have been selected and tested. The results show that companies use more accruals abnormal in the first years and less really abnormal items. But over time, the use of accruals abnormal decreases and they turn more to really abnormal items. Also, in overvalued state-owned companies, the use of accruals abnormal has received more attention, but the really abnormal items manipulation has not had a major impact. Introduction The intrinsic value of the company is determined based on the information obtained regarding the operational ability of the company. But in practice, sometimes the stock price in the market is not an accurate reflection of the available information and the market does not act rationally in the face of the information, as a result of which the intrinsic value of the stock market will be different. If the market price of a company's stock is higher than its intrinsic value, overvaluation is created. In these cases, managers of overvalued companies may manipulate earnings through actual or accrued activity. Managers may do more accrual earnings management and less actual earnings management in the first years so that the company's future cash flows are not jeopardized. But over time, since accruals are reversible, they turn to real earnings management. Also, in addition to the financial status of economic enterprises, government ownership affects the motivation of managers during financial reporting and preparation of financial statements. Government support in the form of state ownership helps companies to use this advantage, to obtain more financial resources, so managers of overvalued state-owned companies have less incentive to manipulate earnings to maintain the company's overvaluation. Therefore, the main goal of this research is to investigate the relationship between company overvaluation and abnormal earnings with an emphasis on government ownership in companies listed on the Tehran Stock Exchange. MethodThis research is applied in terms of purpose. Abnormal accruals and actual abnormal earnings are dependent variables and stock overvaluation is the independent variable. State ownership is also a moderating variable. The first and second hypotheses of the research state that there is a positive relationship between the overvaluation of the company and the amount of abnormal accruals and earnings. There is a negative relationship between the overvaluation of the company and the amount of real unusual items of earnings. Also, the third and fourth hypothesis of the research states, the increase in the duration of overvaluation has a negative relationship with the amount of accrual items of abnormal earnings, but it has a positive relationship with the amount of actual items of abnormal earning. Finally, the fifth and sixth hypotheses state that state ownership has an effect on the relationship between company overvaluation and the amount of abnormal accrual items of Earning and the amount of actual abnormal items of Earning. In order to collect data, a sample consisting of 130 listed companies in Tehran Stock Exchnge were selected for the period of 2014 to 2020. Also, to test research hypotheses, multivariate regression with panel data and ordinary least squares (OLS) approach and robust standard error method have been used. FindingsThe results of the research showed that when companies are overvalued, they manipulate earnings through abnormal accruals and use less manipulation of abnormal real earnings. Also, in the first and second year of stock valuation, companies manipulate earnings through accruals and due to the reversible nature of abnormal accruals, over time it becomes difficult for managers to show more earnings through the manipulation of abnormal accruals. So the manager has to reduce the use of unusual accruals over time. Continuing the process of manipulation in the fourth year, the amount of manipulation of unusual accrual items decreases and the use of actual unusual items increases. In addition, during the overvaluation of the company, the use of accruals has increased in government companies as well as in non-government companies. On the other hand, the overvaluation of corporate shares in non-government firms leads to a reduction in the use of abnormal real earnings manipulation. But in overvalued public companies, the real unusual items of earning have decreased, but this decrease is not significant. RecommendationsIt is recommended to investors, creditors, including investors, while evaluating companies for investment, keep in mind that some companies may be overvalued due to the use of unusual earnings items. In this case, they should do more experience and analysis and not only pay attention to the last figure of the Earning and Loss report and consider the process of preparing the reports. So investors and creditors are suggested to be more aware of the overvaluation of the company. In addition, managers are also suggested that if the company under their supervision is overvalued, there is this insight for users that the company has used abnormal earnings items. Therefore, to prevent the market from creating a negative view of the company, try to improve the financial reports and increase the quality of the reports. Also, law makers and standard setters should take effective measures and measures to prevent the continuation of overvaluation of the company by applying stricter laws and stronger supervision. Corresponding author

Earnings management refers to a company's use of either accounting techniques (accrual-based earnings management) or real economic activities (real earnings management) to manipulate reported earnings and mislead users of financial information. It often indicates serious ethical issues in a company's management, which will affect the reliability and sustainability of a firm's services in the supply chain. Using A-share listed Chinese firms on the Shanghai and Shenzhen Stock Exchanges, we investigated the impacts of state ownership on management's decision to select real or accrual-based earnings management strategies. We found that state-owned enterprises (SOEs) tend to favor real earnings management over accrual-based earnings management more than non-SOEs. Furthermore, those SOEs that are controlled by the central government engage in real earnings management more often than those controlled by local governments. We also examined whether media attention and litigation interact with state ownership to affect earnings management. We found that SOEs, especially central SOEs, with a high level of media attention or an incidence of litigation, are more likely to use real earnings management. Our research can assist firms in making better decisions in selecting business partners and service suppliers in an emerging market through the assessment of management integrity. [ABSTRACT FROM AUTHOR]

This paper examines the innovation spending gap associated with overborrowing in China's state-owned enterprises (SOEs). Based on the double agency problem of the banking sector, the authors hypothesize that SOEs are more inclined to a higher level of overborrowing and therefore worsen firms' debt governance system for innovation. We argue that obtaining excessive bank loans has an indulgence effect and is used by firms' managers as an entrenchment strategy for underinvestment in innovation. We test our theoretical model under the unique institutional setting of China's banks, in particular the administrative-economic governance. Using a longitudinal panel dataset that contains a cross section of Chinese listed companies from 2012 to 2018, we confirm overborrowing's mediating role between state ownership and firm innovation expenditure, implying that enhancing the delegated monitoring of banks is also essential to firm innovativeness in transition economies. Additionally, we further test the role of political connections and managers' R&D functional experience to leverage the benefits of SOEs' innovation resource endowment. Our study demonstrates another debt governance channel through which government intervention has a negative impact on firm innovation resource allocation. It expands the understanding of the debt governance role for innovation in transition economies. [ABSTRACT FROM AUTHOR]

This study empirically investigates the moderating effect of board activeness on the relationship between the structure of corporate ownership and firm performance. The objective was evaluated using the hierarchal panel regressions with data from non-financial companies of the Pakistan Stock Exchange from 2009 to 2018, operationalizing the ownership structure as state ownership, associated companies, foreign ownership, ownership concentration, institutional ownership, and family ownership, and firm performance as operating performance, financial performance, and stock market performance. The findings of the study revealed that operating, financial, and stock market performance were favorably influenced by the ownership stakes of the state, associated concerns, institutions, and foreigners. Family interests proved to be diverse for the firm performance. The isolated effect of the board consistently uplifted the firm productivity, but its interactional impact with all the ownership stakeholders postulated differential outcomes for internal and external performance. The study provides valuable insights for policymakers and investors to make optimal strategies to manage ownership interests and enhance value. [ABSTRACT FROM AUTHOR]

This study examines the impacts of powerful CEOs and state ownership on commercial banks' corporate social responsibility (CSR) in Vietnam, a transitional market in Asia. Given the differences between emerging and developed markets in terms of their institutions and governance, it is essential to explore the impact of CEO power on CSR disclosure in emerging markets. This study collects data from 37 Vietnamese commercial banks from 2010 to 2020. We employ a dynamic system Generalized Method of Moments to overcome endogeneity and heterogeneity issues. The findings show that powerful CEOs negatively reduce CSR programs. CEO power tends to focus less on CSR investments because CSR expenses reduce the operating free cash flow. Meanwhile, our findings indicate a positive relationship between state ownership and CSR developments. This study reports a moderating role of state ownership in empowering powerful CEOs to develop CSR programs in commercial banks. We also perform a robustness test to confirm the persistence of our main findings across subsamples by CEO ages. Our robustness test results indicate that CEOs have the lowest motivation to improve CSR when their ages are from 40 to 60. Our findings align with agency theory, stakeholder theory and prior literature. Finally, our study contributes practical implications for management and policymakers to develop CSR programs sustainably. [ABSTRACT FROM AUTHOR]

This article analyzes the growth impact of state ownership in enterprises by introducing state-owned enterprises (SOEs) into the endogenous, Romer-type economic growth model. We build on the empirical firm-level analysis showing that SOEs underperform their privately owned counterparts and consider SOEs' inefficiency and related subsidization in the growth model. Our model predicts that the growth rate is decreasing in the SOE inefficiency and SOE shares in final goods production and R&D sectors. The model helps to shed light on the mechanisms behind empirical facts observed in European economies in the 21st century - lower growth and innovation rates in countries with larger SOE shares. [ABSTRACT FROM AUTHOR]

Given the development of the digital economy, the shift to digitalization is an inevitable direction for corporate strategic planning. This empirical study investigates the impact of corporate digital strategic orientation on innovation output. It also examines the moderating effects of executive equity and compensation incentives on the relationship between corporate digital strategic orientation and innovation output. We selected a sample of Chinese listed companies and adopted the Heckman two-stage and two-stage least square (2 S LS) methods to control for potential endogenous problems. Our findings indicate that corporate digital strategic orientation significantly enhances innovation output. Additionally, we found that executive compensation and equity incentives positively moderate the impact of corporate digital strategic orientation on innovation output, with equity incentives having a greater moderating effect than compensation incentives. Further analysis shows that the impact of corporate digital strategic orientation on innovation output is greater in non-manufacturing industries and non-state-owned enterprises. Our study provides policy insights on how companies can enhance their innovation capability in the digital economy.

Objective: In this study, the role of state ownership in comparison to private ownership on the asymmetric behavior of costs has been investigated.Method: In order to conduct this research, sample of 325 companies listed in the Tehran Stock Exchange and Iran Fara Bourse (1990 firm-year) were selected during the period 2010-2020. Selling, general & administrative costs and, at a higher level, operating costs have been evaluated as dependent variables of the model. Hypotheses were tested using panel data and multiple regression model with ordinary least squares method and robust standard error approach.Results: State ownership compared to private ownership leads to greater stickiness in selling, general & administrative costs and total operating costs.Conclusion: In the state-owned enterprises due to government support, prioritizing socio-political objectives and intervention in the decision-making process, the degree of cost stickness is higher, because downward adjustments in costs such as employee adjustments and changes in resources level is lower than other firms. Management expectations in conjuction with government support (such as optimism about future demand) and their incentives (such as opportunism and empire building) are other reasons for higher degree of cos stickness of state-owned enterprises in comparison with private-owned enterprises.

The study is conducted to investigate the impact of corporate governance and ownership on business performance in listed firms on the Vietnamese Stock Exchange. The study employed the general regression method (GLS) with a sample of 506 listed firms in the period 2008–2020. The study demonstrated the impacts of corporate governance and ownership on firm performance. First, the size of the Board of Directors (BOD), state ownership, and foreign ownership have a positive impact on firm performance. On the contrary, the ratio of independent members in the BOD and the percentage of members of the BOD who are major shareholders have a negative impact on firm performance. An interesting finding is that the BOD with female members, the duality of director and chairman, and the ratio of independent members have a negative impact on the Board of Management. In contrast, firms with no female members in the BOD have a positive relationship with firm performance. The empirical results and recommendations in this study might be good instructions for firms to improve their firm performance.

This study investigates the relationship between information asymmetry and cash holdings under the impact of the coronavirus disease 2019 (COVID-19) in China. It likewise explores how state ownership dominates their nexus, particularly during the pandemic. COVID-19 caused increases in cash holdings, and that the information asymmetry's effect on cash holdings is more pronounced over the COVID-19 period. Additionally, information asymmetry has a weaker effect on corporate cash holdings for state-owned enterprises (SOEs) under the pandemic. Overall, the study shows that state ownership moderates information asymmetry's impact on cash holdings and softens firms' precautionary motive for cash holdings during the pandemic. [ABSTRACT FROM AUTHOR]

The defense innovation systems (DIS) in France and Sweden have longstanding traditions of domestic innovation and high self-reliance, but they differ greatly in how they have achieved these ambitions. France has almost complete self-reliance in defense technology and close government control of activities contributing to defense innovation and regarding the defense industry. In France, there is considerable state ownership, and foreign ownership is blocked. In contrast, Sweden has delimited its breadth of sovereign technology development since the 1990s, and now expresses three "essential security interests": fighter aircraft, underwater capability, and cyber. This research brief describes what characterizes the present defense innovation systems in these countries, discusses their similarities and differences, and points out factors that have led to their success.

This study provides up-to-date evidence concerning the relationship between government ownership and R&D investments in the Chinese context. Using a large sample comprised of 15,138 observations from A-share firms traded on the Shanghai and Shenzhen stock exchange between 2009 and 2018, the findings show that government ownership has a positive impact on R&D investment decisions. Furthermore, a supplementary test confirms that government ownership has also a positive impact on board monitoring intensity, as measured by the frequency of board meetings. This study injects the literature with fresh evidence on the role of state ownership in R&D investment in China, especially after the most recent wave of privatization, namely Split-Share Structure Reform (SSSR) which started in 2005. The results of this study have implications for different stakeholders as they do not support the common impression regarding the negative impact of state ownership on business outcomes.

The study examined the relationship between firm life cycle (FLC) and earnings management (EM) in the Vietnamese context with the moderating role of state ownership (SOE). We used the sample of 622 Vietnamese listed companies over the period 2010–2019. To eliminate autocorrelation and heteroscedasticity violations, we utilized FE Robust on all models. The data show that accrual earnings management (AEM) behavior varies between FLC phases. The results revealed a U-shaped pattern, with discretionary accruals (DAs) being more remarkable in the introduction and decline stages and lower in the remaining stages. The findings on the connection between FLC and real earnings management (REM) varied depending on the REM technique used. The results support the involvement of SOE as a moderator in both the FLC—REM and the FLC—EM relationship. This study significantly contributed to the existing literature about FLC and EM behavior.

The extant literature offers inconsistent predictions and conflicting evidence regarding the relationship between state ownership and the internationalization of emerging market firms (EMFs). Drawing on institutional theory, we examine the moderating roles of political and economic institutions at the subnational and national levels in the link between state ownership and EMFs' outward foreign direct investment (OFDI). Based on a sample of 1421 OFDI projects involving 286 Chinese listed firms in 115 host countries between 2003 and 2016, we find that state ownership can scale up OFDI when Chinese firms are headquartered in subnational regions with high institutional development or low economic development, or when political relationships between home and host countries are amicable or market growth in a host country is slow; otherwise, state ownership hinders OFDI. These findings offer new insights into the relationship between state ownership and the internationalization of EMFs. [ABSTRACT FROM AUTHOR]

The research objective of our article is to evaluate the impact of tax planning on firm value from the case of non-financial companies listed in Vietnam with different state ownership. We used the purposive sampling method and selected 504 companies for the period 2015-2020. We used secondary data from audited financial statements and stock trading statistics of these companies. The data were analyzed using the generalized least squares (GLS) method. According to the GLS regression results, we assert that the effective tax rates to represent tax planning negatively affect firm value, and this relationship has a significant difference between companies with shares owned by the State and companies without shares owned by the State. In addition, the increased moderation of state ownership on the negative impact of tax planning on firm value differs significantly between state-owned-controlled and non-state-controlled companies. We expect these findings to provide useful information on the relationship between tax planning and firm value, especially for groups of companies with different levels of state ownership. Company managers and the Government can be consulted when making relevant financial decisions or policies. [ABSTRACT FROM AUTHOR]

This study empirically investigates the relationship between independent directors' cash compensation and the likelihood of corporate fraud. Using data of 2542 Chinese firms and 17239 firm years from 2010 to 2017, the findings of logistic regression, firm-fixed effects, instrumental variable specification, and propensity score matching models show that there is a negative association between cash compensation of independent directors and corporate fraud. Our findings suggest that if independent directors are treated with higher cash compensation, it enhances the board's independence and makes the effective monitoring over management behaviors and financial reporting process. On contrary to non-SOEs, the findings also document that the negative association between independent directors' compensation and corporate fraud is pronounced in SOEs. The study not only shows the impact of independent director's compensation on firm fraud beyond agency and contract theories but also creates policy implications regarding independent director's compensation in particular scenario of emerging economies. [ABSTRACT FROM AUTHOR]

This study empirically investigates the relationship between independent directors’ cash compensation and the likelihood of corporate fraud. Using data of 2542 Chinese firms and 17239 firm years from 2010 to 2017, the findings of logistic regression, firm-fixed effects, instrumental variable specification, and propensity score matching models show that there is a negative association between cash compensation of independent directors and corporate fraud. Our findings suggest that if independent directors are treated with higher cash compensation, it enhances the board’s independence and makes the effective monitoring over management behaviors and financial reporting process. On contrary to non-SOEs, the findings also document that the negative association between independent directors’ compensation and corporate fraud is pronounced in SOEs. The study not only shows the impact of independent director’s compensation on firm fraud beyond agency and contract theories but also creates policy implications regarding independent director’s compensation in particular scenario of emerging economies.

This paper investigates the relationship between two characteristics of corporate governance (concentrated and state ownership) and firm financial performance by bringing new and extensive evidence from an emerging market. Further, this study examines the impact of the recent stock split reform in China on the corporate ownership characteristics–firm performance relationship. The final sample of this study is comprised of 234 firms with 2340 annual observation values. The study hypotheses are examined using regression analysis of panel data. We found that concentrated ownership is positively and significantly related to firm performance. However, state ownership has a significant negative impact on firm performance. Further, we observed that the stock split reform has a substantial and positive effect on the ownership–corporate financial performance relationship. In particular, the positive relationship between ownership concentration and firm performance has increased following the split-share structure reform. The negative relationship between state ownership and corporate financial performance has been mitigated following the split-share structure reform. We contribute to the existing literature on corporate governance by investigating the ownership–corporate financial performance relationship in a unique research setting based on the impact of an exogenous regulatory change, namely, the split-share structure reform in China. The study presents implications for regulators, investors, and researchers interested in examining developing markets such as China. Our results imply that the institutional reform of the Chinese stock market has benefitted investors through enhancing corporate financial performance. The findings suggest that the reform of the Chinese stock market has significantly shaped the impact of ownership structure on corporate financial performance in a valuable way for effective capital allocation. Thus, collectively, the split-share structure reform enhances the quality of corporate governance, which is pivotal to the growth of the country's economy. This, in turn, has policy implications for other emerging economies. [ABSTRACT FROM AUTHOR]

Privatization has played an important role in national economic reform in Vietnam. However, unlike other transitional countries in Central and Eastern Europe, Vietnam has chosen a partial and gradual privatization where the government still holds significant ownership in most privatized firms. Whether partial privatization can enhance privatized firms' performance or full privatization should have been implemented is a critical question that needs to be answered. This paper utilizes semiparametric regressions to study the relationship between residual state ownership and firm performance. The results indicate an inverted U relationship between state ownership and firm performance. We show that the performance of privatized firms improves with an increase in the level of state ownership until around 40%, after which the effect of state ownership on firm performance tends to decline. This demonstrates that in a transitional context, relinquishing governmental control via privatization can significantly benefit privatized firm performance. However, further reduction of state ownership may decrease the performance of privatized firms. Overall, the study contributes significantly to the growing body of evidence on the nonlinear effects of state ownership. This suggests that in the transitional context of Vietnam, due to weak corporate governance and limited protection of minority shareholders, there could be a temporary optimal position where state and private investors hold balanced ownership to simultaneously supervise operations and promote the performance of privatized firms. [ABSTRACT FROM AUTHOR]