• The Journal of Asian Finance, Economics and Business
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• v.8 no.1
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• pp.271-283
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• 2021

This article provides empirical evidence on factors of internal audit (IA) characteristics affecting the internal audit effectiveness in steel enterprises in Vietnam. The study uses data from survey obtained from 114 responses representing owners, managers, and internal auditors from 38 steel enterprises in Vietnam for period from 2018 to 2019. Data collected is firstly checked with Cronbach's Alpha, then the EFA test, and the model linear regression is used to test the relationship between internal audit characteristics and internal audit effectiveness. Results reveal that internal audit effectiveness in steel enterprises in Vietnam is influenced by various internal factors, including the size of internal audit, the scope of internal audit, the capacity of internal auditors, the independence of internal auditor, and the operational bases and methods of internal audit. Based on the research results, the paper makes six recommendations: strengthening operational basis of IA; increasing the independence of IA; increasing the size and capacity of IA staff; expanding and not underestimate the scope of IA; and reforming the internal governance structure. These proposed recommendations could be applied, not only for steel companies in Vietnam, but also for other companies in Vietnam or other companies in jurisdictions that have similar conditions.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.4
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• pp.317-328
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• 2021

This study aims to determine the factors that affect dividends initiation by initial public offering firms in Malaysia. The ownership structure is examined from a corporate governance theoretical perspective in order to evaluate the impacts of managerial, institutional, and family ownership on the dividend's initiation decision of IPO firms. This study employs a quantitative pooled cross-section of 372 Malaysian IPO companies active during the period of 2002-2013. The number of firms that went public each year varies, thus the pooled cross-section data takes place in this case rather than the panel data. The logistic model was employed to test the proposed hypotheses. The results revealed that the presence of institutional investors in the ownership structure make it more likely for IPO firms to initiate dividends. On the contrary, the presence of a family ownership structure in IPO companies as the controlling shareholder makes these companies less probable to initiate dividends. Managerial ownership was found to have no effect on the decision of initiating dividends by IPO firms. The findings of this study suggest that the existence of institutional and family ownerships are agency cost mitigators, as these ownership types could prompt IPOs firms to initiate dividends to overcome the agency conflicts.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.4
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• pp.21-32
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• 2021

This paper aims to investigate the relationship between country-level institutional quality and public debt in the context of Pakistan. The hypotheses of this study were assessed by using the country-level institutional quality data for Pakistan throughout the years from 1996 to 2018. Data came from the World Databank, IMF and Worldwide Governance Indicators databases. For the analysis, ordinary least square, quantile regression and robust regression were employed to assess the factors influencing the public debt. The results of this study indicate that the factors of voice and accountability, regulatory quality, and control of corruption have a positive and significant relationship with public debt, while political stability, government effectiveness, and the rule of law have a negative and significant effect on public debt. Based on the findings, a weak country-level institutional quality poses a substantial market risk as it signals the existence of an unfavorable economic condition that raises public debt. It was also revealed that an improved performance of country-level institutional quality can lead to the improvement of financial market transparency, hence reduce public debt. In contrast to previous studies, the present study will be breaking ground in enhancing public insight regarding the impact of country-level institutional quality on Pakistan's public debt.

• Asia-Pacific Journal of Business
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• v.13 no.3
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• pp.59-71
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• 2022

Purpose - We investigate how firms transfer financial risks to employees in a form of flexible employment contracts and layoffs. Design/methodology/approach - Based on the literature on the prevalence of shareholder value ideology and the associated 'risk shift', we examined how stock price volatility is associated with a firm's use and hiring of nonstandard employees, and the number of employees lay-offed. We test our hypotheses using a longitudinal, multi-source, dataset of Korean firms from 2003 to 2011. Findings - We found support for the relationship between stock price volatility and flexible employment contracts and layoffs after controlling for actual risks such as increased debt or decreased sales. However, we found that the relationship is moderated by the power of professional CEOs relative to that of shareholders, in that powerful CEOs are more likely to transfer the external risks, i.e. stock price volatility, to employees. Research implications or Originality - This study contributes the emerging stream of literature that explore the effect of stock market pressures and governance structures on human resource management.

• Asian Journal of Business Environment
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• v.12 no.4
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• pp.35-44
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• 2022

Purpose: The main purpose of this study is to find out the impact of ownership structure on firm performance in the pharmaceutical and chemical industry of Bangladesh. Research design, data and methodology: The study has been conducted on 28 listed pharmaceutical and chemical companies from 2012 to 2020. Return on Assets (ROA) and Tobin's Q are selected as indicators of internal and market performance of the firms respectively whereas institutional ownership, directors' ownership and foreign ownership are selected as proxies of ownership structure. Panel analysis using random effects, lag method and time dummy method is used to analyse the relationship. Results: The study has found the existence of highly concentrated directors' ownership, a low percentage of institutional ownership and a very insignificant proportion of foreign ownership in the industry. The regression results show that directors' ownership has a positive and significant impact on firm performance, supporting the concept of agency theory. The study has also found a positive and significant impact of foreign ownership on firm performance. Unfortunately, the impact of institutional ownership is found to be insignificant. Conclusions: Directors' ownership and foreign ownership decreases agency cost that ultimately increases firm performance. However, the role of institutional investors is not significant enough to improve firm performance. It is suggested that institutional investors should be more active and involved in monitoring the activities of the organisations to improve performance.

• Journal of Korea Trade
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• v.23 no.7
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• pp.83-95
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• 2019

Purpose - This study analyzed the effect of the Trump Government's protectionist trade policies on foreign ownership. Specifically, this study empirically analyzes the hypothesis that foreign ownership will decrease after the Trump Government rather than before the Trump Government. Design/methodology - The hypothesis of this study is based on the expectation that US protection trade policy will negatively affect the profitability of Korean companies. The dependent variable in this study is the foreign ownership ratio, and the independent variable is a dummy variable representing before and after the Trump Government. Multiple regression analysis was performed, including the control variables suggested in previous studies related to foreign ownership. Findings - As a result, foreign ownership increased after the Trump Government rather than before the Trump Government. This study further analyzes whether the main variables affecting foreign investor's decision-making are differences before and after Trump Government. The export ratio, profitability and dividends did not differ before and after Trump Government. However, the level of information asymmetry decreased after the Trump Government than before the Trump Government. This suggests that US protection trade policies do not adversely affect the profitability of Korean companies. However, Korean firms are improving their information environment because US protectionist trade policies can lower profitability and negatively impact capital raising. In this regard, the foreign ownership ratio seems to differ before and after the Trump Government. Originality/value - This study contributes in that it presents data that US protectionist policies can affect Korean corporate governance. This study has implications from the short-term analysis of US protection trade policy.

• The Journal of Asian Finance, Economics and Business
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• v.10 no.2
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• pp.49-60
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• 2023

The study attempts to examine the relationship among revenue growth factors from different angles and provides a comprehensive overview of tax revenue collection for developing countries. The impact of income tax, customs duty, and value-added tax on the gross domestic product is examined using the ordinary least-square (OLS) multiple regression approach. To confirm the association, a multiple regression model is applied to time-series data. SPSS software, MS Excel, is used to draw the empirical results, trend analysis, and some graphical presentation to reach the study's objective. The findings show that while the value-added tax has a significant impact and the highest coefficient, regardless of country, income tax and customs duty may or may not be significant depending on the circumstances. It triggers effectual and efficacious economic growth. The paper has implications in policy-making areas where governments are seeking how to stimulate revenue growth effectively and efficiently. To promote economic growth, the tax net and tax rate on luxury goods should be increased along with human resources in the tax administration for the short term. But in the long term, decentralization & digitization of tax administration, dismantling the existing tax barriers and good governance are necessary.

• The Journal of Asian Finance, Economics and Business
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• v.9 no.7
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• pp.185-196
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• 2022

The purpose of this study is to examine the effects of split ratings on earnings management through cost adjustments based on asymmetric cost behaviors. Using a sample of 2,027 Korean firm-year observations over the 2002-2019 period, we analyze whether a firm deliberately reduces discretionary costs, such as selling, general, and administrative (SG&A) expenses, to improve profits when it receives multiple ratings from credit rating agencies (CRAs). While examining earnings management incentives in the presence of split ratings, we also investigate the moderating effects of Chaebols, Korea's unique corporate governance structure. We find that split-rating firms show less stickiness in SG&A costs compared to non-split-rating firms when sales decrease. This result implies the deliberate reduction of discretionary costs to improve earnings in the presence of split ratings, which are more likely to change in future credit assessments. We also find that the incentives for earnings management of split-rating firms are limited in Chaebol firms, which have high levels of socio-economic surveillance and support affiliated firms through the internal market of corporate groups. This study contributes to existing research by identifying new determinants of cost behavior by using the framework of asymmetric cost behavior in relation to earnings management incentives.

• The Journal of the Convergence on Culture Technology
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• v.8 no.4
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• pp.61-65
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• 2022

As corporations grow in size, corporations exert a very wide influence on society, but on the other hand, as they fail to take responsible corporate actions to use their influence, giant corporations are often criticized as irresponsible social organizations that cause great social problems. This study examines the problem between ESG and corporate power as a fundamental background that causes social problems related to corporate activities, and studies corporate social responsibility issues that have been traditionally discussed in the business and social fields.

• The Journal of Asian Finance, Economics and Business
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• v.9 no.5
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• pp.365-376
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• 2022

This study aims to look into the causal relationships between corporate social responsibility and firm value, corporate social responsibility and institutional ownership, and firm value and institutional ownership. This study develops a triangle model of causal relationships among the three endogenous variables. Samples for this study are manufacturing companies listed on the Indonesia Stock Exchange for the period 2014-2018. The model is operated in the system of simultaneous equation models using the generalized method of moments technique to estimate parameter coefficients. After controlling the effects of trade-off/balancing capital structure and managerial ownership, the research findings show a positive causal relationship between CSR and firm value and firm value and institutional ownership. Institutional ownership has a positive effect on CSR, while the effect of CSR on institutional ownership is negative in the firms without managerial ownership and positive in the firms with managerial ownership. This study finds that the causal relationship between CSR and firm value is stronger after the trade-off/balancing of capital structure is included in the model. Capital structure has a convex effect on firm value and positively impacts institutional ownership. In addition, an independent commissioner has a negative impact on CSR but has no direct impact on firm value.