BI Norwegian Business School

About: BI Norwegian Business School is a education organization based out in Oslo, Norway. It is known for research contribution in the topics: Corporate governance & Computer science. The organization has 525 authors who have published 2766 publications receiving 55406 citations. The organization is also known as: Handelshøyskolen BI.

Blockholder Exit Threats and Financial Reporting Quality

Abstract: Recent theoretical and empirical studies suggest that blockholders (shareholders with ownership ≥ 5 percent) exert governance through the threat of exit. Blockholders have strong incentives to gather private information and sell their shares when managers are perceived to underperform. To prevent blockholders from selling their shares and the firm from suffering a stock price decline, managers align their actions with the interests of shareholders. As a result of the greater manager‐shareholder alignment, managers' actions are more likely to be in shareholders' best interest, and consequently there is less need for managers to manipulate earnings. Consistent with these predictions from economic theory, we find evidence that as exit threat increases, firms have higher financial reporting quality. Theory also predicts that the impact of blockholders' exit threat on financial reporting quality (FRQ) should increase as the manager's wealth is tied more closely to the stock price, and this is what we find. Our study contributes to the research on the impact of shareholders on FRQ and to an emerging literature on the impact of blockholders in financial markets. Blockholders play an important role in managers' reporting outcomes through their actions as informed investors. Les recentes etudes theoriques et empiriques semblent indiquer que les detenteurs de blocs d'actions (soit les actionnaires dont la participation s'etablit a au moins 5 pour cent) exercent un pouvoir de gouvernance par l'intermediaire d'une menace de retrait. Les detenteurs de blocs d'actions sont fortement enclins a colliger de l'information privilegiee et a ceder leurs actions lorsqu'ils percoivent le rendement des gestionnaires comme etant inferieur aux attentes. Pour dissuader les detenteurs de blocs d'actions de se departir de leurs actions et pour prevenir le declin du cours des actions de l'entreprise, les gestionnaires ajustent leurs decisions aux interets des actionnaires. Cet alignement gestionnaires‐actionnaires fait en sorte que les decisions des gestionnaires sont davantage susceptibles d'etre favorables aux interets des actionnaires, ce qui reduit la necessite pour les gestionnaires de manipuler les resultats. Conformement a ces predictions de la theorie economique, les auteurs relevent des donnees demontrant qu'une augmentation de la menace de retrait entraine une hausse de la qualite de l'information financiere produite par les societes. Selon cette theorie, l'incidence de la menace de retrait des detenteurs de blocs d'actions sur la qualite de l'information financiere devrait egalement augmenter a mesure que se resserre le lien entre la richesse des gestionnaires et le cours de l'action, ce que constatent bel et bien les auteurs. Leur etude contribue aux recherches relatives a l'influence des actionnaires sur la qualite de l'information financiere et a la documentation emergente relative a l'incidence du comportement des detenteurs de blocs d'actions sur les marches financiers. Les detenteurs de blocs d'actions exercent une influence importante sur l'information financiere que communiquent les gestionnaires, par l'intermediaire de leurs decisions en qualite d'investisseurs bien renseignes.

Sharing Economy, Sharing Responsibility? Corporate Social Responsibility in the Digital Age

Abstract: The sharing economy has transformed economic transactions, created new organizational forms, and contributed to changes in consumer culture. Started as a movement with promises of a more sustainable, democratic, and inclusive economy, the sharing economy, and its impact on issues such as privacy, discrimination, worker rights, and regulation, is now the subject of heated debate. Many of these issues root in the changes that digital technologies have brought and the unresolved moral and ethical questions emerging therefrom. This special issue contributes to this ongoing debate with five articles that develop theoretical frameworks and conduct empirical investigations, providing fine-grained analyses of urgent issues in the sharing economy. In this article, we highlight these and other issues that we believe deserve further attention from business ethics scholarship.