Narrow Results

I argue that paying dividends before issuing new stock can increase the stock price in the case when firms announce dividend payments and new stock issuance contemporaneously. It enables issuing firms to disentangle the agency problem of paying dividends by newly-raised funds from dividend information for new stock issuances. I employ the seasoned offerings of Taiwan listed firms as the sample, because of their practice of paying dividends once a year. The conditional event study strongly supports this argument and explains why previous studies fail to detect the information conveyed by dividends for new stock issuances.

In this study, we examine whether financial reporting quality improves corporate social responsibility (CSR) decisions. By using a sample of 3,502 observations from 18 countries, our findings show that financial reporting quality is positively (negatively) associated with CSR activities for firms that are more prone to under-invest (over-invest) in CSR. These results suggest that financial reporting quality mitigates managerial discretion in CSR activities and leads to an improvement in CSR decisions. Further, we decompose CSR into environmental and social dimensions and find that the effects of financial report quality on CSR initiatives are more pronounced for firms with a tendency to under-invest in environmental CSR.

This study examined the degree to which the educational level of directors affects corporate governance and firm value in firms. From the results, it has been found that the educational levels of directors are negatively related to corporate governance performance. On the other hand, firms with higher-educated directors have lower block shareholders’ holdings, which implies that the ownership right is not concentrated and block shareholders cannot effectively monitor the operation of the firm to avoid agency problems. Furthermore, a firm with higher educational levels of directors and stronger governance mechanisms is more significant to raise the firm value.