Board network characteristics and company performance in Sweden : the case of Gnosjö companies and their board members in southern Sweden

When managers of entrepreneurial companies typically talk about strategies, they first consider what products to make and secondly where to locate the business. The entrepreneurial companies locate in rural areas because of a wish to maintain a certain lifestyle, or because they can combine a resource available there with certain knowledge or interest that they have (Getz and Nilsson, 2004). In addition, many managers of entrepreneurial companies are confident in locating in a rural area, because there often is economic and social structure supportive of local corporate governance. The most central part of corporate governance is the board of directors. In an entrepreneurial company in a rural area, such members of boards are most likely to be individuals in dominant positions influential in the local economy.

Small, Medium, Large: Theatre Companies and Issues of Scale - A Case Study of a Medium-Sized Company

'Surviving but not thriving.' Tbat is the message about small to mediumsized companies that Ian McRae, Chair ofthe Theatre Board of the Australia Council, has been delivering since 2003. In the Theatre Board Assessment Meeting Report of 2007, McRae strongly urged renewed financial support for this most important sector given the significant decrease over the last 10 years and the consequent decrease in new Australian works being produced. Without such support his prediction is that'considerable damage could be done to the creative infrastructure across Australia resulting in a loss of artistic vibrancy down the track that could be very difficult to recover' (McRae, 2007:3).

The application of the statutory derivative action in Pt 2F.1A of the Corporations Act to companies in liquidation under Ch 5 : Well oiled machine or is Pt 2F.1A in need of a tune up?

The statutory derivative action was introduced in Australia in 2000. This right of action has been debated in the literature and introduced in a number of other jurisdictions as well. However, it is by no means clear that all issues have been resolved despite its operation in Australia for over 10 years. This article considers the application of Pt 2F.1A of the Corporations Act to companies in liquidation under Ch 5. It demonstrates that the application involves consideration of not only proper statutory interpretation but also policy matters around the role and the supervision by the court of a liquidator once a company has entered liquidation.

An analysis of the nature and effectiveness of corporate governance in smaller listed Australian companies

The objective of this thesis is to investigate the corporate governance attributes of smaller listed Australian firms. This study is motivated by evidence that these firms are associated with more regulatory concerns, the introduction of ASX Corporate Governance Recommendations in 2004, and a paucity of research to guide regulators and stakeholders of smaller firms. While there is an extensive body of literature examining the effectiveness of corporate governance, the literature principally focuses on larger companies, resulting in a deficiency in the understanding of the nature and effectiveness of corporate governance in smaller firms. Based on a review of agency theory literature, a theoretical model is developed that posits that agency costs are mitigated by internal governance mechanisms and transparency. The model includes external governance factors but in many smaller firms these factors are potentially absent, increasing the reliance on the internal governance mechanisms of the firm. Based on the model, the observed greater regulatory intervention in smaller companies may be due to sub-optimal internal governance practices. Accordingly, this study addresses four broad research questions (RQs). First, what is the extent and nature of the ASX Recommendations that have been adopted by smaller firms (RQ1)? Second, what firm characteristics explain differences in the recommendations adopted by smaller listed firms (RQ2), and third, what firm characteristics explain changes in the governance of smaller firms over time (RQ3)? Fourth, how effective are the corporate governance attributes of smaller firms (RQ4)? Six hypotheses are developed to address the RQs. The first two hypotheses explore the extent and nature of corporate governance, while the remaining hypotheses evaluate its effectiveness. A time-series, cross-sectional approach is used to evaluate the effectiveness of governance. Three models, based on individual governance attributes, an index of six items derived from the literature, and an index based on the full list of ASX Recommendations, are developed and tested using a sample of 298 smaller firms with annual observations over a five-year period (2002-2006) before and after the introduction of the ASX Recommendations in 2004. With respect to (RQ1) the results reveal that the overall adoption of the recommendations increased from 66 per cent in 2004 to 74 per cent in 2006. Interestingly, the adoption rate for recommendations regarding the structure of the board and formation of committees is significantly lower than the rates for other categories of recommendations. With respect to (RQ2) the results reveal that variations in rates of adoption are explained by key firm differences including, firm size, profitability, board size, audit quality, and ownership dispersion, while the results for (RQ3) were inconclusive. With respect to (RQ4), the results provide support for the association between better governance and superior accounting-based performance. In particular, the results highlight the importance of the independence of both the board and audit committee chairs, and of greater accounting-based expertise on the audit committee. In contrast, while there is little evidence that a majority independent board is associated with superior outcomes, there is evidence linking board independence with adverse audit opinion outcomes. These results suggest that board and chair independence are substitutes; in the presence of an independent chair a majority independent board may be an unnecessary and costly investment for smaller firms. The findings make several important contributions. First, the findings contribute to the literature by providing evidence on the extent, nature and effectiveness of governance in smaller firms. The findings also contribute to the policy debate regarding future development of Australia’s corporate governance code. The findings regarding board and chair independence, and audit committee characteristics, suggest that policy-makers could consider providing additional guidance for smaller companies. In general, the findings offer support for the “if not, why not?” approach of the ASX, rather than a prescriptive rules-based approach.

Crisis preparedness of construction companies

In high-risk industries, companies with well-conceived crisis management plans are at a commercial advantage. While there is some understanding of the risk management practices of construction companies, there is little insight into their crisis preparedness. This paper presents the findings of exploratory research that investigated this issue. Using a diagnostic model of crisis preparedness that has been developed and tested across a broad range of industries, it concludes that if the sample surveyed is typical, then corporate philosophies in construction companies do not support crisis management activities. Furthermore, crisis planning is rudimentary and undertaken in an insular, informal, fragmented fashion, supported by few resources and little strategic guidance. Consequently, many construction companies will have an inadequate understanding of their crisis exposure, of how to cope with crises when they happen, and of how to learn and recover from their aftermath.

Implementing a six sigma initiative in financial service companies

In a world of intense competition, Six Sigma is considered to be an important management philosophy, supporting organisations in their efforts to obtain satisfied customers. As financial service organisations have been slow to adopt Six Sigma, issues concerning its implementation are of major importance. For its implementation a large number of tools and techniques have been suggested by academics and practitioners. Intriguingly, despite the extensive effort that has been invested and benefits that can be obtained, the systematic implementation of Six Sigma in financial service organisations is limited. This paper presents a conceptual framework derived from literature and empirical results with a focus on financial services. Using this framework a financial service company should be able to cope with the relevant critical success factors. Thus, the framework allows identifying relevant aspects for a sustainable and successful implementation of a Six Sigma initiative.

Internationalisation of emerging market firms : an exploratory study of Chilean companies

Purpose This paper explores how firms from a Latin American market internationalise using the resource-based view (RBV) of the firm as a theoretical foundation. Specifically, it examines the internationalisation process of three Chilean companies that have become relevant international players. Design/methodology/approach Drawing on interviews with company managers, as well as industry data and corporate reports, this paper provides insights into the successful internationalisation process of emerging market firms. Findings The findings of this study suggest that specific capabilities and resources, such as belonging to a family conglomerate, domestic and foreign partnerships and networks, innovation and market orientation, and an experienced management team, are required for emerging market firms to internationalise and improve their performance in foreign markets. Originality/value This study is one of the few to address the internationalisation process of Chilean companies.

An analysis of the qualitative characteristics of management commentary reporting by New Zealand companies

The narrative section of annual reports has considerable value to its user groups, such as financial analysts and investors (Tiexiera, 2004; Barlett and Chandler, 1997, IASB, 2006). This narrative section including chairpersons’/presidents’ statement contains twice the quantity of information than the financial statements section (Smith and Taffler, 2000). However, the abundance of information does not necessarily enhance the quality of such information (IASB, 2006). This issue of qualitative characteristics has been long foregone by researchers. This issue has attracted the attention of IASB (2006). Following the dearth in research in regard to qualitative characteristics of reporting this paper explores whether investors’ required qualitative characteristics as outlined by the IASB (2006) have been satisfied in management commentary section of New Zealand companies’ annual reports. Our result suggests that the principal stakeholders’, that is, investors’ qualitative characteristics requirements have been partially met in this section of annual reports. The qualitative characteristic of ‘relevance’ and ‘supportability’ have been satisfied in more annual reports compared to that of ‘balance’ and ‘comparability.’

The Profiling of Property, Plant & Equipment (PPE) Contributions in Australia and Malaysia Public Listed Construction Companies

The purpose of this paper is to study the profiling of property, plant and equipment (PPE) contributions in Australia and Malaysia construction companies. A company’s worth is usually based on the listed share price on the stock exchange. In arriving at the net profit, the contribution of PPE in the company’s assets is somehow being neglected. This paper will investigate the followings; firstly the level of PPE contribution in the construction firms by comparing the PPE contributions to the company’s asset as a whole which includes fixed (non-current) assets and current assets. This will determine the true strength of the companies, rather than relying on the share prices alone. Secondly, the paper will determine the trend of company’s asset ownership to show the company’s performance of the PPE ownership during the period of study. The data is based on the selected construction companies listed on the Australian Stock Exchange (ASX) and Malaysian Stock Exchange, known as Bursa Malaysia. The profiling will help to determine the strength of the construction firms based on the PPE holding, and the level of PPE ownerships in the two countries construction firms during the period of study.

An analysis of the corporate governance practices of smaller listed Australian companies

We examine the corporate governance environment of smaller listed Australian firms to investigate the factors that determine how firms respond to recommendations contained in corporate governance codes. We group corporate governance recommendations into three distinct categories and argue that differences in adoption costs between categories, together with firm specific factors, determine a firm’s decision to conform with the recommendation or to explain the reasons for non-conformance. Analysis of the conformance by smaller firms with governance recommendations highlights substantial differences in adoption rates between categories of recommendations. Our results also reveal that the cost of adopting specific recommendations, together with profitability, external audit quality, and ownership dispersion, jointly explain a firm’s decision to ‘comply or explain’. This study provides insights for policy makers and regulators regarding the appropriateness of corporate governance recommendations for smaller firms

Shifting the Airline Business Model - Current Struggles of National Carriers to Become Profitable Passenger Experience Companies

National flag carriers are struggling for survival, not only due to classical reasons such as increase in fuel and tax or natural disasters, but largely due to the inability to quickly adapt to its competitive environment – the emergence of budget and Persian Gulf airlines. In this research, we investigate how airlines can transform their business models via technological and strategic capabilities to become profitable and sustainable passenger experience companies. To formulate recommendations, we analyze customer sentiments via social media to understand what people are saying about the airlines.

Spinning a sustainable yarn: assessing the claims of Australian companies’ eco-initiatives

In Australia, few fashion brands have intervened in the design of their products or the systems around their product to tackle environmental pollution and waste. Instead, support of charities (whether social or environmental) has become conflated with sustainability in the eyes of the public.However, three established Australian brands recently put forward initiatives which explicitly tackle the pre-consumer or post-consumer waste associated with their products. In 2011, Billabong, one of the largest surfwear companies in the world, developed a collection of board shorts made from recycled bottles that are also recyclable at end of life. The initiative has been promoted in partnership with Bob Marley’s son Rohan Marley, and the graphics of the board shorts reference the Rastafarian colours and make use of Marley’s song lyrics. In this way, the company has tapped into an aspect of surf culture linked to environmental activism, in which the natural world is venerated. Two mid-market initiatives, by Metalicus and Country Road, each have a social outcome that arguably aligns to the values of their middle-class consumer base. Metalicus is spear-heading a campaign for Australian garment manufacturers to donate their pre consumer waste – fabric off-cuts – to charity Open Family Australia to be manufactured into quilts for the homeless. Country Road has partnered with the Australian Red Cross to implement a recycling scheme in which consumers donate their old Country Road garments in exchange for a Country Road gift voucher. Both strategies, while tackling waste, tell an altruistic story in which the disadvantaged can benefit from the consumption habits of the middle-class. To varying degrees, the initiative chosen by each company feeds into the stories they tell about themselves and about the consumers who purchase their clothing. However, how can we assess the impact of these schemes on waste management in real terms, or indeed the worth of each scheme in the wider context of the fashion system? This paper will assess the claims made by the companies and analyse their efficacy, suggesting that a more nuanced assessment of green claims is required, in which ‘green’ comes in many tonal variations.