The role of the audit committee and institutional investors in constraining earnings management : evidence from Chinese firms listed in Hong Kong

Using data from 2004 to 2008, we find that an audit committee is an important monitoring mechanism as audit committee independence, expertise and size are associated with reduced levels of abnormal accruals, our measure of earnings management. This study also attempts to discern when the monitoring role of the audit committee is more salient for the firm. We find that ownership concentration and the presence of government officials on the audit committee are important determinants of the negative association between audit committee characteristics and earnings management. In contrast, we find no significant associations between the audit committee and abnormal accruals for Chinese firms listed only on the Chinese domestic Stock Exchanges. The paper contributes to the corporate governance literature in a transitional economy. Identifying the role of audit committees of firms listed on markets other than the domicile market demonstrates the importance of considering the institutional setting in governance research.

Can an effective audit committee help to mitigate earnings management in Chinese firms listed in Hong Kong?

This paper attempts to determine whether the adoption of recommended corporate governance practices by Chinese firms is associated with less earnings management proxied by abnormal accruals. We examine the role of the audit committee and ownership concentration in preventing earnings management using Chinese firms listed in Hong Kong. The results of this preliminary analysis show that the frequency of audit committee meetings is associated with reduced levels of abnormal accruals, our measure of earnings management. We conclude that audit committee activity is an important factor in constraining the propensity of managers to engage in earnings management. In contrast, we find that the size of the audit committee is associated with increased levels of abnormal accruals and suggest that increasing the size of the audit committee creates information asymmetry between the audit committee and management that reduces the monitoring capacity of the audit committee. We do not find any association between audit committee independence, financial and industry experience, or ownership concentration and abnormal accruals.

Profiling HRM in innovative firms

Effective people management is essential to successful innovation, however no single human resource function or practice can facilitate the development of innovation capacity in an organization. Several studies have argued that different bundles or configurations of human resource practices can improve innovation performance, but there is little empirically based research that provides details of the practices utilized by different types of innovative firms. In this exploratory, qualitative study of innovative Danish firms we examine the profiles of human resource practices evident in a sample of firms recognized for their innovative performance. In examining these profiles, we analyze how characteristics of the organizations, namely their size and the nature of industry specific core capabilities, influence the human resource practices used to support innovation. Our initial findings indicate that in this sample of firms size is not a factor but knowledge-intensive firms have notably different profiles of human resource practices to technology-based firms.

Board members’ contribution to strategic decision-making in small firms

This article explores how the boards of small firms actually undertake to perform strategic tasks. Board strategic involvement has seldom been investigated in the context of small firms. We seek to make a contribution by investigating antecedents of board strategic involvement. The antecedents are “board working style” and “board quality attributes”, which go beyond the board composition features of board size, CEO duality, the ratio of non-executive to executive directors and ownership. Hypotheses were tested on a sample of 497 Norwegian firms (from 5 to 30 employees). Our results show that board working style and board quality attributes rather than board composition features enhance board strategic involvement. Moreover, board quality attributes outperform board working style in fostering board strategic involvement

Assetti proprietari e meccanismi di governance nelle imprese familiari [Finacial reporting in small family firms : searching for a new framework]

SOMMARIO: 1. La “governance” nelle aziende familiari: rilevanza, aspetti distintivi e criticità. 2. Il ruolo della compagine proprietaria nella definizione dei meccanismi di governo. 3. Composizione e funzioni del consiglio d’amministrazione. 4. I patti di famiglia come strumento di disciplina dei rapporti impresa-famiglia. 5. Considerazioni conclusive: prospettive di analisi e scenari futuri negli studi sulla governance delle imprese familiari.

Impact of embeddedness in co-ethnic & non co-ethnic networks on business performance : evidence from Chinese immigrant entrepreneurs in Australia

This paper investigates the research question ‘What is the effect of co-ethnic and non coethnic networking on business performance in Chinese immigrant businesses?’ The research will discuss key themes such as the extent to which Chinese immigrant entrepreneurs are embedded in co-ethnic and non co-ethnic networks and the affect of embeddedness on business performance, such as the entrepreneur’s satisfaction and business growth. Research on immigrant entrepreneurship has emerged as an important new area of inquiry within the field of entrepreneurship. The increased importance of the subject is due in part to major immigrant receiving countries, such as Australia, the United States and Canada, experiencing a high growth rate in their immigrant population. Reflecting on the existing research on immigrant entrepreneurship, it was decided to investigate the role of embeddedness on entrepreneurial business performance. This research seeks to identify the impact of embeddedness in co-ethnic and non co-ethnic networks on business performance of Chinese immigrant entrepreneurs in Australia. Chinese immigrant restaurant entrepreneurs in southeast Queensland, Australia were studied. The result expands on existing research on immigrant entrepreneurship, since the majority of immigrant entrepreneurship studies have been conducted on the United States and Canada immigrant experiences, but few have been conducted in the Australian immigrant entrepreneur context. This thesis also adds empirical testing to a research area with little empirical testing. The results indicated that embeddedness in the co-ethnic network is positively related to business performance measured by both growth and satisfaction. Embeddedness in the non co-ethnic network of the Chinese immigrant entrepreneurs in Australia did not show a similar pattern in accordance with studies conducted in the United States and Canada. This result is interesting and creates the opportunity for future research employing a comparative study.

The role of the internet on international market growth of Australian firms : an exploratory study

The Internet has been shown to positively influence the internationalisation activities of firms through enhanced information, knowledge and network development. Although there has been evidence of a positive impact of the Internet on internationalisation process components, it is vague as to whether the Internet has an impact on firm international market growth. This paper examines the role of the Internet in the outward internationalisation of a cross-national sample of 224 firms from Australia. The results show evidence that a there is a link between Internet usage, Internet intensity and the international market growth of the firm. The findings indicate that firms are using Internet technologies beyond simple e-mail and websites in their international marketing. For example, Internet directories and Internet market spaces are assisting international market expansion of the firm. Firms are integrating the Internet into international marketing processes such as advertising, marketing, market research and international market management as well as in data transference between company and supplier and company and customer. Further, there is evidence in this study of the statistical relationships between the use of website, e-mail and online sales with the international market growth of the firm.

Do strategy choices matter for nascent firms? Effectuation in the early stages of venture creation

This paper explores empirically effects of Effectuation on nascent firms’ performance. Three potential outcomes for nascent firms using different levels of effectuation and causation are investigated. Innovation, a measure of venture sophistication was introduced as a moderator. We examine a longitudinal random sample of 625 nascent firms collected over two years in Australia and provide support for our hypotheses. Results show that in situation of high uncertainty, nascent firms using effectuation are more likely to reach operational stage than their counterpart using causation.

Vatkst, profit og strategisk orienteering i gazellevirksomheder (Growth, profitability and strategic orientation among gazelle firms)

Growth and profitability are often essential parts of the overall managerial goals of firms. High growth can be seen as an indicator of success and as a mean for achieving competitive advantage and higher profitability. But high growth can also lead to a number of managerial and organisational challenges, that may affect the profitability negatively. The aim of this article is to analyse the relationship between growth and profitability for Danish gazelle firms, and furthermore to investigate how the strategic orientation of the firm affects this relationship. Our study finds a clear positive relationship between growth and profitability among gazelle firms pursuing a broad market strategy. A managerial implication of this is that the growth strategy should be clearly integrated with the general strategic orientation of the firm.

The role of digressive learning and uniqueness on performance : longitudinal evidence from young firms

The ability to differentiate from competitors through the selection of unique offerings is an important cornerstone of competitive performance. Developing unique products and services to offer in the marketplace is not only important for established firms, but also an important strategic choice for young firms (Baum and Haveman, 1997). Unlike large and established firms, young firms tend to have less access to adequate resources, well-developed sources of information, contact networks, and considerable experience and management know-how. That is, these firms differ significantly in their attributes and performance from larger and well-established firms (c.f. Miller and Chen, 1994). Although young firms are disadvantaged by the paucity of resources in putting together its unique product offering(s), they develop different pathways in advancing their assortment of capabilities that enables them to stay ahead of competitors.

Role demands and work-family balance experience in Malaysia : the different moderating effects of collectivism and gender role identity among diverse ethnic groups

The purpose of this thesis is to examine the influence of ethnic cultural values on the relationship of role demands and the work-family balance (WFB) experience. Past studies have found that the demands from work and family roles have a different impact on the work-family experience in people of different ethnicity. Researchers attribute these results to the cultural differences across the groups. However, there has been no empirical support for these assumptions because most past studies did not explicitly measure the cultural dimension in their design. Therefore, although studies have found ethnic differences in work-family experience, as cultural variables were not measured, it cannot be determined whether these differences were due to the differing ethnic groups’ cultural styles. The present thesis is set up to address this limitation in the literature, employing the Malay and Chinese ethnic groups in Malaysia as the study samples. The investigation consisted of pilot interviews and two survey studies. The interviews were carried out to establish the perception of WFB by target participants of a non-western nation. The first survey served to identify whether the Malay and Chinese ethnic groups residing under the same economic and social systems vary in their perceptions of work and family roles. The second survey tests the research model empirically, that is, whether cultural values moderate the relationship between role demands and WFB and if these moderation effects vary across ethnic groups. From the interviews, the results indicated that work-family experience is not a universal experience, but is partly culture-specific. Specifically, in the case of Malaysia, WFB is very much observed from the role obligation perspective. In particular, balance is perceived when work duties and household affairs are both adequately fulfilled. On the other hand, the conceptualisation of WFB in terms of role satisfaction and role interference also emerged in the interviews, suggesting the universality of these constructs across cultures. The findings from Survey One indicated that participants of different ethnicities in this study do not differ greatly in their perceptions regarding their participation in work and family roles. Generally, these participants revealed the less traditional attitudes towards women’s participation in work and family roles. However, variations were observed between the two groups in terms of reasons for working, spouses’ preferences towards their employment, and the extent to which their work role is perceived to impede their normative role performance in the household. Despite these differences, the Malay and Chinese ethnic groups showed more similarities than differences in their perceptions of work and family. The findings from Survey Two, which tested the research model, produced mixed results. On the whole, the results showed that the cultural dimensions examined in this study (i.e. collectivism, work identity and family identity) did influence the relationship between role demands and WFB experience, thus providing empirical evidence for the assumption in the literature that the relationship between role demand and work-family experience is moderated by cultural values. Most importantly, support was found for the proposition that these moderation effects vary between the Malay and Chinese ethnic groups. Moreover, this study also found evidence that Malays and Chinese differ significantly on collectivism and work identity cultural dimensions where Malays are found to be more collectivist than the Chinese, while work identity is stronger in the Chinese than in the Malays. There is no difference in the levels of family identity between the two groups. Of all the three moderators, work identity was deemed the most important because many of the supported hypotheses pertained to the work identity moderating effects. In contrast, family identity does not seem to have much moderating influence on role demand-WFB relationships, while the results for the collectivism moderator are mixed. As such, although not conclusive, it can be deduced that variations in the effects of role demand on work-family experience across ethnicity are a result of the groups’ cultural differences, thereby supporting the assumption in the literature.

Knowledge integration within Japanese firms : the Fujitsu way

The paper analyses knowledge integration processes at Fujitsu from a multi-level and systemic perspective. The focus is on team-building capability, capturing and utilising individual tacit knowledge, and communication networks for integrating dispersed specialist knowledge required in the development of new products and services. The analysis shows how knowledge integration is performed by Fujitsu at different layers of the company.

Managing specialised knowledge in technopreneurial firms : the Australian experience

Technology-oriented young firms play an important role for innovation and commercialisation of new ideas. These firms are often founded by engineers, scientists or academics who posses great scientific/technological knowledge, but limited know-how in other aspects of managing a business including knowledge management. Successful managing and integrating their specialised knowledge is of particular importance when it comes to developing a new product or process. This article therefore focuses on the particularities of the knowledge management process in technopreneurial firms. Using a qualitative investigation from a sample of Australian SMEs, a number of key observations are derived which show the challenges of managing knowledge and how important knowledge management is as a management tool for R&D and innovation process in technology-oriented SMEs. Findings suggest that knowledge management and integration processes in these firms are very much project focused and mainly based on ad hoc and informal processes and not embedded within the overall organisational routines.