دانلود رایگان مقاله انگلیسی حاکمیت شرکتی و دارایی های نقدی: راهی به سمت جلو - امرالد 2017

ABSTRACT

Purpose – This study aims to provide a review of corporate governance and cash holdings because strong corporate governance is necessary for the efficient utilization of firm’s liquid resources such as cash, to minimize the agency cost of high cash holdings and to improve the value of cash. Design/methodology/approach – The author provides a literature review of corporate governance and cash holdings through a conceptual and theoretical argument rather than empirical research. Findings – The author reviews empirical and theoretical work surrounding key corporate governance variables and identifies avenues for future research. The author finds that corporate governance mechanisms and cash holdings have received much attention during the last two decades. However, the significant role of corporate governance (both country-level and the firmlevel) in controlling the entrenched behaviour of the managers is discussed separately in the literature. The combined effect of both country-level and the firm-level governance is lacking in the cash holdings literature. Additionally, this study has found that while much attention is paid to developed markets, very little is paid to developing markets even though agency problems are high. Originality/value – The study contributes to the growing literature on corporate governance and cash holdings and provides a further understanding of the role of governance in minimizing the agency cost to increase value by assuring that firms’ assets are used efficiently and productively in the best interests of investors and other stakeholders. In addition, it provides new ideas for policy makers and future researchers where they need to do more work.

6. Concluding Remarks

Cash holding literature has expanded rapidly in recent years. In particular, researchers have attempted to identify the major motives for cash holdings in both single markets and internationally. Two classical explanations for high cash reserves are: the desire to avoid transaction costs when firms need cash, but do not want to liquidate assets and face underinvestment scenarios in the future. If the firms hold cash for these two motives, then there is no need to monitor the firm as it is fulfilling its fiduciary duties. However, a number of studies have proven that these two motives are not the only drivers of the propensity to hold high cash, with the divergence of management and the shareholder interests - the agency motive – also being important.

Agency motive advocates that management of the firms is utilizing its cash resource in under- or over-investment, which harms the value of the shareholders. Thus, shareholders need to discipline the management of the firms that have high cash reserves. Corporate governance in this regards plays important role in monitoring the firm by forcing the management to efficiently utilize free cash. Researchers have shown the significant impact of both country- and firm-level governance on cash holdings. But the role of both country- and firm-level governance were discussed separately in the past studies. The literature on the impact of country-level governance and cash holdings has shown mixed results in the cross-country analysis. While, keeping the control on country-level governance, the firm-level governance has also shown their significant impact on cash holdings. Both firm-level and the country-level governance have shown their strong impact in effecting the value of cash.