Ongoing projects

Defining and doing sustainable investing: understanding the European approach. 01/01/2021 - 01/07/2021

Abstract

I propose to research how the European approach to sustainable investing merges financial goals with altruistic goals to achieve best outcomes. A Fulbright grant to study in Belgium will give me critical access to the policymakers (European Commission), think tanks (European Sustainable Investment Forum or Eurosif), and asset managers (Candriam, Robeco, Amundi, etc.) who are leading voices in the field of sustainable investing. Further, I am confident my affiliation with a strong group of academics at the University of Antwerp will provide me with the advice, care, and partnership I will need to bring this research to fruition. Sustainability -- in particular, climate change -- has become a critical global issue. Any solution to this problem will require vast sums of investment. My research will shed light on how investments can best be deployed to achieve financial outcomes, but also create positive impact for the environment. Having become increasingly jaded by traditional, profitonly oriented capitalism, this research is personally important to me. I plan to use this research in my doctoral dissertation, and upon graduation I will use this knowledge as a platform to raise awareness and to re-enter the field of asset management with new focus and vigor.

Researcher(s)

Research team(s)

The auditor selection process: from tender to relationship management. 01/03/2020 - 29/02/2024

Abstract

The overall purpose of this project is to obtain a better understanding of the complex process of selecting a new auditor. The auditor selection process is essential in preserving auditor independence and ensuring audit quality. In order to gain insights into the selection of an auditor, this project will conduct a field study of client companies' auditor appointment decisions. We take advantage of the institutional setting of the Netherlands, where mandatory audit firm rotation has recently been implemented. In our project, we intend to examine a sample of client companies that recently experienced or are currently experiencing appointment of a new auditor, prompted by the introduction of mandated audit firm rotation, covering different phases of the auditor selection process (i.e., the preparation, the auditor selection and appointment, and the relationship after the appointment).

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Research team(s)

Do You want to Bond? Pricing and Use of Corporate Bonds: Lessons from the Past. 01/11/2019 - 31/10/2021

Abstract

The most important financing sources for a firm are equity and debt. Equity consists of stocks that pay a variable dividend, while debt consists of loans that pay a predetermined interest. Many loans are bonds sold by the firm to outside investors and traded on a financial market. Despite the economic importance of corporate bonds, we still know little about (a) what determines the return of bonds for investors, and (b) when and why firms use bonds as a source of financing. In my dissertation, I will use a unique, newly constructed dataset of Belgian corporate bonds that spans the period 1873-1940 to investigate corporate bond returns and corporate bond financing. There is currently only limited evidence on the determinants of corporate bond returns, and all of this evidence is mostly based on one recent dataset, for the U.S. This raises the question whether the results found for this dataset hold in other environments. The highly-developed Belgian bond market in the period considered and the high quality of data enables me to test this in a unique way. By studying a period in which financial markets were almost completely unregulated by the state, I can also investigate how firms convince investors to buy bonds when there are no specific laws to protect them and how firms used debt contracts to protect investors and how this affected bond pricing. Additionally, I investigate how the voluntary disclosure of information to investors influenced bond pricing and riskiness.

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Research team(s)

Advice to the compliance of financial products with the new Quality Standard (QS) for socially responsible and sustainable financial products. 01/05/2019 - 30/04/2022

Abstract

We analyze whether financial products of asset managers meet the requirements of the Febelfin label for socially responsible and sustainable investment products. We test whether formal policies on exclusion of controversial activities is in place, whether the asset managers meet the requirements on climate change and fossil fuels.

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Research team(s)

An in-depth analysis of European B corp social ventures. 01/04/2019 - 31/03/2023

Abstract

One of the most noteworthy attempts to increase the credibility and awareness of social entrepreneurship is the B Corporation certification. Certified B Corps are for-profit firms certified by the non-profit B Lab to meet rigorous standards of social and environmental performance, accountability, and transparency. To date, our theoretical and empirical understanding of how the financing, performance and survival of B Corps differ from commercial ventures remains scarce. This limited understanding is an important issue because financing is a crucial resource for ventures to develop and grow. Moreover, firms need to understand better the short- and long-term internal effects of B Corp certification while prior research on certification in general has largely adopted an external focus. Next, previous studies have almost exclusively used samples of US B Corps. However, B Corps can be found across the globe. We lack a detailed understanding of how national systems of corporate governance, which are crucial in explaining access to external funding and availability of external funding, uniquely influence the financing and development of B Corps. This dissertation addresses the above issues and investigates for-profit social ventures in depth.

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Research team(s)

Governance in Private Firms 01/01/2019 - 31/12/2023

Abstract

This network will respond to calls from a multidisciplinary perspective by addressing concrete challenges within three main research topics: (1) start-up and scale-up governance, (2) corporate governance and family governance in family firms, and (3) heterogeneous financing and governance implications in private firms. This WOG brings scholars together from different disciplines, i.e., corporate finance, management, entrepreneurship and strategy. Improving the collaboration between and the internationalization of the different research units will advance the international recognition of Flemish scientific research that focuses on "Governance in Private Firms". Currently, research units work on their own or bilateral. The goal of this WOG is (a) to develop new theoretical and conceptual approaches to address these challenges, (b) to reflect on methodological approaches to examine these challenges, (c) to collect quality research datasets including private firms among the world, and (d) to exchange and discuss research proposals of the different research units to examine the complex research stream of "Governance in Private Firms" from an inter- and multidisciplinary perspective with the result of joint research projects. The WOG will conduct a number of yearly activities, i.e., a "Young Researcher Workshop" and a guest lectures given by one of the foreign partners. Further, this WOG will organize PDW's (Personal development Workshop) at international conferences, will stimulate double PhD degrees and research visits among the different research units, involvement in external PhD committees and submit at least two joint and externally funded research projects. A clear research agenda is proposed: In the first year, a proposal of a special issue in a journal will be submitted. In the second year, the WOG will start with the organization of a conference organized in one of the Flemish research units. In the third year, the conference will take place. The best papers submitted to the conference get the opportunity to submit their paper for the special issue. In the fourth year, the members of the WOG start with the preparation of submitting a joint and large-scale research funding proposal. A symposium will be organized. In the fifth year, the WOG will submit its research funding proposal.

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Research team(s)

Strategic change in family firms: antecedents and consequences of strategic change from a change readiness perspective. 01/01/2019 - 31/12/2022

Abstract

In order to survive, closely held family firms face a mounting pressure to adapt to rapidly changing competitive environments. However, many of these organizations are often found to be strategically inert and conservative to changes. A key question is under which conditions family firms can overcome inertial forces and reach successful strategic changes. Hereby we make a distinction between the initiation of strategic change (antecedents) and the implementation of strategic change (consequences). This project aims to reach four central scientific objectives which emerged from four important gaps in the literature. These objectives are summarized as follows: • Cognition: we investigate how and when Management Control Systems (MCS) influence a family firm's knowledge management process in such a way that new strategies are discovered and initiated and subsequently successfully implemented. Main questions are: Do family businesses need different MCS in different stages of the strategy process (initiation vs. implementation)? Is the relationship between MCS characteristics, knowledge management, capacity building and strategic change context-dependent? Which combination of internal knowledge building and external knowledge sourcing leads to knowledge generation that is supportive of strategic change and stimulates change readiness? • Affect: we examine how Socioemotional Wealth preservation, learning frames, team psychological safety and organizational learning culture impacts upon readiness for strategic change in family firms. We focus on the affective dimension and take a multilevel perspective (individual, group, organization). Central questions are: How do actors in family firms develop readiness for strategic change and what are key influences and catalysts? How do learning frames influence individual cognitive and affective change readiness in a family firm setting? How does the framing of new situations by leaders influence other's framing activities and readiness for change? • Governance structures: we examine the interactions between family firm's ownership, management and board and the influence of these interrelated family governance mechanisms on strategic change in family firms. Key questions are: How do the interrelationships of Top Management Teams (TMT) and board composition influences strategic change initiation and implementation in family firms? What is the role of family governance mechanisms and how do they interact with firm governance structures (TMT and Board of directors) in facilitating strategic change in family firms? • Resources: we will investigate the role and impact of financing constraints in the strategic change process from a supply as well as demand side perspective. We will focus on alternative financing sources to initiate and implement strategic change and potential bottlenecks. We will also focus on intergenerational differences.

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Research team(s)

Corporate Governance & Sustainability. 01/10/2018 - 30/09/2023

Abstract

One of the most noteworthy attempts to increase the credibility and awareness of social entrepreneurship is the B Corporation certification. Certified B Corps are for-profit firms certified by the non-profit B Lab to meet rigorous standards of social and environmental performance, accountability, and transparency. To date, our theoretical and empirical understanding of how the financing, performance and survival of B Corps differ from commercial ventures remains scarce. This limited understanding is an important issue because financing is a crucial resource for ventures to develop and grow. Moreover, firms need to understand better the short- and long-term internal effects of B Corp certification while prior research on certification in general has largely adopted an external focus. Next, previous studies have almost exclusively used samples of US B Corps. However, B Corps can be found across the globe. We lack a detailed understanding of how national systems of corporate governance, which are crucial in explaining access to external funding and availability of external funding, uniquely influence the financing and development of B Corps. This dissertation addresses the above issues and investigates for-profit social ventures in depth.

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Research team(s)

Historical high-quality company-level data for Europe (EURHISFIRM). 01/04/2018 - 30/06/2021

Abstract

EURHISFIRM designs a world-class research infrastructure (RI) to connect, collect, collate, align, and share detailed, reliable, and standardized long-term financial, governance, and geographical data on European companies. EURHISFIRM enables researchers, policymakers, and other stakeholders to develop and evaluate effective strategies to promote investment, economic growth and job creation. The RI provides the tools for long-term analysis highlighting the dynamics of the past and the way those dynamics structure our present and future. A few large stand-alone long-term databases have been built in Europe so far, while important resources have been invested into scattered and dispersed historical datasets. EURHISFIRM develops innovative models and technologies to spark a "Big data" revolution in historical social sciences and valorize Europe's cultural heritage. These technologies match and collate historical data, and connect them to recent ones. They bring the next generation of data extraction and enrichment systems from digitized historical sources and web-based resources. The scaling up in the variety, quantity and quality of long-term data changes the way of conducting scientific enquiry in the historical social sciences. EURHISFIRM constitutes a vibrant and large users' community around the innovative data and services provided. The 2016 ESFRI Roadmap identifies Big Data, interdisciplinarity and innovative ways to disseminate research products as the main science drivers for RIs in the Social Sciences and Humanities. It recognizes the need and the opportunity for RIs providing access to the European Cultural Heritage and innovative methods to analyze and integrate information extracted to broad communities. EURHISFIRM fulfills this mission in close cooperation with ESFRI Landmark CESSDA and other existing RIs in the field of Arts and Humanities, like DARIAH, within the Research Data Alliance.

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Past projects

The rise and fall of multiple voting shares during the Interbellum. 01/10/2019 - 30/09/2020

Abstract

One share, one vote is a basic principle that guarantees good protection of investors. However, the use multiple voting shares (MVS) increases all over the world. In this paper, we investigate the rise and fall of MVS in Belgium during the Interbellum. As from the 1920s, MVS became increasingly popular and in 1934 they are legally abolished. In order to enhance our understanding of MVS, we will investigate which kind of firms adopt MVS, how the adoption of MVS affects stock performance and how shareholder reacted to the 1934 abolishment act.

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Research team(s)

The impact of government regulation and self-monitoring in capital markets; 01/10/2019 - 10/09/2020

Abstract

Good investor protection is of primordial importance to ensure that investors are willing to invest in a company. This is important during the entire life of a firm and especially when the firms needs external funding, e.g. at incorporation or when going public. At incorporation, the legal requirements for firm entry guarantee a minimal level of investor protection. When firms go public, they should comply with the listing rules, which further improve shareholder protection. Moreover, firms can also voluntarily adopt additional protection mechanisms. During the life of a firm, protection against managerial misbehavior is ensured by, e.g., giving shareholders voting rights on the annual meeting. All over the world, laws on the entry of new firms, listing rules and voting rules, which are thus designed to guarantee investor protection, are currently under debate (e.g. debate on strict listing rules in China). As regulators today face similar problems as regulators in the past, I use history as a laboratory to investigate the impact of regulation. I go back to pre-World War II Belgium, which was at that time one of the leading economies in the world. I first examine the effect of the abolition of government permission to incorporate new firms (1873) and to go public (1867) (1). Next, I study the effect of the abolition of multiple voting shares (1934) (2). Finally, I investigate the voluntary adoption of protection mechanisms when legal investor protection was weak (3).

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Research team(s)

Succession in Flemish SMEs 01/04/2019 - 31/12/2019

Abstract

The research project consists of four parts. The central research question for Part 1 can be described as: 'To what extent are the companies where the managing director, manager or person in charge of the executive board is over 55 years of age aware of the problems of follow-up and acquisition and to what extent has the situation changed since the previous study in 2015?'. In order to compare the results of this study well with the previous study in 2015, this survey will be limited to companies operating for at least 20 years and comply with the legal form BVBA or NV. The selection of SMEs will be made on a stratified basis so that sufficient SMEs from each size category are questioned. The data collection will be done through an online survey prepared with the Qualtrics platform. The client wants to know whether entrepreneurs are more aware of the problems of Follow-up and Acquisition today, whether they are better informed and whether they were using the guidance opportunities offered The central research question that will be answered in Part 2 is: To what extent are pre-starters and start-ups aware that acquisition is an opportunity to start? The research in Part 3 aims to carry out an investigation into the intention to grow through acquisition. The survey will be carried out in the selected samples of pre-starters, start-ups and growers in Flanders on the basis of an online survey. Finally, a number of policy statements will be formulated in Part 4.

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Research team(s)

The evolution of the financial landscape of ambitious startups and scaleups in Flanders and the role of BAN-Vlaanderen, Hefboom and Microstart. 01/06/2018 - 31/10/2018

Abstract

In a first phase, the government agency Flanders Innovation & Entrepreneurship expects a study about the components of a mature financing landscape for Flanders in order to stimulate the startup and growth of firms. In a second phase, an operational and financial evaluation of BAN-Vlaanderen, Hefboom and MicroStart must be made as well as the conditions for a new agreement (including KPIs).

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Research team(s)

Fostering learner-centered education in the field of taxation. 01/09/2017 - 29/02/2020

Abstract

This project analyses the impact of the Base-Erosion and Profit-Shifting (BEPS) Initiative and the Anti-Tax-Avoidance-Directive (ATAD) against the background of the partner countries' respective national tax systems. Beyond this, the project will address the question, how tax policies can foster innovation and growth. In this project, the University of Antwerp will focus on a theoretical and empirical exploration of the impact of taxation on entrepreneurial risk taking. A model will be developed covering the main elements of the tax systems of the partner countries, including an Allowance for Corporate Equity (ACE) (like in BEL, ITA, LIE) and an interest ceiling rule (GER). This model serves as a theoretical workhorse which allows for an analysis of the economic impact of the BEPS initiative and the ATAD within the context of the respective national tax systems. The focus will be on how an ACE affects risk behavior of entrepreneurs. These behavioral responses can be used to model the behavioral responses to other policy measures that affect the risk-return trade-off for entrepreneurs.

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Research team(s)

Rhetorical impression management in sustainability reporting and monitoring mechanisms: Interdependencies with sustainability performance and impact on financial and institutional legitimacy. 01/01/2017 - 31/12/2020

Abstract

Sustainability reports are discretionary vehicles to signal sustainability performance to external constituents. Motives for their provision vary (from signaling the firm's sustainability track record to opportunistically managing perceived legitimacy on the sustainability front). Central to these motives is public perception management. A firm may resort to rhetorical impression management (IM)to strengthen the persuasiveness of its reporting in order to increase benefits of perceived sustainability efforts. The effectiveness of such rhetorical IM hinges, however, on the credibility of the messages conveyed. External assurance, institutionalized reporting formats, stakeholder engagement and internal governance structures may play a central role in establishing external credibility.

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Research team(s)

Professional skepticism profiles, effects on audit processes and outcomes, and the moderating role of audit firm culture. 01/10/2016 - 31/12/2020

Abstract

Regulators and standard setters have recently emphasized professional skepticism as a key input to audit quality (e.g., AFM 2014; PCAOB 2015; IFIAR 2015; IAASB 2015). The goal of this project is to understand the profile of auditors' professional skepticism, and to link that trait to audit judgments and decisions indicative of audit quality. Specifically, the proposed project seeks to provide answers to the following fundamental questions: (1) What is the profile of individual auditors' professional skepticism?; (2) How does professional skepticism affect the audit process and audit outcomes?; and (3) What role do audit firms' organizational conditions (e.g., firm culture) play in the application of professional skepticism on audit processes and outcomes? We make use of a well-established model in the literature on professional skepticism developed by Nelson (2009) and updated and expanded by Hurtt et al. (2013) as theoretical basis for understanding and predicting individuals' behavior. The model begins with evidential input, which includes information collected and considered during the audit. This, in turn, affects skeptical judgment, which is influenced by individual auditor characteristics (i.e., personality and individual differences), client and environmental factors (e.g., audit firm culture, financial incentives), and knowledge gained from experience and training. The outcomes of skeptical judgment can be captured in different ways (e.g., by assessing risk assessments or by examining materiality levels). Together, these judgments and characteristics affect skeptical actions (e.g., audit planning decisions, personnel allocation judgments, specialist consultations, and misstatement adjustment decisions). Skeptical actions then dictate evidential outcomes, which include evidence collection and evaluation, documentation, and audit reporting.The insights obtained from the project will not only be relevant for the academic community, but also for audit practice, standard setters, and regulators to better understand the profiles of individual auditor professional skepticism and the relationship between professional skepticism, the audit process, and audit quality.

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Research team(s)

Capital Market Effects of Information Dissemination on Social Media. 01/10/2016 - 30/09/2020

Abstract

This project will investigate the capital market consequences of firms disseminating information through social media channels. The use of social media such as Facebook and Twitter is proliferating at an incredible pace. Many firms nowadays make use of social media as an additional channel to communicate with customers and (potential) investors. Despite the explosion of firm and investor use of social media, academic interest in the potential capital market consequences of firms' social media usage has been very limited. This research project is motivated by the relative paucity of academic research on this topic, and by the shortcomings of the few prior studies that have been conducted in this area. Therefore, the first objective of the proposed research project is to focus on a sample of firm-generated (rather than user-generated) social media messages from a broad sample of firms. As a second objective this research project will examine the capital market effects of the tone and readability of such firm-generated social media messages (as opposed to merely focusing on the number of such messages). The third objective of the research project is to account for the interactive nature of social media (i.e. users can redistribute firm-generated social media messages) when considering capital market consequences. In order to achieve these aims, the proposed research project will employ cross-sectional regressions and event studies to analyze the "tweets" (i.e. messages on Twitter) of all S&P 1500 firms.

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Research team(s)

Dividend policy: a long term investigation. 01/10/2016 - 30/09/2019

Abstract

In this project, I will describe the dividend policy of Belgian firms during the period 1832-2012. I will focus on firms listed on the Brussels Stock Exchange during this period. Data is available from the SCOB-database. In a first part, I investigate the evolution of dividend policy over the period 1832-2012, which was characterized by major institutional, regulatory and tax changes, such as the introduction of taxes on dividends, the abolishment of multiple voting shares, the split-up of universal banks etc. My long-term perspective allows investigating how such changes affect dividend policy. Next, I investigate the evolution of cross-sectional determinants of dividend policy.

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Research team(s)

Impression management in performance commentary in annual results press releases of listed companies and institutional context. 01/10/2016 - 30/09/2017

Abstract

We examine extent and nature of opportunistic tendencies in annual results framing in press releases of listed companies. Artificial intelligence methods are applied to measure explanation profiles and assess their impression management propensity. Next, we will investigate (in an international context) whether scope and properties of regulatory control and institutional shareholder protection affect the occurrence, nature and strength of impression management tendencies in management's performance commentary.

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Research team(s)

Capital Market Effects of Firm-Generated Social Media Messages 01/04/2016 - 31/03/2017

Abstract

Despite the explosion of firm and investor use of social media (e.g. Twitter), academic interest in the potential capital market consequences of firms' social media usage has been very limited. This research project aims to investigate the capital market effects of firm-generated social media messages by conducting a series of cross-sectional regressions and event studies to analyze the "tweets" (i.e. messages on Twitter) of 500 randomly selected listed European companies.

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Research team(s)

Literature study about financing of scale-ups and high growth SMEs 30/11/2015 - 31/03/2016

Abstract

In previous studies, it was found that attracting sufficient funding for the growth of enterprises is an obstacle. Growth companies make to a large extent use of internal financing and traditional forms of bank financing, but these sources are often not enough. Additional financing needs should be financed with new forms of bank financing as well as alternative (or non-bank) financing. Based on an extensive literature review we will give an overview of the funding sources that can be used in different stages of business growth. Then we will discuss to what extent funding sources are used by Belgian growth companies and what problems they face in attracting these funds. Finally, based on findings from the literature review a number of policy recommendations are formulated with regard to the financing of growth businesses.

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Research team(s)

The predictability of returns and dividend growth rates: long-run evidence. 01/10/2015 - 30/09/2019

Abstract

We use a unique Belgian stock and bond return dataset covering almost two centuries to investigate the predictability of stock returns and dividend growth, taking into account economic and institutional factors. We will first investigate whether the dividend yield predicts stock market returns and/or dividend growth and whether the strength of these relations are linked to the institutional and economic environment. Secondly, we will focus on the monetary and interest rate environment to study their impact on the predictability of stock and bond returns.

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Research team(s)

The relation between entrepreneurial performance of family firms and the moderating role of family involvement and governance characteristics 01/11/2014 - 28/02/2016

Abstract

This project represents a formal research agreement between UA and on the other hand AMS. UA provides AMS research results mentioned in the title of the project under the conditions as stipulated in this contract.

Researcher(s)

Research team(s)

Dividend policy: a long term investigation. 01/10/2014 - 13/01/2017

Abstract

In this project, I will describe the dividend policy of Belgian firms during the period 1832-2012. I will focus on firms listed on the Brussels Stock Exchange during this period. Data is available from the SCOB-database. In a first part, I investigate the evolution of dividend policy over the period 1832-2012, which was characterized by major institutional, regulatory and tax changes, such as the introduction of taxes on dividends, the abolishment of multiple voting shares, the split-up of universal banks etc. My long-term perspective allows investigating how such changes affect dividend policy. Next, I investigate the evolution of cross-sectional determinants of dividend policy.

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Research team(s)

Research by the "Studiecentrum voor Onderneming en Beurs" in the field of accounting. 21/05/2014 - 31/12/2020

Abstract

This project represents a formal research agreement between UA and on the other hand the client. UA provides the client research results mentioned in the title of the project under the conditions as stipulated in this contract.

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Research team(s)

Study on SME financing. 12/05/2014 - 31/10/2014

Abstract

This project represents a formal research agreement between UA and on the other hand UNIZO. UA provides UNIZO research results mentioned in the title of the project under the conditions as stipulated in this contract.

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Research team(s)

The Impact of Non-Audit Services on Auditor Independence 01/02/2014 - 31/12/2014

Abstract

The project examines whether auditor independence in private firms is affected by the provision of non-audit services (NAS) by individual audit engagement partners. The idea that the provision of NAS may have a detrimental effect on auditor independence has been a controversial topic for many years that has attracted considerable attention from both scholars as well as the profession and regulators.

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Research team(s)

Research in the field of family enterprises and family offices. 01/01/2014 - 31/12/2017

Abstract

This project represents a formal research agreement between UA and on the other hand AMS. UA provides AMS research results mentioned in the title of the project under the conditions as stipulated in this contract.

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Research team(s)

Long-run evidence on dividend policy. 01/11/2013 - 30/09/2014

Abstract

The empirical literature finds that dividend policy differs greatly across firms and changes slowly through time. Dividends seem to contain information about average stock returns, and aggregate dividend yields predict future market returns. However, there is no consensus about the explanation for these empirical regularities, nor even about their universal existence. In the literature it has been conjectured that slowly changing institutional factors are at least partly responsible for the relations and their strength. By using an unique, available dataset covering the full Belgian stock market since 1832, we are able to investigate the patterns described above over a 180 years period. Moreover, we can relate them to the underlying institutional setting. We can also test the impact of changing dividend policy on the relation between dividends and stock returns, as well as on the value of the aggregate dividend yield as a predictor for stock market returns. Firstly, we document patterns in dividend policy through time and relate them to changes in dividend taxes and institutional changes. Secondly, we study determinants of dividend policy across firms including measures of taxes, agency-conflicts, asymmetric information and liquidity. Thirdly, we link dividend yields to returns across firms, taking into account the changing patterns in dividend policy and its determinants. Finally, we relate the predictive strength of the dividend yield for market returns to these factors.

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Research team(s)

Board diversity in family and non-famiy firms: a comparative analysis with a "true" diversity measure and the role of mediators. 01/10/2013 - 30/09/2015

Abstract

Although board diversity is often unconditionally considered to be a beneficial practice, its relationship with firm performance appears to be more nuanced. We study the impact diversity in family firms vs. non-family firms. In doing so, we propose to compute a diversity measure that takes into account directors‟ family membership and to study the mediating role of firm reputation and innovation in the board diversity – firm performance relationship. As opposed to extant research, we analyze the impact of board diversity on firm performance both in terms of both "innate" and "acquired" director characteristics and thus view it much broader than merely gender diversity.

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Research team(s)

Scientific empirical research on non-audit fees and the impact on audit quality. 15/05/2013 - 31/12/2013

Abstract

The main purpose of this study is to determine whether there is a link between non-audit services and audit quality on the Belgian audit market. More specifically, the study will determine whether, and to what extent, the services provided by companies' statutory auditors and their network, in addition to the performance of their audit assignment, affect their independence and the quality of the audit. Investigating this link is relevant given the current debate at European level, in response to the financial crisis, about the restriction on or even complete prohibition of the provision of non-audit services by auditors to their audit clients. The study consists of two parts. In the first part, we give a brief historical overview of the regulatory framework for non-audit services, taking into account both the Belgian and international situation, in particular American and European initiatives. Next, we focus on the evolution and composition of fees for both audit and non-audit services in Belgium over the period 2008-2010 and make a comparison with developments in other countries. We conclude the first part by addressing the empirical studies that examine at an international level the link between (fees for) non-audit services and audit quality. The literature review shows that the empirical studies have ambiguous results. In the second part, we examine whether there is effectively a link between non-audit services and audit quality on the Belgian audit market. To this end, use is made of multivariate regression analyses in order to assess the link between, on the one hand, the response or dependent variable (in this case the audit quality) and, on the other hand, the explanatory or independent variables (in this case the test variable, namely the non-audit services) and various control variables (such as the company size, the age and the financial situation) that can also have an impact on audit quality as shown in the literature. The results of these regression analyses permit us to conclude that there is little empirical support for the assumption that non-audit services have an impact (neither negative nor positive) on audit quality.

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Research team(s)

Estimating a real term structure (ERTS). 01/04/2013 - 15/10/2013

Abstract

The objective of the project is to develop an estimation method voor the real term structure • to obtain an estimate of the zero-coupon real interest rates • build a real yield curve across the maturity spectrum • to compare it with the nominal term structure and derive the inflation compensation - often defined as the break-even inflation rate - requested by market participants to hold index-linked bonds, a proxy of their expectations of inflation. • this estimation procedure should be easy to update (on a monthly basis as a minimum)

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Research team(s)

Intra-industry benchmarking of discretionary disclosure content in corporate reporting. 01/01/2012 - 31/12/2015

Abstract

We investigate intra-industry imitation in discretionary financial disclosure and management commentary. Imitation of discretionary reporting content and related reporting choices may be conceived as a rational response to discretion and related ambiguity in order to meet explicit and implicit industry norms. This issue is crucial in the current debate on a principles-based versus rules-based approach in the reporting standard-setting process. Neo-institutional theory suggests that more ambiguous reporting properties can be affected by mimetic, cognitive and normative pressures to conform to institutional templates of appropriate behavior. Benchmarking of reporting features on those of other firms within the industry is a basic mechanism underlying imitation. Mimetic and cognitive imitation will be more prominent in reporting issues characterized by uncertainty about instrumentality (means-ends relationships) or about consequences of reporting choices, whereas for other issues normative pressures (e.g., through auditors and external stakeholders) will prevail. We will address the following research questions: (1) What is the extent of intra-industry benchmarking in specific discretionary reporting choices and which imitation mechanisms drive reporting conformity, (2) What is the impact of professional intermediaries on imitation-driven reporting, (3) Which firm-specific factors affect the extent of benchmarked reporting, and (4) Whether and to what extent self-serving consequences of industrybased imitation in external reporting can be observed.

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Research team(s)

The relation between entrepreneurial orientation and the performance of family firms taking into account the moderating role of family involvement and the mediating role of family essence. 01/01/2012 - 31/12/2014

Abstract

The research objective of this project is to examine the variables which influence the performance of family firms. Using data from a written survey as well as financial data from published financial statements different relationships between variables will be studied. The research results will provide additional insights into the heterogeneity within family firms and into the intention to transfer the company to the next generation.

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Research team(s)

Setting up and customizing a database on historical financial data of French fairs since the 18th century. 01/10/2011 - 30/12/2015

Abstract

This project represents a formal research agreement between UA and on the other hand l'Ecole d'Economie de Paris. UA provides l'Ecole d'Economie de Paris research results mentioned in the title of the project under the conditions as stipulated in this contract.

Researcher(s)

Research team(s)

Stochastic modeling with applications in financial markets. 01/01/2011 - 31/12/2020

Abstract

This is a fundamental research project financed by the Research Foundation - Flanders (FWO). The project was subsidized after selection by the FWO-expert panel. The aim of this scientific research network is the promotion of interdisciplinary research (mathematics – physics – economics) in the domain of stochastic modelling, relying on the correlation between theory, numerical calculations and applications. The combination of ideas and results from financial mathematics with the classical valuation and pricing methods from actuarial sciences is a continuing trend in this research. The scientific research network facilitates research merging both methodologies into a combined financial-actuarial approach. In addition techniques from statistical physics and network theory are incorporated to develop models intended to explain the underlying market dynamics and to estimate systemic risk. As such we want to anticipate and respond to the evolutions of research problems related to financial markets. The knowledge and expertise at hand in the various subdomains by the participating Flemish, Walloon and international research groups is united to create new synergies, to stimulate the interaction and to look for optimization. The objective is to make the most of the available complementarity. The scientific research network wants to encourage and support young researchers by offering training through seminars, schools and work visits, and by giving them the opportunity to participate in conferences and to present their research results. The possibility of personal contacts is an important extra advantage, and facilitates future cooperation. The researchers of the participating teams will meet on a regularly basis in order to enable the organization of common workshops and symposia, to exchange expertise, to develop new research lines and to draw up joint research projects.

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Research team(s)

Investment Returns in the Long Run: Evidence from Belgium 1838-2010. 01/01/2011 - 31/12/2013

Abstract

We investigate long run investment returns for stocks, government bonds and cash. Our analysis is based on a (worldwide) unique database which covers all securities ever listed on the Brussels Exchange / Euronext Brussels in the period 1838-2010. We construct new, value weighted return indices for government bonds and analyze the equity risk premium and term premium.

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Research team(s)

Investment returns and risk premia for Belgian corporate bonds (1832-2010) 01/01/2011 - 31/12/2012

Abstract

The Brussels stock exchange was one of the top ten most important stock exchanges in the world in the 19th and early 20th centuries. Companies from all sectors (railways, coal mines, zinc companies, metal, glass, banks, electricity companies etc.) were listed on it. Moreover, the Brussels Stock Exchange was very internationally oriented before the First World War with many shares, government bonds and corporate bonds from goverments and companies all over the world (or Belgian companies operating abroad). We examine the returns of all the Brussels Stock Exchange listed Belgian corporate bonds for the period 1832-2010 using quotes, numbers and all the characteristics of these corporate bonds (interest, valuation, the duration, the issuing price, the IPO price on the stock exchange, additional conditions (call / put), and reimbursement conditions (amount, repayment facilities). At the same time we calculate the risk premium and compare it to the equity premium. Our sample includes 1270 corporate bonds. Because we have such a unique and very long time series it will allow us to make valid econometric conclusions (given the volatility). This research is important both for investors and companies. Investors have many opportunities for investments. A wide range of alternatives is available with perhaps the most famous among them investments in equities, government bonds or holding cash. In the international literature, these three are traditionally the subject of many inquiries. But there is another investment opportunity, viz. corporate bonds. Our research will inform investors exactly on the difference between such investments. The question can also be viewed from a different perspective, particularly from the financial policy of a company. Is it without importance for a company to finance her activities with share capital or bonds or is one of them more attractive? This seems to be an important question for financial management. Lacking international studies, our research can help in providing a detailed account on the risk premium.

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Research team(s)

The impact of presentational qualities of corporate narrative disclosure on risks and performances on the properties of financial analyst behavior in an international setting. 01/10/2010 - 30/09/2014

Abstract

The research will assess how companies model the presentational qualities of narrative disclosure in their annual reports and how such disclosures affect and are affected by financial analyst behavior. Narratives are portrayed as an integrated component of a company's investor relations program and as interdependent (as complement or substitute) with other reporting modes. Institutionalization effects will be studied by comparing disclosure behaviour of continental-European, Asian and Anglo-Saxon companies.

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Research team(s)

Tunneling and private investments in public equity in China. 20/08/2010 - 19/06/2011

Abstract

This project represents a formal research agreement between UA and on the other hand EU. UA provides EU research results mentioned in the title of the project under the conditions as stipulated in this contract.

Researcher(s)

Research team(s)

Annual questionnaire of Belgian enterprises dealing with financing of small and medium-sized enterprises. 04/06/2010 - 03/06/2013

Abstract

This project represents a formal research agreement between UA and on the other hand KeFiK. UA provides KeFiK research results mentioned in the title of the project under the conditions as stipulated in this contract.

Researcher(s)

Research team(s)

Qualitative analysis of the management commentary disclosure process 01/01/2010 - 31/12/2011

Abstract

The aim of the project is to identify key factors which affect the preparation of management discussion and analysis reports. We investigate how firms' institutional setting and capital market context affect managers' ability to provide informative disclosures.We use a qualitative approach and investigate differences in institutional setting using an international sample.

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Research team(s)

Effective Governance in private organisations: the influence of multiple stakeholders' incentives on organizational outcome and the mediating role of governance. 01/10/2009 - 31/01/2014

Abstract

The aim of this research project is to study governance practices from a holistic perspective, in contrast to the piecemeal approach of the extant literature and to develop a contingency model of governance. Taking into account that universal remedies are counterproductive (Ostrom, 2007), we develop a contingency perspective that diagnoses the specific conditions needed to make specific governance practices contribute to organizational outcome (e.g. success or failure measured by multi-attributes). The specific conditions relate to actor characteristics (owners, directors, managers and employees), to the institutional environment, to the organizational form and to other intervening variables (e.g. life cycle of the company, industry antecedents, etcetera). Besides the development of the contingency model for governance, individual research themes in the individual workpackages will be addressed too. (e.g. changes in governance practices over the life cycle of an organization, the introduction of family heterogeneity in family governance research, the impact of works council's demographic variables on organizational outcome).

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Research team(s)

The 'value' of bank relationships during a financial crisis: Evidence from Belgium in the 1930s. 01/02/2009 - 31/12/2010

Abstract

We investigate the impact of bank affiliations on the performance of Belgian listed companies in the first half of the 1930s. This period was characterized by a large economic crisis and major problems in the financial sector which led to profound institutional reforms. We consider different dimensions of company performance.

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Research team(s)

Institutional conformity in financial reporting. 01/01/2009 - 31/12/2011

Abstract

The study will identify and analyze institutional conformity in properties of corporate financial reporting characterized by normative ambiguity, such as risk reporting, MD&A and cost allocation decisions. Reporting conformity is theorized as institutional imitation behaviour driven by social, cognitive and competitive forces. The study will integrate the role and functioning of external auditors in reporting conformity.²

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Research team(s)

Media legitimacy, news exposure and corporate environmental communication. 01/01/2008 - 31/12/2009

Abstract

We explore the association between environmental media legitimacy and the quality of corporate environmental communication efforts. Using a media measure of legitimacy, we study the interrelationships among (1) environmental legitimacy, (2) environmental news exposure, and (3) corporate environmental communication. In addition, we explore the substitutional versus complementary role of different corporate environmental communication channels.

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Research team(s)

Financing of start-ups in Flanders: determinants of the start-up capital and the use of bootstrap financing. 01/01/2008 - 31/12/2009

Abstract

New start-ups lack prior history or lack reputation and are associated with a high failure risk. Nevertheless, a future entrepeneur needs to find a sufficient amout of capital in order to be able to start a new venture. The aim of this study is to identify the determinants of both the initial start-up capital as well as the use of bootstrap financing in newly founded ventures. Moreover, this study will investigate the impact of bootstrap financing on the new venture's performance.

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Research team(s)

Long-term return predictability: robustness tests and impact of institutional developments. 01/01/2007 - 31/12/2010

Abstract

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Research team(s)

Business groups, political connections and institutions: a long-term analysis. 01/01/2007 - 31/12/2010

Abstract

This project takes a long-term perspective on the role of business groups. Using a unique database of Belgium listed companies over the 19th and 20th century, and taking into account the evolution of institutions, we study how business groups affect company performance, and how business groups use political connections to pursue the interests of their owners.

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Research team(s)

Impact of the regulatory and endorsement system on content and consequences of selfpresentational behavior in management commentary of annual reports. 01/01/2007 - 31/12/2009

Abstract

This research investigates the impact of characteristics of the regulatory and endorsement system regarding narrative disclosures on form, content and effect of explanatory behavior in the annual management commentary. Contrasting different institutional environments (US, Australia, Canada, Europe), we will assess the relative impact of differences in regulatory regime on the content and value relevance of argumentation patterns and self-presentational narrative content.

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Research team(s)

The business transfer within family firms and the impact on the financial structure. 01/01/2007 - 31/12/2008

Abstract

The transfer of a business can be considered as one of most important and most difficult phases in the life cycle of a company. Particularly the financing of the entire operation often leads to considerable problems. Current research aims at increasing our knowledge of this field by studying the use of different financing techniques in transferring a business. In that way the impact of a business transfer on the financial structure and the future growth of the company can be studied.

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Research team(s)

Risk management and pricing with incomplete information about the underlying distributions. 01/07/2006 - 31/12/2010

Abstract

A key problem in the financial and actuarial research is the choice of models, so as to avoid syste¬matic biases in prices et al. An alternative consists of fixing only a number of parameters instead of a complete distribution, resulting in bounds instead of unique results. The aim of this project is to develop this research theme into three directions: a direct application to new research questions, extensions to more complex situations, and testing in combination with sensitivity analysis by means of simulations.

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Research team(s)

Processing of the KeFiK-survey SME-financing. 08/06/2006 - 27/10/2008

Abstract

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Research team(s)

Taxes and income shifting in multinational corporations. 01/03/2006 - 31/12/2007

Abstract

In this project we investigate to what extent and how multinational corporations (MNCs) shift income between subsidiaries in different countries, in order to minimize global tax payments. For a sample of European, Japanese and US MNCs, we examine how tax differences between parent country and host country affect income reporting and financing- and dividend policies.

Researcher(s)

Research team(s)

Narrative communication on venture risks and performances in the field of sound governing. 01/03/2006 - 31/12/2007

Abstract

The research project aims at exploring the role and effectiveness of corporate narrative reporting on risks and performances within a corporate governance framework. The interaction of narrative disclosure patterns and corporate governance processes is analysed as contingent on stakeholder management concerns and institutional forces. Institutionalisation effects are studied within an international setting

Researcher(s)

Research team(s)

Study into irregularities in the accounting systems of the Sabena Group and the SWISSAIR/SAIRgroup. 18/01/2006 - 30/09/2009

Abstract

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Research team(s)

Quality of financial reporting within the EU : impact of accounting standards, audit quality, corporate governance and regulation. 01/01/2006 - 31/12/2009

Abstract

Consistent with the title of the research proposal, the objectives of the research are to study the impact on quality of financial reproting within the EU of the new EU regulations on : (a) accounting standards; (b) corporate governance; (c) audit quality.

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Research team(s)

Budgetary impact of the granting of an interest for companies that suffer the accessibility disturbed as a result of interference by public works 29/06/2005 - 15/03/2006

Abstract

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Research team(s)

Transparency in performance disclosure as a corporate governance mechanism. Strategic dynamics and institutional pressures. 01/10/2004 - 31/12/2005

Abstract

The research project focuses on the interaction of performance disclosure transparency and other corporate governance mechanisms (stock options, board committees, independent review, etc.) within the setting of strategic management of trust relationships with external shareholders. Three lines of inquiry are followed: qualifying the relative impact of performance disclosure transparency as a corporate governance mechanism, transparency as a stakeholders relations management tool and transparency as an institutionalized process. Institutionalisation effects are studied within an international setting.

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Research team(s)

01/06/2004 - 30/10/2004

Abstract

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Research team(s)

Causes and Consequences of Interlocking Directorships and Seat Accumulation in Belgian Companies. 01/01/2004 - 31/12/2007

Abstract

In this research project we investigate the causes and consequences of interlocking directorships and seat accumulation in Belgian companies. First, we investigate the determinants of interlocking directorships. Second, we investigate how interlocking directorships on firm value. To what extent do interlocking directorships destroy or create value? We analyze the impact on both stock market value and accounting profitability, taking into account other firm characteristics. In a first part of the study, we investigate interlocking directorships of listed Belgian companies in the period 1893-1935.

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Research team(s)

A study of the financial reporting quality of the financial reporting system of Sabena and The Sairgroup. 01/10/2003 - 28/02/2006

Abstract

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Research team(s)

Earnings Management Induced by Cognitive Reference Points. An International Perspective. 01/05/2003 - 30/04/2005

Abstract

The current study attempts to examine earnings management induced by cognitive reference points. The international sample is composed of a large set of both listed and private companies. The study aims at, among other things, determining whether investors are really misled by this type of earnings management and whether independent audits are able to restrict these practices.

Researcher(s)

Research team(s)

Interlocking directorships and seat accumulation in Belgian companies. 01/03/2003 - 31/12/2005

Abstract

In this project research is done into the causes and consequences of interlocking directorships and seat accumulation in Belgian companies during the 20th century. First, I will investigate the determinants of interlocking directorships. Second, I will analyse the impact of interlocking directorships on firm value. To what extent do interlocking directorships destroy or create value. I investigate the impact on both stock market value and accounting profitability, taking into account other firm characteristics. The empirical analysis will be based on appropriate and up-to-date econometric techniques.

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Research team(s)

01/05/2002 - 30/09/2004

Abstract

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Research team(s)

01/04/2002 - 30/09/2004

Abstract

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Research team(s)

The financing policies of belgian listed companies: a long term perspective. 01/01/2002 - 31/12/2005

Abstract

What determines the financing and dividend policies of firms? To what extent do these policies affect firm value? Over de past decaded, these research questions have been studied intensively. Studies so far, howevr, have largely analyzed corporate financing and dividend policies over very short time periods, and in a single country context, mainly focussing on the United States.

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Research team(s)