Action (finance) | EPFL Graph Search

vignette|250px|Action du Zoo d'Anvers, Belgique,23 juillet 1843. vignette|250px|Action de la Société royale de Zoologie, d’Horticulture et d’Agrément (Zoo de Bruxelles à l'époque), 1874. vignette|Action de la S. A. de la Franc-maçonnerie bordelaise, 1878. vignette|Action de la Société Anonyme du Home-Décor, 1898. vignette|Action de la Compagnie Impériale des Chemins de Fer Éthiopiens, 1899. vignette|Action de Imprimerie et Publicité Charles Verneau, 1899. vignette|Action de la Compagnie des Installations Maritimes de Bruges (Belgique), 1904. thumb|Action française de la Compagnie des Tramways de l'Ain, de 1909, avec quelques coupons vignette|Action de la Banque industrielle de Chine, 1920. Une action est un titre de propriété délivré par une société de capitaux (par exemple une société anonyme ou une société en commandite par actions). Elle confère à son détenteur la propriété d'une partie du capital, avec les droits qui y sont associés : intervenir dans la gestion de l'entrepr

Essays in Financial Economics

Kornelia Fabisik

This thesis consists of three parts that study separate subjects in corporate finance and corporate governance. The overarching theme is ownership by CEOs and other insiders. In the first part, which is co-authored work with Rüdiger Fahlenbrach, René M. Stulz, and Jerôme Taillard, we build the largest database of managerial ownership information ever used in the literature. We show that the empirical relation between a firm's Tobin's q and managerial ownership is systematically negative. When we restrict our sample to larger firms as in the prior literature, we confirm earlier findings of an increasing and concave relation between Tobin's q and managerial ownership. We show that cumulative past performance and liquidity can explain these seemingly contradictory results. Better performing firms have more liquid equity, which enables firms and insiders to more easily sell shares after the IPO, and they also have a higher Tobin's q. In the second part, I conduct the first large-scale empirical analysis of the pledging phenomenon among U.S. CEOs. Pledging allows the owner of shares to put them up as collateral to a third party in exchange for cash. I show that between 2007 and 2016, 7.6% of publicly listed U.S. firms disclosed that their CEOs had pledged company stock as collateral for a loan. On average, CEOs pledge 38% of their shares. The mean loan value is an economically sizeable $65 million. CEOs use the funds to either double down (6.0%), hedge their ownership (3.5%), or to obtain liquidity while maintaining ownership (90.5%). My event study results reveal that stock market participants view pledging as value-enhancing. Similarly, I find no evidence of its negative shareholder value consequences, except for CEOs who engage in significant pledging. In the third part, I provide the first in-depth analysis of U.S. pledging CEOs who faced margin calls. A margin call occurs whenever the value of collateral backing a loan falls below a certain pre-specified amount. I find that 15% of CEOs with margin loans have at some point faced margin-call-induced selling. The mean (median) drop in CEO ownership following margin-call-induced sales is 31.2% (22.0%). More than 87% of firms do not introduce any type of an anti-pledging policy post margin-call sales by their CEOs which could explain the absence of any major changes in CEO compensation contracts. Corporate policies in firms with CEOs who lost a sizeable ownership stake are not indicative of weakened incentives.

EPFL2020

CLASHING INTERESTS IN THE IPO PROCESS: CONTINGENCIES OF SIGNALING WITH REPUTABLE VC TIES

Giovanni Liotta

In this study I look at how inter-organizational ties with reputable venture capital (VC) firms affect the valuations that entrepreneurial ventures receive from public investors at initial public offerings (IPOs). I propose that the effect of signaling is attenuated when there is misalignement of strategic interests between a venture and its VC investors. I consider the level of shares sold by insiders at the IPO and the enforcement of demand registration rights as elements indicating misalignement of interests. Drawing on a sample of 86 IPOs in the main U.S. stock exchanges completed by entrepreneurial ventures in the Clean Technology sector, I find that, on average, affiliation with reputable VCs elicits a positive response by public investors. However, public markets react less favorably to reputable ties when insiders sell large amount of their shares at the IPO or when VCs force the offer of their shares by the enforcement of demand registration rights.

2011

Signaling and Self-regulation in Venture Capital

Giovanni Liotta

This thesis proposes three studies that provide novel empirical evidence on how different types of VCs' characteristics signal the quality of an entrepreneurial venture and influence investment strategies of funds subject to self-regulation. In the first study we aim at contributing to the ongoing debate on the different effects of reputation and status on organizational outcomes. We explore the signaling value that these two organizational attributes exert on external parties judging the quality of entrepreneurial ventures under uncertainty. Moreover, we examine whether signaling mechanisms are valuable only if the external parties are affected by high information asymmetry with the valued venture. We test our hypotheses using a sample of 1,339 U.S. clean technology ventures that received the first round of Venture Capital (VC) between the years 1990 and 2012. We look at their ability to gather supplemental financial resources for survival and growth by completing an Initial Public Offering (IPO) or an acquisition by an incumbent firm. The findings indicate that VCs' reputation - an economic attribute based on past performance - can signal a venture's quality externally, while VCs' status - a social-standing attribute - does not have signaling value. The results also show that quality signals are more relevant for public investors at IPOs than for managers of acquiring companies. The second study looks at how inter-organizational ties with reputable VCs affect valuations received by entrepreneurial ventures that go public. I propose that the signaling effect of reputable VC ties is lower when there is misalignment of strategic interests between the venture and the VCs. I consider the amount of shares sold by insiders in the initial public offering (IPO) and investors' enforcement of demand registration rights as elements indicating misalignment of interests with the venture. The hypotheses are tested on using a sample of 86 IPOs in the main U.S. stock exchanges completed by entrepreneurial ventures operating in the Clean Technology sector. The results suggest that affiliation with reputable VCs elicits a positive response by public investors. However, public markets react less favorably to ties with reputable VCs when they sell large amount of their shares in the IPO or resort to demand registration rights to force the public offering of their shares. The third study investigates organizations' use of self-regulation as form of symbolic response to normative pressure that does not necessarily entail compliance in practices. I argue that, when self-regulatory initiatives are not supported by an explicit regulatory environment, opportunistic organizations might reduce their efforts to align with the normative ideals through compliant actions and behaviors. The "walking of the talk", which is the implementation of actions that are aligned with the symbolic response, might also be discouraged by alternative means to obtain organizational legitimacy, such as through an organization's status. The hypotheses are tested on a sample of Venture Capital (VC) funds whose limited or general partners voluntarily decided to join the United Nations' Principles of Responsible Investment (UNPRI, 2006) initiative between 2006 and 2014. The results from a difference-in-differences estimation show that VC funds' likelihood to invest in clean technology companies is lower after funds' stakeholders (i.e. general or limited partners) join the UNPRI initiative. I also find that the likelihood to invest in clean technologies after self-regulation is negatively moderated by the VC fund's status.

EPFL2016

Signaling and Self-regulation in Venture Capital

Giovanni Liotta

EPFL2016

Essays in Financial Economics

Kornelia Fabisik

EPFL2020