The value of excess cash and corporate governance: Evidence from US cross-listings

• 成果类型: Article
• 署名作者: Fresard, Laurent; Salva, Carolina
• 署名单位: Hautes Etudes Commerciales (HEC) Paris; University of Neuchatel
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2010.04.004
• 发表日期: 2010
• 页码: 359-384
• 关键词: International cross-listing; corporate governance; Cash holdings; liquidity

摘要

We examine whether and how a US cross-listing mitigates the risk that insiders will turn their firm's cash holdings into private benefits. We find strong evidence that the value investors attach to excess cash reserves is substantially larger for foreign firms listed on US exchanges and over-the-counter than for their domestic peers. Further, we show that this excess-cash premium stems not only from the strength of US legal rules and disclosure requirements, but also from the greater informal monitoring pressure that accompanies a US listing. Overall, because investors' valuation of excess cash mirrors how they expect the cash to be used, our analysis shows that a US listing constrains insiders' inefficient allocation of corporate cash reserves significantly. (C) 2010 Published by Elsevier B.V.