Corporate governance and firm cash holdings in the US

• 成果类型: Article
• 署名作者: Harford, Jarrad; Mansi, Sattar A.; Maxwell, William F.
• 署名单位: University of Washington; University of Washington Seattle; Virginia Polytechnic Institute & State University; University of Arizona
• 刊物名称: JOURNAL OF FINANCIAL ECONOMICS
• ISSN/ISSBN: 0304-405X
• DOI: 10.1016/j.jfineco.2007.04.002
• 发表日期: 2008
• 页码: 535-555
• 关键词: CASH HOLDINGS; corporate governance; Ownership structure; take-over provisions; acquisitions

摘要

Using governance metrics based on antitakeover provisions and inside ownership, we find that firms with weaker corporate governance structures actually have smaller cash reserves. When distributing cash to shareholders, firms with weaker governance structures choose to repurchase instead of increasing dividends, avoiding future payout commitments. The combination of excess cash and weak shareholder rights leads to increases in capital expenditures and acquisitions. Firms with low shareholder rights and excess cash have lower profitability and valuations. However, there is only limited evidence that the presence of excess cash alters the overall relation between governance and profitability. In the US, weakly controlled managers choose to spend cash quickly on acquisitions and capital expenditures, rather than hoard it. (C) 2008 Elsevier B.V. All rights reserved.