The Relationship between Internal Corporate Governance Mechanism and Risk-Taking in Family and Non-Family Firms

• Main Authors: Sung-Ming Chang, 張淞銘
• Other Authors: Lie-Huey Wang
• Format: Others
• Language: zh-TW
• Published: 2009
• Online Access: http://ndltd.ncl.edu.tw/handle/f5b669

碩士 === 銘傳大學 === 財務金融學系碩士班 === 97 === The main purpose of this study is to examine the relationship between internal corporate governance mechanism and family and non-family firms’ risk-taking. We also explore whether internal corporate governance mechanism has different impacts on family and non-family firms’ risk-taking between different industries and different firm size. Data are collected from Taiwan’s non-financial listed firms during 2002 to 2007 and we use the panel data linear regression to analysis. The empirical results show that the ratio of the stock hold by blockholders, the ratio of the stock hold by directors and supervisors, the ratio of the stock hold by institutional investors, the ratio of divagation between cash flow rights and board seat ratio, and the number of independent directors and supervisors have significant impacts on family firm’s risk-taking. However, there is no significant relationship between the internalization of board and family firm’s risk-taking. The only two governance variables that have significant impacts on non-family firm’s risk-taking are the ratio of the stock hold by institutional investors, and the number of independent directors and supervisors. The empirical results also show that internal corporate governance mechanism has different impacts on family and non-family firms’ risk-taking between different industries and different firm size. In the aspects of high technology family and non-family firms, only the ratio of the stock hold by blockholders, and the ratio of the stock hold by institutional investors have significant impacts on high technology family firm’s risk-taking. However, only the ratio of the stock hold by directors and supervisors has significant impacts on high technology non-family firm’s risk-taking. In the aspects of conventional family and non-family firms, only the ratio of the stock hold by blockholders, the ratio of the stock hold by directors and supervisors, the number of independent directors and supervisors, and the internalization of board have significant impacts on conventional family firm’s risk-taking. However, only the ratio of divagation between cash flow rights and board seat ratio has significant impacts on conventional non-family firm’s risk-taking. There are significantly relationships between the ratio of the stock hold by institutional investors and conventional family and non-family firms’ risk-taking, but the influencing direction of the ratio of the stock hold by institutional investors to risk-taking are different between conventional family and non-family firms. In the aspects of high technology and conventional family firms, only the ratio of divagation between cash flow rights and board seat ratio has significant impacts on high technology family firm’s risk-taking. However, only the ratio of the stock hold by directors and supervisors, and the internalization of board have significant impacts on conventional family firm’s risk-taking. There are significantly relationships between the ratio of the stock hold by institutional investors and high technology and conventional family firm’s risk-taking, but the influencing direction of the ratio of the stock hold by institutional investors to risk-taking are different between high technology and conventional family firms. In the aspects of high technology and conventional non-family firms, only the ratio of the stock hold by directors and supervisors, and the number of independent directors and supervisors have significant impacts on high technology non-family firm’s risk-taking. However, only the ratio of the stock hold by institutional investors has significant impacts on conventional non-family firm’s risk-taking. There are significantly relationships between the ratio of divagation between cash flow rights and board seat ratio and high technology and conventional non-family firms’ risk-taking, but the influencing direction of the ratio of divagation between cash flow rights and board seat ratio to risk-taking are different between high technology and conventional non-family firms. In the aspects of large family and non-family firms, only the ratio of the stock hold by blockholders, the ratio of divagation between cash flow rights and board seat ratio, and the internalization of board have significant impacts on large family firm’s risk-taking. In the aspects of small family and non-family firms, only the ratio of the stock hold by blockholders, and the ratio of the stock hold by directors and supervisors have significant impacts on small family firm’s risk-taking. In the aspects of large and small family firms, only the ratio of divagation between cash flow rights and board seat ratio, and the internalization of board have significant impacts on large family firm’s risk-taking. The ratio of the stock hold by directors and supervisors, and the ratio of the stock hold by institutional investors all have significant impacts on large and small family firms’ risk-taking, but the influencing direction of the ratio of the stock hold by directors and supervisors, and the ratio of the stock hold by institutional investors to risk-taking are different between large and small family firms. In the aspects of large and small non-family firms, only the ratio of the stock hold by directors and supervisors has significant impacts on large non-family firm’s risk-taking. There are significantly relationships between the ratio of the stock hold by institutional investors and large and small non-family firms’ risk-taking, but the influencing direction of the ratio of the stock hold by institutional investors to risk-taking are different between large and small non-family firms.