Why firms with remedies for agency problems may havehigh cash flow right leverage?

• Main Authors: Hao-Yu Wu, 吳皓猷
• Other Authors: Hsiu-I Ting
• Format: Others
• Language: zh-TW
• Published: 2009
• Online Access: http://ndltd.ncl.edu.tw/handle/69891002201923672061

碩士 === 國立高雄第一科技大學 === 金融營運所 === 97 === This paper mainly investigates the reasons that affect cash flow right leverage of controlling shareholder and verifies that cash flow right leverage of controlling shareholder may be increased even though enterprises relatively have remedies for agency problems. This phenomenon could be explained by private benefit and risk aversion. The results suggest that debt ratio, board size and accounting transparency can retard agency problems, but cash flow right leverage do not decay monotonously with them. Because of risk aversion of controlling shareholder, cash flow right leverage level of controlling shareholder is increased and it intensifies cash flow right leverage level which controlling shareholder has already manipulated even though enterprises relatively have remedies for agency problems. After considering endogenous, controlling shareholder tends to manipulate cash flow right leverage because of private benefit motive of controlling shareholder even though enterprises relatively have remedies for agency problems. The result also suggests that cash flow right leverage level of controlling shareholder is increased and cash flow right leverage level which controlling shareholder has already manipulated is intensified because of risk aversion of controlling shareholder. Finally, these conclusions are identical if remedy for agency problem is measured by corporate governance.