The Impact of Firm Learning on Financial Value in Strategic Outsourcing Relationships

We investigate whether managers in outsourcing firms, through their prior experience in managing similar strategic alliances and prior association with the provider, learn to create value in their outsourcing relationships. Value creation is estimated in terms of long-term abnormal stock returns to the outsourcing firm relative to an industry, size and book-to-market matched sample of control firms following the implementation of the outsourcing contract, announcement period returns, and allied wealth effects. We find that prior experience and prior association have a significant impact on long-term abnormal stock returns, suggesting that financial markets are slow to price learning effects in outsourcing. Further, while relational learning alone influences value creation in simpler fixed price contracts, both procedural learning through prior experience and relational learning through prior association with the provider have an impact on value creation in variable price contracts. This is because of greater ambiguity in cooperation and coordination between firms that characterizes variable price contracts. The results have implications for management of outsourcing engagements and their performance and valuation

Royal Dutch Shell PLC balancing oil with energy transition

This Equity Research aims to value Royal Dutch Shell, a major Oil & Gas company, as of December 2020. The valuation integrates both the current and future prospects for the industry, incorporating expected energy transition features and how these will change Shell’s value creation process. A Discounted Cash Flow valuation is performed, using Weighted Average Cost of Capital as the discount factor. These results, together with a multiples analysis, suggest that Shell is undervalued, which creates an investment opportunity

Legal systems, national governance and renewable energy investment : evidence from around the world

This paper examines renewable energy (RE) investment and the role of a country’s legal system in shaping investment decisions. Analysing data from 236 renewable energy companies between 2000 and 2017 across the world, our study establishes that those in a common law system are more responsive to growth opportunities in RE investment, while facing greater financial constraints than their counterparts in civil law systems. Our study demonstrates that the global imbalance in RE development is caused by the influence of a country’s legal system, which determines the regulatory and business ethos that impacts on the trajectory of investment, and by the varying degrees of accountability implicit in a country’s governance environment. Our research raises the implication that the opportunity costs of forgone economic gains are in direct conflict with long-term environmental goals, retarding the transition from carbon-based to sustainable sources of energy, and provides insights into how development can be stimulated by fiscal incentives, favourable regulations, societal engagement, improved access to finance and the alignment of national strategies. Our findings contribute to the economic literature of legal origin theory and establish fundamental principles for refining global RE development strategy and confronting the challenge of climate change

Managing Intellectual Property to Foster Agricultural Development

Over the past decades, consideration of IPRs has become increasingly important in many areas of agricultural development, including foreign direct investment, technology transfer, trade, investment in innovation, access to genetic resources, and the protection of traditional knowledge. The widening role of IPRs in governing the ownership of—and access to—innovation, information, and knowledge makes them particularly critical in ensuring that developing countries benefit from the introduction of new technologies that could radically alter the welfare of the poor. Failing to improve IPR policies and practices to support the needs of developing countries will eliminate significant development opportunities. The discussion in this note moves away from policy prescriptions to focus on investments to improve how IPRs are used in practice in agricultural development. These investments must be seen as complementary to other investments in agricultural development. IPRs are woven into the context of innovation and R&D. They can enable entrepreneurship and allow the leveraging of private resources for resolving the problems of poverty. Conversely, IPRs issues can delay important scientific advancements, deter investment in products for the poor, and impose crippling transaction costs on organizations if the wrong tools are used or tools are badly applied. The central benefit of pursuing the investments outlined in this note is to build into the system a more robust capacity for strategic and flexible use of IPRs tailored to development goals

Taxation as a driver for Portuguese foreign direct investment in Netherlands: myth or reality?

Together with the increased internationalization of the companies, as an answer to the challenges of globalization, emerged the interaction between different tax systems. In this context, MNCs exploited gaps and differences between tax systems in order to reduce the tax burden. As a result, the taxation became an area of attention and highly considered as a key factor in the decision of internationalization. The present study aims to identify the countries where the Portuguese companies normally invest, and how taxation influence that decision of investment. With this objective, a comparative analysis between the Portuguese tax system and the tax system of the country where the Portuguese companies more invest in was made. It was also made a financial analysis to a set of Portuguese companies with presence in that country, in order to analyse the nature of its activities, the functions performed, the assets owned and the risks assumed by those companies. The results allowed to identify the existence of differences in Portuguese taxation regime and the Dutch tax regime, namely regarding the business profits, capital gains, dividends and interests/loans. Finally, it was possible to conclude that the tax regime assumes a great importance for the investment decision. However, it was possible to conclude that the investment of the companies analysed does not correspond to genuine FDI, but to the creation of SPEs, which in turn were platforms for the investment and internalisation of the group, allowing the group benefit from the advantages of the Dutch tax regime.A par da crescente internacionalização das empresas como resposta aos desafios da globalização emergiu também a interação entre os diversos sistemas fiscais. Neste sentido as multinacionais tem explorado as diferenças existentes entre estes com o objetivo de diminuir o montante de impostos a pagar. O presente estudo visa identificar os países mais representativos do investimento português no estrangeiro e o modo como a fiscalidade pode influenciar a decisão de investimento para os mesmos. Assim, realizou-se uma análise comparativa entre o sistema fiscal português e o sistema fiscal do país mais representativo do investimento português no estrangeiro. Adicionalmente realizou-se uma análise económica a um conjunto de empresas portuguesas com presença neste país de modo a identificar as funções desempenhadas, os riscos assumidos e os ativos empregues na sua atividade. Os resultados permitiram identificar diferenças entre os dois sistemas fiscais, nomeadamente no que respeita à tributação de dividendos, juros e mais-valias. Por último foi possível concluir que a fiscalidade assume um papel de relevo na decisão de investimento e que o investimento realizado pelas empresas em análise não corresponde a um genuíno investimento na Holanda mas à criação de SPEs, utilizadas pelos Grupos como plataformas para potenciar o seu investimento no estrangeiro, beneficiando das vantagens do sistema fiscal holandês

Corporate Social Responsibility

This Edited Volume Corporate Social Responsibility is a collection of reviewed and relevant research chapters, offering a comprehensive overview of recent developments in corporate behavior. The book comprises single chapters authored by various researchers and edited by an expert in the field. All chapters are complete in themselves but united under a common research study topic. This publication aims at providing a thorough overview of the latest research efforts by international authors and opening new possible research paths for further novel developments

Development of small and medium enterprises: the EU and East-partnership countries experience: monograph

The monograph reveals challenging issues of small and medium enterprises development in the European Union and East-Partnership countries. Special attention is paid to a new paradigm of financing investments and fostering innovations at all levels of legal entities including SMEs, enhancing innovative entrepreneurship in conditions of global social and technological challenges as well as determining priority sectors for small and medium enterprises as drivers of economic growth. The authors of the monograph emphasize on such European approaches to financing SMEs as crowd-funding and SME-bonds, analyze experience of applying fiscal instruments to support investment and innovations. The researchers underline the role of social investment as an innovative strategy for European SMEs that could be applied in Ukraine and East-partnership countries, suggest new conceptual approach to the evaluation of innovative business development. They also analyse trends of Ukrainian IT enterprises development in the context of modern information services in a global market. Additional attention is paid to the analysis of SMEs’ entrepreneurial potential in conditions of global social and technological changes, estimation effects of applying electronic governance technologies to provide administrative services by public authorities of various levels of governance. Finally, the researchers disclose economic mentality of legal entities as an informal side of financial assets and substantiate the necessity of creation entrepreneurial universities as drivers of innovative development of economy. The materials of the monograph will be useful to scholars, financial managers of companies, financial analysts, representatives of state bodies who implement the state policy in the field of SMEs development in the East-partnership countries, as well as students of economic universities

The Structure and Control of Public Enterprises in Algeria: Problems and Reforms

The Algerian public enterprise which, since 1965, had benefitted from considerable political and financial support of policy makers came under closer scrutiny and, indeed, severe criticism in the late 1970's. In 1980 the central authorities decided to reorganise these public firms. This reorganisation was part of a wider reform programme aimed at restructuring the administration and management of the public sector as a whole. The reforms stressed the need for greater decentralisation in decision making and a greater degree of financial autonomy for the public enterprises. The public enterprises were broken up into smaller, more specialised units in order to allow a more rational use of resources and to reduce the widespread inefficiency and waste in the public sector. In addition to these structural changes the finances of the public enterprises were overhauled. A number of measures to strengthen their financial autonomy were proposed. These included the deregulation of prices, the reactivation of the role of credit, the introduction of self-financing for minor investments