Industry expertise, information leakage, and the choice of M&A advisors

This paper examines the impacts of M&A advisors’ industry expertise on firms’ choice of advisors in mergers and acquisitions. We show that an investment bank's expertise in merger parties’ industries increases its likelihood of being chosen as an advisor, especially when the acquisition is more complex, and when a firm in M&A has less information about the merger counterparty. However, due to the concerns about information leakage to industry rivals through M&A advisors, acquirers are reluctant to share advisors with rival firms in the same industry, and they are more likely to switch to new advisors if their former advisors have advisory relationship with their industry rivals. In addition, we document that advisors with more industry expertise earn higher advisory fees and increase the likelihood of deal completion.Chang acknowledges financial support from Rega Capital Management Limited and Academic Research Fund Tier 1 provided by Ministry of Education (Singapore). Shekhar acknowledgesfunding provided under the Faculty Research Grant scheme of the Faculty of Economics and Commerce, the University of Melbourne. Tam acknowledges research funding (MYRG074(Y1-L2)-FBA11-THK) provided by University of Macau

Managerial entrenchment and firm value: a dynamic perspective

We examine the impact of managerial entrenchment on firm value using a dynamic model with firm fixed effects. To estimate the model, we employ the long-difference technique, which is shown by our simulation to deliver the least biased estimates. Based on a large sample of U.S. companies, we document a significantly negative and causal effect of managerial entrenchment on firm value after taking into account omitted variables, reverse causality, and highly persistent endogenous variables. Additional analysis suggests that the causality running from managerial entrenchment to firm value is more pronounced than that for reverse causality.Chang acknowledges financial support from Academic Research Fund Tier 1 provided by Ministry of Education (Singapore). Zhang acknowledges the financial supports for his PhD research from the University of Melbourne

A survey on trends and digital adoption in China's outbound tourism 2023

As many Chinese start to resume overseas travels from the beginning of 2023 following a nearly three-year COVID-19 disruption, the study on Chinese outbound tourism is of great interest to many. We surveyed 500 Chinese consumers who plan to travel abroad within the upcoming 12 months to understand Chinese outbound tourists' attitudes, preferences and trends in 2023. We included previously understudied topics such as digital technology adoption and mobile payment usage. The findings highlight digital technologies' significant role in Chinese tourists’ travel experiences. The results provide valuable insights into the preferences and behaviour of Chinese travellers, shedding light on their reliance on digital technologies and mobile payments while exploring foreign countries. We hope these insights are helpful for businesses and destinations looking to cater to the needs and expectations of this influential group of travellers

Environmental risk and buyer-supplier relationships

We provide empirical evidence on the adverse effects of supplier firms’ environmental risk exposure on their relationship with principal customers. We document that supplier firms with high environmental risk are less likely to have principal customers. From principal customers’ perspective, a higher level of environmental risk lowers a supplier firm’s probability of being chosen relative to its industry peers by its potential customer. Conditional on an ongoing relationship with principal customers, supplier firms with high environmental risk have lower sales to principal customers and shorter relationship durations. These results are more pronounced when customers’ environmental risk is low. Collectively, our findings suggest an important channel through which firms can benefit from being environmentally responsible