Board structure and institutional ownership at the time of IPO

Purpose: The purpose of this paper is to examine the impact of mandatory regulatory provisions on board structure and the influence of such board structure on institutional holdings. Design/methodology/approach: The study uses unique hand-collected data set of Indian IPOs during the 2004-2012 period after the corporate governance reforms with the introduction of clause 49 in the listing agreements in 2001. Using OLS regression, the paper empirically analyses the determinants of board size and board independence at the time of the IPOs and the influence of such a board structure on shareholdings by domestic and foreign institutional investors. Findings: The authors find that complying with mandatory regulatory provisions does not impede firms from structuring their boards to reflect the firms’ advising and monitoring needs. The authors also find that complying with provisions have positive implication for the firm, as firms with greater board independence appear to attract more foreign institutional investors. Originality/value: To the authors’ best knowledge, this is the first study to examine the issue in a regime where regulation mandates the composition of the board of directors. The paper also extends the literature on institutional holdings by providing evidence on the impact of board structure on institutional ownership at a critical time in a firm’s life cycle when concerns for endogeneity for empirical investigations are weaker

Synthesis and Electron Emission Properties of Aligned Carbon Nanotube Arrays

Carbon nanotubes (CNTs) have become one of the most interesting allotropes of carbon due to their intriguing mechanical, electrical, thermal and optical properties. The synthesis and electron emission properties of CNT arrays have been investigated in this work. Vertically aligned CNTs of different densities were synthesized on copper substrate with catalyst dots patterned by nanosphere lithography. The CNTs synthesized with catalyst dots patterned by spheres of 500 nm diameter exhibited the best electron emission properties with the lowest turn-on/threshold electric fields and the highest field enhancement factor. Furthermore, CNTs were treated with NH3 plasma for various durations and the optimum enhancement was obtained for a plasma treatment of 1.0 min. CNT point emitters were also synthesized on a flat-tip or a sharp-tip to understand the effect of emitter geometry on the electron emission. The experimental results show that electron emission can be enhanced by decreasing the screening effect of the electric field by neighboring CNTs. In another part of the dissertation, vertically aligned CNTs were synthesized on stainless steel (SS) substrates with and without chemical etching or catalyst deposition. The density and length of CNTs were determined by synthesis time. For a prolonged growth time, the catalyst activity terminated and the plasma started etching CNTs destructively. CNTs with uniform diameter and length were synthesized on SS substrates subjected to chemical etching for a period of 40 minutes before the growth. The direct contact of CNTs with stainless steel allowed for the better field emission performance of CNTs synthesized on pristine SS as compared to the CNTs synthesized on Ni/Cr coated SS. Finally, fabrication of large arrays of free-standing vertically aligned CNT/SnO2 core-shell structures was explored by using a simple wet-chemical route. The structure of the SnO2 nanoparticles was studied by X-ray diffraction and electron microscopy. Transmission electron microscopy reveals that a uniform layer of SnO2 is conformally coated on every tapered CNT. The strong adhesion of CNTs with SS guaranteed the formation of the core-shell structures of CNTs with SnO2 or other metal oxides, which are expected to have applications in chemical sensors and lithium ion batteries

Do foreign institutional investors improve board monitoring?

Exploiting the global financial crisis of 2007–08 as an exogenous shock that resulted in a significant decline in the ownership of foreign institutional investors (FIIs) in the Indian equity market, we find evidence of a causal link between FIIs’ ownership and different dimensions of board monitoring. Specifically, the empirical results suggest that higher FIIs ownership leads to lower board size, busyness, network size, CEO power, CEO pay, and improved board diligence. However, we also document a negative link between FIIs’ ownership and board independence, indicating that FIIs do not view independent directors as effective monitors. In terms of implications, our results suggest that improved board monitoring, induced by higher FIIs’ ownership, leads to higher firm valuation and innovation activities

Corporate governance reform and risk-taking:evidence from a quasi-natural experiment in an emerging market

Existing studies suggest that stricter Corporate Governance Reform (CGR) reduces corporate risk-taking, primarily due to higher compliance costs and expanded liabilities of insiders or managers. We revisit the relationship between CGR and risk-taking in an emerging market set-up characterized by weaker market forces of corporate scrutiny and greater insider ownership, which encourages firms to pursue investment conservatism. Using a quasi-natural experiment, we find that stricter CGR leads to greater corporate risk-taking. We further show that risk-taking is an important channel through which CGR enhances firm value. Our findings support the view that stricter CGR can have a positive effect on corporate risk-taking and corporate investment decisions in an evolving regulatory environment

Domestic and foreign institutional investors' investment in IPOs

The regulatory provisions in India ensure that IPO investors are able to observe the participation levels of other subscribers prior to their own subscription decisions. This should reduce the information asymmetry between the foreign institutional (FIIs) and domestic institutional investors (DIIs). We argue that because of this setting we should observe less difference in their investment patterns and performance. Our results, however, show that (a) FIIs subscribe to IPOs more aggressively than DIIs; (b) DIIs have better IPO selection ability than FIIs; and (c) in the post-listing period, FIIs reduce their IPO holdings more extensively than DIIs. FIIs reduce their post-listing holdings especially in firms that are smaller, younger, have higher stock volatility while increasing on stocks with higher returns, indicating that FIIs chase hot markets. Overall, in spite of transparency-enhancing regulations, the investment patterns of FIIs and DIIs differ significantly

International equity portfolio allocations and stock market development

This paper examines whether the widely reported phenomena of home and foreign biases (i.e. sub-optimal international equity portfolio diversification) hold any ramifications for the development of stock markets. The results, analysed using macro- and micro-level data, support the view that stock markets that are characterised by a higher degree of home bias are associated with lower levels of development. On the other hand, markets where foreign investors show a higher degree of allocation preference, relative to the prescribed benchmark (foreign bias), are found to be more developed. The results, which are robust to the use of shock based identification strategy, indicate that policy measures that promote optimal international equity portfolio diversification could be crucial in developing the depth and breadth of domestic stock markets

Diverse investor reactions to the COVID-19 Pandemic : insights from an emerging market

We examine the reaction of different investor categories to the COVID-19 pandemic in the Indian market throughout 2020. Using quarterly ownership data, we find significant differences across various investor categories during the crisis and post-crisis periods. We find that domestic institutional investors (DIIs) exhibit 'flight-to-quality' behavior, foreign institutional investors (FIIs) exhibit 'fire-sale' behavior, and retail investors (RIs) act as informed investors who provide liquidity during the crisis period. We observe conservative behavior from DIIs and FIIs throughout 2020, during which RIs initially increase their holdings in high-risk stocks but move to high-quality stocks in the final quarter of 2020. FIIs contribute the most to lower stock returns and higher volatility during the crisis period. Using daily FII trade-level data, we find that long-term FIIs start buying high-quality stocks before other categories in the post-crisis period, with short-term FIIs driving returns and volatility during the crisis period

Regeneration Status and Carbon Accumulation Potential in Community Managed Sal (Shorea robusta) Forests of Far-Western Terai Region, Nepal

Regeneration patterns of species population can address climate change by adaptive evolution or by migrating association to survival in their favorable climate and finally decide the particular forest future. This research examined the status of regeneration and carbon sequestration potential in tropical Sal (Shorea robusta) forest of Kanchanpur district, Nepal. For the study, a total of 63 concentric sample plots were investigated by using systematic sampling with 0.5% sampling intensity. Regeneration status of forest was estimated by calculating the density of each species in each developmental phase. The above-ground carbon stock of trees species were estimated using allometric equations. The studied forests had good regeneration status and Shorea robusta was the dominant species in terms of regeneration and carbon stock. Ramnagar community forest had greater number of seedling, sapling and tree than that of the Ganesh community forest. Reverse J-shaped population curves were recorded at both the study sites. This study provided information about the regeneration status, structure, composition and carbon sequestration potential of tree species which is very necessary for conservation and sustainable management of community forests. Studies indicate that community management has increased the carbon stock of forests and also has promoted the productivity of forests by altering the structure and composition of the community forests

Do foreign institutional investors improve board monitoring?

Exploiting the global financial crisis of 2007–08 as an exogenous shock that resulted in a significant decline in the ownership of foreign institutional investors (FIIs) in the Indian equity market, we find evidence of a causal link between FIIs' ownership and different dimensions of board monitoring. Specifically, the empirical results suggest that higher FIIs ownership leads to lower board size, busyness, network size, CEO power, CEO pay, and improved board diligence. However, we also document a negative link between FIIs' ownership and board independence, indicating that FIIs do not view independent directors as effective monitors. In terms of implications, our results suggest that improved board monitoring, induced by higher FIIs' ownership, leads to higher firm valuation and innovation activities