Chaur Shiuh Young

Cross-country comparison of intellectual capital performance of commercial banks in Asian economies

This study explores the intellectual capital performances of commercial banks in eight Asian economies by applying Pulics value-added intellectual coefficient method (VAIC™). The results show that after controlling for the influence of loan quality (LQ), fund utilisation (FU), and Asian financial crisis, both physical and human capitals (HCs) are the main factors creating value for banks. From 1996 to 2001, banks in Hong Kong on average had the best intellectual capital performance while those in Thailand improved the most. Further analysis shows that the value-creating efficiency of HC is the major driving force of performance.

Voluntary Appointment of Independent Directors in Taiwan: Motives and Consequences

This study explores factors that motivate firms to increase board independence in the absence of legal requirements to do so. In addition, we examine the impact of voluntary enhancement of board independence on firm performance. Using a sample of listed companies in Taiwan, we show that voluntary appointment of independent directors is associated with both economic factors and managerial power. Specifically, we find that board independence increases with the weaknesses of alternative corporate governance mechanisms and the severity of agency problems. However, board independence decreases with managerial ownership and family control. In addition, by employing a simultaneous equations model with selectivity, we provide evidence supporting the positive performance impact of voluntary appointment of independent directors in Taiwan.

Top management teams' social capital in Taiwan. The impact on firm value in an emerging economy

Purpose – The paper aims to examine the contributions of top management teams’ (TMTs) social capital to the creation of business value.Design/methodology/approach – Least‐squares regression is used to estimate the relationship between TMT social capital and Tobins Q, while controlling for other firm‐ and industry‐specific explanatory variables.Findings – The empirical results show that it is TMT extra‐business group (but not intra‐business group) directorate ties that are viewed as valuable strategic assets by the marketplace, and the benefits of extra‐business group directorate ties mainly come from the relationships’ greater prominence, but not from the relationships’ wider span or better position.Research limitations/implications – Past research has tended to focus on “who executives are” – their background, personality, etc. Since the results show that executives’ extra‐business group social capital is strategically valuable, future research should take note that “whom executives know” – i.e. their s...

Influences of relationship transparency from intellectual capital reporting on supply chain partnerships with suppliers: a field experiment

Purpose – This paper aims to explore the intellectual capital (IC) information needed to enable relationship transparency and the influences of relationship transparency on supply chain partnerships.Design/methodology/approach – A field experiment research design is adopted to examine whether IC information facilitates relationship transparency with partners in the supply chain of a focal firm and contributes to supply chain partnership enhancement.Findings – This study identifies an IC transparency framework consisting of two components – the transparency of important business characteristics and the transparency of relationship atmosphere – for guiding the provision of IC information and enabling relationship transparency. The provision of the focal firms IC information to partners in its supply chain significantly increases partners trust, satisfaction and commitment towards their relationships. Thus the results suggest that relationship transparency derived from IC transparency enhances supply chain...

Relationship transparency for partnership enhancement: an intellectual capital perspective

Purpose – The purpose of this article is to explore and illustrate how intellectual capital transparency through intellectual capital reporting can enable relationship transparency and enhance partnership.Design/methodology/approach – A case study research method is adopted to explore and illustrate the key research issues on a single case.Findings – Three elements of intellectual capital transparency specific for the enhancement of business‐to‐business partnerships are proposed: the transparency of a focal business vision, value proposition, strategies and supportive knowledge resources; the transparency of information perceived as being relevant by its partners; and the transparency of relationship atmosphere. Intellectual capital transparency through the suggested intellectual capital reporting framework is very suitable for enabling holistic understanding of and enhancing partnership.Practical implications – Businesses may benefit from making transparent their intellectual capital information to key p...

Relationship between intellectual capital-oriented corporate performance management systems, intellectual capital and corporate performance: an exploratory study

This study examines whether an intellectual capital (IC)-oriented corporate performance management (CPM) system drives corporate performance through supporting the development and accumulation of intellectual capital. Data were collected from 211 firms in Taiwan and analysed using a structural equation model (SEM) analysis. We document that greater adoption of an IC-oriented CPM system is significantly associated with higher IC levels. In addition, greater adoption of an IC-oriented CPM system has a significant and positive indirect effect on corporate performance through its association with IC levels. The results highlight the importance and benefits of adopting an IC-oriented CPM system. This study extends existing research on the association between IC and corporate performance by explicitly identifying IC-oriented CPM systems as a contributing factor to corporate IC developments.

Information technology, organisational capital and firm performance

Our objective is to examine the mediating effect of organisational capital on the relationship between information technology and firm performance. Using the mediated regression method and a sample of Taiwans listed firms, an IT intensive context, empirical results provide statistical support for our argument that through organisational capital (OC), IT investments indirectly contribute to firm performance, measured by Tobins Q. Moreover, we also find that firms with high ratio of OC value change to IT expenditures have better future performance. This supports our argument that management should put attention on how IT investments being complementary with organisational practices to boost a firms organisational capital and thereby firm performance. As a whole, the results offer insights into how or why IT contributes to firm performance, and thus explain the IT productivity paradox phenomenon.

Auditor selection and corporate social responsibility

This study examines the association between the selection of an industry specialist auditor and corporate social responsibility (CSR). We find that firms with higher CSR ratings are more likely to hire industry specialist auditors (national-level industry leaders, city-level industry leaders, or joint city-national industry leaders). Moreover, firms with better CSR performance related to product quality and the environment in controversial industries are found to select non-specialized auditors. The results suggest that such firms may overinvest in CSR activities associated with the environment and product issues to disguise the sin nature of their manufactured goods, and simultaneously engage low quality auditors perhaps to avoid full disclosure of potential environmental and legal liabilities. Overall, we conclude that CSR is associated with the non-controversial firms ensuring high quality financial reporting in response to societal expectations, and thus CSR firms in such industries have strong incentives to engage industry specialist auditors. This article is protected by copyright. All rights reserved

The Relationship between R&D Capitalization and Subsequent R&D Investment Decisions: the Monitoring Role of the Board of Directors

Proponents of the R&D capitalization method have long argued that expensing R&D incentivizes myopic managers to cut R&D to manage short-term profits, leading to underinvestment in R&D. However, we argue that R&D capitalization is not a panacea. Using a sample of U.S. software firms from 2007 to 2010, we document the first archival empirical evidence that R&D capitalization can lead to subsequent over-investment in R&D. This finding is consistent with the view that, to save their reputation, managers of R&D capitalizing firms are reluctant to report impairment of capitalized R&D. Consequently, capitalizing firms tend to continue those R&D projects with bleak prospects and thus over-invest in R&D. A further analysis indicates that effective monitoring from a firms board of directors can discipline managers for overinvestment in R&D.

Family executives' external directorate ties and corporate innovation in Taiwan's electronics industry: The role of controlling family agency problems

Top management teams of family firms are often characterized as having less diversity and professionalism, which could limit corporate innovation. Based on the Resource Dependence Theory, to build external directorate ties is one approach to accessing different resources and information which can benefit firms’ innovation. However, controlling families’ external directorships may bring two distinct effects on firms due to, on the one hand, their strong needs for heterogeneous ideas and, on the other hand, the potential agency problems related to family firms. Given the prevalence of family firms in Taiwan’s information and electronics industry, we first examine the relationship between family executives’ directorate ties and innovation. Next, considering the controlling families’ ownership structures, we further examine how the controlling family’s agency problem affects the aforementioned relationship. Using a sample of family firms in Taiwan’s information and electronics industry, we predict and find a positive association between the quality of family executives’ external directorate ties and firms’ innovation performance. Moreover, we find this positive association to be offset by controlling families’ entrenchment incentives arising from their divergence between control and cash flow rights. These results imply that family firms with greater agency problems allow their family-member executives to accept at-will external directorships while ignoring firms’ overall benefits. 【Keywords】 external directorate ties, family executives, innovation 台灣電子業家族經理人之外部董事會連結與公司 創新:論控制家族代理問題之影響 臺大管理論叢 2014/6 第24卷第2期 181-212 DOI: 10.6226/NTURM2014.JUL.R09001 台灣電子業家族經理人之外部董事會連結與公司創新:論控制家族代理問題之影響 182 壹、前言 在全球化競爭的知識經濟時代下,創新是企業取得競爭優勢的關鍵 (Lengnick-Hall, 1992);而新知識與資訊為提升公司創新能力之來源 (Tsai and Ghoshal, 1998; Tsai, 2001)。Salman and Saives (2005) 指出,經由直接或間接網絡連結所取得的知識與資源, 可以協助公司提升創新效益。依據資源依賴理論 (Resource Dependence Theory),公司 間之董事會連結 (Directorate Ties) 是一個取得外部資訊、知識與資源的良好媒介 (Burt, 1980);尤其是組織中擬定策略的高階管理者,可藉此外部董事連結與其他組織交流溝 通 (Geletkanycz and Hambrick, 1997),獲致有益於公司創新的資訊與知識。然而,董事 會連結亦被視為和代理問題有關 (Bizjak, Lemmon, and Whitby, 2009),尤其在諸如台灣 的新興市場中,家族企業為典型 (Yeh and Woidtke, 2005),其具有創新受限 (Munari, Oriani, and Sobrero, 2010) 及控制股東與小股東間具代理問題的特質 (La Porta, Lopezde-Silanes, and Shleifer, 1999),導致家族經理人之外部董事連結對公司創新具有不明的 實質意涵。 具體而言,家族公司通常具有排外繼承、專業性成長不足的問題 (Covin, 1994), 難以吸引並留住擁有豐富網絡關係的專業經理人,致使管理團隊成員的多樣化水準受 限 (Sirmon and Hitt, 2003)。過去文獻指出,具適度多樣化背景的管理團隊較能產生創 新想法、避免短視思考 (Auh and Menguc, 2005)。因此,藉由指派家族成員到其他公司 獲取經驗與知識,是彌補管理團隊缺乏異質性的可行作法 (Sirmon and Hitt, 2003);此 與資源依賴觀點 (Pfeffer and Salancik, 1978) 下,透過董事會連結取得外部關鍵性資源 的論點相符。然另一方面而言,家族企業中高階管理者個人及所屬家族的利益,可能 與公司整體股東的利益並不一致。過去文獻指出,家族企業具有任人唯親、搭便車、 侵占利益等不利於公司績效之挑戰,造成代理成本增加 (Miller, Le Breton-Miller, Lester, and Cannella, 2007; Schulze, Lubatkin, and Dino, 2003)。因此,在控制家族擁有 控制權的情況下,家族經理人出任其他公司外部董事的決策,較難受到監督力量的牽 制,而容易流於牟取個人與家族之利益,不利公司整體利益的發展。 綜上可知,家族經理人的外部董事連結尤其存在「擴展家族管理團隊多元創新觀 點之需求」與「流於控制家族自利決策」的兩股衝突效應。本研究針對新興市場家族 企業,首先驗證家族經理人之外部董事會連結與公司創新之關聯性。其次,過去文獻 (Shleifer and Vishny, 1997; La Porta et al., 1999) 提出控制家族在控制權與現金流量權偏 離時,存在侵害小股東之代理問題,此時外部董事連結可能無益於甚或有損於公司創 新績效。鑑此,本研究目的二進而檢視家族企業代理問題如何影響家族經理人外部董 事連結與公司創新之關係。後文中,將允許經理人到其他公司擔任董事職務的公司稱 之為派出公司 (Sending Firm),而接受其他公司之經理人擔任董事職務的公司則稱為接 收公司 (Receiving Firm),本研究係聚焦於派出公司之創新績效。