Mark Holub

The Necessary Illegitimacy of the Whistleblower

This article examines the plight of the whistleblower using elements of organizational legitimacy theory. In recognizing the negative correlation between the actions of the organization and the whistleblower, it becomes clear that the continuing legitimacy of the organization necessitates the illegitimacy of the whistleblower. This helps explain the blacklisting of the whistleblower and their vilification which results in the destruction of both their career and their reputation. Only specific protective legislation can provide insurance for their career.

Corporate Flight: 'Moving' Offshore to Avoid US Taxes

Shows how many US companies, which are increasingly multinational, are using offshore subsidiaries to reduce their tax liability; some are even moving their head offices abroad or “offshore”. Discusses what offshore financial centres are; key characteristics are low taxation, little supervision of depositors, and secrecy of accounts. Points out that the term offshore is confusing, since large countries can be attractive to non‐resident businesses, and so they are not a homogeneous group; within the USA itself, Delaware is a state with low taxes and so has long been used by companies which are actually based in another state. Describes how reincorporating offshore works and the problem it poses for US tax revenues; the issue is contentious, especially after September 11, but the Bush administration’s attitude remains relaxed.

Bitcoin research across disciplines

ABSTRACT Over the last few years, research on Bitcoin and other cryptocurrencies has snowballed across many disciplines: technical fields, economics, law, public policy, finance, accounting, and others. As the uses of blockchain technology behind Bitcoin expand, more disciplines will be drawn to its study and the research will greatly expand. This paper provides an assessment of the current state of the literature. From a comprehensive search of the literature that resulted in an original sample of 13,507 results, a final sample of 1,206 papers on Bitcoin are categorised and mapped across six disciplines.

Stanley Works: to Bermuda or not to Bermuda, that was the question

Deals with the subject of US companies which relocate offshore to take advantage of the tax differentials between countries following globalisation. Focuses on Stanley Works, an established Connecticut manufacturer which in February 2002 announced that it would relocate its legal domicile to Bermuda in order to increase cash flow and decrease tax payments. Describes the strong negative reactions in the USA to this intended reincorporation abroad ‐ from unions, shareholders, the press, the US Treasury, politicians and commentators. Relates this storm of protest to the atmosphere in the US after the financial scandals and terrorist attacks of the early 21st century; although other companies had reincorporated outside the USA before Stanley Works, which eventually withdrew its reincorporation plan, none has since.

The Signalling Properties of On-Market Share Buybacks

We use the high disclosure environment for on-market buybacks in Australia to investigate whether detailed disclosure is valuable. We find that company type, buyback duration, and management motivation are all valuable signalling elements in the announcement event. These variables, which are not required in the disclosure rules of many major markets, are useful in discriminating the value of the buyback. They contribute 50% of the available explanatory power even after allowing for traditional determinants such as economic undervaluation, information signalling and lack of growth opportunities. We further consider whether firms’ actual repurchase activity communicates additional information. We find a negative relation between actual repurchases and the marginal post-announcement returns, which we interpret as evidence of strategic trading by management. Actual repurchases occur when post-announcement returns are poor, mainly as an immediate response to share price deterioration, rather than being due to any continued signalling benefit.

Assessing the Value of Overseas On-Market Share Buybacks

Overseas on-market share buybacks are buybacks by domestic firms conducted wholly or partly on a foreign exchange. Compared with a 2.3 percent average abnormal market response on announcement for domestic buybacks, we find a significantly lower 0.7 percent response for overseas buybacks. Further, portfolios of overseas relative to domestic buybacks have a significantly negative buy-and-hold abnormal return difference of -20.6 percent over a two-year horizon. Regardless of measurement, this difference in longer-term returns is both materially and statistically important and is only partly driven by conventional buyback explanatory variables of: larger firm size, high growth opportunities, lower overall cash balance and higher profitability. We find that the overseas nature of the buyback itself, especially for cross-listed firms, is economically and statistically significant in influencing the negative post-buyback event medium-term abnormal returns. Two key implications of our results, which are applicable and relevant for all stock markets, are: (i) overseas buybacks have signaling benefits for future performance, and (ii) improved disclosure of both the intention and extent of any overseas buybacks is desirable as it provides useful information.