Capital structure has been a widely discussed subject among researchers, but no clear-cut answer regarding the optimal level has yet been provided. A great amount of previous researchers has studied how main theories, such as Modigliani and Miller´s “irrelevance of capital structure”, perform in real life and an extensive amount of studies have been made on the conceptual link between capital structure and performance. Although the majority of previous studies have been conducted on international public firms, less attention has been given to private firms in Sweden. Therefore, the purpose of this study is to investigate the association between capital structure in Swedish unlisted firms and performance. Furthermore, this study aims to investigate whether the location of the firm influence this relationship. In line with previous research, this study use a robust regression model and a random effect model to analyze a sample of 7444 unlisted Swedish firms, operating in 28 industries, in 21 different locations, during the time period 2009-2014. Return on assets is used as a proxy for performance and capital structure is defined as total, short term and long term debt scaled to total assets respectively. Our results show that there is a negative association between capital structure and performance and thereby reveals results in line with the pecking order theory. This implies that high levels of debt seems to increase the cost of outside financing in the presence of asymmetric information, which will make managers of private firms in Sweden more likely to use inside finance to acquire capital for their operations. Furthermore, a concave association between capital structure and performance is tested for total debt and short term debt in line with the agency cost theory. This result is also significant and provides reasons to assume that there might be an optimal capital structure in private firms in Sweden. To the authors’ best knowledge this study is one of the first to examine a concave relationship between capital structure and performance on private listed firms in Sweden as well as finding a significant impact of location on this association. In our additional analysis we also observe that the relationship between capital structure and performance is significantly different in Stockholm, Västra Götaland and Skåne in comparison to firms located in other places.

This research investigates 202 data breach events occurring between 2015 and 2019 and the related financial effects on the USA's impacted private firms. From examining previous research, it is obvious that no known studies evaluate the financial impacts of cybercrimes on private firms. Prior studies mostly focus on public firms and stock market reactions even though there is the increasing number of cyberattacks on private firms too. This study seeks to fill the gap by providing the empirical evidence of the impacts on those firms' cash holding after experiencing a cybersecurity attack. Overall, the results of this research show if the private firms that have been cyberattacked face the connate aftermath and follow the similar precautions as public firms with data breaches or not. I find that the firms that experienced an attack two years ago increase their cash holdings significantly, while an attack that happened a year ago can only impact cash holdings while interacting with tangibility and ROA of a firm. These results are essential as the private firms draw up a budget and reform strategies for coping with cyber incidents.

Since the late 1970s, China has gradually transformed from a planned system towards a market economy and its private sector has played increasingly important roles in the national development. During the process, Chinese private manufacturing firms made remarkable contribution to advancing reform, driving growth, enhancing export and improving employment. After the early 2000s, China joined in the World Trade Organisation and aimed to further progress its development through globalisation. The deep integration with the global economy has greatly facilitated China’s global competitiveness in manufacturing industries, but it has also brought the country with a series of development challenges. Nowadays, many Chinese private manufacturing firms are encountering various problems and stuck in development predicament. This dissertation tries to explore the question: What are the current development challenges for Chinese private manufacturing firms in globalisation? The research question is relevant to a wide range of theoretical and empirical research in development studies, including firm competition in global value chains, industrial districts in the global economy, large business in global competition and global battles within China. Building on critical reviews on related literature, the dissertation tries to enrich the existing knowledge by investigating the latest development of China’s manufacturing industries, analysing the challenges and responses of Chinese leading private firms of both large and small sizes individually, and discussing how the interaction of foreign and indigenous firms in both domestic and international markets shapes the global competitiveness of Chinese private firms. The dissertation mainly conducts qualitative inquiry and case studies to analyse the research question. Wenzhou is an outstanding pioneer in China to develop private economy and lead economic reform. The dissertation therefore makes in-depth investigation on Wenzhou’s leading firms in the footwear and the electrical equipment industries, to reflect China’s development in globalisation. Based on Wenzhou’s experience, the dissertation summarises the competition situation of Chinese private manufacturing firms in globalisation, concludes their current development challenges and puts forward policy implications for China’s economic reform and industrial upgrade.

Essay 1: I examine sales of private firms to better understand the effect of relaxing financial constraints on firm value. My empirical tests exploit an exogenous shock to financial constraints caused by interstate bank branching deregulation. On a sample of 557 sales of private firms to public acquirers, I find that relaxed financial constraints lead to a statistically significant increase of 7.3% in valuation multiples of private targets. I also find a significant increase in private target valuation multiples benchmarked to public target valuation multiples. These effects are more pronounced for firms in the sample with below median annual sales. Acquirer returns are negatively impacted when financial constraints on private targets are relaxed. The evidence supports the prediction that relaxing financial constraints allows private targets to substitute bank credit for some of the financing benefits provided by acquirers and bargain for a higher valuation.

This thesis examines debt maturity and trade credit in public and private firms. It consists of three essays that try to answer the following questions: Does the IPO decision affect the debt maturity structure of a firm? Do private firms use more or less trade credit than public firms? Does the supplier's listing status affect its trade credit provision? The first essay investigates the effect of an initial public offering (IPO) on the evolution of debt maturity structure using a sample of U.S. firms that went public during the period 1998-2011. I find that firms decrease their short-term debt by 19% in the first two years after the IPO and decrease it post-IPO, by about 7% relative to the pre-IPO level. These results continue to hold in a sample of new debt issues, in a difference-in-difference regression of IPO and non-IPO firms, in a treatment regression to account for endogeneity of the IPO decision, and in an instrumental variable regression to control for the joint determination of leverage and debt maturity. Further results show that the decline in short-term debt post-IPO is consistent with the asymmetric information and agency costs of equity theories and inconsistent with the agency costs of debt theory. I also find that the IPO effect on debt maturity was magnified during the recent financial crisis. The second essay explores the use of trade credit by public and private firms using a sample of U.S. firms during the period 1995-2012. Evidence shows that private firms use more trade credit by about 40.4% than public firms. This result is robust to models accounting for sample selection and for the endogeneity associated with a firm's decision to go public. In line with the asymmetric information and credit constraints theories, private firms that are young, have more growth opportunities, and fewer tangible assets rely more on trade credit than their public counterparts. Compared to private firms, public firms are faster in adjusting toward their target trade credit due to their lower adjustment costs. I also find that during the recent financial crisis, public firms increased their reliance on trade credit, while, suppliers granted private firms less trade credit. The third essay examines the supply side of trade credit; more specifically, the impact of a supplier's listing status on its trade credit provision using a sample of U.S. firms during the period 1994-2012. The findings show that public firms provide nearly a quarter more trade credit than their private counterparts. I propose that this is because public firms have higher financial capability, better ability in handling the trade credit process, and in enforcing payments and contract terms, than private firms. I rule out that the endogeneity of the listing decision and the observable differences between public and private firms have driven my earlier results. Additional tests show that firm characteristics, industries types, and level of competition, have a significant impact on the level of trade credit provided by public and private firms. The results also indicate that both types of firms provided less trade credit during the recent financial crisis.

abstract: This paper examines how equity analysts' roles as information intermediaries and monitors affect corporate liquidity policy and its associated value of cash, providing new evidence that analysts have a direct impact on corporate liquidity policy. Greater analyst coverage (1) reduces information asymmetry between a firm and outside shareholders and (2) enhances the monitoring process. Consistent with these arguments, analyst coverage increases the value of cash, thereby allowing firms to hold more cash. The cash-to-assets ratio increases by 5.2 percentage points when moving from the bottom analyst-coverage decile to the top decile. The marginal value of $1 of corporate cash holdings is $0.93 for the bottom analyst-coverage decile and $1.83 for the top decile. The positive effects remain robust after a battery of endogeneity checks. I also perform tests employing a unique dataset that consists of public and private firms, as well as a dataset that consists of public firms that have gone private. A public firm with analyst coverage can hold approximately 8% more cash than its private counterpart. These findings constitute new evidence on the real effect of analyst coverage. / Dissertation/Thesis / Ph.D. Business Administration 2012

The interest in company transparency has increased in the last years. This has been a demand from customers and other stakeholders after witnessing numerus scandals by big companies. Along with this, being transparent has also become a goal for a lot of companies today. Despite this, there are still little research on how companies should work with transparency. There are numerus ways for companies to exercise transparency, one of the being communicating about the company’s CSR (corporate social responsibilities) to share their contribution to a better world. However, there are some difficulties of doing this to make sure that the communication is not misleading and is in line with the reality. However, there are few studies in current research on CSR involving how practitioners are working when communicating CSR and their thoughts about it. Followingly, a company’s CSR efforts can be communicated in various ways. As social media is a major communication channel today it is also a main communication channel for companies CSR work. Which is why this degree project is focusing on CSR communication on social media. The purpose for this degree project is to investigate and explore how private firms in northern Sweden are using social media to exercise transparency by communicating their CSR efforts. The rapid economic growth of northern Sweden has made this an interesting geographical location for this study along with the fact that social media is well implemented in Swedish companies and the Swedish population along with CSR being well imbedded in Swedish companies. A qualitative method was applied along with grounded theory to analyze the findings and connecting them to current literature. The findings show of six approaches of how private firms in northern Sweden are using social media to communicate their CSR efforts, and therefor exercise transparency. These are: (1) Using social media to inform about the company’s actions regarding CSR, (2) Using social media to drive traffic to website to share further information about CSR, (3) Having the reputation of the company in mind when posting about CSR on social media, (4) Using social media to disclose organization information about CSR, (5) Using social media to encourage others to be more involved with CSR, and (6) Using social media to be more generous in their communication about CSR. The findings of this degree project will add to current research of transparency and CSR communication by having Sweden, and more specifically northern Sweden, as a geographical area. Followingly, by focusing on the practitioner’s perspective of communicating CSR, how they work, and their thoughts on CSR communication will also add to current research on the topic. Moreover, there are a number of practical recommendations from this study. Firstly, the findings of this study give insights and show of the importance of communicating CSR as a company. Secondly, the findings of this study can act as a framework for companies that want to start or improve their communication about CSR on social media. Lastly, the findings of this study are highlighting the benefits of using social media to communicate about CSR.

The analysis of key corporate decisions is mostly restricted to publicly listed firms even though privately held firms constitute a substantial part of any economy. In this dissertation, my goal is to enhance our understanding of some of the important decisions of private firms, namely: cash holdings, investment and performance using unique and large cross-country samples. In the first chapter, I examine cash holdings of private, unlisted firms versus publicly traded firms in 33 European countries during 2002-2011. I find that the average cash-to-assets ratios are lower in the Eurozone than in non-Eurozone countries by 5.4% due to lower transaction demand under a single currency regime. Public firms have higher cash ratios than private firms. However, the difference in cash ratios between public and private firms is higher in the Eurozone than in non-Eurozone countries, reflecting that: (a) precautionary demand is higher in the Eurozone due to risks and pitfalls of policy coordination, and (b) economic adjustments and transfers in the Eurozone more directly affect publicly traded firms than private ones. Moreover, I show that, during the financial crisis, corporate cash ratios increased in the Eurozone, indicating that the increase in precautionary cash demand was greater than a decrease in transaction demand due to the adoption of the Euro. In the second chapter, I compare the operating performance and efficiency of publicly and privately held firms in the UK over the period 2003-2012. I find that privately held firms typically perform better than publicly traded firms. This finding is robust in various model settings, using industry and size as well as propensity scored matched samples, considering alternative definitions of operating performance, ownership structure and taking into account the endogeneity of firm's exchange listing choice. I also show that average operating profitability of public firms is even lower than that of private firms when both types of firms are financially constrained. Finally, I show that informational value of R&D is higher for private firms than it is for public firms. In the third chapter, I examine the relationship between time horizons and corporate investment, both on the firm and country levels, for private, unlisted firms and publicly traded firms using a unique dataset from 73 countries around the world during the time period of 2003-2012. I show that a longer time horizon (i.e. higher propensity to save and invest) on a cultural and country level also manifests itself as higher investment at the firm level. This is robust to using alternative proxies for the country-level time horizon. Investment behavior of private firms, not public firms, follows a country-level horizon pattern, which is reflective of close monitoring by fewer owners and the absence of stock market pressures in making investment decisions. When I consider time-horizon at the firm-level, we find that firms with a longer time horizon invest more, and this effect is more pronounced for public firms than for private firms, given the former's greater, easier, and cheaper access to capital in the public capital market. I also show that public firms invest more and are more responsive to investment opportunities than private firms. / Business Administration/Finance

Este trabalho de pesquisa objetivou investigar os determinantes do caixa das companhias brasileiras a partir de uma inédita amostra pareada de empresas de capital aberto e fechado. Mais do que explorar as principais vertentes teóricas que tentam explicar os fatores que influenciam a gestão das reservas de caixa, analisou-se conjuntamente os impactos das fricções financeiras e dos custos de agência sobre o nível de caixa, particularmente. Nesse contexto, buscou-se explorar a política de caixa em uma economia emergente como o Brasil, cujo ambiente legal e sistema financeiro ainda não estão plenamente consolidados. Além disso, estudou-se a influência da concentração da propriedade acionária sobre o caixa, assim como a velocidade com que as firmas ajustam seu nível de caixa em direção ao nível alvo em diversas situações. Os principais resultados encontrados apontaram que no período analisado as companhias de capital aberto apresentaram um nível de caixa significativamente superior ao das companhias de capital fechado, isto é, evidenciaram que os efeitos do problema de agência sobre a liquidez corporativa são mais acentuados que os efeitos das fricções financeiras. / This research aimed to investigate the determinants of the cash holdings of Brazilian companies from an unprecedented sample of public and private firms. More than just exploring the main theories that attempt to explain the factors that influence the cash management, the impacts of financial frictions and agency costs on the cash level were analyzed together. In this context, I sought to explore the cash policy in an emerging economy such as Brazil, whose legal environment and financial system are not fully consolidated. In addition, I have also studied the influence of the concentration of equity ownership on the cash holdings, as well as the speed of adjustment with which the firms manage their cash reserves towards a target level in several situations. The main results showed that public companies had a significantly higher cash level than private companies in the analyzed period. In other words, they presented that the effects of the agency problems on corporate liquidity are more pronounced than the effects of the financial frictions.

Inledning Revisorns oberoende är och har varit en omdiskuterad fråga under en lång tid. I Sverige ska en revisor, enligt lag, bekräfta sitt oberoende inför varje nytt uppdrag eller i ett befintligt uppdrag när anledning föreligger, vilket görs med hjälp av analysmodellen. Istället för revisorns uppfattning om sitt oberoende förklarar denna studie hur klienter uppfattar revisorns oberoende med utgångspunkt i analysmodellen. Studien blir unik, dels i och med att klientens uppfattningar är det centrala och dels att studien fokuserar på privata företag. Syfte Syftet med denna studie är att utifrån analysmodellen förklara hur klienter uppfattar revisorns oberoende. Metod Eftersom studien utgår ifrån en deduktiv ansats innebär det att hypoteser har formulerats utifrån tidigare forskning och befintlig teori. En tvärsnittsdesign har använts, då datainsamling har gjorts vid en bestämd tidpunkt. Huvudsakligen har kvantitativ data legat till grund för studien i form av telefonenkäter. Studien har dock kompletterats med kvalitativ data i form av intervjuer med revisorer som har fått ge sin syn på de resultat som framkommit från telefonenkäterna. Slutsats Studiens resultat indikerar att klienter inte uppfattar hotet mot revisorns oberoende som ett problem. Dock har klientens storlek och revisorns ämbetstid signifikanta samband med klientens uppfattning om hotet mot revisorns oberoende. De intervjuade revisorerna förstod våra resultat och tyckte att de stämde väl överens med deras uppfattning om hur det ser ut i praktiken. / Prelude Auditor independence is and has been a contentious issue for a long time. InSweden an auditor shall, by law, confirm its independence before any newassignment or in an existing one when needed, which is done by using thethreats recognized by IESBA. Instead of the auditor’s perception of itsindependence this study explains how clients’ perceive auditor independence onthe basis of the threats recognized by IESBA. This study is unique partlybecause of that the client’s perspective is central and partly because of its focuson private firms. Purpose The purpose of this study is that on the basis of the threats recognized by IESBAexplain how clients’ perceive auditor independence. Method Since the study is based on a deductive method this means that hypotheses havebeen formulated on the basis of previous research and existing theory. A crosssectionaldesign was used, because our data collection was made at a given time.Mainly quantitative data, by telephone surveys, has been the basis for the study.However, the study has been supplemented with qualitative data throughinterviews with auditors, who have been given their views on the resultsobtained from the telephone surveys. Conclusion The results of the study indicates that clients’ don’t perceive the threat againstauditor independence as a problem. However, the size of a client and auditortenure have a significant relation with the client’s perception of the threatagainst auditor independence. The interviewed auditors understood our resultsand said they agreed well with their idea of what it looks like in practice.