To stay competitive and sustain long-term profitability, Business Process Improvement (BPI) methodologies have become strategically important for financial institutions in recent years. These include well-known approaches such as Total Quality Management (TQM), Business Process Reengineering (BPR), Six Sigma and Lean. The customer-focused themes of BPI should be of particular interest to service practitioners, in order to achieve both process excellence and superlative customer service. The adoption of BPI in the financial services sector, however, still appears to be at an early stage. There is limited empirical research reported in the academic literature. This research therefore explored the existing phenomena of BPI adoption through case studies, carried out in leading Thai financial institutions. The study was carried out in three main phases, following a literature review of BPI and service quality issues, which provided the initial theory context. First, three case companies were investigated to find out how the financial institutions introduced BPI, and conducted BPI projects. The resulting insights helped to develop a theory model that aimed to provide understanding of the outcomes of BPI initiatives, in this context. The second research phase refined and validated the proposed theory model, aiming to elevate the conceptual level of the findings. The empirical data was analysed, by iterating between observed evidence and the literature, also using experts’ comments and suggestions. In the final phase, the key relationships in the evolving theory model were established and verified, employing further empirical evidence from revisiting the case studies, specifically focusing on four important areas of financial services. A final theory model was proposed, and in a further development aimed at practitioners, this model was used as the basis for a proposed BPI evaluation framework, taking account of current performance measurement approaches. This research contributes to knowledge in the area of quality management, in particular to BPI methodology and service quality for the financial services sector, but potentially also in a broader context. The main contribution is the development of a theory model to explain how financial institutions adopt BPI methodology for improving service quality, providing a better understanding for managers in accurate targeting of the operations process to be improved, through BPI adoption. The model also provides a constructive foundation for further development of a practical BPI evaluation framework, at the project level. The proposed theory model is, therefore, considered a basis for further empirical work, both qualitative and quantitative, relating to the BPI in the services context.

This thesis examines the capital structure determinants of private SMEs in China and the extent to which financial theories of capital structure adequately explain their financing behaviour. It also investigates whether other theoretical perspectives can be utilised to explain their capital structure decisions. In order to investigate these issues a mixed method approach is utilised, combining analysis of secondary data, with field research in the form of semi-structured interviews and survey questionnaires. Data analysis indicated that financial theories of capital structure alone do not provide a full explanation as to how SMEs are financed due to distinct institutional and cultural differences between China and the developed economy context in which these theories were developed. In order to better explain the financing behaviour of Chinese SMEs a theoretical model was developed based on insights from interviews with SME owner managers and the existing literature. This model highlighted the role played by managerial strategy, psychology, human capital and network ties in small business financing. Such factors are shown to be influential in determining the capital structure adopted by Chinese SMEs and are not taken into account by existing theories of capital structure in the finance paradigm. Based on the findings of this research theoretical and policy implications are provided. In order to support the continued growth of the SME sector Chinese government authorities should consider providing better support to entrepreneurs to access the formal financial sector. SME owner/managers must also understand the impact of their behaviour on the ability to access external financing and consider improving their accounting and information systems to reduce information asymmetries between themselves and their lenders.

No description available.

China’s outward foreign direct investment (OFDI) grew from a very limited scale prior to the 1990s to reach an annual average growth rate of 67% between 1991 and 2009, placing China as the largest FDI source country among the developing countries, and the fifth largest FDI source country in the world in 2009. China’s experience is particularly interesting because it serves to help us further understand OFDI in general and the emergence of investments from the developing countries in particular. This thesis aims to answer a series of unexplored questions about China’s OFDI, including its underlying motivations and locational determinants, the dynamic adjustment of China’s OFDI and its relationship with China’s inward foreign direct investment (IFDI), as well as the displacement effect of China’s OFDI on the OECD’s OFDI in the host countries. The first essay of this thesis (Chapter 3) investigates the underlying motivations and the locational determinants of China’s OFDI flow in detail, and focuses on the role played by the host country’s natural resources and technology. The chapter constructs two datasets, the first one encompasses 157 host countries for the recent period 2003-2009 and the second one includes 171 host countries for the early period 1991-2003. An FDI gravity equation is estimated by using alternative specifications, including Tobit, fixed effects and the Heckman selection model. In the recent period of 2003-2009, the findings provide strong evidence of the natural resources-seeking motivation and the technology-exploiting motivation in Chinese OFDI. In particular, China’s OFDI is driven to resources abundant countries with poor governance. The chapter also argues that China’s OFDI is promoted when the oil price is growing. In the early period of 1991-2003, however, there is only some evidence that China’s OFDI is driven to resources abundant countries with poor governance, and no evidence that the host country’s technology plays a role in Chinese OFDI. The second essay (Chapter 4) introduces a partial stock adjustment model and provides the first study on the dynamic adjustment of China’s OFDI in a dynamic framework. The effect of China’s IFDI on China’s OFDI within this dynamic framework is also studied. 172 host countries are included for 2003-2009 by using the System GMM, OLS and fixed effects models under an augmented gravity specification. The chapter provides strong evidence to support the dynamic adjustment of China’s OFDI. The equilibrium OFDI stock is greater and more volatile than the actual OFDI stock, implying that the underinvestment in China’s OFDI and the possible existence of the substantial adjustment costs associated. The findings suggest that the host country, on average, exploits its potential in attracting China’s future investments. There is some evidence of the positive correlation between China’s IFDI and China’s OFDI. In particular, the dynamic adjustment of China’s OFDI is stronger for the high-technology host countries, and the positive association between IFDI and OFDI is higher for the high-income host countries. The third essay (Chapter 5) is the first piece of research to examine whether and how China’s OFDI displaces the OECD’s OFDI in the given host countries. The chapter examines 33 of the OECD countries’ OFDI flow into 155 host countries for 2003-2009. Most importantly of all, the chapter also explores how the OECD countries’ OFDI are affected by China’s OFDI in these host countries. TSLS and fixed effects estimations are undertaken under an augmented gravity specification. The chapter presents evidence that China’s OFDI displaces the OECD’s OFDI in general. However, in contrast to the often-cited arguments concerning a ‘new colonialism’ in Chinese OFDI, no evidence was found that the OECD’s OFDI in oil and metal abundant host countries, in particular Africa and Latin America, are displaced by China’s OFDI.

In recent years a large number of rankings, ratings and indices have been developed that attempt to measure the Corporate Social Responsibility (CSR) of companies. Substantive growth in the Socially Responsible Investment (SRI) market in the last decade plays a major role in this development. Little is known about the extent to, and ways in which, the metrics developed for the SRI market may contribute to improvements in CSR. The research aims to answer these questions by studying the FTSE4Good index, an SRI index launched by FTSE Group in 2001. The research examines how this metric for the SRI market is developed by FTSE with the help of third parties; and the influence of the index on the responsible corporate behaviour of included companies. A mixed-methods approach to data collection and analysis is used to study these two research questions, drawing on interviews, archival data and document analysis, media analysis and multivariate analysis. The research employs an institutional work perspective to study the practices of individual and collective actors aimed at creating, maintaining, and disrupting institutions (Lawrence, Suddaby & Leca, 2011). The research shows how the FTSE4Good index has become an integral part of international accountability standards that have emerged in the CSR field (Waddock, 2008a; Waddock, 2008b). Three types of activities underpin this trend: first, the work by FTSE and social rating agency EIRIS to frame the index inclusion criteria and measure compliance; second, the process of engagement and dialogue with companies and third parties (e.g. NGOs) by the FTSE Responsible Investment (RI) team; and third, the valorising by companies and third parties of the index as a de facto CSR standard. The research builds on a central concern in the social sciences regarding reactivity - the idea that people change their behaviour in reaction to being evaluated, observed or measured. External metrics that evaluate, measure or rank the performance of organisations often induce strong reactivity (Espeland & Sauder, 2007). The research findings show how, as the bar for inclusion in the FTSE4Good index is continuously raised, companies react by adjusting their behaviour in line with the index criteria. A dynamic conceptualisation of reactivity is developed, and the range of organisational responses to CSR metrics in the SRI market is explored. The engagement dialogue between the FTSE RI team and included companies is one of the main mechanisms to create reactivity, as it provides companies an opportunity to obtain advice and guidance about the index inclusion criteria. A conceptual framework is developed that links engagement, symbolism and routine practices of calculation and measurement to changes in corporate behavior. The research examines the institutional work needed for reactivity to occur. The study contributes to the literature on SRI by providing qualitative and quantitative analyses of the effect of engagement by the FTSE RI team on the responsible behaviour of companies. The research contributes to the study of reactivity and metrics by highlighting the work that is needed from the part of both the organisation undertaking the measurement and the organisations that are subject to the evaluation. The research contributes to the study of institutional work by incorporating sociomateriality (Orlikowski & Scott, 2008) into the analysis of embedded agency. The study has implications for those seeking to govern by metrics, as it shows how striking a balance between what can be measured and what ought to be measured is complicated and requires a lot of work. Lastly, the research opens up a number of venues for future research into CSR, SRI and institutional work.

This thesis is structured to research on a financial derivative asset known as a credit default swap (CDS). A CDS is a contract in which the buyer of protection makes a series of payments (often referred to as CDS spreads) to the protection seller and, in exchange, receives a payoff if a default event occurs. A default event can be defined in several ways, including failure to pay, restructuring or rescheduling of debt, credit event repudiation, moratorium and acceleration. The main motivation of my PhD thesis is to investigate the determinants of the changes of CDS spreads and to model the evolution of spreads. Two widely traded types are corporate and sovereign CDS contracts, the first has as its underlying asset a corporate bond and, hence, hedges against the default risk of a company; the second type hedges against the default risk of a sovereign country. The two contract types have different risk profiles; for example, it is known that liquidity premium with different maturity varies significantly for a corporate CDS but less so for a sovereign CDS because, in contrast with the corporate markets where a majority of the trading volume is concentrated on the 5-year CDS, the sovereign market has a more uniform trading volume across maturities. In light of the difference, this thesis is divided into four parts. Part A introduces the motivation and research questions of this thesis, followed by literature review on debt valuation, with emphasis on default and liquidity spreads modelling. Part B aims at the role liquidity risk plays in explaining the changes in corporate CDS spreads. Part C models sovereign CDS spreads with macro and latent factors in a no-arbitrage framework. Part D concludes this thesis with a list of limitations and further research direction.

This thesis investigated stock market disequilibrium focusing on two topics: the impact of multiple market makers on the market disequilibrium at the market microstructure level, and the detection of the long-run market disequilibrium in the context of bubbles and the changes in transition probabilities. The multiple market makers increased the resilience of price rather than improving its efficiency when a multiple market maker system (the NASDAQ) was compared with a single market maker system (the NYSE) in terms of lowering non-stationarity and raising predictability. On the other hand, the volatility modelling of intraday data showed that market maker’s under-estimation (higher-than-estimated size of return) increased volatility while over-estimation decreased it. Also, intraday seasonality in mean and volatility was confirmed, but leverage effects were denied in the GJR-GARCH-type models. The evidence of price bubbles in the Indian markets (1987-2008) and positive duration dependence in negative runs in the Korean market (1990-2008) were revealed using the duration dependence tests. The unconditional transition probabilities that a positive or negative run continues or ends were mostly significantly different from 0.5. On the other hand, the structural break based duration dependence test was devised to detect the changes in the transition probabilities between the market (dis)equilibrium. The NASDAQ and the Indian market showed positive duration dependence in positive runs and the Korean market displayed it in negative runs. In other words, the transition probability in those markets increases as a price run between structural breaks lengthened.

This thesis contributes to the current discourse around co-evolution, this study investigates co-evolution between the South African venture capital industry and the South African government. Using a qualitative method which involved gathering data from archival sources and contemporary interviews, this study extends the growing literature on the co-evolution of organizations and their institutional environment in three ways. First, the study shows that the co-evolution that occurs between organizations and the institutional environment, is facilitated by both entities' respective need for legitimate status with different audiences. Second, the study furthers our understanding of co-evolution at the meso level (i.e. the organizational field) by illustrating the place of subject positions of organizations and power in the co-evolution that occurs at that level. Third, from the narrative presented in the study on the emergence of a venture capital industry in South Africa, the study explicates the importance of a free market system in a transition economy as it engenders the growth and development of a venture capital industry in such economies.

The purpose of this thesis is to provide a new simple theoretical framework for understanding the sterilisation of foreign exchange intervention within a monetary policy framework where a short-term interest rate is the main policy instrument. Another aim is to carry out new empirical analysis that compares and contrasts the effects of intervention on base money growth with its effects on broad money growth, and to investigate if these effects are associated with common country characteristics in terms of the nature of intervention, balance of payments flows and monetary policy frameworks. Using a portfolio balance model and simple balance sheet constraints, it is shown that base money sterilisation does not imply broad money sterilisation. Incomplete broad money sterilisation, when intervention is a positive money supply shock, leads to looser monetary and financial conditions, even as base money growth is completely sterilised in an interest rate-targeting framework. With a progressively lower degree of broad money sterilisation, the policy interest rate in an optimal monetary policy reaction function needs to respond more strongly to the exogenous factors affecting the output gap and inflation. The empirical analyses of the contemporaneous and long-run effects of real intervention on real base money growth and real broad money growth are carried out using multivariate autoregressive distributed lag (ARDL) regressions for individual countries. These regressions include controls for demand factors. The focus on a reasonably large sample of 30 countries, with individual country heterogeneity taken into account, and the emphasis on broad money sterilisation represent a clear departure from existing empirical literature. The empirical results reveal that on average, the real intervention effect on real broad money growth is higher than and disconnected from the effect on real base money growth. The baseline group average short-run and long-run coefficients are 0.122 and 0.496 respectively for real broad money growth and 0.075 and 0.111 respectively for real base money growth (excluding outliers, Egypt and Taiwan, in both instances). With regard to the relevance of country characteristics, a general lack of statistical significance is observed across mean and median equality tests and bivariate regressions. This is not unexpected with regard to real intervention effects on real base money growth, but indicates that the real intervention effects are very much country-specific in the case of real broad money growth. In particular, there is no evidence of a difference in real intervention effects on real broad money growth between inflation-targeting and non-inflation-targeting countries. The short-run and long-run real intervention effects on real base money growth are found to be robustly associated with differences in capital account openness although these differences are not of a monotonic nature. Meanwhile, the short-run real intervention effects on real broad money growth have a positive, monotonic association with current account surpluses and concurrently a negative monotonic association with capital account surpluses. On the other hand, the long-run real intervention effects on real broad money growth do not appear to be robustly linked to any particular country characteristic in a statistically significant manner. A key implication of the thesis is that broad money sterilisation matters, not base money sterilisation, in understanding how balance of payments flows and intervention permeate the economy. Complete broad money sterilisation, however rarely occurs. Furthermore, regardless of the degree, broad money sterilisation, seen as a blunt instrument, may have unpredictable and undesirable effects, owing to uncertainties over money demand and money supply shocks, and mismatches in asset demand and supply. The model presented provides a framework for understanding the continued reliance on measures such as prudential policies and restrictions on capital flows in dealing with financial imbalances; this despite seemingly successful sterilisation by way of the containment of base money growth.

This study investigates the managerial incentive of insider trading. A research subject that has not been empirically examined in the UK yet. In doing so, this study merges two parallels but related tracks: The information contents of insider trading which is a Finance subject backed by the Efficient Market Hypothesis (EMH) and the managerial incentives of insider trading which is a Management subject backed by the Agency Theory. In fact, the managerial incentives of insider trading only becomes testable once there is evidence that insider trading is profitable. In detecting the information contents of insider trading, this research differs from previous literature in that (1) it employed three signal definitions, (2) it used dally data, (3) it used the security' return index, instead of share prices, (4) it used a most recent set of data, (5) it used the Capital Asset Pricing Model (CAPM) to estimate the expected returns, (6) it reports the results within a shorter event window and (7) it provides, for the first time, empirical evidence on the Executive Share Options (ESO) transactions, in addition to ordinary shares. In terms of the managerial incentive part of this research,a major contribution of this research is that it provides evidence for the first time on the managerial aspects of insider trading by directors in the UK. The analysis has examined the short-term profitability of FTSEIOO directors trading in their own firm's ordinary shares and executive shares options, over recent years (1999 to 2000). The empirical results of this study shows that except for the executive share options portfolios, the empirical results significantly reject the null hypothesis that directors trading in their own company's securities are not profitable. Instead they suggest the alternative hypotheses that directors buying portfolios achieve positive abnormal return and those of selling ones avoid negative abnormal returns. The results of this study have been checked on by re-running the analysis taking into account thin trading, confounding events, year-by-year analysis, and firm size. The robustness check analysis shows that there is no thin trading problem in the sample securities, no firm key event announcement conoccured with the director dealing transactions, thus the director dealing abnormal returns are not a result of other events. In addition, smaller firms outperform larger ones, particularly in the longer event windows of buying transactions and directors buying in the year 2000 outperform those in 1999. However the year 1999 was a successful selling year for FTSE 100 directors. Two important conclusions are suggested by employing different signal methodologies These are first, different signal definition produce different results, not only in terms of the level and sign of cumulative abnormal return (CAR), but also in terms of the significance of the statistical results. On one hand, multiple (MS) and quantitative (QSs) signals produced significant CARs at earlier days than single signal (SS). This leads to suggest that the market reacts significantly sooner to successive signals than to a single signal. On the other hand, none of the other signals produce significantly results that reject (accept) what has been accepted (rejected) by the single signal. The results of three tests, parametric (standard errors) and non-parametric (Wilcoxon Signed Ranks Test), about the equality of the means of CARs of SS and of MS, QSI, QS2, QS3 and QS4 might lead to suggest that while the magnitude of CARs across various signals is identical, the time when these CARs becomes significant is varied. CARs of compounded signals (MS and QSs) are significant at earlier days in the event window, while those of SS are significant at later days in the event window. This suggests that none of other signals can be considered as an alternative or a counterpart to the single signal with daily data. Second, each signal definition requires certain data frequency. Single signal produces robust results when daily data are used, while those of multiple and quantitative signals are mixed. Monthly data is recommended with multiple signals, whereas both monthly and daily data can be used with quantitative signal. In the context of EMH, the empirical result of this study shows clearly that the stock exchange is significantly inefficient in terms of the strong level of market efficiency. On the other hand, the availability of abnormal returns to outsiders following the publicly known information, i.e. insiders' transactions, can be seen as a direct test to the semi-strong level of market efficiency. The empirical results indicate that abnormal returns can be earned by outsiders' imitating insiders' transactions. However, taking into account the transaction cost, such returns would end up with zero, if not negative returns. In terms of the managerial incentive of insider trading, the model states that as the number of insiders in the firm increases, competition to insider trading increases and each insider's expected returns decreases. On the other hand, as number of insiders' increases, the explicit form of director's compensation should increase to offset his insider trading returns decreases. This concept leads to an empirically testable assumption that the director's expected compensation has two forms, (1) an explicit form (salary, bonuses, perks and other ex ante measurable incentives) which is predicted to be positively correlated with the number of insiders; and (2) an implicit form (his expected insider trading returns) which is predicted to be negatively correlated with the number of insiders in his firm. The empirical prediction, presented in a multivariate model, was tested using, FTSE 100 chief executive officers (CEO) data. The data and the justification behind using each and every dependent and independent variable in the test is discussed. Also, the variables for the regression model, which is used to explain the relationship between the CEO explicit form of compensation (dependent variable) and the number of insiders in his firm, as well as his personal and job characteristics (independent variables), are analysed and assessed. The results were very much in favour of the model. The positive relation between the explicit forms of CEO compensation and the number of insiders in the UK FTSE100 firms was found to be quite robust. That is, the significant relation does not depend on (i) whether the model accounts for CEO internal experience and industry sector, (ii) whether the model accounts for CEO's capacity to trade and his actual insider trading returns and (iii) whether an omitted variables problem is accounted for by using panel data. This leads to conclude that insider trading is an integral part of the director's total compensation package, and thus, can be considered as a managerial incentive. A by-product finding from the analysis indicates that there is an indication that the labour market for top management in FTSEIOO might not be competitive. This conclusion is brought about by the positive association found between director's pay and his realized insider trading returns. However, this conclusion is subject to the definition of CAR used in the analysis.