Corporate Leverage and Investment

Leverage and corporate performance: International evidence

Article history: Received 5 December 2011 Received in revised form 10 July 2012 Accepted 10 July 2012 Available online 20 July 2012 This paper analyzes the effect of financial leverage on corporate operating performance and how this effect varies across countries. Results for 10,375 firms in 39 countries indicate that the performance of firms with greater leverage is significantly reduced compa...

CEO Traits, Corporate Performance, and Financial Leverage

This study uses a random effect panel model to examine the impact of CEO traits and compensation on earnings performance and financial leverage for the 729 listed US companies in ExecuComp over the period of 2001– 2010. The results indicate that CEO cash compensation has a negative relationship with earnings performance, but that it has a positive impact on financial leverage. Moreover, for CEO...

Financial leverage changes associated with corporate mergers

We empirically examine whether firms increase financial leverage following mergers. Firms could increase financial leverage either because of an increase in debt capacity or because of unused debt capacity from pre-merger years. We find that financial leverage of combined firms increases significantly following mergers. A cross-sectional analysis shows that the change in financial leverage arou...

8 Real Determinants of Corporate Leverage

Green Investors and Corporate Investment

Green investing, or socially responsible investing (SRI), which refers to making investment decisions according to both financial and ethical criteria, has become increasingly popular in recent years. This paper explores the effects of ethical screening on the investment decisions of firms that fail the screen (’polluting’ firms) and on their decisions to reform so as to pass the screen. The pa...