Izvorni znanstveni članak
https://doi.org/10.1080/1331677X.2022.2109053
Related Party Transactions and firm value: the role of governance mechanism
P. C. Abdul Rasheed
Iqbal Thonse Hawaldar
T. Mallikarjunappa
Sažetak
The research on Related Party Transactions (R.P.T.s) shows that the
impact of R.P.T.s is context dependent and there is no consensus
on the findings of available studies. This study aims to examine
the impact of R.P.T.s on firm value in Indian context and the interaction
effect of governance mechanism on the relationship
between R.P.T.s and firm value. A sample of 2,294 firms consisting
of 685 group affiliated firms and 1,609 standalone firms for a
period of 2014–2021 has been selected and panel data regression
method has been applied for testing the hypotheses. The empirical
findings of the study support the transaction efficiency hypothesis
that R.P.T.s in India do not expropriate the interest of minority
shareholders and these transactions enhance efficiency of the firm
by reducing transaction cost, enforcing optimal business contracts
and effectively allocating resources between affiliated firms. The
findings of the study also provide significant contribution to the literature
by examining the interaction effect of governance mechanism
on the relationship between R.P.T.s and firm value.
Ključne riječi
Related Party Transactions (R.P.T.s); transaction efficiency; conflicts of interests; arm’s length price; firm value; corporate governance
Hrčak ID:
306649
URI
Datum izdavanja:
30.4.2023.
Posjeta: 490 *