Ph.D. Arias-Moya, Jose

2024, Ph.D. Arias-Moya, Jose, Maquieira, Carlos, Espinosa‐Méndez, Christian

This article studies the relationship between environmental, social and governance (ESG) score and dividend payment for 274 large family firms in the period 2015–2021. This research has three contributions to the literature. First, to the best of our knowledge this is the first article to focus on large family firms considering their greater importance in stock ownership around the world. Second, this sample covers both developed and emerging nations. Third, our study not only establishes a connection between ESG (Environmental, Social, and Governance) criteria and dividend payments but also considers how financial constraints moderate the relationship between ESG scores and dividend payments. The results indicate a positive influence of ESG scores on dividend payments. Furthermore, financial constraints of family firms are negatively related to dividend payments. Finally, the moderating effect of financial constraints on the relationship between dividend payment and ESG show that for high levels of financial constraints that dividends are less sensitive to ESG score. The opposite effect is reported when firms show low levels of financial constraints. Practically speaking, the study demonstrates the value of creating a dividend policy that is in line with the ESG score because they are complementary signals. Additionally, it is important to consider financial limitations when planning financial reserves in family firms. This is due to the diminished correlation between ESG score and dividend payments in the presence of financial constraints.

2021, Espinosa Méndez, Christian, Arias-Moya, Jose

This article investigates whether COVID-19 pandemic had an effect on herding behaviour in Europe. Using a sample from the stock exchanges of France (Paris), Germany (Frankfurt), Italy (Milan), United Kingdom (London) and Spain (Madrid), over the period from January 03, 2000 to June 19, 2020, we found robust evidence that COVID-19 pandemic increased herding behaviour in the capital markets of Europe.

2021, Espinosa Méndez, Christian, Arias-Moya, Jose

This is the first article in investigating how COVID-19 affects Oceania’s financial markets. Specifically, we investigate if COVID-19 pandemic has an effect on herding behaviour in the Australian stock market. Using a sample of all firms listed over the period from 10 June 2008 to 19 June 2020, we find evidence that COVID-19 pandemic increases herding behaviour. The results report that herding behaviour manifests during crisis and extreme periods.

2021, Dr. Llanos-Contreras, Orlando, Ph.D. Arias-Moya, Jose, Maquieira, Carlos

This article makes progress in understanding how the heterogeneity of governance factors, and changes in the political/economic landscape influence family firms’ risk taking. Using a sample of 133 Chilean listed firms, this article studies the risk taking behavior of family firms from 2009 to 2016. Using several informational sources, an unbalanced panel data set is built to make estimations employing the two-way fixed effects OLS data panel regressions. GMM is also employed for robustness. Chilean family firms’ risk-taking, measured through z-score and ROA volatility, is higher than in non-family firms. This would be a response to take advantage of business opportunities that enhance their long-term position in financial and socioemotional wealth. Results also indicate that founders’ leadership (on the board of directors) aligns with higher levels of corporate risk, while the influence of founders’ descendants within the board is in the opposite direction. Finally, political uncertainty has a negative and statistically significant influence on Chilean family firms’ risk taking. Context (defined as point of reference) is a critical factor in explaining family firms’ strategic behavior through socioemotional wealth. Performance above/below expectation, the danger of bankruptcy and the global financial crises have been used as points of reference (context) to explain family firms’ risk taking, but political and economic landscapes have not been included before as explanatory variables.

2024, Ph.D. Arias-Moya, Jose, Maquieira, Carlos, Espinosa-Méndez, Christian

This research is focused on studying the relationship between ESG performance and default risk of family firms. The sample consists of the 500 largest family firms worldwide (including all continents) for the period 2015–2021. This study shows a positive and a statistically significant relationship between ESG score and Z-score. This is confirmed for ESG environmental and ESG social scores. We include ownership concentration of family members as well as the percentage of family members in the board of directors. In the first case, we detect a non-linear relationship between ownership concentration and Z-score (inverted U shape) and for the second variable we find a negative relationship between the family participation in the board and Z-score. Finally, financial constraints of family firms reduce the impact of ESG score on Z-score.