Abdulaziz Ahmed Alomran’s research while affiliated with King Faisal University and other places

This article aims to examine the voting behaviour of long-term institutional shareholders towards board recommendations on management proposals and resolutions and how the potential agency costs could moderate such voting behaviour. This study is conducted using all corporate capital proposals put to vote by management during the annual general meetings (AGM) of publicly listed firms on the London Stock Exchange over a period of 17 years from 2000 to 2016. Building on agency theory and the concept of the monitoring function of institutional shareholders, this study finds that long-term institutional shareholders do support board recommendations on management proposals, but potential agency concerns linked to excess cash holding can negatively moderate this relationship. Additional analysis reveals that this moderating effect is observed only for management proposals related to cash inflows, specifically after the 2007–2009 financial crisis. This study highlights the importance of long-term institutional shareholders actively monitoring firms’ cash holdings and using voting to address agency concerns while advising corporate managers to optimise cash management and stay attuned to shareholder preferences. For policymakers, the research suggests promoting transparency in corporate governance and strengthening shareholder engagement to reduce agency problems and improve governance. Several robustness tests are conducted, and the results support our predictions.

This study investigates the influence of corporate cash holdings on the flow of open-end equity mutual funds. Building on the economic mechanisms that drive investors’ decisions when they construct their portfolio, the study analyses a comprehensive global dataset that includes 13,674 firms and 58,406 funds from 23 countries for the period from 2008 to 2017. Multiple regression models (pooled and fixed effect) are implemented to explore this relationship. The results show that there is a negative relationship between mutual fund flow and corporate cash holdings which indicates the significant role corporate cash holding policies have on the mutual fund industry. This article contributes to the literature by adding a new factor that can explain mutual fund investors’ behaviour. To the best of our knowledge, it is the first study to examine the relationship between corporate cash holdings and mutual fund flow, and one of the few studies to examine the influence of corporate-level decisions on the mutual fund industry. The results could help fund managers to better forecast future fund flow by considering corporate-level policies, namely cash holdings.

Purpose This study aims to investigate the impact of ownership by large shareholders (blockholders) on corporate cash holdings. The study further investigates heterogeneity in the relationship between blockholder ownership and corporate cash holdings. Design/methodology/approach Building on the precautionary and agency motives of corporate cash holdings, the study focuses on publicly listed firms from 22 European countries for the period from 2006 to 2015. Multiple pooled ordinary least square and fixed effects regression models are employed to examine the relationship between blockholder ownership and firms’ cash holdings. Findings This study documents a positive relationship between blockholder ownership and corporate cash holdings which indicates the role of blockholders in influencing firms’ cash holdings policies. However, further analyses show that the effect of blockholding on cash holdings depends on the type of blockholder. While the relationship is still positive between cash holdings and ownership by strategic blockholders, it turns negative for the ownership by institutional blockholders. Research limitations/implications This study provides evidence for the important role played by firms’ ownership structures, and especially blockholding, in shaping firms’ cash holdings decisions. The findings are therefore of great value for investors, firms’ management and board and policy makers. Originality/value This paper contributes to the literature by providing an explanation of the contradictory results documented in the literature on the impact of blockholders on corporate cash holdings. This study, to the best of the author’s knowledge, is the first to examine the effect of blockholder ownership on cash holdings by distinguishing between different types of blockholder.

Focusing on the role of the institutional investment horizon as a monitoring mechanism that enhances companies’ sustainability reporting reliability, this study investigates the association between long-term ownership and companies’ decisions to assure their sustainability report. Further, the study examines the moderating effect of the quality of governance on this association. Consistent with the critical mass theory, the study argues that long-term ownership should reach a certain threshold to have an influence on companies’ assurance decisions. The study’s results support the argument and find that long-term ownership is positively and significantly associated with companies’ assurance decisions, and the association is positive and significant only for a high level of long-term ownership in comparison to low- and medium-level long-term ownership. Moreover, the study finds that the association between long-term ownership and assurance is negatively moderated by the quality of governance at both the company and country levels.

This study investigates the effects of oil price uncertainty on corporate cash holdings using large international publicly listed firms from 89 countries for the period 1990–2017. Building on the precautionary motive of cash and the trade-off theory, we argue that the oil price uncertainty has a significant impact on corporate cash holdings and this impact is nonlinear. First, we find that oil price volatility is positively associated with corporate cash holdings. However, we then find evidence that shows that the association between oil volatility and cash holdings exhibits a U-shape. Finally, we present evidence that the positive relationship between oil price uncertainty and corporate cash holdings is more pronounced in firms operating in oil-exporting countries and in oil-exposed industries. Overall, our findings support our predictions and are robust to multiple robustness tests.