Related party transactions, disclosure and ownership structure in Brazil
Open Access
- 3 April 2020
- journal article
- Published by Virtus Interpress in Corporate Ownership and Control
- Vol. 17 (3), 134-145
- https://doi.org/10.22495/cocv17i3art10
Abstract
This article investigates the association between RPTs, disclosure, ownership structure, and performance in Brazil and uses a hand-collected sample of 3,790 Brazilian RPT contracts obtained from corporate filings of a representative and randomly drawn sample of public companies from 2010 through 2012. Firms with greater conflicts of interest potential may employ less RPTs to signal that there will be no abuse. There is a negative and significant relationship between RPT values and accounting performance, but the same is not true for market value. The evidence in this article contrasts with that presented in national surveys by Matos and Galdi (2014) and Silveira, Prado, and Sasso (2009a), which may reflect different methodological choices. Companies and market participants may realize that some types of RPTs are beneficial and others harmful to minority shareholders and their short and long term impacts on performance are not the same. The evidence suggests that both the hypothesis of efficient economic transactions and of the conflict of interest may have merit depending on the type of RPT and the performance metrics.Keywords
Funding Information
- Conselho Nacional de Desenvolvimento Científico e Tecnológico (302691/2010-3)
This publication has 36 references indexed in Scilit:
- Not All Related Party Transactions (RPTs) Are the Same: Ex Ante Versus Ex Post RPTsJournal of Accounting Research, 2012
- Tunneling through intercorporate loans: The China experienceJournal of Financial Economics, 2010
- The Role of Corporate Governance in Related Party TransactionsSSRN Electronic Journal, 2010
- Related Party Transactions: Legal Strategies and Associations with Corporate Governance and Firm Value in BrazilSSRN Electronic Journal, 2008
- O ativismo dos fundos de pensão e a qualidade da governança corporativaRevista Contabilidade & Finanças, 2007
- Evolution and Determinants of Firm-Level Corporate Governance Quality in BrazilSSRN Electronic Journal, 2007
- Evidências sobre as estruturas de propriedade de capital e de voto das empresas de capital aberto no BrasilRevista Brasileira de Economia, 2007
- Tunneling, propping, and expropriation: evidence from connected party transactions in Hong KongJournal of Financial Economics, 2006
- RELATED PARTY TRANSACTIONS AND CORPORATE GOVERNANCEPublished by Emerald ,2004
- A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for HeteroskedasticityEconometrica, 1980