تئوری و عمل در امور مالی شرکت ها: شواهدی از زمینه

We survey 392 CFOs about the cost of capital, capital budgeting, and capital structure. Large firms rely heavily on present value techniques and the capital asset pricing model, while small firms are relatively likely to use the payback criterion. A surprising number of firms use firm risk rather than project risk in evaluating new investments. Firms are concerned about financial flexibility and credit ratings when issuing debt, and earnings per share dilution and recent stock price appreciation when issuing equity. We find some support for the pecking-order and trade-off capital structure hypotheses but little evidence that executives are concerned about asset substitution, asymmetric information, transactions costs, free cash flows, or personal taxes.

In this paper, we conduct a comprehensive survey that describes the current practice of corporate finance. Perhaps the best-known field study in this area is John Lintner's (1956) path-breaking analysis of dividend policy. The results of that study are still quoted today and have deeply affected the way that dividend policy research is conducted. In many respects, our goals are similar to Lintner's. We hope that researchers will use our results to develop new theories – and potentially modify or abandon existing views. We also hope that practitioners will learn from our analysis by noting how other firms operate and by identifying areas where academic recommendations have not been fully implemented. Our survey differs from previous surveys in a number of dimensions.1 First, the scope of our survey is broad. We examine capital budgeting, cost of capital, and capital structure. This allows us to link responses across areas. For example, we investigate whether firms that consider financial flexibility to be a capital structure priority are also likely to value real options in capital budgeting decisions. We explore each category in depth, asking more than 100 total questions in total. Second, we sample a large cross-section of approximately 4,440 firms. In total, 392 chief financial officers responded to the survey, for a response rate of 9%. The next largest survey that we know of is Moore and Reichert (1983) who study 298 large firms. We investigate for possible nonresponse bias and conclude that our sample is representative of the population. Third, we analyze the responses conditional on firm characteristics. We examine the relation between the executives’ responses and firm size, P/E ratio, leverage, credit rating, dividend policy, industry, management ownership, CEO age, CEO tenure, and the education of the CEO. By testing whether responses differ across these characteristics, we shed light on the implications of various corporate finance theories related to firm size, risk, investment opportunities, transaction costs, informational asymmetry, and managerial incentives. This analysis allows for a deeper investigation of corporate finance theories. For example, we go beyond asking whether firms follow a financial pecking order ( Myers and Majluf, 1984). We investigate whether the firms that most strongly support the implications of the pecking-order theory are also the firms most affected by informational asymmetries, as suggested by the theory. Survey-based analysis complements other research based on large samples and clinical studies. Large sample studies are the most common type of empirical analysis, and have several advantages over other approaches. Most large-sample studies offer, among other things, statistical power and cross-sectional variation. However, large-sample studies often have weaknesses related to variable specification and the inability to ask qualitative questions. Clinical studies are less common but offer excellent detail and are unlikely to “average away” unique aspects of corporate behavior. However, clinical studies use small samples and their results are often sample-specific. The survey approach offers a balance between large sample analyses and clinical studies. Our survey analysis is based on a moderately large sample and a broad cross-section of firms. At the same time, we are able to ask very specific and qualitative questions. The survey approach is not without potential problems, however. Surveys measure beliefs and not necessarily actions. Survey analysis faces the risk that the respondents are not representative of the population of firms, or that the survey questions are misunderstood. Overall, survey analysis is seldom used in corporate financial research, so we feel that our paper provides unique information to aid our understanding of how firms operate. The results of our survey are both reassuring and surprising. On one hand, most firms use present value techniques to evaluate new projects. On the other hand, a large number of firms use company-wide discount rates to evaluate these projects rather than a project-specific discount rate. Interestingly, the survey indicates that firm size significantly affects the practice of corporate finance. For example, large firms are significantly more likely to use net present value techniques and the capital asset pricing model for project evaluation than are small firms, while small firms are more likely to use the payback criterion. A majority of large firms have a tight or somewhat tight target debt ratio, in contrast to only one-third of small firms. Executives rely heavily on practical, informal rules when choosing capital structure. The most important factors affecting debt policy are financial flexibility and a good credit rating. When issuing equity, respondents are concerned about earnings per share dilution and recent stock price appreciation. We find very little evidence that executives are concerned about asset substitution, asymmetric information, transactions costs, free cash flows, or personal taxes. We acknowledge but do not investigate the possibility that these deeper implications are, for example, impounded into prices and credit ratings, and so executives react to them indirectly. The paper is organized as follows. In the second section, we present the survey design, the sampling methodology, and discuss some caveats of survey research. In the third section we study capital budgeting. We analyze the cost of capital in the fourth section. In the fifth section we examine capital structureWe offer some concluding remarks in the final section.

Our survey of the practice of corporate finance is both reassuring and puzzling. For example, it is reassuring that NPV is dramatically more important now as a project evaluation method than, as indicated in past surveys, it was 10 or 20 years ago. The CAPM is also widely used. However, it is surprising that more than half of the respondents would use their firm's overall discount rate to evaluate a project in an overseas market, even though the project likely has different risk attributes than the overall firm. This indicates that practitioners might not apply the CAPM or NPV rule correctly. It is also interesting that CFOs pay very little attention to risk factors based on momentum and book-to-market value. We identify fundamental differences between small and large firms. Our research suggests that small firms are less sophisticated when it comes to evaluating risky projects. Small firms are significantly less likely to use the NPV criterion or the capital asset pricing model and its variants. Perhaps these and our other findings about the effect of firm size will help academics understand the pervasive relation between size and corporate practices. Further, the fact that the practice of corporate finance differs based on firm size could be an underlying cause of size-related asset pricing anomalies. In our analysis of capital structure, we find that informal criteria such as financial flexibility and credit ratings are the most important debt policy factors. Other informal criteria such as EPS dilution and recent stock price appreciation are the most important factors influencing equity issuance. The degree of stock undervaluation is also important to equity issuance, and we know from other surveys that most executives feel their stock is undervalued. We find moderate support that firms follow the trade-off theory and target their debt ratio. Other results, such as the importance of equity undervaluation and financial flexibility, are generally consistent with the pecking-order view. However, the evidence in favor of these theories does not hold up as well under closer scrutiny (e.g., the evidence is generally not consistent with informational asymmetry causing pecking-order-like behavior), and is weaker still for more subtle theories. We find mixed or little evidence that signaling, transactions costs, underinvestment costs, asset substitution, bargaining with employees, free cash flow considerations, and product market concerns affect capital structure choice. Table 12 summarizes our findings.In summary, executives use the mainline techniques that business schools have taught for years, NPV and CAPM, to value projects and to estimate the cost of equity. Interestingly, financial executives are much less likely to follow the academically proscribed factors and theories when determining capital structure. This last finding raises possibilities that require additional thought and research. Perhaps the relatively weak support for many capital structure theories indicates that it is time to critically reevaluate the assumptions and implications of these mainline theories. Alternatively, perhaps the theories are valid descriptions of what firms should do–but corporations ignore the theoretical advice. One explanation for this last possibility is that business schools might be better at teaching capital budgeting and the cost of capital than at teaching capital structure. Moreover, perhaps NPV and the CAPM are more widely understood than capital structure theories because they make more precise predictions and have been accepted as mainstream views for longer. Additional research is needed to investigate these issues.