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Narratives in managers’ corporate finance decisions

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  • Les Coleman
  • Krishnan Maheswaran
  • Sean Pinder

Abstract

This article uses the extended case method to explore senior executives’ corporate finance decisions. We quantified firm’s finance practices using a mail survey, and then – to resolve puzzles in managers’ decision processes – conducted face‐to‐face interviews with chief finance officers of large listed firms. The interviews identified six themes as consistent influences on finance decisions: pressures imposed by clienteles; constraints on resources; risk management; heuristics; real options; and sustainability. We conclude that managers are logical and rational in their decisions, but employ a wider range of criteria than assumed in conventional finance theories.

Suggested Citation

  • Les Coleman & Krishnan Maheswaran & Sean Pinder, 2010. "Narratives in managers’ corporate finance decisions," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 50(3), pages 605-633, September.
    • Handle: RePEc:bla:acctfi:v:50:y:2010:i:3:p:605-633
    DOI: 10.1111/j.1467-629X.2010.00343.x
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    References listed on IDEAS

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    Cited by:

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    3. Soonchul Hyun & Jong Min Kim & Jeongsoo Han & Mark Anderson, 2022. "Female executive leadership and corporate social responsibility," Accounting and Finance, Accounting and Finance Association of Australia and New Zealand, vol. 62(3), pages 3475-3511, September.
    4. Rieke Pernamasari & Rista Bintara & Yuni Rosdiana & Helliana, 2024. "The Impact of Environment Social Governance (ESG) Performance on Stock Returns in Indonesian Companies," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(3), pages 2868-2876, March.
    5. Feng, Jingwen & Goodell, John W. & Shen, Dehua, 2022. "ESG rating and stock price crash risk: Evidence from China," Finance Research Letters, Elsevier, vol. 46(PB).
    6. Christine Brown & John Handley & James O'Day, 2015. "The Dividend Substitution Hypothesis: Australian Evidence," Abacus, Accounting Foundation, University of Sydney, vol. 51(1), pages 37-62, March.

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