Baker, A., Haslam, C., Leaver, A. orcid.org/0000-0001-6199-6057 et al. (4 more authors) (2020) Against hollow firms : repurposing the corporation for a more resilient economy. Report. Centre for Research on Accounting and Finance in Context (CRAFiC), University of Sheffield
Abstract
The Covid-19 pandemic is revealing latent weaknesses at large, well-established companies who may now require state support. This report argues that those weaknesses pre-date the current pandemic and are a consequence of excesses in the non-financial corporate sector during the post-2008 economy. Those excesses include: i) historically high levels of dividends and buybacks which, in many cases, exceeded earnings and hollowed out reserves ii) the growth of low-prime debt, which risks being downgraded to junk in the current crisis and iii) a build-up of ‘fair valued’ assets, often intangible assets such as goodwill, which are vulnerable to write downs that could push firms into negative shareholder equity.
Metadata
Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2020 The Author(s). For re-use permissions, please contact the Author(s). | ||||
Keywords: | Financialization; COVID-19; Dividends; Share Buybacks; Creative Accounting; Corporate Collapse | ||||
Dates: |
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Institution: | The University of Sheffield | ||||
Academic Units: | The University of Sheffield > Faculty of Social Sciences (Sheffield) > Management School (Sheffield) | ||||
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Depositing User: | Symplectic Sheffield | ||||
Date Deposited: | 13 Jul 2020 11:01 | ||||
Last Modified: | 13 Jul 2020 11:41 | ||||
Published Version: | https://www.taxresearch.org.uk/Blog/wp-content/upl... | ||||
Status: | Published | ||||
Publisher: | Centre for Research on Accounting and Finance in Context (CRAFiC), University of Sheffield |