Decent work and economic growth
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Defining the deal value in mergers and acquisitions is inherently complex and often constitutes an inflection point for the parties involved. By paying part of the deal value at a later stage according to predefined goals, earnouts are intended to alleviate information asymmetries and help bridge valuation differences. Despite their wide application in practice, research on earnouts remains fragmented. This study presents the first systematic literature review of earnouts, mapping the scattered research landscape by analyzing 64 papers published between 1970 and 2023. The review categorizes the body of earnout research into three distinct streams: the motives for employing earnouts, their implications, and the nuances of their contractual arrangements. Based on this synthesis, research gaps are identified that present a comprehensive road map for future research. This study enables investors to employ earnouts more successfully and guides scholars to pursue further earnout research based on its holistic overview.
Earnout deals are expected to protect acquirers from overpayment as information asymmetries are reduced and the final purchase price is partly based on the future performance of the target. Various scholars have investigated the perception of earnout deals by capital markets revealing significant abnormal returns. Those studies are focused mostly on the Anglo-Saxon countries and China leveraging a pre-COVID datasets. Hence, this study aims at investigating capital market reaction to earnout deals in Continental Europe covering the timeline of 2012 to 2022. Our results indicate that earnout deals in Continental Europe outperform non-earnout deals and are especially beneficial in times of high uncertainty.
Einleitung
(2024)
Ausgehend von den gesellschaftlichen Herausforderungen unserer Zeit widmet sich diese Stellungnahme wesentlichen Aspekten der Frage, wie die Arbeit von morgen neu gestaltet werden kann. Die Autor:innen haben sich im Auftrag des Ständigen Ausschusses der Nationalen Akademie der Wissenschaften und unter Federführung der Berlin-Brandenburgischen Akademie der Wissenschaften intensiv mit dem gegenwärtigen Strukturwandel der Arbeitswelt beschäftigt. Sie schlagen vor, den Begriff der Arbeit weit zu fassen und Erwerbsarbeit in ihrem Wechselspiel mit anderen Formen des Tätigseins zu betrachten. Auch nicht-marktbezogene Tätigkeiten wie Bürgerarbeit, Sorgearbeit und politische Arbeit und deren Zusammenspiel werden in den Blick genommen. Mit der Akzentverschiebung von einer „Arbeitsgesellschaft“ hin zu einer „Tätigkeitsgesellschaft“ wird auf die Chancen hingewiesen, die sich den Menschen, der Wirtschaft und der Gesellschaft eröffnen, wenn diese Tätigkeiten gleichermaßen anerkannt werden.
The integration of legitimacy in entrepreneurial ecosystem theory is under-researched, resulting in scholarly vagueness about how entrepreneurs acquire resources. Our qualitative study with 31 (co-)founders of startups following the triple bottom line investigates entrepreneurs' daily practices for building legitimacy in entrepreneurial ecosystems. We identify that entrepreneurs follow a sequential process to build legitimacy: 1) engaging and assimilating with culture, 2) establishing and utilizing networks, 3) enhancing visibility, and 4) leveraging the sustainable mission. Following this sequential process builds different levels of legitimacy. Each level grants access to resources from the entrepreneurial ecosystem. We contribute to the scholarly conversation on legitimacy in entrepreneurial ecosystems and provide practical implications for entrepreneurs.
More than 15 years after the introduction of 'familiness' into the literature, the term has evolved into one of the most popular concepts in family firm research. Despite the steadily growing body of studies that build on familiness, recent calls suggest a need to revisit its conceptualisation due to a lack of a common understanding that could affect future research endeavours. In our systematic literature review of 25 studies, we find support for this notion and show that the discussion on the concept has reached a dead end. We present a systematisation of familiness research that highlights an inconsistent conceptualisation, a lack of validation and even a partial hijacking of the term into contexts different from those originally proposed by Habbershon and Williams (1999). Based on these findings, we present a research agenda aimed at overcoming the current limitations and rejuvenating familiness as a suitable approach to understanding family firm heterogeneity.
Purpose/Rationale
European elite football often fails to translate its economic success story and revenue growth into financially viable businesses. This paper aims to extend the current research on financial performance in European football, adding a significant but missing pan-European comparison to the research field. It analyzes the bankruptcy likelihood of clubs in four leading European football leagues from 2017–2022.
Approach
We use Altman’s Z-Score to assess the financial risks of 88 clubs in England (28), Spain (23), Germany (17), and Italy (20) that played in the national top division for at least one season during the period under review. Panel regression is used to assess the impact of five performance variables on Z-Scores. Data were sourced from dissecting clubs’ annual accounts and extracted from other football financial databases.
Findings
The results show significant financial distress across European football clubs. The analysis emphasizes that the COVID pandemic has exacerbated clubs’ financial challenges, but not caused them. However, the absence of spectators due to COVID restrictions did aggravate the situation, as stadium utilization positively correlated to Z-Scores. Fixed-effects panel regressions show that a balanced wages-to-revenue ratio is a critical performance metric for improving Z-Scores.
Practical Implications
European football needs collective governance efforts to enforce stricter financial discipline post-COVID and remedy its financial situation.
Research Contribution
The findings have significant implications for policymakers, club managers, and investors, highlighting the financial risks across Europe’s the four leading football leagues.
Originality
This first pan-European analysis compares clubs across different geographies, thus extending existing country-view work/approaches.
StrategyLab
(2024)
In der Vergangenheit konnten Unternehmensstrategien mit einiger Sicherheit geplant werden, und Innovationen waren meist ein nettes Extra, um das bestehende Produktportfolio zu verbessern und zu erweitern und vielleicht die Chance auf einige überraschende, disruptive neue Opportunitäten zu haben. Dies ändert sich alles in den heutigen unsicheren und dynamischen Geschäftsumgebungen, in denen etablierte Unternehmen die strategische Erneuerung ihrer Wettbewerbsvorteile vorantreiben müssen, um in der Zukunft zu überleben und zu gedeihen: Strategische Planung ist vermehrt auf völlig neue zukünftige Geschäftsmöglichkeiten angewiesen, und Innovationseinheiten müssen solche strategisch relevanten neue Opportunitäten liefern. Bestehende Innovationsfunktionen sind jedoch selten für diesen Zweck aufgebaut. Traditionelle integrierte Funktionen wie Forschung und Entwicklung (F&E) oder Produktentwicklung (New Product Development, NPD) konzentrieren sich meist auf die inkrementelle Entwicklung innerhalb bestehender Produkt-/Markt-Kategorien. Moderne separate Innovationseinheiten wie Innovationslabore oder Corporate Venture Builder überwinden diese Begrenzung und fokussieren sich meist auf radikale oder disruptive neue Produkt-/Markt-Kombinationen. Ihre Trennung vom Kerngeschäft verhindert es jedoch, das bestehende Geschäft für die Entwicklung zukünftiger Wettbewerbsvorteile zu nutzen, was meistens nur zu geringem kommerziellem Erfolg führt – weit entfernt von den Bedürfnissen eines etablierten Unternehmens, um darauf seine Zukunft zu bauen. Als neuartiger Ansatz bietet die vorgestellte Forschung aus 30 Corporate Venturing-/Innovationseinheiten einen (praktischen) organisatorischen Rahmen für „vernetzte strategische Innovationseinheiten“. Diese sog. „StrategyLabs“ können strategisch wichtige und organisatorisch relevante neue Geschäfte für die strategische Erneuerung ihres Mutterunternehmens entwickeln. Um dies zu erreichen, etablieren und nutzen sie ein spezifisches Set von fünf dynamischen Fähigkeiten durch geeignete organisatorische Maßnahmen mit sieben verschiedenen Hebeln. Zusammen bieten diese Elemente einen Bauplan für das spezifische organisatorische Design von strategischen Innovationseinheiten in der Praxis.
Secondary buyouts (SBOs) appear paradoxical because the surge in SBO activity is met with scepticism from the public and investors regarding their performance. In this paper, we undertake a comprehensive analysis of SBO performance through two distinct lenses: First, we address the prevailing notion of SBOs as “lemons”. These are perceived as opportunities that, following a successful primary buyout (PBO), seemingly leave little room for further value creation. To investigate this “negative correlation hypothesis”, we employ a unique back-to-back sample of 276 cases involving the same firm in both a PBO and an SBO. Analysing the correlation between the internal rate of returns (IRRs) of back-to-back PBO/SBOs, our results do not support the “negative correlation hypothesis”. Second, we directly compare the deal performance of the two related back-to-back buyout rounds. For our back-to-back sample, we find that PBOs display significantly higher IRRs than SBOs. However, after performing a matched comparison adjusting for size and holding period differences, which are two well-known pitfalls of IRR rank orders, our findings suggest that there is no systematic outperformance of SBOs against their PBO comparables. Finally, we analyse differences in operating performance between PBOs and SBOs. Our results do not indicate a significant difference, either based on the back-to-back sample or when comparing PBOs and SBOs against matched public peers. In the light of our findings, we advocate for a reevaluation of the current perception of SBOs. Rather than being dismissed as “second-hand” opportunities, they should be recognised as “second-generation” opportunities deserving closer consideration.
In 2011, French football experienced a defining moment when Qatar Sports Investments acquired a majority stake in Paris St. Germain (PSG). The initial €30 million investment was one of many investments made by wealth funds from the Gulf States in European football, but only a few have had such a transformative effect. The investment in the club was the starting point that led to the rise of PSG becoming the leading football club in France. This paper is the first to examine the investment in light of true value creation from PSG’s and QSI’s perspectives. The review of its sporting, economic, social, and media capital reveals that PSG’s sporting success and initiation of a global brand came with a high cost but generated indirect returns for QSI. Ultimately, QSI’s long-term commitment might capitalize with Arctos’ co-investment in December 2023.
Since the seminal work by Hackman and Oldham (1975) there has been a growing body of literature demonstrating how work characteristics can positively both organizations and their employees. While the very nature of the task or job at hand is well explored, insufficient attention has been given to the social and cultural context in which the work is done (Spreitzer & Cameron, 2012). Based on Meynhardt’s public value approach (2009, 2015), we investigate whether organizational public value acts as an additional work characteristic in the Job Characteristics Model (JCM), thus extending the model. Specifically, we theorize that organizational public value is an additional unique resource for employees and social context work characteristic in the JCM that is positively related to employees work engagement. Additionally, our study analyzes that the positive relationship between the work characteristics, including organizational public value, and work engagement is mediated by self-efficacy. Moreover, we analyze whether employees working in industries with a public focus integrated into their core business will experience higher levels of public value in their jobs than employees in other industries. To test our hypotheses, we conducted a representative online survey in different public and non-public organizations in Switzerland (N = 949). Overall, the results support our hypotheses and contribute to close the gap by taking social context factors into the JCM and to reveal processes between the macro-level (organizational public value, work characteristics) and micro-level (employees work experience). Further theoretical and practical implications as well as future research avenues are discussed in the paper.