Firm’s Free Cash Flows, Growth, and Firm Performance: The Role of Corporate Governance

[[abstract]]本研究檢定公司的經理人代理問題對公司績效的影響 (假說一)，及公司治理是否能改善此影響 (即公司治理的干擾效果) (假說二)。代理問題以自由現金流量和成長性兩變數值之多寡衡量；公司績效使用營運績效和股票報酬來衡量；公司治理使用綜合指標，係納入多個治理變數而得。實證樣本是台灣上市上櫃公司的財務資料，使用追蹤資料迴歸分析法。另外也檢視電子業和非電子業的結果差異性。實證結果指出，整體而言，自由現金流量與 ROA 正相關；無好的投資機會也會使 ROA 降低。然而，假說檢定的結果不如預期，將自由現金流量和投資機會優劣交乘後，並不會影響未來的 ROA，甚至使 3 年 ROA 提高；此外，公司治理的干擾效果也不存在。因此，本研究的假說不成立，而且從股票報酬看，也是此結果。電子業與非電子業分別檢驗的結果，前者也是兩個假說都不成立；後者在股票報酬方面亦然，但是其 ROA 的假說一成立，即沒有好的投資機會而自由現金多的公司，未來 ROA 會下降；但是此下降的程度不會因為有好的公司治理有所改善，實質結果反而指出公司治理使一年的 ROA 下降更多，因此不支持假說二。本研究進行穩健性檢查，將主要自變數改用虛擬變數，結果仍不支持兩個假說。[[abstract]]This study examines the impact of a company’ manager agency problem on company performance (Hypothesis 1), and whether corporate governance can improve this impact (i.e., the interference effect of corporate governance) (Hypothesis 2). Agency problem is measured by the conditions of the number of two variables, which are free cash flow and firm’s growth. Corporate performance is measured by operating performance and stock returns. Corporate governance is measured by comprehensive indicators, which are derived by incorporating multiple governance variables. The empirical sample is the financial data of listed and OTC companies in Taiwan, using the panel data regression analyses. It also examines the difference in results between the electronics industry and the non electronic industry. The empirical results point out that on the whole, free cash flow is positively correlated with ROA; lack of good investment opportunities will also reduce ROA. However, the results of the hypothesis test are not as expected. After ultiplying the free cash flow and worse investment opportunities, it will not affect the future ROA, or even increase the 3-year ROA; in addition, the interference effect of corporate governance does not exist. Therefore, the hypotheses of this study are not valid, and it is also the result from the erspective of stock returns. According to the results of separate tests of the electronics industry and the non-electronics industry, the former is also not valid for both hypotheses; the latter is also true in terms of stock returns, but hypothesis 1 for ROA is held. That is, companies that do not have good investment opportunities and have a lot of free cashes will decline ROA in the future, but the degree of this decline will not be improved because of good corporate governance. Instead, the substantive results point out that corporate governance has reduced the ROA in a year even more, so Hypothesis 2 is not supported. This study conducts a robustness check and changes the main independent variables to dummy variables, and the results still do not support the two hypotheses