Sadok El Ghoul

Professor

Curriculum Vitae

Sadok El Ghoul is a Professor of Business Administration at Campus Saint-Jean of the University of Alberta, where he teaches finance, international business and econometrics. He received his B.B.A. from Institut Supérieur de Gestion de Tunis and his M.B.A. and Ph.D. from Laval University. Before joining the University of Alberta, he taught international financial management at Laval University. His research interests include corporate finance, corporate governance, corporate social responsibility, international finance, financial institutions, and the role of culture in financial markets. His work has been published in finance, management, international business, business ethics and accounting journals such as Journal of Financial and Quantitative Analysis, Review of Finance, Management Science, Journal of International Business Studies, Journal of Business Ethics, The Accounting Review and Contemporary Accounting Research. Prof. El Ghoul received the McCalla Professorship at the University of Alberta in 2013-2014. He has won several awards including the Moskowitz Prize for the Best Paper in Socially Responsible Investing in 2011, the best paper award in financial institutions at the Southwestern Finance Association conference in 2012, the Korea Development Bank outstanding paper award at the Conference on Asia–Pacific Financial Markets in 2013, the best paper award at the World Business Ethics Forum in 2016, and the best paper award in emerging economies research at the Academy of International Business meeting in 2018. In 2017, he received the Martha Cook Piper Research Prize, which recognizes two University of Alberta faculty members in the early stage of their careers.

Ausgewählte Publikationen

Board ancestral diversity and voluntary greenhouse gas emission disclosure

Johannes Barg, Wolfgang Drobetz, Sadok El Ghoul, Omrane Guedhami, Henning Schröder
British Journal of Management | 08/2023 | Forthcoming
This paper examines the relationship between board diversity and firms’ decisions to voluntarily disclose information about their greenhouse gas (GHG) emissions. We focus on board ancestral diversity as a relatively new dimension of (deep-level) board structure and document that it has a positive and statistically significant effect on a firm’s scope and quality of voluntary GHG emission disclosure. The effect goes beyond the impact of more common (surface-level) dimensions of board diversity and remains robust after addressing endogeneity concerns. In line with the theoretical conjecture that diversity enhances a board’s advising and monitoring capacity, we find that the impact of diverse boards is stronger in more complex firms and in firms with low levels of institutional ownership. Overall, our findings provide evidence for board diversity being a relevant governance factor in corporate environmental decision making.

Cross-country determinants of institutional investors’ investment horizons

Wolfgang Drobetz, Simon Döring, Sadok El Ghoul, Omrane Guedhami, Henning Schröder
Finance Research Letters | 06/2020 | Forthcoming
Using a large dataset of firms from 35 countries, we study the country-level determinants of institutional investors’ investment horizons. We show that an equity investor-friendly institutional environment is more important for long-term investors, while short-term investors seem to be less concerned about the quality of the financial and legal environment. Beyond the financial and legal structure, the cultural environment and economic policy uncertainty in a country are other important determinants of investor horizons. These findings improve our understanding of cross-country differences in the corporate governance role, i.e., engagement vs. exit, of institutional investors.

Do Foreign Institutional Investors Affect International Contracting? Evidence from Bond Covenants

Paul Brockman, Wolfgang Drobetz, Sadok El Ghoul, Omrane Guedhami, Ying Zheng
Journal of International Business Studies | 09/2023 | Forthcoming
We examine the impact of foreign institutional shareholders on the prevalence of restrictive bond covenants using a sample of 959 Yankee bonds from 29 countries over the period 2001–2019. We find a significantly negative relation between foreign institutional ownership and debt covenants. This inverse relation is strongest for U.S. institutional ownership of foreign-issued Yankee bonds, and for covenants designed to mitigate such opportunistic behavior as claims dilution and wealth transfers. We also show that the inverse relation between U.S. institutional ownership and restrictive debt covenants is moderated by country- and firm-level variables re-lated to corporate governance, information asymmetry, and agency costs of debt. Additional analyses show that U.S. institutional ownership has a significant pricing effect on Yankee bond investors by lowering the issuer’s cost of borrowing.

Entrepreneurial finance and sustainability: Do institutional investors impact the ESG performance of SMEs?

Wolfgang Drobetz, Sadok El Ghoul, Omrane Guedhami, Jan P. Hackmann, Paul P. Momtaz
HFRC Working Paper Series | Version 05/2024
Institutional investors improve the environmental, social, and governance (ESG) performance of small-and medium-sized enterprises (SMEs). Our difference-in-differences framework shows that the backing from private equity and venture capital funds leads to an increase in SMEs' externally validated ESG scores compared to their matched non-investor-backed peers. Consistent with "ESG-as-insurance" theory, the ESG performance of SMEs with a higher probability of failure is more likely to benefit from the backing of institutional investors. This positive effect is heterogeneous; while SMEs with high ex-ante ESG performance tend to further improve their ESG performance following institutional investor backing, SMEs with low ex-ante ESG performance are unlikely to implement any improvements. Entrepreneurial finance seems to help sustainable entrepreneurs develop into "sustainability champions," while neglecting the betterment of non-sustainable SMEs.

Foreign institutional investors, legal origin, and corporate greenhouse gas emissions disclosure

Wolfgang Drobetz, Simon Döring, Sadok El Ghoul, Omrane Guedhami, Henning Schröder
Journal of Business Ethics | 01/2023
The disclosure of corporate environmental performance is an increasingly important element of a firm’s ethical behavior. We analyze how the legal origin of foreign institutional investors affects a firm’s voluntary greenhouse gas emissions disclosure. Using a large sample of firms from 36 countries, we show that foreign institutional ownership from civil law countries improves the scope and quality of a firm’s greenhouse gas emissions reporting. This relation is robust to addressing endogeneity and selection biases. The effect is more pronounced in firms from non-climate-sensitized countries, for which the gap between firms’ environmental standards and investors’ environmental targets is potentially larger, and in less international firms. Firms with a higher level of voluntary greenhouse gas emissions disclosure also exhibit higher valuations.

Institutional dual ownership and voluntary greenhouse gas emission disclosure

Johannes Barg, Wolfgang Drobetz, Sadok El Ghoul, Omrane Guedhami, Henning Schröder
HFRC Working Paper Series | Version 11/2023
This paper shows evidence of a positive relationship between institutional dual holders, who hold both equity and debt in a firm, and voluntary greenhouse gas (GHG) emission disclosure. Considering dual holders as particularly risk-sensitive institutional investors, we docu-ment that voluntary GHG emission disclosure improvements are motivated by not only cli-mate-conscious but also risk-related considerations. The positive effect of institutional dual ownership is more pronounced when firms face severe environmental risks, where disclosure enables explanations and prevents exaggerated stakeholder reactions. The impact of dual ownership is also stronger in firms with poor information environments, where dual holders exploit their salient monitoring capacity from gathering information from their public equity and private debt holdings. Supporting our risk-based explanation, voluntary GHG emission disclosure reduces the cost of equity and increases firm valuation in firms with higher dual ownership.

Institutional investment horizons and firm valuation around the world

Wolfgang Drobetz, Simon Döring, Sadok El Ghoul, Omrane Guedhami, Henning Schröder
Journal of International Business Studies | 09/2020 | Forthcoming
Using a comprehensive dataset of firms from 34 countries, we study the effect of institutional investors’ investment horizons on firm valuation around the world. We find a positive relation between institutional ownership and firm value that is driven by short-horizon institutional investors. Accounting for the interaction between investors’ investment horizon and nationality, we show that foreign short-horizon institutions, which are more likely to discipline managers through the threat of exit rather than engaging in monitoring made costly by the liability of foreignness, are the investor group with the strongest effect on firm value. Reinforcing the threat of exit channel, we find that the value-enhancing effect of short-horizon investors is stronger in the presence of multiple short-horizon investors, who are more likely to engage in competitive trading. The positive valuation effect of short-horizon investors is stronger when stock liquidity is high, which makes the exit threat more credible, and in firms prone to free cash flow agency problems. Overall, our results are consistent with short-horizon institutional investors, especially foreign institutional owners, affecting firm value by disciplining managers through a credible threat of exit.

Institutional investment horizons, corporate governance, and credit ratings: International evidence

Hamdi Driss, Wolfgang Drobetz, Sadok El Ghoul, Omrane Guedhami
HFRC Working Paper Series | Version 01/2021
Using a comprehensive set of firms from 57 countries over the 2000–2016 period, we examine the relation between institutional investor horizons and firm-level credit ratings. Controlling for firm- and country-specific factors, as well as for firm fixed effects, we find that larger long-term (short-term) institutional ownership is associated with higher (lower) credit ratings. This finding is robust to sample composition, alternative estimation methods, and endogeneity concerns. Long-term institutional ownership affects ratings more during times of higher expropriation risk, for firms with weaker internal governance, and for those in countries with lower-quality institutional environments. Additional analysis shows that long-term investors can facilitate access to debt markets for firms facing severe agency problems. These findings suggest that, unlike their short-term counterparts, long-term investors can improve a firm’s credit risk profile through effective monitoring.