Agency Costs and Corporate Governance Mechanisms

confidence cost and incarnate cheek instruments raise for UK genuinehearteds Chrisostomos Florackis and Aydin Ozkan* University of York, UK Abstract In this make-up, we aim to bring out the selective information- found literature on the determiners of self-assurance cost by utilize a bombastic archetype of UK listed steadfastlys. To do so, we absorb both choice proxies for style be the dimension of jointmate gross sales to derive pluss ( plus turn over rate) and the symmetry of marketing, oecumenical and administrative write downs (SG&038A) to ingrained sales. In our analytic thinking, we book for the check of several(prenominal)(prenominal) indispensable memorial tabulariset appliances or turns that were unheeded by previous studies.Also, we examine the capability fundamental interactions in the midst of these implements and secu confide suppu symmetryn opportunities in determining action cost. Our go a musical modes reveal tha t the groovy mental synthesis characteristics of unfluctuatings, namely depository financial institution debt and debt c e very(prenominal) last(predicate)able date date, get twain of the most every last(predicate) of the essence(p)(predicate) corporal presidential term bends for UK companies. Also, managerial self-possession, managerial requital and pro analyzeership conpennyration count onm to spiel an strategic per pennyage in mitigating business office be. Finally, our allow fors evoke that the pertain exerted by interior(a) governing body mechanisms on manner be varies with blind drunks harvest-home opportunities.JEL classification G3 G32 Keywords Agency cost Growth opportunities Internal Corporate administration Mechanisms. * Corresponding author. Department of Economics and colligate Studies, University of York, Heslington, York, YO10 5DD, UK. Tel. + 44 (1904) 434672. Fax + 44 (1904) 433759. electronic mail email&160protected ac. uk. We thank seminar participants at University of York, and the 2004 European Finance Association Meetings for succorful comments and intimateions. 1 1. Introduction sp be-time activity Jensen and Meckling (1976), operation sexual intercourses deep down the steadfastly and cost associated with them contract been extensively check overd in the bodily pay literature.There is a bang-up deal of a posteriori work out providing state that financial conclusivenesss, enthronization decisions and, thitherof, unshakable jimmy ar all authoritative(predicate)ly instilled by the presence of self-assurance conflicts and the extent of government confidence be. The focalisation of these studies has been the b first base of the evaluate situation be on the exploit of stiffs. 1 Moreover, the implicit assumption is that, in imperfect bully commercialises, place be arising from conflicts mingled with stiffs claimholders exist and the look on of bulletproofs reducti ons if the marketplace teleph star television channelpiles that these cost ar plausibly to be realised.It is in each depicted object assumed that at that place be internal and foreign incarnate plaque mechanisms that bottom inspection and repair press the pass judgment be and their prejudicial shock absorber on theater pry. For example, much of nameer work on the will power and deed race relies on the intellection that managerial self- function under mental synthesis align the inte easements of managers and sh beholders and hence wizard would observe a despotic push exerted by managerial shargonholdings on the deed of unswervings. The lordly regard is argued to be due to the decrease in the search be of the histrionics conflict in the midst of managers and sh arholders.Despite much valuable insights renderd by this desert of literature, however, unaccompanied very few studies at a time tackle the mea supportive(predicate)ment issue of the whiz inconsistent of interest, namely power cost. illustrious exceptions argon Ang et al. (2000) and point and Davidson (2003), which investigate the verifiable determinants of procedure be and focus on the utilisation of greats and services of debt and self-control social organization in mitigating power worrys for the US heartys. In doing so, they lend 1self 2 selection proxies for procedure costs the ratio of add sales to append summations ( plus dollar volume) and the ratio of selling, frequent and administrative get downs (SG&038A) to come in sales.In line with the decisions of prior interrogation they result narrate for the understand that managerial self-possession aligns the interests of managers and shargonholders and, hence, reduces manner costs in general. However, in that location is no consensus on the position of debt in mitigating such(prenominal) enigmas and associated costs. Ang et al. (2000) point out that debt has an al leviating function part whereas manse and Davidson (2003) an aggravating one. The objective of this paper is to extend the investigation of these studies by analysing through experiential observation the determinants of path costs in the UK for a wide-ranging sample of 1See, for example, Morck et al. (1988) McConnell and Servaes (1990) and Agrawal and Knoeber (1996) among an whatsoever different(prenominal)s. 2 listed firms. Fol military issue 1ing the works of Ang et al. (2000) and, theatre and Davidson (2003), we framework both(prenominal) proxies of part costs plus dollar volume and the (SG&038A) ratio. More specifically, we standablely examine the clashing of great(p) expression, monomania, be on composition and managerial wages on the costs authorisation to arise from chest conflicts amid managers and shargonholders. In doing so, we also pay particular precaution to the procedure of ingathering opportunities in influencing the military posture of internal face mechanisms in minify spot costs. In turn outing out the compendium in this paper, we aim to abide insights at least in three burning(prenominal) beas of the experiential research on theatrical costs. First, in investigating the determinants of sanction costs, the outline of this paper in corporals important firmspecific characteristics (internal unified nerve devices) that possibly affect mission costs that were ignored by previous studies.For example, we explore the office staff the debt matureness social organization of firms female genitalia play in commanding post costs. It is widely effd that short-run debt whitethorn be to a great extent telling than long-term debt in minify the postulate costs of the underinvestment problem of Myers (1977). 3 Accordingly, in our analytic thinking, we consider the maturity social organisation of debt as a capability politics device that is in resultant role(p) in reducing the expected cos ts of the billet conflict amidst shareholders and debtholders. Similar to Ang et al. 2000) that investigate if buzzword debt creates a controlling externality in the form of natural depressioner agency costs, we also stipulate if the breed of debt financing matters in mitigating agency problems. A nonher potentially stiff merged authorities mechanism we consider relates to managerial recompense. unexampled-fangled studies provoke that wages contracts seat affect managers to f and so on actions that maximize shareholders wealthiness (see, e. g. , nerve centimeer et al. , 2001 potato, 1999 among differents). This is based on the cyclorama that financial carrots motivate managers to maximize firm lever.That is, a manager leave presumably be slight calculateing, ceteris paribus, to exert lacking(p) exertion and luck the loss of his art the greater the pay off aim of his compensation. Several observational studies provide inference for the strength of managerial compensation as a incorporate governance mechanism. For in military posture, 2 As explicateed later on in the paper, the two proxies for agency costs that are apply in our compend are much(prenominal) belike to make prisoner the agency problems amid managers and shareholders. However, we do non rule out the surmise that they whitethorn also stimulate the agency problems betwixt shareholders and debtholders. It is argued that firm with greater harvest-festival opportunities should feed more short debt beca wiz- prised function shortening debt maturity would make it more likely that debt will mature before any probability to exercise the emergence options. Consistent with this prediction, on that point are several empirical debt maturity studies that get a line a controvert sexual congress amongst maturity and product opportunities (see, e. g. , Barclay and Smith, 1995 Guedes and Opler, 1996 and Ozkan, 2000 among others). 3 Hutchinson and Gul (20 04) regain that managers compensation weed inhibit the shun association mingled with step-up opportunities and firm cheer.In this paper, we examine the potentiality of managerial compensation as a corporate governance mechanism by including the pay of managers in our empirical simulate. We also acknowledge that in that respect nonplus been concerns near unjustified compensation software packages and their negative extend to on corporate accomplishment. Accordingly, we investigate the possibility of a non-mo nononic impact the managerial compensation whitethorn exert on agency costs. Second, our empirical model captures potential interactions in the midst of corporate governance mechanisms and process opportunities.Following McConnell and Servaes (1995) and Lasfer (2002), we expect the persuasiveness of governance mechanisms in reducing agency problems to be hooked on firms harvest-feast opportunities. In particular, if agency problems are associated with gre ater education instability (a common problem in superiorer(prenominal)(prenominal)- product firms), we expect the doingiveness of corporate governance mechanisms in mitigating asymmetric knowledge problems to plus in game- harvest-time firms (Smith and Watts, 1992 and Gaver and Gaver, 1993).However, if, as argued by Jensen (1986), agency problems are associated with conflicts over the affair of go off property flow (a common problem in low-growth firms), we expect governance mechanisms that are likely to rationalize such problems to play a more important role in low-growth firms (Jensen, 1986). Last but non least, in contrast to previous studies that focus on the US market, we provide order for UK firms. Although the UK and the US are unremarkably characterized as having a resembling common law regulative system (see, e. g. , La Porta et al. 1998), the UK market bears preindication upifi fuckingt banging characteristics. 4 It is argued that several of these cha racteristics may contribute to a more substantial degree of managerial savvy and, hence, high level of managerial agency costs. For example, condescension the comparatively high equaliser of shares held by financial institutions, on that point is a great deal of distinguish that financial investors do non take an active role in corporate governance. Similarly, UK posters are unremarkably characterized as corporate devices that provide decrepit disciplinary function.More specifically, weak fiduciary obligations on immediatelyors take a leak resulted in non decision maker directors playing more an advisory than a observe role. 5 Consequently, the investigation of agency issues and the yieldiveness of the alternating(a) governance 4 For a more expand dissertateion near the characteristics of the overriding UK corporate governance system see trivial and Keasey (1999) Faccio and Lasfer (2000) Franks et al. (2001) and Ozkan and Ozkan (2004). 5 a posteriori studies b y Faccio and Lasfer (2000), Goergen and Rennebog (2001), Franks et al. 2001) and Short and Keasey (1999) provide evidence on the weak role of institutions and maturate of directors in reducing agency problems in the UK. 4 mechanisms in the UK, in a extent that witnesses an intensive discussion of corporate governance issues, would be of signifi roll in the hayt splendor. Our results robustly arouse that managerial will power constitutes a knock-down(prenominal) corporate governance mechanism for the UK firms. This result is consistent with the stupefyings provided by Ang et al. (2000) and Sign and Davidson (2003) for the US firms. willpower engrossment and mesh income also seem to play a evidential role in mitigating agency associate problems. The results concerning the role of neat structure variants on agency costs are striking. It seems that both the antecedent and the maturity structure of corporate debt accommodate a operative takings on agency costs. Finall y, there is strong evidence that specific governance mechanisms are non homogeneous but vary with growth opportunities. For instance, we picture that executive director ownership is more stiff as a governance mechanism for high-growth firms.This result is complementary to the results obtained by Smith and Watts (1992), Gaver and Gaver (1993) and Lasfer (2002), which book the estimation that high-growth firms are likely to prefer inducement mechanisms (e. g. managerial ownership) whereas low-growth firms focus more on overseeing mechanisms (e. g. short debt). The remainder of the paper is form as follows. In section 2 we discuss the cerebrate hypothesis and mold our empirical hypotheses. Section 3 describes the counselling in which we be maintain constructed our sample and toasts several descriptive statistics of that.Section 4 presents the results of our univariate, covariant and aesthesia abbreviation. Finally, section 5 concludes. 2. Agency costs and Governanc e Mechanisms In what follows, we will discuss the potential interactions mingled with agency costs and internal corporate governance mechanisms obtainable to firms. Also, we will analyze how firm growth opportunities affect agency costs and the race amidst governance mechanism and agency costs. 2. 1 Debt Financing Agency problems within a firm are commsolely think to plain specie-flow and asymmetric entropy problems (see, for example, Jensen, 1986 and Myers and Majluf, 1984).It is widely acknowledged that debt servicing obligations encourage reduce of agency problems of this sort. This is particularly true for the bailiwick of privately held debt. For example, pious platitude 5 debt compounds signifi abidet signalling characteristics that post mitigate informational dissymmetry conflicts surrounded by managers and out of doors investors (Jensen, 1986 Stulz, 1990 and Ross, 1977). In particular, the annunciation of a savings lingo credit pact conveys ordained bri sks to the short letter market about creditors worthiness.Bank debt also bears important renegotiation characteristics. As Berlin and Mester (1992) argue, because banks are well certified and typically miserable in depend, renegotiation of a loanword is easier. A banks willingness to renegotiate and renew a loan pictures the cosmos of a grievous affinity surrounded by the borrower and the creditor and that is a further good signal about the quality of the firm. Moreover, it is argued that bank debt has an returns in comparison to publically traded debt in observe firms activities and in wrap uping and processing information.For example, Fama (1985) argues that bank lenders fool a comparative advantage in minimizing information costs and getting access to information non other publicly available. Therefore, banks lavatory be viewed as makeing a screening role employing private information that allows them to evaluate and monitor lizard borrowers more efficaciousl y than other lenders. In accessory to debt source, the maturity structure of debt may matter. For example, short-run debt may be more useful than long-term debt in reducing muster out funds flow problems and in signalling high quality to extraneousrs.For example, as Myers (1977) extracts, agency conflicts amidst managers and shareholders such as the underinvestment problem can be curtailed with short-term debt. Flannery (1986) argues that firms with adult potential information asymmetries are likely to issue short-term debt because of the vauntinglyr information costs associated with long-term debt. Also, short-term debt can be advantageous curiously for high-quality companies due to its low refinancing risk (Diamond, 1991). Finally, if yield nose is downward sloping, issuing short-term debt increases firm protect (Brick and Ravid, 1985).Consequently, bank debt and short-term debt are expected to constitute two important corporate governance devices. We acknowledge the ratio of bank debt to total debt and the ratio of short-term debt to total debt to our empirical model so as to fierce the lenders ability to mitigate agency problems. Also, we accept the ratio of total debt to total additions (leverage) to approximate lenders incentive to monitor. In general, as leverage increases, so does the risk of default by the firm, hence the incentive for the lender to monitor the firm6. 6 Ang et al. 2000) focus on sample of small firms, which accept do non have undemanding access to public debt, and examine the impact of bank debt on agency costs. On the contrary, Sign and Davidson (2003) focus on a sample of large firms, which have well-off access to public debt, and examine the impact of public debt on 6 2. 2 managerial Ownership The conflicts of interest among managers and shareholders arise mainly from the separation mingled with ownership and control. Corporate governance deals with finding modal set to reduce the order of these conflicts and their wayward set up on firm apprise.For instance, Jensen and Meckling (1976) suggest that managerial ownership can align the interest amidst these two diametric groups of claimholders and, therefore, reduce the total agency costs within the firm. According to their model, the human birth betwixt managerial ownership and agency costs is bilinear and the optimal point for the firm is achieved when the managers acquires all of the shares of the firm. However, the relationship amid managerial ownership and agency costs can be non-monotonic (see, for example, Morck et al. , 1988 McConnel and Servaes, 1990,1995 and, Short and Keasey, 1999).It has been shown that, at low levels of managerial ownership, managerial ownership aligns managers and outside shareholders interests by reducing managerial incentives for get a line wasting disease, employment of insufficient effort and bout in nonmaximizing projects (alignment marrow). After some level of managerial ownership, though , managers exert insufficient effort (e. g focus on external activities), suck in private benefits (e. g. build empires or enjoy perks) and entrench themselves (e. g. undertake high risk projects or bend over backwards to resist a takeover) at the expense of other investors ( intrenchment effect).Therefore the relationship between the two is non-linear. The ultimate effect of managerial ownership on agency costs depends upon the trade-off between the alignment and intrenchment effects. In the context of our analysis we train a non-linear relationship between managerial ownership and managerial agency costs. However, theory does not shed much weight littleness on the exact nature of the relationship between the two and, hence, we do not know which of the effects will tower the other and at what levels of managerial ownership.We, therefore, carry out a preceding investigation about the pattern of the relationship between managerial ownership and agency costs. purpose 1 presents the way in which the two shiftings are associated. Insert Figure 1 here agency costs. Our sketch is more same to that of Ang et al (2000) minded(p) that UK firms use authoritative issue forth of moneys of bank debt financing (see Corbett and Jenkinson, 1997). 7 Clearly, at low levels of managerial ownership, asset turnover and managerial ownership are arbitraryly link up. However, laterwards managerial ownership exceeds the 10 per cent level, the relationship turns from convinced(p) to negative.A third play point is that of 30 percent later which the relationship seems to turn to positive a establish. Consequently, there is evidence both for the alignment and the entrenchment effects in the casing of our sample. In set out to capture both of them in our empirical specification, we allow the level, the forthrightly and the square of managerial ownership in our model as predictors of agency costs. 2. 3 Ownership Concentration A third alternative for alleviating age ncy problems is through concentrated ownership.Theoretically, shareholders could take themselves an active role in monitor charge. However, given that the monitor benefits for shareholders are balanceal to their blondness stakes (see, for example, Grossman and Hart, 1988), a small or reasonable shareholder has comminuted or no incentives to exert monitoring behavior. In contrast, shareholders with substantial stakes have more incentives to supervise steering and can do so more in effect (see Shleifer and Vishny, 1986 Shleifer and Vishny, 1997 and Friend and Lang, 1988).In general, the high the amount of shares that investors hold, the stronger their incentives to monitor and, hence, protect their investment. Although large shareholders may help in the reduction of agency problems associated with managers, they may also harm the firm by causing conflicts between large and nonage shareholders. The problem ordinarily arises when large shareholders gain nearly full control of a corporation and engage themselves in self-dealing expropriation procedures at the expense of nonage shareholders (Shleifer and Vishny, 1997).Also, as Gomez (2000) points out, these expropriation incentives are stronger when corporate governance of public companies insulates large shareholders from takeover threats or monitoring and the ratified system does not protect minority shareholders because either of poor people laws or poor enforcement of laws. Furthermore, the creative activity of concentrated holdings may decrease diversification, market liquidation and stocks ability to grow and, therefore, increase the incentives of large shareholders to expropriate firms resources.Several empirical studies provide evidence consistent with that view (see, for example, Beiner et al, 2003). In order to show the impact of ownership preoccupancy on agency costs, we complicate a protean that refers to the sum of stakes of shareholders with uprightness stake greater than 3 8 per cent i n our retrogression equation. The results remain robust when the threshold place changes from 3 per cent to 5 per cent or 10 per cent. 2. 4 Board of Directors Corporate governance research recognizes the essential role performed by the advance of directors in monitoring management (Fama and Jensen, 1983 Weisbach, 1988 and Jensen, 1993).The effectiveness of a board as a corporate governance mechanism depends on its sizing and composition. Large boards are usually more powerful than small boards and, hence, considered requirement for organizational effectiveness. For instance, as Pearce and Zahra (1991) point out, large powerful boards help in beef up the link between corporations and their purlieus, provide proponent and advice regarding strategic options for the firm and play life-or-death role in creating corporate identity. new(prenominal) studies, though, suggest that large boards are little(prenominal)(prenominal) effective than large boards.The underlying supposition is that large boards make coordination, communication and decision-making more cumbersome than it is in smaller groups. Recent studies by Yermack, 1996 Eisenberg et al. , 1998 and Beiner et al, 2004 support such a view empirically. The composition of a board is also important. There are two components that characterize the independence of a board, the proportion of non-executive directors and the separated or not roles of head executive officer ( chief executive officer) and chairman of the board (COB).Boards with a remarkable proportion of non-executive directors can limit the exercise of managerial discretion by exploiting their monitoring ability and protect their reputations as effective and independent decision makers. Consistent with that view, Byrd and Hickman (1992) and Rosenstein and Wyatt (1990) contrive a positive relationship between the percentage of non-executive directors on the board and corporate surgical process. Lin et al. (2003) also propose a positive share mo doughary value reaction to the appointment of outside directors, especially when board ownership is low and the designation possesses strong ex ante monitoring incentives.Along a slightly diverse dimension, Dahya et al. (2002) find that top-manager turnover increases as the fraction of outside directors increases. Other studies find exactly the verso results. They argue that non-executive directors are usually characterized by lack of information about the firm, do not bring the requisite skills to the strain and, hence, prefer to play a less confrontational role kinda than a more critical monitoring one (see, for example, Agrawal and Knoeker, 1996 Hermalin 9 nd Weisbach, 1991, and Franks et al. , 2001)7. As furthermost as the separation between the role of CEO and COB is concerned, it is believed that separated roles can lead to better board performance and, hence, less agency conflicts. The Cadbury (1992) inform on corporate governance stretches that issue and recommend s that CEO and COB should be two translucent jobs. Firms should comply with the recommendation of the report for their own benefit. A decision not to intermix these roles should be publicly explained.Empirical studies by Vafeas and Theodorou (1998), and Weir et al. (2002), though, which select that issue for the case of the UK market, provide results that do not support Cadburys stance that the CEO COB duality is undesirable. In the context of the UK market, UK boards are believed to be less effective than the US ones. For instance,. To bear witness the effectiveness of the board of directors in mitigating agency problems we include three variables in our empirical model a) the ratio of the chip of non-executive directors to he number of total directors, b) the total number of directors (board size) and c) a sens variable which takes the value of 1 when the roles of CEO and COB are not separated and 0 otherwise. 2. 5 Managerial Compensation Another important component of corp orate governance is the compensation package that is provided to firm management. Recent studies by pump et al. (2001) and Murphy (1999) suggest, among others, that compensation contracts, whose use has been increase dramatically during the 90s, can motivate managers to take actions that maximize shareholders wealth.In particular, as Core et al. (2001) point out, if shareholders could directly observe the firms growth opportunities and executives actions no incentives would be necessary. However, due to asymmetric information between managers and shareholders, both equity and compensation related incentives are required. For example, an increase in managerial compensation may reduce managerial agency costs in the disposition that satisfied managers will be less likely, ceteris paribus, to utilize insufficient effort, perform expropriation behaviour and, hence, risk the loss of their job.Despite the central importance of the issue, only a few empirical studies examine the impact of managerial compensation components on corporate performance. For example, Jensen and Murthy 7 such(prenominal) a result may be consistent with the governance system familiar in the UK market given the situation that UK legislation encourages non-executive directors to be inactive since it does not impose fiduciary obligations on them. Also, UK boards are dominated by executive directors, which have less monitoring power.Franks et al. (2001) have this view by providing evidence on a non-disciplinary role of nonexecutive directors in the UK. 10 (1990) find a statistically significant relationship between the level of pay and performance. Murphy (1995), finds that the form, rather than the level, of compensation is what motivates managers to increase firm value. In particulars, he argues that firm performance is positively related to the percentage of executive compensation that is equity based.More recently, Hutchinson and Gul (2004) analyze whether or not managers compensation ca n contribute the negative association between growth opportunities and firm value8. The results of this study imply that corporate governance mechanisms such as managerial stipend, managerial ownership and non-executive directors possibly affect the linkages between organizational environmental occurrenceors (e. g. growth opportunities) and firm performance.Finally, Chen (2003) analyzes the relationship between equity value and employees bonus. He finds that the classbook stock bonus is strongly associated with the firms contemporaneous but not future performance. Managerial compensation, though, is considered to be a debated component of corporate governance. Despite its potentially positive impact on firm value, compensation may also work as an infectious esurience which creates an environment ripe for abuse, especially at importantly high levels.For instance, remuneration packages usually include uttermost(a) benefits for managers such as the use of private jet, golf club membership, diversion and other expenses, apartment purchase etc. Benefits of this sort usually cause arrant(a) agency conflicts between managers and shareholders. 9 Therefore, it is practical that the relationship between compensation and agency costs is non-monotonic. Similar to the case of managerial ownership, we carry out a preliminary investigation about the pattern of the relationship between allowance and agency costs.As shown in figure 2, the relationship between earnings and agency costs is likely to be non-linear10. In our empirical model, we include the ratio of the total net income paid to executive directors to total assets as a determinant of agency costs. Also, in order to capture potential 8 Rather, the majority of the studies in that strand of literature reverse the condition and examine the impact of performance changes on executive or CEO compensation (see, for example, Rayton, 2003 among others). Concerns about excessive compensation packages and their n egative impact on corporate performance have lead to the makeup of basal recommendations in the form of best practises in which firms should comply so as the problem with excessive compensation to be diminished. In the case of the UK market, for example, one of the staple recommendations of the Cadbury (1992) report was the establishment of an independent compensation committee. Also, in a posterior report, the Greenbury (1995) report, specific propositions about remuneration issues were made.For example, an issue that was stretched was the rate of increase in managerial compensation. In the case of the US market, the set of best practises includes, among others, the establishment of a compensation committee so as transparency and disclosure to be guaranteed ( kindred practise an in the UK) and the substitution of stock options as compensation components with other tools that conjure up the long-term value of the company 10 A similar preliminary analysis is carried out so as to tag potential non-linearities concerning the relationship between the rest of internal governance mechanisms and agency costs.Our results (not reported) tell that none of them is related to agency costs in a non-linear way. 11 non-linearities, we include high ordered recompense harm in the regression equation. Finally, we include a blank variable, which takes the value of 1 when a firm pays options or bonuses to managers and 0 otherwise. Including that dummy variable in our analysis enables us to test whether or not options and bonuses themselves provide incentives to managers.As Zhou (2001) points out, ignoring options is likely to incur honorable problems unless managerial options are either paltry compared to ownership or almost utterly correlated with ownership. Insert Figure 2 here 2. 6 Growth Opportunities The magnitude of agency costs related to underinvestment, asset substitution and free cash flow differ significantly across high-growth and low-growth firms. In the underinvestment problem, managers may sink to pass up positive net present value projects since the benefits would mainly descend to debt-holders.This is more severe for firms with more growth-options (Myers, 1977). asset substitution problems, which fall out when managers opportunistically substitute higher variance assets for low variance assets, are also more prevalent in high-growth firms due to information asymmetry between investors and borrowers (Jensen and Meckling, 1976). High-growth firms, though, face lower free cashlow problems, which occur when firms have substantial cash militia and a tendency to undertake unsteady and usually negative NPV investment projects (Jensen, 1986).Given the different magnitude and types of agency costs between high-growth and low-growth firms, we expect the effectiveness of corporate governance mechanisms to vary with growth opportunities. In particular, if agency problems are associated with greater underinvestment or information a symmetry (a common problem in high-growth firms), we expect corporate governance mechanisms that mitigate these kinds of problems to be more effective in high-growth firms (Smith and Watts, 1992 and Gaver and Gaver, 1993).However, if, as argued by Jensen (1986), agency problems are associated with conflicts over the use of free cash flow (a common problem in low-growth firms), we expect governance mechanisms that mitigate such problems to play a more important role in low-growth firms (Jensen, 1986). Several empirical studies that model company performance confirm the reality of potential interactions between internal governance mechanism and growth opportunities. For example, McConnell and Servaes (1995) find that the relationship between firm value and leverage is negative for high-growth firms and positive for low12 growth firms.Their results also show up that equity ownership matters, and the way in which it matters depends upon investment opportunities. Specifically, they pro vide weak evidence that on the view that the allocation of equity ownership between corporate insiders and other types of investors is more important in low-growth firms. Also, Lasfer (2002) points out that high-growth firm (low-growth firms) rely more on managerial ownership (board structure) to mitigate agency problems. Finally, Chen (2003) finds that the positive relationship between annual stock bonus and equity value is stronger for firms with greater growth opportunities.In order to capture potential interaction effects, we include interaction footing between proxies for growth opportunities and governance mechanisms in our empirical model and, also, employ sample- snagting methods (see, for example, McConnell and Servaes, 1995 and Lasfer, 2002). found on previous empirical evidence the prediction we make is that mechanisms that are utilise to mitigate asymmetric information problems (free cash flow problems) are stronger in high-growth firms (low-growth firms). 3. selectiv e information and methodology 3. 1 Data For our empirical analysis of agency costs we use a large sample of ublicly traded UK firms over the stop 1999-2003. We use two selective information sources for the compilation of our sample. Accounting entropy and data on the market value of equity are collected from Datastream database. Specifically, we use Datastream to collect information for firm size, market value of equity, annual sales, selling general and administrative expenses, level of bank debt, short-term debt and total debt. Information on firms ownership, board and managerial compensation structure is derived from the Hemscott Guru Academic Database.This database provides financial data for the UKs top 300,000 companies, detailed data on all directors of UK listed companies, live regulatory and AFX intelligence feeds and share price charts and trades. Specifically, we get detailed information on the level of managerial ownership, ownership slow-wittedness, size and compos ition of the board, managerial stipend, bonus, options and other benefits. Despite the fact that data on directors are provided in a spreadsheet format, information for apiece item is given in a separate file away. This makes data collection for the required variables fairly complicated.For example, in order to get information about the amount of shares held by executive directors we have to combine two different files a) the 13 file that contains data on the amount of shares held by severally director and b) the file that provides information about the type of each directorship (e. g. executive director vs. nonexecutive director). Also, we have to take into broadsheet the fact that several directors in the UK hold positions in more than one company. Complications also arise when we attempt to collect information about the composition of the board and the remuneration package that is provided to executive directors.The way in which our final sample is compiled is the spare-tim e activity we start with a total of 1672 UK listed firms derived from Datastream. This number reduces to 1450 firms after excluding financial firms from the sample. After unified Datastream data with the data provided by Hemscott, the number of firms further decreases to 1150. Missing firmyear observations for any variable in the model during the sample period are also dropped. Finally, we exclude outliers so as to avoid the problem with extreme determine. We end up with 897 firms for our empirical analysis. 3. helpless Variable In our analysis we use two alternative proxies to measure agency costs. Firstly, we use the ratio of annual sales to total assets (Asset Turnover) as an inverse placeholder for agency costs. This ratio can be interpreted as an asset drill ratio that shows how effectively management deploys the firms assets. For instance, a low asset turnover ratio may indicate poor investment decisions, insufficient effort, consumption of perquisites and purchase of unp roductive products (e. g. office space). Firms with low asset turnover ratios are expected to experience high agency costs between managers and shareholders11.A similar placeholder for agency costs is also used in the studies of Ang et al. (2000) and Sign and Davidson (2003). However, Ang et al. (2000), instead of using the ratio directly, they use the difference in the ratios of the firm with a certain(p) ownership and management structure and the no-agency-cost base case firm. Secondly, followers Sign and Davidson (2003), we use the ratio of selling, general and administrative (SG&038A) expenses to sales (expense ratio). In contrast to asset turnover, expense ratio is a direct placeholder of agency costs.SG&038A expenses include salaries, commissions charged by agents to help transactions, travel expenses for executives, advertising and marketing costs, rents and other utilities. Therefore, expense ratio should 11 The asset turnover ratio may also capture (to some extent) agen cy costs of debt. For instance, the sales ratio provides a good signal for the lender about how effectively the borrower (firm) employs its assets and, therefore, affects the cost of capital 14 confer to a significant extent managerial discretion in spending company resources.For example, as Sign and Davidson (2003) point out, management may use advertising and selling expenses to camouflage expenditures on perquisites p. 7. Firms with high expense ratios are expected to experience high agency costs between managers and shareholders12. 3. 3 Independent Variables Our empirical model includes a set of corporate governance variables related to firms ownership, board, compensation and capital structure. Several control variables are also incorporated. For example, we use the logarithm of total assets in 1999 prices as a deputy for firm size (SIZE).Also, we include the market-to-book value (MKTBOOK) as a representative for growth opportunities. Finally, we classify firms into 15 sect ors and include 14 dummy variables accordingly so as to control for sector specific effects. Analytical interpretations for all these variables are given in disconcert 1. Insert tabularize 1 here 3. 4 Methodology We examine the determinants of agency costs by employing a cross sectioned regression admittance. Following Rajan and Zingales (1995) and Ozkan and Ozkan (2004), the dependent variable is measurable at some time t, eon for the independent variables we use comely-past values.Using ordinarys in the way we construct our explanatory variables helps in mitigating potential problems that may arise due to short-term fluctuations and extreme values in our data. Also, using past values reduces the likelihood of discovered relations reflecting the effects of asset turnover on firm specific actors. Specifically, the dependent variable is measured in year 2003. For accounting variables and the market-tobook ratio we use average values for the period 1999-2002. Ownership, boar d and compensation structure variables are measured in year 2002.Given that equity ownership characteristics in a country are relatively stable over a certain period of time, we do not expect that measuring them in a single year would yield a significant bias in our results (see also La Porta et al. , 2002, among others). 12 An alternative proxy for agency costs between managers and shareholders, which is not used in our paper though, is the interaction of companys growth opportunities with its free cash flow (see Doukas et al. , 2002). 15 Our approach captures potential interaction effects that may be present.For example, as explained analytically in section 2. 6, the nature of the relationship between the alternative governance mechanisms or devices and agency costs may vary with firms growth opportunities. To explore that possibility, we first interact our proxy for growth opportunities (MKTBOOK) with the alternative corporate governance mechanisms. In this way, we test for the existence of both main effects (the impact governance variables on agency costs) and conditional effects (the impact of growth opportunities on the relationship between governance variables and agency costs).Additionally, we split the sample into high-growth and low-growth firms and estimate our empirical models for each sample separately. past we check whether the coefficients of governance variables retain their sign and their meaning across the two sub-samples. 3. 5 Sample Characteristics confuse 2 presents descriptive statistics for the main variables used in our analysis. It reveals that the average values of asset turnover ratio and SG&038A ratio are 1. 24 and 0. 45 respectively. The mean value for managerial ownership is 14. 4 per cent of which the average proportion of stakes held by executive (non-executive) directors is 10. 68 per cent (4. 06 per cent). The ownership tautness reaches the level of 37. 19 per cent, on average, in the UK firms. Also, the average proportion of non-executive directors is 49. 5 per cent and the average board size consists of 6. 97 directors. Finally, we were able to identify only 73 firms out of the final 897 (8. 1 per cent) in which the same person held the positions of CEO and COB. As far as the capital structure variables are concerned, the average proportion of bank debt on firms capital structure is 55. 5 per cent and that of short-term debt is 49. 53 per cent. Finally, the average market-to-book value is 2. 09. In general, these values are in line with those reported in other studies for UK firms (see, for example, Ozkan and Ozkan, 2004 and Short and Keasey, 1999). Insert duck 2 here The results of the Pearsons correlativity of our variables are reported in set back 3. Our inverse proxy for agency costs, asset turnover, is clearly positively correlated to managerial ownership, executive ownership, compensation, bank debt and short-term debt.Ownership denseness is also positively related to asset turnover but the correlation coefficient is not statistically significant. On the contrary, board size and non-executive 16 directors are found to be negatively correlated with asset turnover. Finally, as expected, asset turnover is found to be negatively correlated with both growth opportunities and firm size. The results for our second proxy for agency costs, SG&038A, are qualitatively similar with a few exceptions (e. g. short-term debt) but with setback signs given that SG&038A is a direct and not an inverse proxy for agency costs. Insert card 3 here 4. Empirical Results 4. 1 Univariate analysis In knock back 4 we report univariate mean-comparison test results of the sample firm subgroups categorized on the backside of supra and below median(prenominal)(prenominal) values for managerial ownership, ownership concentration, board size, proportion of non-executives, bank debt, short-term debt, total debt, salary, firm size and growth opportunities. Firms with above median managerial owner ship (ownership concentration) have asset turnover of 1. 34 (1. 31) whereas those with below median managerial ownership (ownership concentration) have asset turnover of 1. 5 (1. 17). These differences are statistically significant at the 1 per cent (5 per cent) level. The results for executive ownership, salary, bank debt and short-term debt are also found to be statistically significant and are in the hypothesized direction. Specifically, we find that firms with above median values for all the above mentioned variables have relatively higher asset role ratios. On the contrary, there is evidence that firms with larger board sizes indicate significantly lower asset work ratios. Insert panel 4 here In panel B of the same table we report the results using SG&038A expense ratio as a proxy for agency costs. Results are in general not in line with the hypothesized signs with notable exceptions those of ownership concentration and growth opportunities. For example, firms with above m edian ownership concentration (MKTBOOK) have an SG&038A expense ratio of 0. 41 (0. 55) whereas firms with below median ownership concentration (MKTBOOK) have an SG&038A expense ratio of 0. 49 (0. 36).However, the results for managerial ownership, salary and short-term debt suggest that these governance mechanisms or devices are not effective in defend firms from excessive SG&038A 17 expenses. Sign and Davidson (2003) obtains a set of similar results, for the case when agency costs are approximated with the SG&038A ratio. Overall, the univariate analysis indicates several corporate governance mechanisms or devices, such as managerial ownership, ownership concentration, salary, bank debt and short-term debt, which can help mitigate agency problems between managers and shareholders.Also, consistent with previous studies, we find that the relation between governance variables and agency costs is stronger for the asset turnover ratio than the SG&038A expense ratio. The analysis that fol lows allows us to test the validity of these results in a multivariate framework. 4. 2 Multivariate analysis In this section we present our results that are based on a cross sectional regression approach. We start with a linear specification model, where we include only total debt from our set of capital structure variables (model 1).In general, the estimated coefficients are in line with the hypothesized signs. Specifically, consistent with the results of Ang et al. (2000) and Sign and Davidson (2003), we find both managerial ownership and ownership concentration to be positively related to asset-turnover. The coefficients are statistically significant at the 5 per cent and 1 per cent significance level respectively. On the contrary, the coefficient for board size is negative, which probably indicates that firms with larger board size are less efficient in their asset utilization.Also, the results for our proxy for growth opportunities (MKTBOOK) support the view that high-growth fi rms put up from higher agency costs than low-growth firms. Finally, there is strong evidence that managerial salary can work as an effective incentive mechanism that helps aligning the interests of managers with those of shareholders. Specifically, the coefficient for salary is positive and statistically significant to the 1 per cent level. Therefore, compared to previous studies, our empirical model provides evidence on the existence of an redundant potential corporate governance mechanism available to firms. Insert Table 5 here In model 2 we incorporate two additional capital structure variables, the ratio of bank debt to total debt and the ratio of short-term debt to total debt, in order to test whether debtsource and debt-maturity impacts agency costs. Also, we split managerial ownership into executive ownership (the amount of shares held by executive directors) and non-executive 18 ownership (the amount of shares held by non-executive directors). We do this because we expect that equity ownership works as a better incentive mechanism in the hands of executive directors rather in the hands of non-executive directors.According to our results, bank debt is positively related to asset turnover. Also, in addition to debt source, the maturity structure of debt seems to have a significant effect on agency costs. The coefficient of short-term debt is positive and statistically significant at the 1 per cent significance level. Furthermore, there is evidence that from total managerial ownership, only the amount of shares held by executive directors can enhance asset utilization and, hence, align the interest of managers with those of shareholders.In model 3 we estimate a non-linear model by adding the square of salary. As explained earlier in the paper, a priori expectations, which are supported by preliminary graphical investigation, suggest that the relationship between asset turnover and salary can be non-monotonic. Our results provide strong evidence that the relationship between salary and asset turnover is non-linear. In particular, at low levels of salary, the relationship between salary and asset turnover is positive. However, at higher levels of salary, the relationship becomes negative.This result is consistent with studies that suggest that extremely high levels of salary usually work as an infectious greed and create agency conflicts between managers and shareholders. The coefficients of the stay variables are similar to those reported in models 1 and 2. Finally, in model 4 we allow for a non-linear relationship between executive ownership and agency costs. However, our results do not support such a relationship and, therefore, the square term in our following models13.To sum up, the results of Table 5 indicate that managerial ownership (executive ownership), ownership concentration, salary (when it is at low levels), bank debt and short-term debt can help in mitigating agency problems by enhancing asset utilization. Also, the c oefficients for the control variables market to book and firm size, negative and positive respectively, suggest that smaller and non- growth firms are associated with reduced asset utilization ratio and, hence, more severe agency problems between managers and shareholders.As discussed earlier in the paper, there is a possibility that the nature of the relationship between the alternative governance mechanisms or devices and agency costs varies with firms growth opportunities. In Panel A of Table 6, we explore such a In trial regressions, which are not reported, the cubic term of executive ownership is also included in our model. at a time more, the results do not support the existence of a non-monotonic relationship. 13 19 possibility by interacting those governance mechanisms found significant in models 1-4 with growth opportunities, proxied by market-to-book ratio.Our empirical results support the existence of two interaction effects. We find that executive ownership is an effect ive governance mechanism especially for high-growth firms (the coefficient EXECOWNER* MKTBOOK is positive and statistically significant). This result is consistent with the study of Lasfer (2002), which suggests that the positive relationship between managerial ownership and firm value is stronger in high-growth firms. On the contrary, the coefficient SHORT_DEBT*MKTBOOK is found to be negative and statistically significant.This means that the dexterity of short-term debt in mitigating agency problems is lower for high-growth firms. A possible explanation may be that short-term debt basically mitigates agency problems related to free cash flow. Given that high-growth firms do not suffer from severe free cash-flow problems (but mainly from asymmetric information problems), the efficiency of short-term debt as governance device decreases for these firms. One could argue, though, that short-term debt should be more important for the case of highgrowth firms since it helps reduce underi nvestment problems.However, it seems that this effect is not very strong for the case in our sample. A similar result is obtained in McConnell and Servaes (1995) who find that the relationship between corporate value and leverage is positive (negative) for low-growth (high-growth) firms14. Insert Table 6 here Secondly, we use the variable MKTBOOK so as two split the sample into two subsamples. We label the swiftness 45 per cent in terms of MKTBOOK as high-growth firms and the lower 45 per cent as low-growth firms. Then, we re-estimate our basic model for the two sub-samples separately (Table 6, panel B).The results of this exercise confirm the existence of an interaction effect between executive ownership and asset turnover. In particular, the coefficient of EXECOWNER is positive and statistically significant only in the case of the sample that includes only high-growth firms. As far as short-term debt is concerned, it is found to be positive and statistically significant in both s amples. 14 The idea in McConnell and Servaes (1995) is that debt has both a positive and a negative impact on the value of the firm because of its influence on corporate investment decisions.What possibly happens is that the negative effect of debt dominates the positive effect in firms with more positive net present value projects (i. e. , high-growth firms) and that the positive effect will dominate the negative effect for firms with fewer positive net present value projects (i. e. , low-growth firms). 20 To summarize, the results of our multivariate analysis suggest, among others, that executive ownership and ownership concentration can work as effective governance mechanisms for the case of the UK market.These results are in line with the ones reported by the studies Ang et al. (2000) and sign and Davidson (2003). Also, we find that, in addition to the source of debt, the maturity structure of debt can help to reduce agency conflicts between managers and shareholders. The fact t hat previous studies have ignored the maturity structure of debt may partly explain their contradicting results concerning the relationship between capital structure and agency costs. Furthermore, we find that salary can work as an additional mechanism that provides incentives to managers to take valuemaximizing actions.However, its impact on asset turnover is not always positive i. e. the relationship between asset turnover and salary is non-monotonic. Finally, there is strong evidence that the relationship between several governance mechanisms and agency costs varies with growth opportunities. Specifically, our results support the view that the positive relationship between executive ownership (short-term debt) is stronger for the case of high growth (low growth) firms. 4. Robustness checks Given the significant impact of growth opportunities on agency costs (main impact) and on the impact of other corporate governance mechanisms (conditional impact), we further investigate the re lationship between growth opportunities, governance mechanisms and agency costs. At first, we substitute the variable MKTBOOK with an alternative proxy for growth opportunities. The new proxy is derived after employing common agent analysis, a statistical technique that uses the correlations between observed variables to estimate common factors and the structural relationships linking factors to observed variables.The variables which are used in order to isolate latent factors that account for the patterns of colinearity are following variables MKTBOOK = Book value of total assets minus the book value of equity plus the market value of equity to book value of assets MTBE = merchandise value of equity to book value of equity METBA = Market value of equity to the book value of assets METD = Market value of equity plus the book value of debt to the book value of assets. 21 These variables have been extensively used in the literature as alternative proxies for growth opportunities an d Tobins Q.As shown in Table 7 (panel A) all these variables are exceedingly correlated to each other. In order to make sure that principal component analysis can provide valid results for the case of our sample, we perform two tests in our sample, the Barletts test and the Kaiser-Meyer-Olkin test. The first test examines whether or not the intercorrelation matrix comes from a population in which the variables are noncollinear (i. e. an identity matrix). The second test is a test for sampling adequacy.The results from these tests, which are reported in panel B, are encouraging and suggest that common factor analysis can be apply in our sample since all the quadrupletsome proxies are likely to measure the same thing i. e. growth opportunities. Panel C presents the eigenvalues of the reduced correlation matrix of our four proxies for growth opportunities. Each factor whose eigenvalue is greater than 1 explains more variance than a single variable. Given that only one eigenvalue is greater than 1, our common factor analysis provides us with one factor that can explain firm growth opportunities.Clearly, as shown in panel D, the factor is highly correlated with all MKTBOOK, MTBE, METBA and METD. We name the new variable outgrowth and use it as an alternative proxy for growth opportunities. descriptive statistics for the variable GROWTH are presented in panel D. Insert Table 7 here Table 8 presents the results of cross-section analysis after using the variable GROWTH as proxy for agency costs. In general, the results of such a task are similar to the ones reported previously.For instance, there is strong evidence that executive ownership, ownership concentration, salary, short-term debt and, to some extent, bank debt are positively related to asset turnover. Also, there is some evidence supporting a non-linear relationship between salary and asset turnover. Finally, our results clearly indicate that agency costs differ significantly across high-growth and low-g rowth firms and, most importantly, there is a significant interaction effect between growth opportunities and executive ownership.However, we can not provide any evidence on the existence of an interaction between asset turnover and short-term debt. Insert Table 8 here 22 In panel B of table 8, we split our sample into high-growth and low-growth firms on the basis of high and low values for the variable GROWTH. Specifically, we label the upper 45 per cent in terms of GROWTH as high-growth firms and the lower 45 per cent as low-growth firms. Then we estimate our basic model for each sub-sample separately. The results are very similar to the ones reported in Table 6 (panel B), where we apply a similar methodology.As an additional robustness check, we use a third proxy for growth opportunities, a dummy variable that takes the value of 1 if the firm is a high-growth firm and 0 otherwise, and re-estimate the models 6 and 7 of Table 8. The definition used in order to distinguish between h igh-growth and low-growth firms is the following Firms above the fifty-fifth percentile in terms of the variable GROWTH are called high-growth firms. Firms below the forty-fifth percentile in terms of the variable GROWTH are called low-growth firms.Finally, firms between the forty-fifth and 55th percentile are excluded from the sample. The results (not reported) are qualitatively similar to the ones reported in Table 8. For example, there is evidence for the existence of an interaction effect between executive ownership and growth opportunities but not for the one between short-term debt and growth opportunities. Also, we re-estimate the models reported in Table 8 after substituting the total salary paid to executive directors for the total remuneration package paid to executive directors.We are doing so given that the total remuneration package that is paid to managers includes several other components. For instance, the components of compensation structure have been increase in nu mber during the last tenner and may include annual performance bonus, fringe benefits, stock (e. g. preference shares), stock options, stock appreciation rights, phantom shares and other deferred compensation mechanisms like qualified loneliness plans (see Lynch and Perry, 2003 for an analytical discussion). Once more, the results do not change substantially.Finally, in Table 9 we substitute the annual sales to total assets with the ratio of SG&038A expenses to total sales. As already mentioned earlier in the paper, this ratio can be used as a direct proxy for agency costs. Our results, as presented in Table 9, indicate that executive ownership, ownership concentration and total debt help reduce discretionary spending and, therefore, the agency conflicts between managers and shareholders. Sign and Davidson (2003) do not find any evidence to support these results. Also, we find that agency costs and growth opportunities are positively related i. . the coefficient of the variable G ROWTH is positive and statistically significant to the 5 per cent statistical level. 23 Finally, our results support the existence of an interaction effect between growth opportunities and executive ownership. However, once more, our analysis does not indicate the existence of an interaction effect between short-term debt and growth opportunities. Insert Table 9 here 5. Conclusion In this paper we have examined the effectiveness of the alternative corporate governance mechanisms and devices in mitigating managerial agency problems in the UK market.In particular, we have investigated the impact of capital structure, corporate ownership structure, board structure and managerial compensation structure on the costs arising from agency conflicts mainly between managers and shareholders. The interactions among them and growth opportunities in determining the magnitude of these conflicts have also been tested. Our results strongly suggest managerial ownership, ownership concentration, exec utive compensation, short-term debt and, to some extent, bank debt are important governance mechanisms for the UK companies.Moreover, growth opportunities is a significant determinant of the magnitude of agency costs. Our results suggest that highgrowth firms face more serious agency problems than low-growth firms, possibly because of information asymmetries between managers, shareholders and debtholders. Finally, there is strong evidence that some governance mechanisms are not homogeneous but vary with growth oppo

Deception Point Page 3

He clucked ruefully. Thirty- foursome. Almost an old maid. You get laid by the time I was thirty-four, Id already- espouse Mom and screwed the neighbor? The words came erupt louder than Rachel had in disco biscuitded, her voice hanging naked in an ill-timed lull. Diners nearby glanced oer.Senator Sextons eyes flash-froze, devil ice-crystals boring into her. You checker yourself, young lady.Rachel headed for the door. No, you watch yourself, senator.2The three men sit pig in silence inside their ThermaTech rage inhabit. Outside, an icy wind buffeted the shelter, inauspicious to tear it from its moorings. N oneness of the men took mark each had seen situations far more jeopardize than this one.Their tent was nude white, pitched in a shallow depression, out of sight. Their colloquy devices, transport, and weapons were all state-of-the-art. The group leader was code-named Delta-One. 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Lives already had been lost to protect it.At the moment, everything looked tranquillize away(p) the structure.The true test, however, was what was happening inside.Delta-One reentered the tent and addressed his two fellow soldiers. duration for a flyby.Both men nodded. Th e taller of them, Delta-Two, capable a laptop computer and turned it on. Positioning himself in front of the screen, Delta-Two dictated his hand on a robotic joystick and gave it a short jerk. A thousand meters away, hidden deep deep down the building, a surveillance robot the surface of a mosquito received his transmission and sprang to life.3Rachel Sexton was still steaming as she host her white Integra up Leesburg Highway. The dim maples of the Falls Church foothills rose stark against a crisp March sky, nevertheless the peaceful setting did little to brace her anger. Her fathers recent surge in the canvass should have endowed him with a modicum of self-confident grace, and yet it seemed solo to fuel his self-importance.The mans pretense was doubly painful because he was the wholly immediate family Rachel had left. Rachels fuss had died three historic period ago, a devastating loss whose activated scars still raked at Rachels heart. Rachels besides quilt was k nowing that the death, with ironic compassion, had liberated her mother from a deep despair oer a miserable marriage to the senator.Rachels beeper beeped again, pulling her thoughts back to the road in front of her. The incoming message was the aforesaid(prenominal). RPRT DIRNRO STAT overcompensate to the director of NRO stat. She sighed. Im coming, for Gods sakeWith rising uncertainty, Rachel drove to her usual exit, turned onto the private addition road, and rolled to a stop at the heavily build up sentry booth. This was 14225 Leesburg Highway, one of the most secretive addresses in the country. turn the guard scanned her car for bugs, Rachel gazed out at the mammoth structure in the distance. The one-million-square-foot multiform sat majestically on lxviii forested acres just outside D.C. in Fairfax, Virginia. The buildings facade was a bastion of one-way glass that reflected the army of air dishes, antennas, and rayodomes on the surrounding grounds, doubling their alread y awe-inspiring numbers.Two minutes later, Rachel had set and crossed the manicured grounds to the main entrance, where a carved granite sign announced field RECONNAISSANCE OFFICE (NRO)The two armed Marines flanking the bulletproof revolving door stared straight forwards as Rachel passed between them. She felt the same sensation she always felt as she pushed done these doors that she was entranceway the belly of a sleeping giant.Inside the vaulted lobby, Rachel perceived the faint echoes of hushed conversations all well-nigh her, as if the words were sifting down from the offices above. An enormous tiled mosaic proclaim the NRO directiveENABLING U.S. GLOBAL data SUPERIORITY, DURING PEACE AND THROUGH WAR.The walls here were lie with massive photographs rocket launches, submarine christenings, break installations towering achievements that could be celebrated only within these walls.Now, as always, Rachel felt the problems of the outside world fading behind her. She was ente ring the shadow world. A world where the problems thundered in like freight trains, and the solutions were meted out with and a whisper.As Rachel approached the final checkpoint, she wondered what lovable of problem had caused her pager to ring doubly in the last thirty minutes. honourable morning, Ms. Sexton. 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Gisting, or data reduction, required analyzing analyzable reports and distilling their essence or gist into concise, single-page briefs. Rachel had be herself a natural. All those years of cutting through my fathers bullshit, she thought.Rachel now held the NROs premier gisting post-intelligence interest to the White House. She was responsible for sifting through the NROs daily intelligence reports, deciding which stories were germane(predicate) to the President, distilling those reports into single-page briefs, and then forwarding the synopsized material to the Presidents theme Security Adviser. In NRO-speak, Rachel Sexton fabricate fi nished product and serviced the customer.

Legal Implications in Human Resources Essay

It is important to give a apprize description of the gild and their betrothment indemnity. Gelato t only mallow Comp either is located in Heartland Corners, U.S.A., and employs integrity hundred workers at its principal process plant who distributes cheese throughout the unify States. The partnership has mostly young atom employed to its smart set between the boards of 25-35. The follow is located in a neighbour, which has a community of 50 percent gaberdine and 25 percent African American, with the rest period being Hispanic American, Asian American and others. The company requires a lavishly naturalise diploma as a watch of employment for its change crew. Based on this requirement Gelatos entire cleaning crew is ovalbumin. Many companies in the coupled States that mainly have a white population have the same or similar policies based on economic system reasons. It is understandable that most company rank their standards based job title, description and milit ary rank a company will striation their standards and qualification based on distributively position.The company must at all times try to stay at bottom the grind laws of the country which have particular conditions that each company must see or will be in breach of the law and will strikingness serious consequences based on these breaches. indeed it is important for the human option division to be current in labour and company law to guide their company in the right direction. Base on the Title VII of the Civil Rights shape of 1964 it can be give tongue tod that at first observation the company did not violate any of the acts requirement of them more over this is wrong. The act highlight and prohibits most employment harassment and variety, covers all private employers, state and local governments, and educational institutions with 15 or more employees. In addition to prohibiting discrimination against workers because of race, colour, national origin, religion, and s ex, those protections have been extended to imply barring against discrimination on the land of pregnancy, sex stereotyping, and sexual harassment of employees. (hrhero.com 2013) The feature that the surround community is mostly maculation and a higher percent board of students calibrate from high school with a security measure is white. It can be assume that the company created its policies based on knowledge acquired from the high school which states 75% of the white population has transactd high school, comp atomic number 18d with 25% of those in barbarianity assorts. This is discrimination to the minority group based on the fact that the company insist on this employment constitution that they know that more whites graduate than the minor group then the correct measures should be taken into consideration. Based on the policy of employing only gradates students from the high has already remark discrimination. (hrhero.com 2013) Gelato Cheese Company human resource depar tment needs to review the epoch Discrimination in Employment mold as it relates to application and employment decisions this is because of the age of their janitorial staff. The members of the janitorial staff are between the ages of cardinal (25) and thirty-five (35). The senesce Discrimination in Employment effect helps to protect ripened employees so they have a conflict fair chance at employment. The Age Discrimination in Employment Act prohibits an employer from refusing to hire, firing, or otherwise discriminating against an employee age 40 or older, solely on the basis of age. Thus base on the company age group they are in beech of the policies and need to lay out and make changes where necessary. At forty (40) geezerhood old you are still operable and able to achieve and conduct precondition task that needs to be complete at the correct time for any company this it is unfair of employers to want to employ only young employee. When these people are out of a job th e over will have to find additional money for unemployment program. (hrhero.com 2013)

'On the Want of Money\r'

'Robyn Sumibcay April 4, 2013 Period 5 Carvalho On the essential of M geniusy It tout ensemble dates back to ten thousand geezerhood ago when money became one of the man’s greatest obsessions. From bartering to coinage to paper, the emergency and need for money has never sortd. In author William Hazlitt’s testify, On the Want of Money, he clearly describes how money slew effectively make or unveil one’s purport. He uses examples, syntax, language, and heart to show that in a military personnel without money a human macrocosm piddle out experience the jumpyness of brio.After stating his aspect that â€Å"one cannot get on closely in the world without money. ” author Hazlitt magnetic inclinations a variety of examples to show the outcome of one’s life if they were to live without money. He clearly states that without money your life will basically be miserable, and use slight. He not only sh ars examples of how life would be with out money, besides in any case a little chomp about how it would be WITH money. His long list of harsh examples allows the reader to paint a picture of Hazlitt’s position.Considering that the whole essay consists of three sentences, the readers begin to have overwhelmed. By overwhelming the reader, they’re able to get a sense of the burden they would feel if they were to live without money. The method of listing in like manner makes readers see the endlessness of problems a person may over go. Listing examples of the way life would be without money makes the reader change their perspective of living â€Å"freely”. On the Want of Money is filled with harsh diction which creates a dreary tone for readers.Hazlitt uses a list of prohibit oral communication such as, â€Å"despised”, â€Å"rejected”, â€Å"carped”, â€Å"disparaged”, â€Å"scrutinized”, â€Å"ignored”, â€Å"thrall”, â€Å"irksome”, †Å"compelled”, â€Å"deprived”, â€Å"back-biting”, â€Å" mortification”, and â€Å"burden” to emphasize the severe set up and harshness of being poor. By accenting in his essay, readers are able to piddle the way their life would change dramatically if money were to be completely abolished from their lives. approximative diction also helps express the endlessness of negative outcomes. Not only does harsh diction create negativity but also produces a dreary, unemotional-like tone.By creating a solemn tone, readers are then able to realize the detention they should have toward money. Diction and tone real has an effect on the readers because it helps them feel what it’s like without money, and creates an experience of being less fortunate. Money plays a major aim in a human beings life because although it’s deniable, money can sometimes really be the answer to happiness. Without money, a person may end up living a hard, struggling life. No matter what form that money is in, a person should always carry it round to be able to get by means of the harshness and reality of life.\r\n'

'Characteristics of Macbeth and Lady Macbeth Essay\r'

'I am report about the lend called Macbeth. Macbeth is a die hard written by Shakespeare based on the lines of a true story, about Macbeth changing his whole personality through with(predicate)out the play. He has patchy obstacles on his way up, from organism major power. skirt Macbeth, started in the play, real persist cunning and im honourable, and felt that Macbeth was as well deterrent example and unplayful-willed. She forced him to do bity things in order for him to gain the surname in the throne. As she helped him however, she became very self-conscious and stop up violent death herself through guilt.\r\nAt the beginning of the play, Macbeth was brave and loyal to king Duncan, and Duncan thought greatly of him. Duncan quoted â€Å"Brave Macbeth- closely he deserves that name” in; fleck 1 photo 2. He a comparable quoted â€Å"The service and the loyalty I owe, / in doing it, pays itself”. In cultivate 1 scenery 3.\r\nIn these quotations, it s hows that Macbeth is kn protest as brave- correct others think he is. He does non expect to be paid; he only does things for loyalty. This shows that he is moral, and is polite to everyone and is customary and desired by pretty untold everyone around him. However, doll Macbeth regains he is too nice for his own good. Macbeth had well-knit moral values, and never agreed to murder soulfulness in order to get himself a claim in the throne. bird Macbeth quoted â€Å"do I fear thy nature, it is too honest o’th’milk of kind kindness”, in strike 1 scene 5. This is showing that Macbeths own wife thinks he is too kind to do anything evil- the milk represents that he is natural and sensitive of heart, whereas Lady Macbeth is non, she is evil.\r\nAt the end of the play, Macbeth seems brave, exclusively too brave, more or less insanely brave. Lady Macbeth does end up persuading Macbeth to kill Duncan, which turns Macbeth evil, and makes his own plans on k illing other people, in order to make him self the highest and the give on the throne. Macbeth says â€Å"I have almost forgotten the taste of fears” in act 5 scene 5. This shows him to be everyplace confident and does not fear anything. The witches’ predictions, which appeared at the beginning of the play, and gave, correct predictions every time, give tongue to that Macbeth cannot be killed by any man born of woman and when Burnham wood espo use of goods and servicess to his castle. This makes him feel that he cannot be defeated.\r\nHis wife, Lady Macbeth, commits self-destruction as she became so full of guilt, just now when he found out, he seemed that he doesn’t seem to fretting oft about lady Macbeth as he says ” She should have died hereafter…life’s just now a walking shadow, a poor player/ That struts and frets his hour upon the percentage point” in act 5 scene 5. This seems to indicate that he does not care about anyone besides himself, and that he is selfish. He compares life to organism in a theatre, he doesn’t think he is going to die, he’s like the actor, and thinks he knows exactly what is going to croak next. However, Macbeth is very wrong, as he comes await to face with reality, as Macduff and his army come to Macbeth’s castle, and Macbeth is told that Macduff is not born from woman, but he was a caesarean. Macbeth then becomes close to worried.\r\nMacbeth still puts on a strong hard battle, but Macduff defeats him.\r\nLady Macbeth\r\nAt the beginning of the play, Lady Macbeth was a bargain stronger and evil than Macbeth. She was much like the man of them both, and she always tried to make Macbeth stronger. She verbalise to Macbeth â€Å"Unsex me here/ and take in me from the public opinion poll to the toe top full/ of direst ruthlessness”. Here, she I trying to say, make me more manly- she is asking to be filled with cruelty, so she can make Macbeth to have the title of the throne. She is trying to show that she will do anything bad in order to fill her ambitions. She is not maternal.\r\nLady Macbeth was very good at being misleading, as she acted artless in front of Duncan, but back end his back, she was plotting to get Macbeth to murder him. She says to Macbeth, â€Å"look like th’ clean-handed flower, but be the ophidian uder’t”. She is saying to be like a deadly flower, looks innocent but will snap at any unpredictable and unexpected moment. The serpent represents evil and temptation; in which, Macbeth has to have.\r\n after(prenominal) Macbeth and herself finally murdered Duncan, she begins to feel very guilty and insecure. She had many nightmares of when she murdered Duncan.\r\n i night when she started sleep walking, in act 5 scene 1 she tell ” what will the hands ne’er be clean?”, she is still left-hand(a) with the stains of her actions. This shows her feminine side breaking th rough. She was being constantly reminded of when her hands were covered in blood; her dreams are showing her that she does not have a clean conscience.\r\nLady Macbeth becomes very ill, and emotionally mental. She has many more nightmares, which shows a shadow of her old self. She quoted in one of her nightmares, â€Å"Old damned period…Hell is murky. Fie, my lord, fie, a soldier and afeard(predicate)”. She is here, cursing the blood; she now has disquiet over everything. She spoke in unequal sentences, showing her being not at all confident, creating a tense atmosphere. The use of repetition in questions to her husband when she slept talked showed her anxiety.\r\n passim the whole of this play, the two characters seemed to have almost switched placed. Macbeth grew courageous and confident after killing Duncan and felt he was undefeatable, while Lady Macbeth became disillusioned and emotionally mental, after her first-class honours degree murder encounter. Macbeth b ecame too full of him self and felt he was â€Å"immortal”.\r\nThe play created very tense and frightening atmospheres and had a strong storyline, which became clearer further on through the play.\r\n \r\n'

'Women Rights in Islam – Modernizing or Outdated?\r'

'Wo gaypower Rights in Islam †Modernizing or oer-the-hill? Definition drive pop aside to the Oxford dictionary, ‘Wo work force’s Rights atomic chassis 18 the indemnifys that move on a position of social and legal embodyity, of wowork force to gentlemanpower. tally to the Oxford dictionary, ‘they argon the functions, claimed for the wo custody, equal to those of work force, as regards to suffrage that right to vote, as regards to place, etc. ‘Modernizing jibe to the Oxford dictionary means, ‘to pee recent, to adapt to modern inevitably or habits And fit to the Webster’s dictionary it means ‘to make modern, or to constitute a naked character or appearance †e. . , to overtake integritys ideas In short, modernizing is a move manpowert of updating or opting for the betterment of the present circumstance itself †It is non the present modern status itself. jackpot we modernize ourselves, to master o ur problems, and to realize a new way of life, for the whole hu slice race? I am not concerned ab cause out of the closet the modern ideas, the conclusions and the categorical statements made by scientists and inexperienced armchair experts, as how a life should be lived by a wo reality. I am going to base my conclusions and considerations on truth, which seat be proved by experience.\r\n recall out and unbiased accompanimentual holistic analysis, argon the trusted test, between the gold of truth, and the glitter of theory. We charter to check our thinking a encouragest reality, otherwise m some(a)(prenominal) a generation, our incorrupt process leave al star go astray †past the great brains of unitary time, call backd that the world was flat. Women Rights in the westbound If we mark pip with the ‘Women’s rights in Islam as portray by the occidental media, you im fictitious character no option, save to agree that the ‘Women’s right s in Islam atomic number 18 overaged.\r\nThe tungs tennerern talk of women’s liberation is actu every last(predicate)y a disguised form of exploitation of her consistency, deprivation of her discover and degradation of her soul. The western nightspot which babble outs of upgrading the status of women in Islam, corroborate actu wholey reduced her status to concubines, to mistresses, to comp some(prenominal) al wholenessterflies, which be mere tools in the hands of conjure marketers and pleasure seekers, which atomic number 18 disguised behind the iridescent screen of art and culture. Women Rights in Islam Islam’s base revolutionary support, gave women their due right and status n the days of ignorance 1,400 historic period ago. Islam’s designive was and continues to be, to modernize our thinking, our living, our seeing, our hearing, our feeling and striving for the women’s upliftment and e firearmcipation in the society. Before I d swell up further with the topic, I would compulsion you to make note of a a few(prenominal) points. •Approximately integrity fifth of the world’s population consists of Moslems. on that point are different Muslim societies †some(a) whitethorn be close to Islam, or so whitethorn be far away from Islam. The ‘Women’s rights in Islam should judge according to the authorized sources, and not what individual Muslims do, or what the Muslim society does. •The authentic sources of Islam are the Qur’an, which is the word of matinee idol, and the authentic Sunnah, and the traditions of our be make loved oracle ( intermission be upon him). •Qur’an leave never contradict itself, nor go out the authentic hadith contradict itself n all result these two authentic sources, contradict separately other. •sometimes the scholars differ, and m all a times, these ends fuel be remove by analyzing the Qur’an as a whole, and n ot retri more thanoverory by quoting single grouchy rhyme.\r\nBecause if one leave-takingicular verse of the Qur’an is ambiguous m for each one a times the answer is crapn over somewhere else in the Qur’an †Some mob quote one source and break d stimulate all the other sources. •It is the trade of every Muslim, virile or fe potent, to seek the pleasure of god, and to act as His trustee on this world, and not to try and gain fame or settle with one’s own ego. Islam believes in equality of men and women Equality does not mean ‘identicality In Islam, the role of a man and cleaning adult female is complimentary, it is not conflicting. It is that of a incitenership, it is not contradictory, so as to strive for supremacy.\r\nWhere ‘Women’s rights in Islam is concerned, I withstand divided it into 6 broad categories. half a twelve Categories of Women Rights in Islam The startle are ‘the Spiritual rights siemens are ‘the Economical rights third are ‘the affectionate rights quaternaryth are ‘the Educational rights fifth are ‘the Legal rights and last are ‘the Political rights. depend upon is no(prenominal) the Criteria to Enter Paradise: The greatest misconception that the West has about Islam, is that they think ‘Paradise in Islam, is but meant for the staminate †it is not meant for the young-bearing(prenominal) This misconception nooky be removed by quoting from Surah Nisa, Ch. no , rime no(prenominal)124, which guesss, ‘If every of you do deeds of righteousness, whether it be anthropoid or a fe man kindred soul and has faith, they shall surely reach Paradise and not the least injustice shall be done to them. A uniform thing is repeated in Surah Nahl, Ch. 16, euphony no. 97 which arranges ‘If every of you perform crush deeds, be it a man or a muliebrity and is a believer, We shall strive you good life and We should take you for all your good works. sightly because in Islam, sex is not the criteria to move into Paradise, go away you call such rights in Islam as modernizing or noncurrent? A. Spiritual Rights of Women in Islam\r\n some other misconception is that, which the western sandwich media has, that, ‘The cleaning lady has no soul. In fact, it was in the s raseteenth century, when the Council of wise men, when they gathitherd at Rome, and they nemine contradicente agreed that the woman had no soul. In Islam, man and woman open the a wish well ghostlike nature. It is mentioned in Quran, Ch. 4, measure nary(prenominal) 1, which says that, ‘O homosexual strain adore your Guardian manufacturer, who has created you from a single person and created like nature his mate. A similar thing is mentioned in Surah Nahl, Ch. 16, Verse none 72, which says that, ‘We stupefy made for you companions and twain of your own nature.\r\nIn Surah Al-Shura, Ch. 42, Verse no 11, it says, ‘He is the one who has created the heavens and the earth and has made for you su blow overers from among yourselves. Just because the spiritual nature of a man and woman is the same in Islam, allow you call such rights in Islam, as modernizing or outdated? The Qur’an clear mentions that, ‘ theology has suspire somewhat of His spirit into the human beings. If you select Surah Hijr, Ch. 15, Verse No. 29, it says, ‘When I ache make you in due proportion and constitute breathed into you something of my spirit, fall you down in obeisance. A similar thing is repeated in the Qur’an, in Surah Sajdah, Ch. 2, Verse No. 9, which says, ‘Then He fashioned him and breathed into him of His Spirit… Here, when God refers to as ‘Something of My Spirit, is breathed into the human beings? E- it does not mean, a sort of avatar or a pantheistic form. It means that Allah has disposed to every human being something of His spiritual Natur e, and the experience of God all-powerful, and coming closer towards Him. Here it refers to two rapture and Eve (may slumber be upon them) †some(prenominal)(prenominal) were breathed something of Gods Spirit. Again we read in the Qur’an, that Allah has positive the human being as His vicegerent, s His trustee, as is mentioned in Surah Isra, Ch. 17, Verse No. 70, which says, ‘We suck up honoured the squirtren of Adam and bestowed on them special favours? E none, here all the children of Adam drive home been honoured, male as well as female. There are some spectral scriptures, for showcase the record, which assembles the blame on Eve for the ruination of humanity. In fact if you read the Qur’an in Surah Araf, Ch. 7, Verse No. 19 to 27, Adam and Eve (may peace be upon them both) are addressed, to a greater extent than a dozen of times. Both disobeyed God, both asked for for shitness, both repented, and both were for inclined.\r\nIn the Bible, i f you read Genesis, Ch. 3, altogether Eve is held responsible ( may peace be upon her) for the downfall of humanity. And according to the doctrine of ‘ passe-partout Sin? E because of Eve (may peace be upon her) the whole of humanity is born in sin. Does gestation Uplift the Women or Degrade? If you read the Bible in Genesis, Ch. 3, Verse No. 16, it says that, ‘To the woman He (God) utter, â€Å"I leave alone greatly multiply your paroxysm in childbearing; in disquiet you shall stick forth children, yet your desire shall be for your save, and he shall rule over you. ‘ That means, pregnancy and child stimulate has been tell in the Bible to degrade the women and the outwear cark is a sort of penalty. In fact if you read the Qur’an, pregnancy and child birth pose uplifted the women. If you read Surah Nisa, Ch. 4, Verse No. 1, it says, ‘ view the womb that tidal bore you Its mentioned in Surah Luqman, Ch. 31, Verse No. 14, it says, ‘We have enjoined on the human being to be kind to the parents, in travail upon travail did their beget bore them and in stratums twain was their weaning. A similar thing is mentioned in Surah Ahqaf, Ch. 46, Verse No. 5, it again repeats, which says, ‘We have enjoined on the human beings to be kind to his parents. To be kind to the parents †in pain did their mother bore them, and in pain did she reveal them birth †Pregnancy in the Qur’an has uplifted the women not degraded her. Just because pregnancy has uplifted the women in Islam depart you call such rights in Islam as modernizing or outdated? Criteria in the Sight of God to Judge Male and Female: The only criteria for legal opinion in the sight of Allah is ‘Taqwa ‘God consciousness or ‘righteousness It is mentioned in Surah Hujurat, Ch. 49, Verse No. 3 ‘O globe, We have created you from a single pair of male and female and have divided you into nations and tribes, so that you shal l recognize each other not that you reject each other and the most honored in the sight of God, is the one who is the most righteous. Sex, color, caste, wealth has got no criteria in Islam †The only criteria in the sight of God is ‘righteousness neither is sex the criteria for God to reward or to punish a person. If you read Surah Imran Ch. 3 Verse No. 195 it says ‘I exit never suffer the loss of any of you, be it male or female, you are companions unto each other.\r\nEqual example Duties for Men and Women: I had started my talk by quoting a verse from the Qur’an from Surah Al Ahzab, Ch. 33, Verse No. 35, which says, ‘For Muslim men and Muslim women, for believing men and women, for darling men and women, for certain men and women, for men and women who are patient and constant, for men and women who assign in benignity, for men and women who fast and deny themselves, for men and women who care their chastity, for men and women who engage much i n Gods praise, God has brisk for them for addictedess and a vast reward.\r\nThis verse indicates that the spiritual duties, the moral duties, for the men and women in Islam are the same †Both have to believe, both have to pray, both have to fast, both have to give in charity, etc, etc. provided the women has been tending(p) certain subsidization in Islam. If she is undergoing her menstrual period or pregnancy, she does not have to fast †She basis keep those fasts subsequent on, when she is more than healthy. During the menstrual period and during the postnatal period, she needs not pray also †she has been tending(p) the concession, and neither does she have to compensate it later on.\r\nJust because the moral duties of the men and women are equal in Islam will you call such rights in Islam as modernizing or outdated? B. Economical Rights to the Women Islam gave economical rights to the women 1,300 years forward the West. An adult Muslim woman can own, she ca n dispose or disown any of her property without consulting any one, irrespective whether she is hook up with or she is single. In 1870, it was the first time in England, that the West recognize the rights of the married woman, where she was allowed to own or dispose any of her property without consultation.\r\nI do agree that the women were presumption their economical rights 1300 years ago †these are antediluvian patriarch rights †but the motion is ? E‘are they modernizing or outdated?? Enbsp; Women on Job: A women in Islam, if she wishes to work she can work †There is no text in the Qur’an or the authentic hadith which pr take downts or makes it disallow for a woman to do any work, as long as it is not un lawfulnessful, as long as it is within the take in of the Muslim Shariah, as long as she abide bys her Islamic dress code.\r\n besides natural, she cannot take up jobs, which acquaint her beauty and body †Like for example, modeling and i nject acting, and such kind of jobs. umpteen a(prenominal) of the vocations and jobs which are command for the woman are also prohibited for the man, for example serving alcohol, working in gambling dens, doing any unethical or dishonest business. All these jobs are prohibited for both men and women. A true Islamic society engages women to take up profession such as bushels. We do lead female Gynecologists, we do require female nurses, we do require female teachers.\r\nBut, a woman in Islam has got no fiscal crafts †The pecuniary obligation is laid on the shoulders of the man in the family †Therefore she need not work for her livelihood. But in genuine cases, where at that place are financial crisis in which both the ends do not meet, she has the option of working. Here too, no one can force her to work †She works out of her own, absolute exonerate will. Financial Security for Women: A woman in Islam has been given more financial security, as compared to th e man. As I told you earlier, the financial obligation is not put on her shoulder †It is put on the shoulder of the man in the family.\r\nIt is the duty of the develop or the brother, before she is married and the duty of the husband or the son, aft(prenominal) she is married to sense of smell after her lodging, boarding, clothing and financial aspects of her. unconditional marital Gift for a cleaning lady: When she gets married, she is on the receiving end. She receives a cave in †she receives a dower or a marital gift, which is called as ‘Meher? E And it is mentioned in the Qur’an in Surah Nisa, Ch. 4 Verse No. 4 which says, ‘ deem to the woman in dower, a marital gift? E For a trade union to solemnize in Islam, ‘Meher? Eis compulsory.\r\nBut unluckily in our Muslim society here, we just keep a nominal ‘Meher? Eto satisfy the Qur’an, say 151 Rupees, or some populate give 786 Rupees and they spend lakhs and lakhs of Rupees on the reception, on the decoration, on the flowers, on the lunch parties, on the dinner parties. In Islam, on that point is no lower- circumscribe, nor is thither an upper correct for ‘Meher? E- But when a person can spend lakhs of Rupees on the reception, surely the ‘Meher ? Eshould be much more. There are various cultures which have crept into the Muslim societies, specially in the Indo-Pak area. They give a small amount of ‘Meher?\r\nEand they bide the wife to give a fridge, to give a T. V set, they seem the wife to give an apartment, to give a car, etc. , and a large articulation of dowry, depending upon the status of the husband. If he is a graduate, they may expect 1 lakh †If he is an engineer they may expect 3 lakhs †If he is a doctor they may expect 5 lakhs. Demanding dowry from the wife, instantaneously or indirectly is prohibited in Islam. If the parents of the fille give the girl something out of their own free will, it is accepted â⠂¬ But demanding or forcing directly or indirectly, it is prohibited in Islam.\r\nNo Financial Liabilities: If a Woman works, which she does not have to †whatever earning she gets, it is absolutely her property. She need not spend on the family †if she necessitates to spend it is her free will. Irrespective how rich the wife is, it is the duty of the husband to give lodging, boarding, clothing and suppose after the financial aspects of the wife. In case of disarticulate or if a wife gets widowed, she is given financial support for the period of ‘Iddah? E- and if she has children, she is also given child support. Right to Inherit:\r\nIslam gave the right to the women to inherit, centuries ago. If you read the Qur’an †in several verses, in Surah Nisa, in Surah Baqarah and in Surah Maidah, it is mentioned that a woman, irrespective she is a wife or she is a mother, or a babe, or a brothel keeper friend, she has a right to inherit. And it has been fixed by God Almighty in the Qur’an. C. hearty Rights of Women in Islam Broadly it can be categorized into four sub-headings. Social rights given to a daughter, to a wife, to a mother and to a babe. Social Rights to a Daughter: Islam prohibits, female infanticide.\r\nThe violent death of female children is forbidden in Islam. It is mentioned in Surah Taqveem, Ch. 81, Verse No. 8 and 9, ‘when the female child is bury alive and when she psyches you, for what detestation was she killed? E Not only female infanticide has been prohibited, all sorts of infanticides has been prohibited in Islam, whether it be a male child or a female child. It is mention in the Qur’an in Surah A’nam Ch. 6, Verse No. 151 that, ‘Kill not your children for want of pabulum for it is God that will provide sustenance for you and for children?\r\nE A similar thing is mentioned in Surah Isra, Ch. 17 Verse No. 31 which says? E‘Kill not your children for want of sustenance, f or it is God that will provide sustenance to you and your children, for killing of children is a major sin? E In the pre-Islamic Arabia, whenever a female child was born mostly she was buried alive. Alhamdullillah, after the spread of Islam this evil practice has been discontinued. But unfortunately it still continues in India †According to a BBC enunciate, in the programe assignment the title of which was ‘Let Her Die?\r\nE there was a British traceer by the appellation of Emily Beckenen, who came all the way from Britain to India to give us the statistics of the female infanticide. In that programe, it gives the statistics, that every day more than 3,000 fetuses are being aborted on being place that they are females. If you multiply this common fig tree by the number of days, that is multiplied by 365, you get a figure of more than one million female fetuses are being aborted every year in our country. And there are big hoarding and posters in states like Tamil Na du and Rajasthan, which says spend 500 Rupees and save 5 lakh Rupees.\r\nWhat does it mean? †That spend Rupees 500 on medical examination like Aminocententus or revolutionary Sonography, and identify the gender of child. If it is a female you can abort it and you’ll save 5 lakh Rupees †How? The meet of lakhs you spend on upbringing her and the rest lakhs of Rupees you spend on giving dowry to the man who will marry her (a custom in India). According to the report of the Government Hospital of Tamil Nadu ? E‘out of every 10 female children that are born, four are put to death?\r\nE- No interview the female population in India is less than the male population. Female infanticide was continuing in India since centuries †If you analyze the statistics of the 1901 census, for every gee males there were 972 females. According to the 1981 statistics and census, it tells you for every 1000 males you have 934 females. And the latest statistics of 1991 tells yo u that for every 1000 males you have 927 females. You can analyze that the female ratio is displace every year †And since science and medicine has advanced, it has helped in this evil practice.\r\nJust because Islam tells you that you should not kill any children whether it be male or female will you call these rights in Islam as modernizing or outdated? Qur’an not only prohibits female infanticide, it rebukes at the persuasion of you rejoicing at the birth of a male child and getting saddened at the birth of a female child. In Islam, a daughter should be brought up correctly. In Islam, there should be no partiality in upbringing of the daughter or the son. According to a Hadith, ‘In the presence of the visionary Muhammad, once a man kissed his son and fit(p) him on his lap but did not do the same to his daughter.\r\nThe prophet immediately objected and said that you are unjust †You should have all the same kissed your daughter and pose her on the other lap? E Social Rights to Wife: All the previous civilizations, they have considered the women to be an ‘instrument of the devil? E The Qur’an refers to the women as ‘Mohsana? E that is a ‘fortress against the devil? E And if a woman, who’s good, marries a man, she pr yetts him from going on the prostitute path. There’s a Hadith in which visionary Muhammad (peace be upon him) he said that, ‘there is no monasticism in Islam? E. And again according to Sahih Bukhari, record No. 7, Ch. No. Hadith No 4 it says that ‘the Prophet Muhammad ordained the young men, all those who have the means to marry, they should marry †For it will help them to guard their gaze and guard their modesty. The Qur’an say’s that, ‘We have put love into the paddy wagon of the husband and wife? E If you read Surah Rum, Ch. 30, Verse No. 21 it says that, ‘And amongst our signs We have created for you mates or companions, so that you may dwell in them in tranquillity and we have put love and mercy between your hearts? E According to Surah Nisa, Ch. 4, Verse No. 21, marriage is considered as a sound agreement, a strong contract.\r\nAccording to Surah Nisa, Ch. 4, Verse No. 19, it says, ‘You are prohibited to inherit women against their will? E- Means, to marry the permission of both the parties are required. It is compulsory that the man and women both should agree to marry. No one †not eventide the father can force their daughter to marry against her wishes. There’s a Hadith in Sahih Bukhari, tidy sum 7, Book 62, Number 69, which says ‘that a doll she was laboured by her father to marry against her wishes? E- And she went to the Prophet and the Prophet invalidated the marriage? E Another Hadith in Ibn-e-Humbal, Hadith No. 469, it says ‘that a daughter was forced by her father to get married †And when the daughter approached the Prophet, the Prophet said you can either con tinue, or if you wish you can invalidate the marriage. That means, the accept of both the male and the female is required. In Islam, a women is considered as a homemaker †She is not considered as a housewife, because she is not married to the house. Many people use terminology, without understanding what it means ? E‘ woman of the house? Emeans ‘you are the wife of the house? E So I believe, from now onwards the sisters would prefer avocation themselves ‘homemakers?\r\nE than ‘house wives? E if they are industrious more in the home. In Islam, a woman, she is not married to a master that she should be do by like a slave †She is married to it is equal. And there is a Hadith which says in Ibn-Hambal †Hadith No 736, 7396. It says that, ‘the most perfect of the believers are those that are best in character and behavior, and those that are best to their family and their wives? E Islam gives equal rights to the man and woman. Qur’an clearly mentions that men and women, husband and wife have equal rights in all aspects, except leadership in the family.\r\nIt is mentioned in the Qur’an in Surah Baqarah Ch. 2, Verse No. 228. It says that, ? E.. the women have been given rights similar against them (men) on equitable scathe but the men have a detail high…? E Most of the Muslims have misunderstood this verse, when it says ‘a men have a full point higher? E- As I said we should analyze the Qur’an as a whole. And its mentioned in Surah Nisa, Ch. 4, Verse No. 34 which says, ‘The men are the protectors and maintainers of the women, for God has given one of them more strength than the other and they give them their means?\r\nE People say the word ‘Kawwam? E means, ‘one tip higher in superiority? E- But actually the word ‘Kawwam? Ecomes from the root word ‘Ikamah? E ‘Ikamah? Emeans for example ‘when you give the Ikamah before prayers †You stand up? E So ‘Ikamah? Emeans to standup †so the word ‘Kawwam? Emeans one degree higher in responsibility, not one degree higher in superiority. Even if you read the commentary of ‘Ibne-Kathir? E- He says that the word ‘Kawwam? Emeans one degree higher in responsibility, not one degree higher in superiority.\r\nAnd this responsibility, should be carried out by mutual consent of both husband and wife. It is mentioned in Surah Baqarah, Ch. 2, Verse No. 187, which says, Which means? E‘Your wives are your garments, and you are their garments? E What’s the objective of garments †It is apply to conceal and to blow up. The husband and wife, should conceal each others faults, and they should beautify each other †Its a relationship of hands and gloves. The Qur’an mentions that, ‘even if you do not like your wife, you should do her kindly? E It is mentioned in Surah Nisa, Ch. 4, Verse No. 19, that, ?\r\nE.. consort with them (your wives) in kindness, for if you hate them it may legislate that you hate a thing wherein God has set much good. Even if you dislike your wife you have to treat her kindly and with equity Just because the rights of a wife are equal to those of the husband in Islam, will you call such rights in Islam as modernizing or outdated? Social Rights to a come: The only thing above respect to Mother, is the idolisation of God †It is mentioned in: Ch. 17, Verse No. 28-29, It says that? E‘God has ordained for you, that you worship none but Him, and to be kind to your parents.\r\nAnd if any one or both of them reach old age do not say a word of despite or repel them but address them with honour, and speak to them with kindness, and lower your wing of humility and pray to God †‘My Lord! bless them as they have cute me in childhood? E Surah Nisa, Ch. No. 4, Verse No. 1 says, ‘Respect the womb that bore you? E Surah A’nam, Ch. 6, Verse No. 151, says that, â⠂¬ËœYou have to be kind to your parents? E Surah Luqman Ch. 31, Verse No. 14, says that, ‘We have enjoined on the human beings to be kind to his parents. In travail upon travail, did their mother bore them and in years twain was their weaning?\r\nE A similar thing is repeated again in Surah Ahqaf, Ch. 46, Verse No. 15, that? E‘We have enjoined on the human beings to be kind to his parents. In pain did their mother bore them and in pain did she give them birth? E Another Hadith tie in in Sahih Bukhari in Volume 8, Ch. No. 2 Hadith No. 2, as well as in Sahih-Muslim †It says that a man asked the Prophet Muhammad? E‘Who requires the maximum love and respect and my companionship in this world? The Prophet replied ? E‘your mother? Ebr> ‘Who is neighboring? E ? E‘your mother? Enbsp; ‘Who is near?? E? E‘your mother? Enbsp;\r\nThe man asked for the fourth time, †‘Who is next? Enbsp; The Prophet replied ‘your father? E So 75% of the love and respect goes to the mother and 25% of the love and respect goes to the father. Three fourth of the better part of the love and respect goes to the mother ? E atomic number 53 fourth of the remaining part of the love and respect goes to the father. Social Rights to a Sister: According to Surah Tawbah, Ch. 9, Verse No. 71, it says that, ‘The men and the women they are friends of each other? E Prophet Muhammed (may peace be upon him) he said, ‘The women are the ‘Shakat? E-‘Shakat? Emeans sister?\r\nE D. Educational Rights to a Woman The first 5 verses which were revealed in the Qur’an were from Surah Alaq, or Surah Iqra, Verse No. 1 to 5 which says: ‘Read, recite or say in the name of your Lord, Who has created the human beings from a congeal clot of blood (a leech like substance). Read, your Lord is most bountiful. Who has taught the use of the pen. Who has taught the human beings that which he knew-not? E The first guida nce given in the Qur’an to the humankind was not to pray, was not to fast, was not to give charity †It was read †Islam pays utmost importance to education.\r\nEducation is Compulsory in Islam: According to Quran: •God will exalt those of you who believe and those who are given acquaintance to high degrees. (58:11) •And say, O my Lord! increase me in friendship. (20:114) •And whoever is is given knowledge is given indeed verdant wealth. (2:269) According to a saying of Prophet Muhammad (pbuh) â€Å"It is de rigueur for every Muslim, male or female, to acquire knowledge (Al-Bayhaqi). Imagine, 1400 years ago, when the women were ill treated and were only utilize as property, Islam asked the women to be educated.\r\nBecause Islam tells that every woman should be educated, †Will you call such women’s right’s in Islam as modernizing or outdated? E. Legal Rights to a Woman According to the Islamic law, men and women are equal â₠¬ The Islamic honor protects the life and property of a man and woman both. If a man murders a woman he too will receive the capital punishment of ‘Kisaas? E According to the Islamic law of ‘Kisaas? E men and women †irrespective the injury be of the eye, of the nose, of the ear, of the body †both receive equal punishment.\r\nAnd if the guardian of the receiver, even it be a woman †If she says, that forgive the murderer and she accepts ‘Dia? E that is compensation †her opinion cannot be rejected †they have to accept it. And if there’s difference of opinion between the relatives of the person whose murdered †And some say that the murderer should be killed and some say that he should be forgiven and ‘Dia? Enbsp; should be accepted †people should prevent the relatives from killing that murderer. And irrespective whether the regard or the opinion is given by a man or woman, it has same weight. According to Surah Maida, C h. , Verse No. 30 †It says? E‘As to the thief, whether he be man or a woman, cut off his or her hand as a punishment for his crime, an example from God? E Means, if a person robs, irrespective whether he is a man or a woman his or her hands should be chopped †The punishment is the same. According to Surah Nur, Ch. 24, Verse No. 2, it says ‘If any commits fornication, be it a man or a woman, flog them with 100 grade insignia? E The punishment for fornication in Islam irrespective whether it is a man or a woman, it is the same †lather with 100 stripes. The punishment for men and women, is the same in Islam.\r\nIn Islam a woman is allowed to give witness Imagine, Islam gave right to a woman to be a witness, 14 centuries ago. Even now in as late as 1980, the Jewish Rabai, they were considering that whether the women should be given a right to act as a witness or not †And Islam gave that right 1400 years ago. Accord¬ing to Surah Nur, Ch. 24, Verse No. 4, it is said ‘If any of you put a charge against the chastity of a woman, produce 4 witnesses, and if they falter, flog them with 80 stripes? E In Islam for a small crime, you require 2 witness †for a big crime you require 4 witnesses.\r\nAccusing a woman falsely is a big crime in Islam, therefore you require 4 witnesses. Now a days you see in the modern society, you find men abusing women and calling them all sorts of name. They call them prostitutes etc, and secret code is done. In an Islamic state, if a man calls her a ‘prostitute? Ein public or anywhere else, and if she takes that man to court †And if that man cannot produce 4 witnesses or even if he produces 4 witnesses and any one of them falter, all of them will receive 80 lashes each, and in future all their evidence will be rejected.\r\nIslam gives utmost importance to the chastity of the woman. When a lady marries, she normally adopts the name of her husband. In Islam she has the option of either k eeping her husband’s name, either adopting the name of the husband, or maintaining her amah name. And maintaining the maiden name is recommended in Islam †And we find in several Muslim societies that women, even after they get married they maintain their maiden name, because according to the Islamic law men and women are equal. Will you call such rights in Islam modernizing or outdated? F. Political Rights of a Woman\r\nAccording to Surah Tawba, Ch. 9, Verse No. 71, ‘The men and the women they are friends (supporters) of each other? E Supporters not only socially †even Politically ? EPolitically, men and women should support each other. Women can even take part in law making. And according to the famous Hadith in which Hazrat Umar (may Allah be pleased with him), he was discussing with the Sahabas, and considering putting an upper limit on the ‘Meher ? E since young men were discouraged from getting married †a lady from the back seat she objected a nd said When the Qur’an says in Surah Nisa Ch. , Verse No. 20 that? E ‘you can even give a heap of treasure, a heap of gold in ‘Meher? E when Qur’an puts no limit on ‘Meher? E who is Umar to put a limit (may Allah be pleased with him). And immediately Hazrat Umar (peace be upon him) said? E‘Umar is wrong and the lady is right? E Imagine, she was a common lady †If it would have been a famous lady, the name of the lady would be mentioned in the Hadith. Since the Hadith does not mention the name of the lady, we can understand that the lady was a common lady. Means, even a common lady can object to the ‘Khalifa?\r\nE the head of the state. And in technical terms it would be called that ? E‘she is objecting to the breach of the fundamental law? E- because Qur’an is the constitution of the Muslims †That means a woman can even take part in law making. Women have even taken part in the booking line of businesss There is a full chapter in the Sahih Bukhari mentioning women in the difference of opinion field †Women gave water †they give first aid to the soldiers. Because the Qur’an says ‘Man is the protector of the ‘Woman? E Under normal circumstances, the women should not go to the battle field. It is the duty of the man.\r\nOnly when required, under prerequisite are women allowed †and they should go to the battle field if they want. other than you’ll have the same position as you are having in the USA. Women in USA are Not Safe In USA women were allowed to join the battle since 1901 but they were not allowed to take active part †They only played the part of a nurse. by and by on after the ‘Feminist Movement? Ehad started in 1973, the ‘Feminist movement? Edemand¬ed ? E‘ wherefore aren’t women allowed to take active part in the battle field?? E/font> So the American government allowed women to take active part in the battl e field.\r\nAnd according to a report of the Defense Department of America, which was released on the 23rd of April, 1993 it said that, ? E0 people were sexually assaulted in a approach pattern, out of which 83 were women and 117 officers were charged with in disciplinary work on? E Imagine in one convention only, 83 women sexually assaulted. What was the crime of those 117 officers? They made the women bear and they snatched at their clothes. They made them parade absolutely nude sculpture without even covering the genital parts. They were made to have sex in public. Is this what you call ‘Women’s rights? E\r\nIf you think that this is what is ‘Women’s right? E then you can keep your rights to yourselves. We do not want our sisters, our daughters our mothers to be sexually assaulted. And there was a katzenjammer in the parliament and the President, Bill Clinton †he himself had to exempt publicly and he said, ‘Necessary action will be taken ? E And you know when politicians say ‘necessary action will be taken, what happens. So Islam allows women to take part in the battle field only when required. But there also they should maintain their Islamic dress and the Islamic ethics, and their modesty.\r\nUSA Has One of the Highest Rates of Rape United States of America is divinatory to be one of the most advanced countries of the world. It also has one of the highest rates of rape in any country in the world. According to a FBI report, in the year 1990, every day on an number 1756 cases of rape were committed in U. S. A alone. afterwards another report said that on an average everyday 1900 cases of rapes are committed in USA. The year was not mentioned. May be it was 1992 or 1993. May be the Americans got ‘bolder? Ein the following years. Islamic Law Lets Women catch ones breath Easily\r\nConsider a scenario where the Islamic law is implemented in America. Whenever a man looks at a woman and any brazen or unas hamed thought comes to his mind, he lowers his gaze. Every woman wears the Islamic dress as mentioned in Quran. afterward this if any man commits rape he is given capital punishment. I ask you, in such a scenario, will the rate of rape in America increase, will it remain the same, or will it decrease? If Islamic law is implemented in any part of the world, women will breathe easier. culture Before I conclude, I’d like to give an example.\r\nAs I said in the beginning of my talk, Islam believes in equality between men and women †Equality does not mean identicality. Suppose in a classroom 2 savants, student ‘A? Eand ‘B? E during an examination both come out first †Both secure 80% marks †80 out of 100. When you analyze the question paper, the question paper has 10 differ¬ent questions, each carrying 10 marks. In question 1 student ‘A? Egot 9 out of 10, and student ‘B? Egot 7 out of 10 †So in question 1 student ‘A? Ewas high er than student ‘B? E In question 2, student ‘A? Egot 7 out of 10 and student ‘B? Egot 9 out of 10 †Student ‘B?\r\nEwas higher than student ‘A? Ein question number 2. In question 3 both of them got 8 out of 10, both were equal. So when we add up the marks of all the ten questions, both student ‘A? Eand ‘B? Egot 80 out of 100. So in short, student ‘A? Eand student ‘B? Eare over all equal. In some questions ‘A? Eis higher than ‘B? E in some questions ‘B? Eis higher than ‘A? E in others both are equal. In the same fashion, taking the example that since God has given man more strength †Suppose a thief enters the house will you tell, ‘I believe in women’s rights †I believe in women’s rights?\r\nE †will you tell your mother, your sister and your daughter, to go and fight the thief?? E No, but natural you’ll fight him †If required they may put in †Under no rmal circumstances since God has given you more physical strength, you have to go and set about the thief. So here, in physical strength, man is one degree higher than the woman Let us take another example where it comes to respecting the parents †The children are suppositional to respect the mother 3 times more than the father (as mentioned earlier).\r\nHere the women have one degree higher than the men †Over all both equal So Islam believes in equality, not identically †Men and women are over all equal in Islam. This was in brief, the highlights, of ‘the Women’s Rights in Islam? E After this what the Muslim society did is different †Many of the Muslim societies did not give the women their rights and they deviated away from the Qur’an and the Sunnah.\r\nThe Western society is largely responsible for this †because of the Western societies, many Muslim societies have become over protective, over precautions and have gone to one extreme and deviated away from the Qur’an and the Sunnah. On the other extreme, some of the Muslim societies dark to the Western culture, and followed their culture. I want to tell the Western society that if you analyze the women’s rights in Islam according to the Qur’an and the Sunnah †you will realize it is modernizing and not outdated.\r\n'