This thesis examines whether there is a substitute or complementary relationship between the simultaneous holding of "double-holder" equity and debt and corporate social responsibility Disclosure “CSR Disclosure”. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an Original Essay The literature on dual owner businesses in the same company is a relatively new phenomenon. Debt holders and shareholders have different interests in the company. The debt holder's intention is to earn interest income on the debt in addition to receiving a fixed or variable fee as additional collateral. They are also first in line to be reimbursed before ordinary and preferred shareholders in the event of liquidation. In comparison, shareholders have a stake in a company and their benefit is to get a dividend. The principal-agent problem can occur because the two parties have different interests. This also creates problems such as information asymmetry and moral hazard. According to the trade-off theory of capital structure, to maximize the value of a firm, the firm must choose an optimal mix of debt and equity. Highly leveraged companies may simply become insolvent, and company value may be lost in the event of bankruptcy. Therefore, the trade-off theory emphasizes the benefit of debt, that is, the fiscal advantage that should be traded off against the increased default costs that come with taking on higher levels of debt. The firm's choice of capital structure will signal important information to the market. Signaling theory also states that managers vary their debt and equity issuance preferences based on information asymmetries between the firm's management and shareholders. Managers issue debt and equity accordingly based on the information they receive. When managers know that companies are undervalued, they issue debt first and then equity. On the other hand, if management believes their company is overvalued, they will first issue equity and then debt to communicate to the market that the company will have acceptable cash flows. Myers & Majluf (1984) in their seminal work on pecking order The theory illustrates that firm insiders who have more knowledge than the firm's investors who have limited information, so that that firm's capital can be valued incorrectly. Therefore, to circumvent the cost of adverse selection, it may be imperative to finance the firm through internal financing or debt financing that results in pecking order financing. Pecking order theory explains that company leverage presents the past profitability and future investment prospects of companies. The reason why investors hold debt and equity at the same time is mainly that dual ownership moderates the conflict of interest between creditors and shareholders. In addition to this, dual owners have the advantage of access to both publicly available and non-public information about the company. This allowed them to have privileges over companies that had a lower default risk for loans. Dual owners with significant holdings also have the benefit of receiving information about the company's financial status with the goal of achieving gains or avoiding losses. Myers & Majluf (1984) stated that a firm's debt-to-equity ratio indicates how the firm is financed along with the degree of asymmetryinformation. However, several studies also show that information asymmetry does not necessarily lead to a preference for debt over equity. Akins et al. (2012) also show that the price of information asymmetry decreases when the number of internal investors in the firm increases. This is because every time the number of informed investors in a firm increases, the price becomes more representative of the firm's activities, thus the price of information asymmetry is reduced. Dual ownership mitigates conflict between shareholders and debt holders.interests since both parties obtain information about the company's equity and debt. Dual holding also reduces information asymmetry because the dual holder acts as a mediator. Nowadays, investors consider companies' CSR disclosure as one of the criteria in their investment decisions. CSR defines as “the enterprise's considerations and response to issues that go beyond the enterprise's narrow economic, technical and legal requirements to achieve social and environmental benefits along with the traditional economic gains that the enterprise seeks.” Dissemination has better quality when it provides useful information to external users. Consequently, a high level of corporate governance is also expected to correlate with high levels of CRS disclosure. CSR disclosure is very important in the capital market because investors invest heavily in the company that discloses CSR. Furthermore, it increases the good image of the company and is a key guide for sustainable business. Therefore, it increases the company's stock price. CSR performance can be related to increased productivity and financial performance because it indicates that the company is in good association with key stakeholders. Cho et al. (2013) indicate that companies with good CSR performance reduce information asymmetry, Dhaliwal et al. (2011) point out that CSR disclosure followed by good CSR performance decreases the firm's information asymmetry. To study the relationship between CSR and information asymmetry, following previous researchers we used the bid-ask stock price spread as a proxy as a measure of information asymmetry. We also further used stock price volatility and return data. Ethical corporate behavior of CSR information is not only a cost factor, but also helps mitigate information asymmetry that can negatively impact a company's reputation. This thesis evaluates the time that dual shareholdings can influence a company's CSR disclosure by mainly using the empirical data research method. The literature argues that firms holding debt and equity simultaneously may have greater information transparency and lower spread (Jiang et al. 2010). Others argue that dual holders could invest in CSR to show their interest in the global environment so that they will be considered good citizens and this will increase their reputation. However, Lopatta et al. (2016) argued that dual holders with greater involvement in syndicated lending (previously limited to banking institutions), these dual holders have appeared as a new group of informed investors. This is largely due to their direct access to the borrower's timely financial information. Furthermore, Peyravan (2016) demonstrated that dual-holders expect to operate based on firm-specific financial information that is not publicly available, which may increase information asymmetry. Please note: this is just one 2017.