This paper examines the effect of largest shareholders on dividend policy in small business. The dividend policy is one of the important business decisions and is affected by demand of shareholders. Prior studies suggest that decision on dividend payout is determined by the trade-off between agency cost and the cost of borrowing. Unlike large companies with diffuse shareholders, the effect of largest shareholders in small companies is greater. According to National Statistical Office, 98%of small companies in Korea have owner-controlled structure. This implies that majority of shareholders in small companies is the largest shareholders and the impact of largest shareholders in small business is significant. This paper investigates the effect of largest shareholders on dividend policy. Specifically, this paper examines the relationship between dividend payout ratio and the portion of largest shareholders. Then we test whether this relationship still holds when financial constraint of companies is high. Using 3,573 observations from 2001 to 2015, we find that small firms with high portion of largest shareholders are more likely to pay dividends. This is consistent with interest-alignment hypothesis. This suggests that even small companies have an incentive to decreases agency cost by paying dividends. We further find that when small companies is under financial constraints, the firms with high portion of largest shareholders are less likely to pay dividends.
Our findings of this paper provide the evidence that even small companies with high portions of largest shareholders have incentive to pay dividend to alleviate interest-conflicts between a firm and outside shareholders. Moreover, this relationship is affected by the condition of financial constraints.

It is very important for entrepreneurial firms to acquire and exploit the resources necessary for growth. This study examines how venture capital financing affect these entrepreneurial firms’ ability to acquire and exploit the resources. Particularly, based on the resource based view, the authors explain the relationship between venture capital financing and entrepreneurial firm’s market performance. Empirical results illustrate that venture capital financing positively and significantly affects the market performance of entrepreneurial firms. It is concluded that entrepreneurial firms need to increase the number of alliances with venture capital, which supports various activities after the investment to achieve growth with resource limitation.

In this paper, we analyzed the determinants of procuring foreign denominated debts (FDDs) for Korean Hidden Champions (KHCs) from the perspective of foreign exchange exposure (FEE) and foreign exchange volatility exposure (FEVE). The main findings are as follows: First, KHCs reduced FDDs as FEVE increased unlike the firms listed in KOSPI and KOSDAQ. Second, such a tendency of KHCs in procuring FDDs formed after the global financial crisis despite that their behavior was similar to the firms listed in KOSPI before the global financial crisis. We attribute KHCs’ strategic shift to the environmental dynamism derived from the challenging economic fundamental. Third, as for KHCs concerned FEVE’s lagging effects did not occur, whilst the effect appeared for the year shown. Finally, given the results of the marginal effect model it was KHCs that resemble nearly the firms listed in KOSPI in responding to FEVE. As such, KHCs’ tendency formed a striking contrast to the fact that most of them are listed in the KOSPI market.

This study investigates small and medium-sized suppliers’ export determinants under inter-firm win-win relationships. SMEs need to progressively step up their globalization step by step due to the 'Export Death Valley' and choose appropriate export models to properly manage the risks faced by globalization. A piggybacking model for indirect exports, with relatively low input costs and low risk is useful in creating Win-Win outcomes through inter-firm Cooperation in Small and Medium-Sized Companies’ Overseas expansion.
In this study, we analyze the factors that determine the globalization of suppliers using the survey data of East-West Power’s SME suppliers, and find four results. First, since hypothesis 1 is rejected, entrepreneurship is not statistically significant as a determinant of exports.
Second, Hypothesis 2, that R&D and patent registrations as important factors that determine firm competency affect globalization, was rejected because it had no statistically significant effect. R&D paradox is emerging.
Third, Hypothesis 3 that there is path dependency and lock-out effect that exporting companies continuously exports is adopted because it is statistically significant. Once SMEs have entered the enthusiastic and successful stages through curiosity, frustration and hesitation steps of globalization, the path dependence between the growth of the company and the increase in sales through globalization results in virtuous cycles. This implies lock-in effect which means that if you do not export, you can not grow.
Fourth, because the resources and competence are required for the globalization of SMEs, the hypothesis 4 that a large number of sales and employees would be advantageous for export is also being statistically rejected.

This study investigates the effect of risk avoiding activities and characteristic of venture capital on the financial performance of invested companies. Based on the review on the literature, we present staged financing, syndicated investment and preferred stock investment as the measurements for risk avoiding activities. Types and age of venture capital were chosen as the variables for characteristic. The financial performance data of the invested companies was derived from their publicly announced yearly financial report. Data were analysed using logistic regression technique. The result show that syndicated investment and independent venture capital have positive influence on the growth of sales revenue and asset of the invested companies. Age of venture capital appears to be positively associated with growth of sales revenue. Staged financing and preferred stock investment, however, have no impact on any financial growth and profitability. Activities and characteristic of venture capital show no influence on the profitability.

This study examined the overall social responsibility (CSR) Status of Korea's SMEs. Through this, we want to establish CSR of the SME support measures. Also, we find reasons to promote CSR despite the limitations of small enterprises. Currently, CSR mainly has been done by large companies, this is the position that SMEs need to do is CSR's most views can act as a burden. However, SMEs were also the times cannot survive unless the CSR as the global standard expanded and diversified in accordance with environmental regulations. Now that is a must, not a choice. In this point of view, we look for a variety of reasons to implement CSR of SMEs, then examine the current situation of SMEs' CSR promotion. We also assess the overall situation of CSR of SMEs and summarize the problems of promoting CSR of SMEs. Furthermore, we propose to the preferred direction of the challenges Korea's SMEs through government support measures, large and small business win-win cooperation, the role of public authorities and local governments and SMEs' own improvement plan.

Today, changes in the environments surrounding companies are so uncertain that corporate entrepreneurship should be activated to enhance the competitiveness of firms and to improve their profitability. In particular, The practice of entrepreneurship by small and medium sized enterprises (hereafter SMEs) is suggested as an important factor for the enhancement of competitiveness of firms. In this context, this study examined the effects of the organizational climates on the entrepreneurship activities of SMEs in Korea and China. The data obtained from 300 SMEs in Korea and China through questionnaire surveys were analyzed. The results demonstrate that the organizational climates have significant positive effects on SMEs in the countries belonging to emerging markets such as Korea and China. However, the practice of corporate entrepreneurship could be manifested in diverse forms, such as innovation or strategic renewal, and the effects of organizational climates were shown to sightly different effects on the corporate entrepreneurship activities.
In addition, SMEs in Korea and China, which belong to common cultural areas, did not show any statistically significant difference in organizational climates in general. Furthermore, the effects of these factors did not show significant differences in general. However, SMEs in Korea with more flexible organizational structures and higher job autonomy were shown to be more advantageous in practicing corporate entrepreneurship than those in China. The results of the study provide meaningful implications for SMEs in Korea in terms of the efforts that should be made to enhance their competitiveness, implement innovation, and achieve comparative advantages over China.