Raj Aggarwal is an author and contributor to the fields of finance and international business studies. Aggarwal was the dean of the
University of Akron College of Business Administration from 2006 until 2009. He was elected as a fellow of the
Academy of International Business
Academy of International Business (AIB) is the leading association of international business scholars and specialists. Established in 1959, it has over 3400 members in about 90 countries. Membership is open to organizations as well as individuals ...
. He has worked as an engineer, financial analyst, strategic planner, department chair, university budget planner and corporate board member. He has authored or co-authored over a dozen books or
monograph
A monograph is a specialist work of writing (in contrast to reference works) or exhibition on a single subject or an aspect of a subject, often by a single author or artist, and usually on a scholarly subject.
In library cataloging, ''monograph ...
s and over a hundred scholarly articles that have cited over 5,000 times according to his profile in Google Scholar.
Biography
Education
Aggarwal received his bachelor's degree in mechanical engineering from the
Indian Institutes of Technology
The Indian Institutes of Technology (IITs) are central government owned public technical institutes located across India. They are under the ownership of the Ministry of Education of the Government of India. They are governed by the Instit ...
in 1968. He then earned his MBA in operations management from
Kent State University
Kent State University (KSU) is a public research university in Kent, Ohio. The university also includes seven regional campuses in Northeast Ohio and additional facilities in the region and internationally. Regional campuses are located in As ...
in 1970, then studied international economics with Professor Harry Johnson at the
University of Chicago
The University of Chicago (UChicago, Chicago, U of C, or UChi) is a private research university in Chicago, Illinois. Its main campus is located in Chicago's Hyde Park neighborhood. The University of Chicago is consistently ranked among the b ...
from 1972 to 1973. He earned his doctorate in corporate finance and international business at Kent State in 1975. In 2000, he became a
Chartered Financial Analyst (CFA) charterholder.
Scholarly career
Aggarwal is the editor of the Journal of Teaching International Business, was the finance area editor for the ''
Journal of International Business Studies'' and was an editor of ''Financial Education and Practice'', a journal published by the
Financial Management Association. He has served on editorial boards of scholarly journals in international business and many journals in finance and economics. In a 2005 issue of the ''Journal of International Business Studies'', Aggarwal was ranked as the most influential scholar in international business literature. He has over 6700 citations with an H-Index of over 40 in Google Scholars.
He has held many elected and appointed leadership positions in academia and in business, including; president of the Eastern Finance Association and the Northeast Ohio Financial Executives International. He has been a consultant to the
UN, the
World Bank
The World Bank is an international financial institution that provides loans and grants to the governments of low- and middle-income countries for the purpose of pursuing capital projects. The World Bank is the collective name for the Interna ...
, the
US SEC and Fortune 100 companies. He serves on business and non-profit boards including Manco Inc (Duck, LePage, and
Loctite
Loctite is an American brand of adhesives, sealants, surface treatments, and other industrial chemicals that include acrylic, anaerobic, cyanoacrylate, epoxy, hot melt, silicone, urethane, and UV/light curing technologies. Loctite products ar ...
brands), Ancora Mutual Funds,
Financial Management Association, the
Cleveland Council on World Affairs, and the
Financial Executive Research Foundation. He is or was on the Board of Directors of Goodwill Industries of Akron, Ohio and the Kent State University Foundation, Kent, Ohio. The Eastern Finance Association elected Raj Aggarwal as their president, and he has been a trustee since 1999. In 2002, Aggarwal co-founded the CIO Forum, which is an invitation only best practices group of large company
CIOs in Northeast Ohio with meetings limited to CIOs with no direct reports. Aggarwal has spoken numerous times on
WCPN
WCPN (104.9 FM) is a non-commercial educational radio station licensed to Lorain, Ohio, featuring a public radio format as a repeater of Kent–licensed WKSU. Owned by Ideastream Public Media, the station serves the western portion of Greate ...
and
NPR, including several interviews on NPR affiliate, WCPN concerning the
financial crisis of 2007–2010. Additionally, he has been considered an authority on Northeast Ohio's business and financial markets. Finally, Raj Aggarwal's academic leadership is reflected in Hoshino, M., "An Interview with Professor Raj Aggarwal, Department Editor for JIBS", and his business leadership was reflected in, "The Super CFO: Changing Roles of the CFO".
Academic career
Aggarwal was the Frank C. Sullivan Professor of International Business and Finance of the
University of Akron College of Business Administration from 2006 to 2013 and was dean for three years. While Aggarwal was serving as dean, the College of Business Administration (CBA) received its first ever ranking of their business program in ''
BusinessWeek'', in 2009. Additionally, the CBA received a 'Best Graduate Business School' ranking from ''
The Princeton Review
The Princeton Review is an education services company providing tutoring, test preparation and admission resources for students. It was founded in 1981. and since that time has worked with over 400 million students. Services are delivered by 4,0 ...
''.
Major research
International capital structure
The
capital structure
In corporate finance, capital structure refers to the mix of various forms of external funds, known as capital, used to finance a business. It consists of shareholders' equity, debt (borrowed funds), and preferred stock, and is detailed in the ...
of a company is the proportion of its assets financed with other people's money, also defined as the proportion of its capitalization financed by long-term
debt
Debt is an obligation that requires one party, the debtor, to pay money or other agreed-upon value to another party, the creditor. Debt is a deferred payment, or series of payments, which differentiates it from an immediate purchase. The ...
. Too little debt often means foregoing the tax, monitoring, and other advantages of debt, a less expensive form of
capital
Capital may refer to:
Common uses
* Capital city, a municipality of primary status
** List of national capital cities
* Capital letter, an upper-case letter Economics and social sciences
* Capital (economics), the durable produced goods used f ...
compared to equity. However, too much debt can expose a company to a higher than acceptable risk of default or not being able to pay its
creditor
A creditor or lender is a party (e.g., person, organization, company, or government) that has a claim on the services of a second party. It is a person or institution to whom money is owed. The first party, in general, has provided some property ...
s (who can then sue to
bankrupt the company).
Trade-offs like these become more complicated when companies have operations and debt in many countries. Aggarwal has been writing about this topic for many years, and has demonstrated that average levels of debt used by companies differ in various countries in
Asia
Asia (, ) is one of the world's most notable geographical regions, which is either considered a continent in its own right or a subcontinent of Eurasia, which shares the continental landmass of Afro-Eurasia with Africa. Asia covers an area ...
,
Europe
Europe is a large peninsula conventionally considered a continent in its own right because of its great physical size and the weight of its history and traditions. Europe is also considered a Continent#Subcontinents, subcontinent of Eurasia ...
, and
Latin America
Latin America or
* french: Amérique Latine, link=no
* ht, Amerik Latin, link=no
* pt, América Latina, link=no, name=a, sometimes referred to as LatAm is a large cultural region in the Americas where Romance languages — languages derived f ...
. Additionally, he has been able to show that this average proportion of corporate debt varies across national borders depending on a number of factors including the level of disclosure timeliness, institutional trading activities, and enforcement of anti-
insider trading
Insider trading is the trading of a public company's stock or other securities (such as bonds or stock options) based on material, nonpublic information about the company. In various countries, some kinds of trading based on insider information ...
laws. Finally, Aggarwal showed that financing activities by the 300
largest banks
The following are lists of the largest banks in the world, as measured by total assets.
By total assets
The list is based on the April 2022 S&P Global Market Intelligence report of the 100 largest banks in the world. The ranking was based upon a ...
in the world are determined first by the location (country) of the bank and second by the bank's size itself.
Foreign financial risk management
Financial risk management
Financial risk management is the practice of protecting economic value in a firm by using financial instruments to manage exposure to financial risk - principally operational risk, credit risk and market risk, with more specific variants as liste ...
takes a new meaning when applied to companies operating internationally with many currencies as currency values can change abruptly and unexpectedly. To combat the associated foreign exchange risks, companies have implemented many of the following tactics and strategies; First, multinational companies have to assess at the individual country and consolidated levels three kinds of
foreign exchange
The foreign exchange market (Forex, FX, or currency market) is a global decentralized or over-the-counter (OTC) market for the trading of currencies. This market determines foreign exchange rates for every currency. It includes all as ...
exposure for various future
time horizon
Time is the continued sequence of existence and events that occurs in an apparently irreversible succession from the past, through the present, into the future. It is a component quantity of various measurements used to sequence events, to co ...
s, transactions exposure, accounting exposure, and economic exposure. Once a company has these measures, it can develop policies and hedge these various exposures directly by buying or selling offsetting currencies in spot and futures markets or indirectly by making appropriate offsetting operating changes. Additionally, his research focused on countertrade opportunities that allow MNCs to take money out of restricted countries. Aggarwal began writing about these topics when he discussed the importance of
FASB 8 within the multinational corporation's needs.
Third World multinational corporations
A recent development in the evolution of
multinational corporations (MNCs) is that they have started originating in
emerging markets
An emerging market (or an emerging country or an emerging economy) is a market that has some characteristics of a developed market, but does not fully meet its standards. This includes markets that may become developed markets in the future or were ...
. While traditional MNCs from the
industrialized countries
A developed country (or industrialized country, high-income country, more economically developed country (MEDC), advanced country) is a sovereign state that has a high quality of life, developed economy and advanced technological infrastruct ...
have used
brand names and technology to overcome the liability of foreignness when they invest overseas, there is much interest in understanding how the new MNCs from the emerging economies overcome the liability of being foreign when they
invest overseas. Research in this field is important and shows how large companies in emerging markets develop. Especially, how they overcome the liabilities incurred when investing overseas and this research has exposed specific dynamics of these entities. Beginning two decades ago, Aggarwal began writing and researching on this topic. His research began by determining the dynamics and characteristics of MNCs in developing nations. He has also modeled the business-government relations during the process of firm nationalization, which accompany the
economic development
In the economics study of the public sector, economic and social development is the process by which the economic well-being and quality of life of a nation, region, local community, or an individual are improved according to targeted goals and o ...
of several nearly industrialized countries. He has also focused his research on the challenges that Western firms face because of the emergence of multinational corporations from
developing countries
A developing country is a sovereign state with a lesser developed industrial base and a lower Human Development Index (HDI) relative to other countries. However, this definition is not universally agreed upon. There is also no clear agreem ...
.
[Aggarwal, Raj, "Third World Multinationals: A New Strategic Challenge for Western Multinationals," in Guth, William D. (ed.) Handbook of Business Strategy: 1985/1986 Yearbook (New York: Warren, Gorham & Lamont, 1985): 3-1 - 3-5.]
References
{{DEFAULTSORT:Aggarwal, Raj
Year of birth missing (living people)
Living people
IIT Delhi alumni
Kent State University alumni
University of Akron faculty
University of Chicago alumni
CFA charterholders