Journal of Risk and Financial Management

29 pages, 3819 KB

Open AccessSystematic Review

Climate Risk, Corporate Sustainability, and Firm Performance: An Integrated Bibliometric and Systematic Review

by Akanksha Akanksha and Thirupathi Manickam

J. Risk Financ. Manag. 2026, 19(8), 646; https://doi.org/10.3390/jrfm19080646 - 21 Aug 2026

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Climate risk has become a defining challenge for businesses, influencing strategic decision-making, organisational resilience, and long-term performance. Despite the rapid growth of research in this area, the intellectual development and thematic evolution of climate-related corporate studies remain fragmented. This study provides a comprehensive [...] Read more.

Climate risk has become a defining challenge for businesses, influencing strategic decision-making, organisational resilience, and long-term performance. Despite the rapid growth of research in this area, the intellectual development and thematic evolution of climate-related corporate studies remain fragmented. This study provides a comprehensive synthesis of the literature through a bibliometric analysis and systematic review of 643 Scopus-indexed, peer-reviewed articles published between 1993 and 2025, with a systematic thematic synthesis of 23 empirical studies. Using Biblioshiny and VOSviewer, science-mapping techniques, including co-citation analysis and bibliographic coupling, were employed to examine publication trends, intellectual foundations, and major research themes. The findings indicate a shift from environmental measurement and compliance toward climate-risk management, carbon disclosure, and sustainable finance. Financial outcomes are heterogeneous, and context-dependent carbon exposure is generally associated with valuation penalties and downside risk, while the relevance of disclosure and climate strategies depends on credibility, substantive implementation, and organisational and institutional conditions. The integrated review shows that the financial implications of climate-related corporate actions are contingent upon climate-risk exposure, disclosure credibility, organisational capabilities, and institutional context. It further explains the coexistence of mixed empirical findings and identifies priorities for future research and policy. The findings offer valuable implications for researchers, corporate managers, investors, and policymakers seeking to strengthen sustainable business practices under an evolving climate risk landscape. Full article

(This article belongs to the Collection Transformative Corporate Finance and Governance)

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29 pages, 1001 KB

Open AccessArticle

From Detection to Prevention: Examining the Associations Between Forensic Accounting Practices, Governance Quality, Transparency, Disclosure, and Accountants’ Perception of Financial Fraud Control

by Nahed Taha Rizk, Radwan Choughari, Mahmoud Edelby, Mazen Massoud and Tamima Elhassan

J. Risk Financ. Manag. 2026, 19(8), 645; https://doi.org/10.3390/jrfm19080645 - 21 Aug 2026

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Abstract

Amid the massive digitization of financial flows, forensic accounting is emerging as a strategic lever to strengthen the prevention, detection, and control of financial irregularities. This study aims to examine the associations between forensic accounting practices and perceived financial fraud control, and to [...] Read more.

Amid the massive digitization of financial flows, forensic accounting is emerging as a strategic lever to strengthen the prevention, detection, and control of financial irregularities. This study aims to examine the associations between forensic accounting practices and perceived financial fraud control, and to analyze the mediating roles of corporate governance quality, transparency, and disclosure. A quantitative survey was conducted with 325 audit, control, and accounting professionals. The data were analyzed using structural equation modeling to assess the direct and indirect relationships. Fraud prevention mechanisms have the strongest correlation with financial fraud control (β = 0.310; p < 0.001), followed by forensic data analysis (β = 0.270; p < 0.001), litigation support (β = 0.084), and fraud detection techniques. Forensic data analysis is associated with the quality of corporate governance (β = 0.480; p < 0.001), while transparency and disclosure practices are the most important determinants of perceived financial fraud control (β = 0.463; p < 0.001), followed by governance quality (β = 0.165). Mediation analyses show that corporate governance and transparency primarily amplify the relationship between prevention mechanisms and forensic data analysis, whereas the mediating effects of detection techniques are not significant. Financial fraud control is strongly associated with an integrated approach that combines prevention, analytical capabilities, quality governance, and transparency, rather than with detection activities alone. The findings provide an explanatory model that highlights the organizational mechanisms by which forensic accounting practices strengthen governance and control over financial fraud. Full article

(This article belongs to the Special Issue Financial Analysis, Corporate Governance, and Firm Performance in Global Markets)

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27 pages, 770 KB

Open AccessArticle

Going Concern Risk and the Market’s Use of Earnings: Multi-Year Evidence Preceding First-Time Going Concern Opinions

by John J. Wild and Jonathan M. Wild

J. Risk Financ. Manag. 2026, 19(8), 644; https://doi.org/10.3390/jrfm19080644 - 21 Aug 2026

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Abstract

This study examines whether earnings become less informative as firms near a first-time going concern audit opinion. The question is important because the going concern assumption underlies the measurement of earnings, and growing doubt about that assumption may substantially alter the market’s use [...] Read more.

This study examines whether earnings become less informative as firms near a first-time going concern audit opinion. The question is important because the going concern assumption underlies the measurement of earnings, and growing doubt about that assumption may substantially alter the market’s use of earnings information before the auditor formally issues the opinion. Using firms that receive first-time going concern audit opinions, the analysis traces the intertemporal behavior of earnings informativeness for up to six years before the opinion through the opinion year, measuring informativeness through the relation between abnormal stock returns and unexpected earnings. The results show a substantial decline in earnings informativeness as the going concern opinion approaches, with the earnings response coefficient becoming indistinguishable from zero at least two years before, and in the year of, the opinion. The decline occurs earlier and is more pronounced for firms receiving consecutive going concern opinions. Additional tests indicate that known determinants of earnings informativeness explain part, but not all, of the decline, while evidence on abnormal earnings and accruals is more consistent with severe distress or conservative reporting than with systematic income-increasing earnings management. Overall, the findings suggest that the market revises downward the usefulness of earnings well before the issuance of a first-time going concern audit opinion. Full article

(This article belongs to the Special Issue Accounting Information and Capital Markets)

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35 pages, 2654 KB

Open AccessArticle

From Compliance to Performance: Board Gender Diversity and Bank Performance in an Emerging Economy—Insights from Egypt

by Mohammed M. Omran

J. Risk Financ. Manag. 2026, 19(8), 643; https://doi.org/10.3390/jrfm19080643 - 21 Aug 2026

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Abstract

We examine the impact of board gender diversity on the financial and operating performance of the banking sector in Egypt over the period 2016–2024. We document a clear upward trend in female board representation, particularly following regulatory reforms introduced in 2019 and beyond. [...] Read more.

We examine the impact of board gender diversity on the financial and operating performance of the banking sector in Egypt over the period 2016–2024. We document a clear upward trend in female board representation, particularly following regulatory reforms introduced in 2019 and beyond. Our results show that board gender diversity is positively associated with bank performance, including profitability, efficiency, asset quality, and capital adequacy. However, this relationship becomes economically and statistically meaningful only after a critical mass of female directors is reached. Within the limited range of female board representation observed in the sample, we do not observe a declining or inverted U-shaped pattern. We further show that the positive role of gender-diverse boards is amplified under stronger governance structures—particularly where board independence is high, state ownership is limited, and CEO–chairman roles are separated. These findings provide support for regulatory initiatives aimed at increasing female representation on corporate boards, including Egypt’s Vision 2030 target of 30% female leadership representation. At the same time, the results highlight that the effectiveness of such policies depends on institutional readiness, governance quality, and meaningful participation beyond symbolic compliance. These results suggest that compliance-driven board gender diversity mandates can contribute to sustainable governance, supporting SDG 5 objectives and the long-term institutional resilience of the banking sector in emerging economies. Full article

(This article belongs to the Section Banking and Finance)

39 pages, 2431 KB

Open AccessArticle

Bank Business Model Similarities Based on Financial Ratio Networks: Evidence from Deposit Banks in Türkiye

by Ayşegül Ciğer

J. Risk Financ. Manag. 2026, 19(8), 642; https://doi.org/10.3390/jrfm19080642 - 21 Aug 2026

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Abstract

Bank business models are commonly classified into fixed groups, although banks may simultaneously resemble multiple peers and these relationships may change over time. This study examines the evolution of ratio-based business model similarity among 25 deposit banks in Türkiye from 2014 to 2024. [...] Read more.

Bank business models are commonly classified into fixed groups, although banks may simultaneously resemble multiple peers and these relationships may change over time. This study examines the evolution of ratio-based business model similarity among 25 deposit banks in Türkiye from 2014 to 2024. Forty-three financial ratios were standardized within a year and used to construct weighted cosine-similarity networks; complementary analyses separated strong- and weak-profile links, tested constrained null models, controlled for bank scale and balance-sheet structure, and assessed threshold, outlier, and equal-dimension sensitivity. Under the baseline 0.40 threshold, network density was lowest in 2022 and 2023, with greater component fragmentation in 2022; winsorized specifications instead identified 2023 as the lowest-similarity year, showing that the exact extreme-year ranking is outlier-sensitive. Weak-profile links exceeded strong-profile links in every year and clustered beyond the baseline constrained-null expectation (p < 0.001). State-owned banks showed higher weighted strength after observable scale controls were applied, whereas evidence of degree centrality was weaker. Profitability and liquidity remained the densest ratio-family networks, while asset quality was the most consistently differentiating under equal-dimension comparisons. This framework provides a reproducible screening approach for identifying changing bank-business-model proximity and shared relative weaknesses, without measuring causal risk transmission, absolute financial strength, or performance superiority. Full article

(This article belongs to the Section Banking and Finance)

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36 pages, 6096 KB

Open AccessArticle

Does Central Bank Transparency Influence the Effects of Quantitative Easing on Banking System Vulnerability?

by Ioannis Dokas, Athanasios Koukouridis and Eleftherios Spyromitros

J. Risk Financ. Manag. 2026, 19(8), 641; https://doi.org/10.3390/jrfm19080641 - 21 Aug 2026

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Abstract

After the global financial crisis, central banks used unconventional monetary policies, including quantitative easing (QE), to restore financial stability. Although several studies have analyzed the effects of these measures on financial markets, limited attention has been given to how central bank transparency influences [...] Read more.

After the global financial crisis, central banks used unconventional monetary policies, including quantitative easing (QE), to restore financial stability. Although several studies have analyzed the effects of these measures on financial markets, limited attention has been given to how central bank transparency influences the stability of commercial banks operating under these conditions. This study examines the impact of central bank transparency on national banking system vulnerability during periods of QE across eight economies from 2013 to 2019. Using a dynamic two-step generalized method of moments model based on bank-level data, the analysis includes bank-specific variables, monetary policy indicators, macroeconomic determinants, central bank characteristics, and structural factors of the banking sector and applies a fixed-effects panel regression model. The findings show that transparency moderates the effect of QE on bank vulnerability and strengthens banking system resilience. By emphasizing the role of central bank transparency as a key element of monetary policy, this research provides useful evidence for policymakers seeking to improve the effectiveness and credibility of unconventional monetary measures in different banking environments. Full article

(This article belongs to the Section Banking and Finance)

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21 pages, 286 KB

Open AccessArticle

Asymmetric Audit Fee Adjustment Under Uncertainty: Evidence from U.S. Listed Firms

by Angie M. Abdel Zaher

J. Risk Financ. Manag. 2026, 19(8), 640; https://doi.org/10.3390/jrfm19080640 - 19 Aug 2026

Viewed by 246

Abstract

Most audit fee studies treat the relationship between fees and client risk as symmetric. This study examines whether this assumption holds in the U.S. audit market using a first-difference specification on 4090 firm-year observations of U.S. listed companies from 2010 to 2022. The [...] Read more.

Most audit fee studies treat the relationship between fees and client risk as symmetric. This study examines whether this assumption holds in the U.S. audit market using a first-difference specification on 4090 firm-year observations of U.S. listed companies from 2010 to 2022. The evidence is consistent with asymmetric adjustment. Audit fees rise meaningfully with increases in the Audit Analytics Risky Client Score but show no statistically detectable response to equivalent decreases. The differential is marginally significant in the preferred specification (p = 0.058). The implied stickiness ratio suggests that fees adjust downward at approximately 13 percent of the rate at which they adjust upward. The pattern is robust across sub-periods and to an alternative risk proxy based on loss-status transitions. A period split around the 2019 Critical Audit Matter mandate shows that the documented asymmetry concentrates in the post-CAM era, consistent with the mandate strengthening incentives to price judgment-intensive risk asymmetrically. The findings have implications for audit pricing models, audit committee oversight, and how fee dynamics are interpreted by users of audit fee data. Full article

(This article belongs to the Special Issue Accounting, Auditing, and Reporting Quality: Challenges Under Uncertainty Conditions)

35 pages, 17565 KB

Open AccessArticle

Trading Differently, Without Detectable Performance Differences: Gender in Simulated Stock Trading

by Alain Finet, Kevin Kristoforidis and Julie Laznicka

J. Risk Financ. Manag. 2026, 19(8), 639; https://doi.org/10.3390/jrfm19080639 - 19 Aug 2026

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Abstract

This article examines whether gender is associated with differences in trading style and performance in a simulated stock-market environment. It uses data from a four-hour CAC 40 trading simulation involving 133 second-year Management students, each managing a virtual EUR 100,000 portfolio under transaction [...] Read more.

This article examines whether gender is associated with differences in trading style and performance in a simulated stock-market environment. It uses data from a four-hour CAC 40 trading simulation involving 133 second-year Management students, each managing a virtual EUR 100,000 portfolio under transaction costs, no short selling, and continuous ranking incentives. The analysis controls for age, prior market exposure, and the five OCEAN personality traits. The empirical strategy relies on a series of ordinary least squares regressions that distinguish trading style from performance. Trading style is measured through average transaction size, invested capital during the simulation, portfolio variability, a composite capital-engagement index, and a turnover ratio, while performance is the portfolio return. The results show that gender is not significantly associated with return. By contrast, gender is associated with several dimensions of trading style. Male participants take larger positions, retain a lower share of cash, display more variable portfolios, and a more intensive trading style. Beyond the widely reported finding that men tend to trade more frequently, the study documents gender-related differences across several dimensions of trading style. These associations remain statistically significant after controlling for prior market exposure and OCEAN personality traits, but they are not accompanied by a statistically significant difference in return. The contribution lies in documenting multidimensional differences in trading style among novice investors operating under identical conditions, rather than in replicating the finding that greater male trading activity is associated with lower performance. Full article

(This article belongs to the Section Financial Markets)

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32 pages, 5467 KB

Open AccessReview

Public Finance Sustainability Under Multiple Crises: A Comparative Bibliometric Analysis Across Economic, Pandemic, Geopolitical, and Environmental Domains

by Nicoleta Mihaela Doran, Constanta Adriana Gorie and Gabriela Badareu

J. Risk Financ. Manag. 2026, 19(8), 638; https://doi.org/10.3390/jrfm19080638 - 19 Aug 2026

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Abstract

Public finance sustainability has become increasingly shaped by recurrent systemic shocks, yet the structure and evolution of research at the intersection of public finances and different types of crises remain insufficiently synthesized. This study provides a comparative bibliometric assessment of four crisis domains—economic, [...] Read more.

Public finance sustainability has become increasingly shaped by recurrent systemic shocks, yet the structure and evolution of research at the intersection of public finances and different types of crises remain insufficiently synthesized. This study provides a comparative bibliometric assessment of four crisis domains—economic, pandemic, geopolitical, and environmental—to identify their developmental trajectories, intellectual cores, and collaboration patterns. Using records extracted exclusively from the Web of Science and processed through the Bibliometrix R package (R version 4.2.2), the analysis covers 1170 publications for economic crises (1991–2025), 285 for pandemic crises (2010–2025), 21 for geopolitical crises (2009–2025), and 110 for environmental crises (1991–2025). The results show that the economic crisis literature represents the most mature and cohesive field, characterized by a sustained annual growth rate of 12.57% and strong internal citation density. The pandemic corpus expanded rapidly during 2020–2022, with the highest growth rate (19.24%) and elevated levels of international co-authorship. The geopolitical segment remains comparatively small and fragmented, while the environmental domain demonstrates steady growth (6.68%) and the highest average citation impact (13.99 citations per document). Overall, the findings indicate differentiated stages of institutionalization across the four domains and suggest a gradual shift toward conceptualizing fiscal sustainability as a dynamic capacity to manage systemic and multidimensional risks. Full article

(This article belongs to the Section Sustainability and Finance)

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20 pages, 471 KB

Open AccessFeature PaperArticle

Are Carbon-Efficient Equities Insulated from Oil Shocks? Evidence from an Indian VARX Model with Exogenous Currency Controls

by Zakir Hossen Shaikh, Rakhi Gupta and Bibhu Prasad Sahoo

J. Risk Financ. Manag. 2026, 19(8), 637; https://doi.org/10.3390/jrfm19080637 - 19 Aug 2026

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Abstract

This paper analyzes the viability of Indian equity markets in response to global energy supply shocks. This study attempts to correct the missing-variable bias in earlier literature by using the USD-to-INR exchange rate as an exogenous explanatory variable. This will help determine the [...] Read more.

This paper analyzes the viability of Indian equity markets in response to global energy supply shocks. This study attempts to correct the missing-variable bias in earlier literature by using the USD-to-INR exchange rate as an exogenous explanatory variable. This will help determine the intricate synthetic relationship between Brent Crude Oil Returns and the carbon-efficient S&P BSE GREENEX. Vector Autoregressive with exogenous variables (VARX) models are employed to analyze the effects of structural shocks to Brent Crude Oil prices on the S&P BSE GREENEX. The empirical results found that global oil price shocks might immediately affect green equity values in India. Even without foreign currency changes, the Indian Green Exchange Index (GREENEX) maintains its long-term values, showing structural resilience. Institutional investors and Indian financial authorities, such as SEBI and the Reserve Bank of India, gain better risk-management insights amid international energy crises from this information. It also shows that carbon-efficient standards can hedge inflation induced by foreign import supply chain interruptions. Full article

(This article belongs to the Special Issue Energy and Sustainability Finance: Pathways to a Low-Carbon Economy)

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30 pages, 4047 KB

Open AccessArticle

Management Accounting Service Quality in a Small Open Economy: A Preparer–User Gap Analysis

by Daniel Zdolšek and Iztok Kolar

J. Risk Financ. Manag. 2026, 19(8), 636; https://doi.org/10.3390/jrfm19080636 - 19 Aug 2026

Viewed by 282

Abstract

Management accounting systems (MASs) are essential to organisations because they provide high-quality information that supports planning and decision-making when it is relevant, timely and reliable. The effectiveness of MAS depends on the delivery of relevant, timely, and understandable information, yet organisations often fail [...] Read more.

Management accounting systems (MASs) are essential to organisations because they provide high-quality information that supports planning and decision-making when it is relevant, timely and reliable. The effectiveness of MAS depends on the delivery of relevant, timely, and understandable information, yet organisations often fail to evaluate the quality of these services systematically, thereby limiting their strategic impact. Our study addresses the underexplored area of MAS service quality, focusing on internal dynamics within accounting departments and gaps in service provision. We conduct a gap analysis within a single consistent cultural environment (Slovenia) to assess the functioning of accounting services. In our study, the statistically significant preparer–user mismatch is concentrated in the reliability dimension. The findings suggest that reliability should be prioritised in efforts to improve MAS service quality. We discuss practical implications for strengthening MAS service quality, particularly through data integrity, reporting reliability, process standardisation and user expectation management. Full article

(This article belongs to the Section Business and Entrepreneurship)

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19 pages, 6501 KB

Open AccessArticle

Dividend Policy Determinants in New Zealand-Listed Companies: Financial Performance, Board Gender Diversity, and Firm Operational Scope

by Rajesh Adhikari, Shafiq Alam, Bing Dai, Jishuo (Jimmy) Sun and Ihsan Badshah

J. Risk Financ. Manag. 2026, 19(8), 635; https://doi.org/10.3390/jrfm19080635 - 19 Aug 2026

Viewed by 343

Abstract

Among developed-market stock exchanges, the NZX is distinctive. Its imputation credit system and capital-gains-tax exemption create financial incentives for firms to distribute earnings that have no close parallel elsewhere, yet what actually drives payout decisions at the firm level has never been tested [...] Read more.

Among developed-market stock exchanges, the NZX is distinctive. Its imputation credit system and capital-gains-tax exemption create financial incentives for firms to distribute earnings that have no close parallel elsewhere, yet what actually drives payout decisions at the firm level has never been tested in a multivariate panel framework. We analyzed 116 NZX-listed companies from 2017 to 2023. The results show that revenue and net profit prove to be the dominant positive predictors of dividend payout; cash flow and shareholders’ equity are negatively associated with the payout, suggesting that the firms prioritize capital retention in a manner consistent with the pecking order theory. Market capitalization adds nothing once earnings quality is accounted for in the model. Firms in which women occupied more than half of board seats paid, on average, seventeen times more in dividends than those with minimal female representation, a gap sustained without exception across all seven years. Domestic firms outpaid multinational firms throughout and, by 2023, had exceeded their own pre-period baseline, while multinationals had not. Our findings have implications for income-focused investors, for boards weighing payout strategies, and for policymakers assessing the case for diversity requirements. Full article

(This article belongs to the Special Issue Corporate Governance in Emerging Markets)

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30 pages, 711 KB

Open AccessArticle

Social Trust and Commercial Insurance Participation in China: Distinguishing Within-Person Change from Between-Person Differences

by Saad Andalib Syed Shah

J. Risk Financ. Manag. 2026, 19(8), 634; https://doi.org/10.3390/jrfm19080634 - 18 Aug 2026

Viewed by 265

Abstract

This study examines how trust is associated with household commercial-insurance participation in China and separates two sources of variation that pooled estimates combine. Within-person change asks whether changes in the same respondent’s trust across survey waves are accompanied by changes in that respondent’s [...] Read more.

This study examines how trust is associated with household commercial-insurance participation in China and separates two sources of variation that pooled estimates combine. Within-person change asks whether changes in the same respondent’s trust across survey waves are accompanied by changes in that respondent’s household insurance participation. Between-person differences compare respondents who maintain different average trust levels over time. Using six waves of the China Family Panel Studies (CFPS) from 2012 to 2022, we analyze 47,006 respondent-wave observations from 15,176 respondents. Pooled linear probability and Probit models show a positive association between the aggregate trust index and insurance participation. In contrast, respondent fixed-effects, conditional fixed-effects Logit, and city-by-wave fixed-effects models provide little evidence of a systematic within-person association. Correlated random-effects estimates locate most of the pooled relationship in persistent differences between respondents. The trust dimensions also differ: persistent trust in strangers is positively associated with participation, whereas trust in local government cadres is negatively associated. Expenditure models lead to a similar conclusion. The results show why generalized interpersonal trust and institutional trust should not be treated as interchangeable and why pooled trust–insurance associations need not describe changes within the same person over time. Full article

(This article belongs to the Section Business and Entrepreneurship)

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29 pages, 2373 KB

Open AccessArticle

Green Versus Brown Assets Under Stress: Who Hedges Energy and Market Risk?

by Chandan Kumar Tiwari, Mohd Abass Bhat, Shagufta Tariq Khan, Indre Siksnelyte-Butkiene and Hafiz M. Sohail

J. Risk Financ. Manag. 2026, 19(8), 633; https://doi.org/10.3390/jrfm19080633 - 18 Aug 2026

Viewed by 275

Abstract

Sustainable finance increasingly treats green assets as instruments for climate-risk hedging; however, it remains unclear whether they protect investors during energy-market shocks and financial-market stress or merely transmit different transition, equity-market, and growth risks. This study asks whether green assets hedge better than [...] Read more.

Sustainable finance increasingly treats green assets as instruments for climate-risk hedging; however, it remains unclear whether they protect investors during energy-market shocks and financial-market stress or merely transmit different transition, equity-market, and growth risks. This study asks whether green assets hedge better than brown assets, or whether the two asset classes hedge different risks across market states. Using daily data from 2010 to 2025 on exchange-traded clean-energy, fossil-fuel, green-bond, ESG, and market-risk instruments, we construct green and brown portfolios and analyze the green–brown return spread across normal conditions, high-volatility regimes, market-stress days, positive and negative oil-price shocks, the COVID-19 crisis, and the recent energy-crisis period. The empirical design combines performance and downside-risk metrics, rolling correlations and betas, Newey–West regressions, stress-state comparisons, quantile regressions, portfolio allocation tests, and supplementary machine-learning classification. The results reveal strong oil-shock asymmetry: brown assets outperform during positive oil-price shocks, while green assets perform relatively better when oil prices fall sharply. However, green assets do not function as broad safe havens during financial-market stress, reflecting persistent equity-market downside exposure and growth-factor repricing. Quantile regressions confirm nonlinear and state-dependent risk transmission, while portfolio tests show weak full-sample return-risk performance for clean-energy equity exposure alone. Shorter-sample suggests that green bonds and ESG assets display more defensive characteristics, whereas machine-learning models show limited short-horizon predictive power. Green assets are therefore not universal hedges but conditional transition-risk assets whose value depends on the shock source, market regime, and sustainable instrument. Full article

(This article belongs to the Special Issue Sustainable Finance and Climate Risk)

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15 pages, 1442 KB

Open AccessArticle

Financial Performance Evaluation of Türkiye’s Savings Finance Sector Using the CRITIC-EDAS Method

by Murat Ahmet Doğan

J. Risk Financ. Manag. 2026, 19(8), 632; https://doi.org/10.3390/jrfm19080632 - 18 Aug 2026

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Abstract

The rapid growth of Türkiye’s savings finance sector under Law No. 7292 has created demand for objective, multidimensional performance evaluation tools. This study assesses the financial performance of six savings finance companies in Türkiye over 2022–2024 using a hybrid CRITIC-EDAS multi-criteria decision-making model. [...] Read more.

The rapid growth of Türkiye’s savings finance sector under Law No. 7292 has created demand for objective, multidimensional performance evaluation tools. This study assesses the financial performance of six savings finance companies in Türkiye over 2022–2024 using a hybrid CRITIC-EDAS multi-criteria decision-making model. Criterion weights for eight financial indicators—spanning profitability, operational efficiency, growth, and financial structure—were derived objectively via CRITIC, while EDAS produced the rankings, which were applied to criterion-direction-normalized data because the dataset contains negative values. The operating expense-to-revenue ratio carried the greatest weight in 2022 and 2023; gross profit margin became dominant in 2024. Katılımevim led the rankings in 2022 (ASi = 1.000); Eminevim then took the lead in 2023 (ASi = 1.000) and held it in 2024 (ASi = 0.968), with Fuzulev second (ASi = 0.815). A normalization artifact affecting two revenue-denominator ratios for one company (İmece) in 2024 was corrected through winsorization. Validity was confirmed in two stages: Spearman correlations between EDAS and the TOPSIS, MABAC, and MARCOS rankings exceeded the 0.89 reliability threshold in all three years, and a nine-scenario sensitivity analysis supported the rankings’ robustness. These findings give regulators, investors, and managers a replicable framework for evaluating performance in this young, underexamined sector and point to operational efficiency and outlier management as priorities for oversight. Full article

(This article belongs to the Special Issue Accounting, Finance, Banking in Emerging Economies)

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26 pages, 838 KB

Open AccessFeature PaperArticle

The Role of Digitization in Corporate Financial Performance: Evidence from GCC Banks

by Rami Alzoubi, Mayes R. Gharaibeh, Ibrahim Saleh Al-Radaideh, Ahmad Alomari, Saleem Ibrahim Alzoubi and Fawwaz Alrwabdah

J. Risk Financ. Manag. 2026, 19(8), 631; https://doi.org/10.3390/jrfm19080631 - 18 Aug 2026

Viewed by 562

Abstract

Digitization is reshaping how banks operate, yet whether it improves corporate financial performance remains unsettled. This study examines how the digital transformation that banks disclose relates to the structure of their key financial performance indicators. Using a balanced panel of 73 listed Gulf [...] Read more.

Digitization is reshaping how banks operate, yet whether it improves corporate financial performance remains unsettled. This study examines how the digital transformation that banks disclose relates to the structure of their key financial performance indicators. Using a balanced panel of 73 listed Gulf Cooperation Council (GCC) banks over 2020–2025 (438 bank–year observations), digital transformation is measured by a text-mined digital disclosure index (DDI, 0–100) constructed from annual reports and decomposed into nine themes. Bank fixed-effects regressions with Driscoll–Kraay standard errors, one-year-lagged specifications, and two-step system GMM are estimated across profitability, net interest margin, cost efficiency, credit risk and capital adequacy. Disclosed digitization more than doubled over the window, but its associations with performance are conditional rather than uniformly positive. Within banks, a higher DDI value is associated with wider net interest margins, yet also with lower profitability, higher cost-to-income ratios, modestly higher credit risk, and thinner capital buffers. This pattern is consistent with an investment or build-out phase in which the costs of digital transformation are visible before any efficiency or stability dividend and in which margins are the single offsetting benefit. The six-year window observes only this cost-bearing segment and not any later recovery, so the study documents the investment-phase drag rather than a completed cycle. The theme decomposition indicates that the margin association is closest to regulatory technology, cybersecurity, broad transformation and payments. Because the design is observational, the results are interpreted as within-bank associations rather than causal effects, and, although precisely estimated, these associations are economically modest. The study contributes a transparent theme-decomposed measure of bank digitization and evidence on its limits for corporate financial performance in an emerging-market banking region. Full article

(This article belongs to the Special Issue The Role of Digitization in Corporate Finance)

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1 pages, 114 KB

Open AccessEditorial

Publisher’s Note: Update of Journal Title Abbreviation

by JRFM Editorial Office

J. Risk Financ. Manag. 2026, 19(8), 630; https://doi.org/10.3390/jrfm19080630 - 18 Aug 2026

Viewed by 179

Abstract

Starting with Issue 9 of Journal of Risk and Financial Management (Volume 19), the Journal of Risk and Financial Management will adopt the abbreviation J [...] Full article

26 pages, 5134 KB

Open AccessArticle

Towards Sustainable Financial Inclusion: A Comparative Study of Ensemble Architectures and SHAP-Based Explainability in Bank Loan Prediction

by Htet Nge Nge Ko, Aung Htoo Khine, Shadab Kalhoro, Maryam Kalhoro, Mobashar Rehman and Khalid Ahmed

J. Risk Financ. Manag. 2026, 19(8), 629; https://doi.org/10.3390/jrfm19080629 - 18 Aug 2026

Viewed by 339

Abstract

As the retail banking sector shifts toward automated lending, the black-box nature of high-performing machine learning models remains a significant barrier to regulatory transparency and institutional trust. A critical gap in existing literature is the lack of deployed frameworks that simultaneously optimize predictive [...] Read more.

As the retail banking sector shifts toward automated lending, the black-box nature of high-performing machine learning models remains a significant barrier to regulatory transparency and institutional trust. A critical gap in existing literature is the lack of deployed frameworks that simultaneously optimize predictive accuracy, manage asymmetric financial risks, and provide actionable interpretability. To bridge this gap, this study aims to develop and evaluate a highly interpretable, ethically accountable ensemble machine learning framework for credit risk assessment. Utilizing a cross-sectional public dataset of over 45,000 generalized retail banking records, this research conducts a comprehensive comparative analysis of four diverse ensemble architectures: Bagging, Boosting, Stacking, and Voting. To address inherent class imbalance and evaluate risk tolerance, the models were integrated with Synthetic Minority Over-sampling Technique (SMOTE) and Adaptive Synthetic Sampling (ADASYN) resampling techniques. While all architectures demonstrated high discriminative power, the SMOTE-balanced Bagging model emerged as the superior performer, achieving a peak Area Under the Curve (AUC) of 0.972 by establishing a safe operational threshold that strictly minimizes costly false approvals. Crucially, a SHapley Additive exPlanations (SHAP) framework was applied across all four models to decode their internal logic. The SHAP analysis successfully validated that the ensembles prioritize core financial behavior, such as default history and loan-to-income ratios, while correctly assigning near-zero predictive weight to demographic traits like gender and education. By empirically proving that high-performance algorithms can be mathematically blind to demographic biases, this framework directly advances SDG 10 (Reduced Inequalities). Furthermore, by resolving the performance-transparency trade-off, this study provides the accountable, feature-level justifications required for secure and sustainable financial inclusion (SDG 8). Full article

(This article belongs to the Section Sustainability and Finance)

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22 pages, 338 KB

Open AccessArticle

Connected at the Top: CEO–Executive Social Ties and Audit Pricing

by So Yean Kwack

J. Risk Financ. Manag. 2026, 19(8), 628; https://doi.org/10.3390/jrfm19080628 - 18 Aug 2026

Viewed by 289

Abstract

This study examines whether social ties within top management teams are associated with audit pricing. Drawing on research on organizational social networks and auditor risk assessment, I investigate whether connections between chief executive officers and other top executives are reflected in auditors’ pricing. [...] Read more.

This study examines whether social ties within top management teams are associated with audit pricing. Drawing on research on organizational social networks and auditor risk assessment, I investigate whether connections between chief executive officers and other top executives are reflected in auditors’ pricing. Using 22,220 S&P 1500 firm-year observations from 2002 to 2014, I find that CEO–executive connections are negatively associated with audit fees. The findings are consistent with connected executive teams being associated with lower audit risk or client business risk, or with auditors treating such teams as lower-risk clients. The negative association between CEO–executive connections and audit fees is weaker among firms facing higher litigation risk, suggesting that auditors’ pricing responses to organizational social structure are constrained when professional and legal risks are salient. In contrast, the negative association is stronger when auditors have longer tenure and when auditors are industry specialists, consistent with auditors being more likely to incorporate CEO–executive connections into audit pricing when they have greater client-specific or industry-specific knowledge. Additional analysis indicates that the negative association is more consistently observed for advice-based ties than for friendship-based ties, consistent with the view that work-related social ties facilitate information sharing, communication, and coordination within the top management team. Overall, the study contributes to the audit pricing and auditor risk-assessment literature by providing archival evidence that informal organizational ties within the client’s top management team are associated with audit pricing outcomes. Full article

(This article belongs to the Section Business and Entrepreneurship)

27 pages, 1128 KB

Open AccessArticle

Does Mandatory ESG Disclosure Move Stock Prices? Evidence from the European Union’s Corporate Sustainability Reporting Directive

by Aleena Varekat Charly and Tetiana Paientko

J. Risk Financ. Manag. 2026, 19(8), 627; https://doi.org/10.3390/jrfm19080627 - 18 Aug 2026

Viewed by 343

Abstract

The Corporate Sustainability Reporting Directive (CSRD) extends mandatory, assured and standardised sustainability reporting to a European reporting population several times larger than that of its predecessor, on the premise that such disclosure is priced by capital markets. This paper examines whether equity prices [...] Read more.

The Corporate Sustainability Reporting Directive (CSRD) extends mandatory, assured and standardised sustainability reporting to a European reporting population several times larger than that of its predecessor, on the premise that such disclosure is priced by capital markets. This paper examines whether equity prices responded to the five legislative and standard-setting milestones through which the mandate became public between April 2021 and July 2023. German DAX constituents falling within the scope of Article 19a are compared with matched S&P 500 firms, using an annual difference-in-differences design and a daily market model event study. The annual estimator yields a positive and significant coefficient of +0.204 that is robust to alternative specifications, standard error corrections and influence diagnostics. Four diagnostics nevertheless indicate that it does not identify a regulatory effect: the same design applied to year pairs containing no CSRD or ESRS event yields estimates of comparable magnitude and mixed sign; parallel pre-trends are rejected; the coefficient is concentrated among poorly matched firm pairs and falls to +0.046 once a caliper is imposed; and the design is underpowered for effects of the magnitude it reports. The event study, which measures each firm against its own home market and therefore does not rely on the cross-country comparison, detects no abnormal return at any milestone once multiple testing and cross-sectional dependence are taken into account: the cumulative 3-day reaction across all five events is +0.8 percentage points, with a 95% confidence interval of [−2.5, +4.0], which excludes a repricing of the magnitude the annual estimate implies. The paper contributes a set of design diagnostics that distinguish an identified estimate from one that is merely stable, and shows that the two-country annual comparisons common in this literature do not survive them. Full article

(This article belongs to the Special Issue ESG Integration in Financial Markets)

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22 pages, 917 KB

Open AccessArticle

Non-Performing Financing Risk in GCC Islamic Banks Under Global and U.S. Monetary Policy Uncertainty: Fixed-Effects and Panel Quantile Evidence

by Lena Bedawi Elfadli Elmonshid

J. Risk Financ. Manag. 2026, 19(8), 626; https://doi.org/10.3390/jrfm19080626 - 17 Aug 2026

Viewed by 306

Abstract

This study examines the determinants of non-performing financing (NPF) using country-level Islamic banking system aggregates for the six Gulf Cooperation Council (GCC) countries, with particular attention to the role of global economic policy uncertainty and U.S. monetary policy uncertainty. Using a panel dataset [...] Read more.

This study examines the determinants of non-performing financing (NPF) using country-level Islamic banking system aggregates for the six Gulf Cooperation Council (GCC) countries, with particular attention to the role of global economic policy uncertainty and U.S. monetary policy uncertainty. Using a panel dataset covering the period 2014Q4–2024Q3, this study applies fixed-effects estimation and panel quantile regression to capture both average effects and distributional heterogeneity in financing risk. The findings reveal that the determinants of NPF vary significantly across the conditional NPF distribution. Profitability and capital adequacy are positively associated with NPF, whereas GDP is negatively associated with NPF. Liquidity has a negative and statistically significant association mainly in the middle and upper quantiles, indicating a stronger stabilizing role under elevated risk conditions. Global economic policy uncertainty is significant only in the upper quantiles and has a negative coefficient, while U.S. monetary policy uncertainty shows limited statistical relevance. These results indicate that mean-based models may conceal important differences across financing risk regimes. The findings are interpreted as statistical associations rather than causal effects, given the country-level aggregation, limited cross-sectional dimension, and potential measurement and model specification constraints. This study contributes distribution-sensitive evidence on GCC Islamic banking systems and offers cautious implications for risk monitoring, liquidity management, and macroprudential supervision. Full article

(This article belongs to the Special Issue Banking Profitability and Efficiency in Emerging Economies)

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55 pages, 3669 KB

Open AccessArticle

Neuro-Symbolic Frameworks for Corporate Leverage and Debt Maturity: Evidence from Econometric and Machine Learning Models

by Omar Shawkey, Taha Mohamed Gaber, Esmail Mohamed, Ahmed Hassanein and Yara Ibrahim

J. Risk Financ. Manag. 2026, 19(8), 625; https://doi.org/10.3390/jrfm19080625 - 17 Aug 2026

Viewed by 311

Abstract

Forecasting corporate leverage adjustments remains challenging due to persistent financing behavior, firm heterogeneity, and changing macroeconomic conditions. This study investigates whether increasing model complexity improves the forecasting of corporate leverage adjustment by comparing dynamic econometric models, machine learning algorithms, and a neuro-symbolic artificial [...] Read more.

Forecasting corporate leverage adjustments remains challenging due to persistent financing behavior, firm heterogeneity, and changing macroeconomic conditions. This study investigates whether increasing model complexity improves the forecasting of corporate leverage adjustment by comparing dynamic econometric models, machine learning algorithms, and a neuro-symbolic artificial intelligence framework. The analysis is based on an unbalanced panel of 39,226 firm-year observations from 3001 publicly listed non-financial firms across 18 countries. The empirical analysis compares Fixed Effects and two-step Difference GMM estimators with regularized regression, gradient boosting, artificial neural networks, and a theory-guided neuro-symbolic framework that incorporates economically meaningful financial constraints through a resampling-based approximation of a differentiable rule-based penalty. Model performance is evaluated using out-of-sample forecasting accuracy measured by the Root Mean Squared Error (RMSE), Mean Absolute Error (MAE), and the coefficient of determination (R²). The results indicate that corporate leverage exhibits substantial persistence, with estimated adjustment speeds of approximately 29–36% annually. Machine learning algorithms do not improve forecasting accuracy relative to benchmark dynamic econometric models when evaluated out of sample, while incorporating symbolic financial constraints provides only limited additional predictive benefits. These findings suggest that leverage persistence dominates model complexity and that parsimonious dynamic econometric models remain highly effective for forecasting corporate leverage adjustment. The study contributes to the growing literature on explainable artificial intelligence in corporate finance by providing a comprehensive comparison of dynamic econometric, machine learning, and neuro-symbolic approaches within a unified forecasting framework for emerging economies in the MENA region. Full article

(This article belongs to the Special Issue Contemporary Studies on Corporate Finance and Business Research, 2nd Edition)

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19 pages, 454 KB

Open AccessArticle

Impact of Environmental, Social, and Governance (ESG) Disclosure on Investor Reactions: Evidence from Thailand

by Chayapat Phonlaboon, Nuttavong Poonpool and Salakjit Ninlaphay

J. Risk Financ. Manag. 2026, 19(8), 624; https://doi.org/10.3390/jrfm19080624 - 17 Aug 2026

Viewed by 316

Abstract

Environmental, social, and governance (ESG) disclosure has received increasing attention in capital markets as investors place greater emphasis on sustainability information alongside financial information when evaluating firms. In this study, the authors examine the relationship between ESG disclosure and investor reactions among firms [...] Read more.

Environmental, social, and governance (ESG) disclosure has received increasing attention in capital markets as investors place greater emphasis on sustainability information alongside financial information when evaluating firms. In this study, the authors examine the relationship between ESG disclosure and investor reactions among firms listed on the Stock Exchange of Thailand using Bloomberg ESG disclosure scores and an event study approach. The analysis is based on secondary data over the period of 2019–2022, employing a fixed-effects model on unbalanced panel data. The findings indicate that overall ESG disclosure is positively and statistically significantly associated with investor reactions. These results show that each ESG dimension is positively associated with investor reactions. While the environmental and social dimensions are significant at the 0.01% level, governance disclosure remains statistically significant at the 0.05 level. The empirical evidence suggests that ESG disclosure provides information that investors may consider when evaluating firms. Moreover, this study provides evidence that changes in the level of ESG disclosure are associated with changes in cumulative abnormal returns (CARs). This study contributes to the literature on ESG disclosure and corporate sustainability in emerging markets. Its results have practical implications for listed companies, investors, and regulators by highlighting the importance of ESG disclosure in corporate reporting and investment evaluation. Full article

(This article belongs to the Special Issue Finance and Accounting in Times of Global Uncertainty: ESG, SDGs, and Digital Disruption)

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12 pages, 230 KB

Open AccessArticle

Ownership–Control Disparity and the Cost of Debt: Evidence from Corporate Bond Yield Spreads in Korea

by Hyunjung Choi

J. Risk Financ. Manag. 2026, 19(8), 623; https://doi.org/10.3390/jrfm19080623 - 16 Aug 2026

Viewed by 253

Abstract

Ownership–control disparity, defined as the difference between controlling shareholders’ voting rights and cash-flow rights, is a distinctive feature of corporate governance in Korean business groups. Although prior studies have examined its association with firm value and credit ratings, relatively little evidence is available [...] Read more.

Ownership–control disparity, defined as the difference between controlling shareholders’ voting rights and cash-flow rights, is a distinctive feature of corporate governance in Korean business groups. Although prior studies have examined its association with firm value and credit ratings, relatively little evidence is available on whether ownership–control disparity is reflected in corporate bond pricing. This study examines the association between ownership–control disparity and corporate bond yield spreads using a sample of publicly listed Korean manufacturing firms from 2011 to 2022. Corporate bond yield spreads are used as a market-based measure of debt financing costs because they incorporate investors’ assessments of credit risk. The empirical results show that firms with greater ownership–control disparity exhibit significantly lower bond yield spreads. The findings suggest that bond investors may view greater ownership–control disparity as being associated with lower corporate credit risk despite potential agency concerns. Consistent results are also obtained when credit ratings are used as an alternative measure of debt financing costs. This study contributes to the literature on corporate governance and debt financing costs by providing market-based evidence on how ownership–control disparity is reflected in corporate bond pricing within the institutional setting of Korean business groups. Full article

(This article belongs to the Collection Transformative Corporate Finance and Governance)

29 pages, 1722 KB

Open AccessArticle

Closing the VAT Gap in the EU-27: Business Cloud Accounting and Mandatory Digital Reporting

by Vanya Georgieva and Radosveta Krasteva-Hristova

J. Risk Financ. Manag. 2026, 19(8), 622; https://doi.org/10.3390/jrfm19080622 - 15 Aug 2026

Cited by 1 | Viewed by 397

Abstract

Digitalisation is increasingly viewed as an instrument for narrowing the VAT gap in the European Union, yet the relative relevance of voluntary business digitalisation and mandatory administrative reporting remains unclear. This study distinguishes cloud accounting from mandatory transaction reporting and analyses an unbalanced [...] Read more.

Digitalisation is increasingly viewed as an instrument for narrowing the VAT gap in the European Union, yet the relative relevance of voluntary business digitalisation and mandatory administrative reporting remains unclear. This study distinguishes cloud accounting from mandatory transaction reporting and analyses an unbalanced EU-27 panel for 2013–2024, with estimations limited to 2013–2023. Sequential pooled OLS, two-way fixed-effects models and robustness checks are applied to European Commission, Eurostat and World Bank data. The initially negative association between cloud accounting and the VAT gap disappears after controlling for income and government effectiveness. Mandatory digital reporting is associated with a VAT gap of about 3–4 percentage points lower, although the small number of adopters and pre-adoption trends preclude causal claims. Theoretically, first, the findings distinguish firm-level digital capability from information directly accessible to tax administrations; second, they show that technology adoption and institutional capacity must be analysed separately. Practically, first, the results support interoperable systems providing timely, structured and verifiable transaction data; second, they indicate that cloud accounting should complement, rather than replace, mandatory reporting infrastructure. Full article

(This article belongs to the Special Issue Synergizing Accounting Practices and Tax Governance)

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28 pages, 2269 KB

Open AccessArticle

Determinants of Bank Profitability in Selected Balkan Countries: A Combined Econometric and Machine Learning Approach

by Sauda Nerjaku and Valentina Sinaj

J. Risk Financ. Manag. 2026, 19(8), 621; https://doi.org/10.3390/jrfm19080621 - 15 Aug 2026

Viewed by 423

Abstract

In recent years, the banking system has been affected by several economic and financial shocks, increasing the importance of analyzing bank profitability and its determinants. This study examines bank profitability in selected Balkan countries over the period 2010–2024 by combining econometric panel data [...] Read more.

In recent years, the banking system has been affected by several economic and financial shocks, increasing the importance of analyzing bank profitability and its determinants. This study examines bank profitability in selected Balkan countries over the period 2010–2024 by combining econometric panel data methods with machine learning techniques. Bank profitability is proxied by two commonly used indicators, ROA and ROE, while the explanatory variables include bank-specific factors such as efficiency, capital adequacy, non-performing loans, net interest margin, and the credit-to-deposit ratio, as well as macroeconomic variables such as GDP, inflation and unemployment. The econometric results indicate that efficiency and capital adequacy are key determinants of bank profitability, with efficiency negatively associated with ROA and ROE, while capital adequacy is positively associated with both indicators. The machine learning analysis, based on Random Forest and XGBoost, further evaluates the predictive role of the explanatory variables. Overall, the results show that bank-specific variables have a stronger influence on profitability than macroeconomic variables. In particular, feature importance highlights the relevance of the credit-to-deposit ratio, while SHAP values emphasize the contribution of NPLs. Overall, the findings suggest that bank profitability in selected Balkan countries is mainly driven by internal banking factors rather than macroeconomic conditions. Full article

(This article belongs to the Section Banking and Finance)

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14 pages, 962 KB

Open AccessArticle

Greenwash, Panic, or Profit? Decoding How Sustainability News Hijacks Equity Investor Sentiment

by Kamran Quddus and Sougata Banerjee

J. Risk Financ. Manag. 2026, 19(8), 620; https://doi.org/10.3390/jrfm19080620 - 15 Aug 2026

Viewed by 262

Abstract

Given the rising global interest in Environmental, Social, and Governance (ESG), this paper investigates whether a company’s ESG news affects equity investors’ sentiment, addressing a gap in the relevant research. Interest in ESG investing has grown rapidly, yet existing research measures investor sentiment [...] Read more.

Given the rising global interest in Environmental, Social, and Governance (ESG), this paper investigates whether a company’s ESG news affects equity investors’ sentiment, addressing a gap in the relevant research. Interest in ESG investing has grown rapidly, yet existing research measures investor sentiment only indirectly—through market-wide proxies such as the CBOE Volatility Index, low-frequency investor surveys, or realized stock returns—measures that conflate sentiment with risk aversion and fundamentals and cannot isolate firm-specific reactions to ESG news. This study measures investor sentiment directly from investors’ own expressions: we pair firm-day ESG news-sentiment scores for all S&P 500 constituents with investor sentiment extracted from stock-related tweets using a finance-tuned RoBERTa model. Using Bayesian Ridge Regression (BRR), the study finds that ESG news significantly impacts equity investors’ sentiment. This study contributes to both academic and managerial practice by establishing the association and sensitivity of ESG news and investor sentiment in academic literature and proposing a framework for firms to practice effective sustainability management. Full article

(This article belongs to the Section Economics and Finance)

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22 pages, 363 KB

Open AccessReview

ESG Governance, Renewable Energy Adoption, and Corporate Financial and Environmental Performance: Evidence from US-Listed Firms

by Omkar Hirlekar, Ashutosh Kolte and Rajesh Pahurkar

J. Risk Financ. Manag. 2026, 19(8), 619; https://doi.org/10.3390/jrfm19080619 - 15 Aug 2026

Viewed by 374

Abstract

The global energy sector is undergoing rapid and, in many respects, irreversible transformation driven by the convergence of digital disruption, sustainability mandates, and shifting investor expectations. Technologies such as artificial intelligence (AI), blockchain, and digital twin systems are fundamentally reshaping energy operations and [...] Read more.

The global energy sector is undergoing rapid and, in many respects, irreversible transformation driven by the convergence of digital disruption, sustainability mandates, and shifting investor expectations. Technologies such as artificial intelligence (AI), blockchain, and digital twin systems are fundamentally reshaping energy operations and strategic decision-making, while ESG governance quality and renewable energy adoption have emerged as two of the most consequential determinants of corporate financial competitiveness and equity valuation. Despite growing practitioner and regulatory interest in these dynamics, limited empirical evidence exists on how ESG governance, renewable adoption, and digital disruption jointly influence financial performance and environmental outcomes across multiple sectors simultaneously. This study addresses that gap using panel data from 26 large-cap US-listed firms across five sectors over 2015–2022 (N = 208 firm-year observations for Revenue/Market Cap/ROA models; N = 91 for the CO₂ model). A multi-method econometric framework is employed, comprising Fixed Effects and Random Effects panel regression with Hausman specification testing, Difference in Differences quasi-experimental analysis, and sequential OLS path analysis with HC3 robust standard errors. Three of four hypotheses are supported. ESG governance quality generates a significant market capitalisation premium of approximately 10–14% per unit Bloomberg ESG Score improvement, after controlling for firm size and R&D intensity; no significant revenue channel effect is found once firm size is properly accounted for. Renewable energy adoption shows a marginal association with market capitalisation at the 10% significance level (FE β = 0.019, p = 0.086; RE β = 0.016, p = 0.077), suggesting capital markets may price clean energy adoption as a forward-looking signal. ESG governance quality drives within-firm CO₂ emission reduction substantially more powerfully than renewable energy quantity alone, with the Fixed Effects estimator identifying a governance-led eco-efficiency mechanism. Firm profitability functions as a cross-model financial capacity moderator, enabling simultaneous ESG investment and environmental improvement. The findings carry direct implications for corporate managers, institutional investors, and policymakers aligned with SDG 7, SDG 9, and SDG 13. Full article

(This article belongs to the Special Issue Finance and Accounting in Times of Global Uncertainty: ESG, SDGs, and Digital Disruption)

23 pages, 356 KB

Open AccessArticle

US Stock Market Reaction to Armed Conflicts: Direct Versus Indirect Military Involvement and Conflict Initiation Versus Termination

by Hany Elzahar, Jamal Ali Al-Khasawneh, Ahmed Hassanein and Hosam Abdelrasheed

J. Risk Financ. Manag. 2026, 19(8), 618; https://doi.org/10.3390/jrfm19080618 - 15 Aug 2026

Viewed by 306

Abstract

This study investigates the impact of different cases of armed conflict on the US stock market. It examines whether the market reacts differently in cases of direct versus indirect US military involvement in the conflict and at the initiation or termination of the [...] Read more.

This study investigates the impact of different cases of armed conflict on the US stock market. It examines whether the market reacts differently in cases of direct versus indirect US military involvement in the conflict and at the initiation or termination of the conflict. The analysis is based on nine armed conflicts that took place from 2003 to 2022. The study utilizes an event study methodology and focuses on three sectors in the US stock market: Defense and Aerospace, Oil and Gas, and Alternative Energy. The results indicate that direct military involvement is generally associated with less favorable market responses, particularly during conflict initiation stages and within energy-related sectors. In contrast, conflict termination events frequently generate more positive market reactions, reflecting lower geopolitical uncertainty and reduced military exposure. Indirect involvement events, especially those related to the Russia–Ukraine conflict and the Russian intervention in Syria, are associated with more favorable responses in several sectors, particularly Aerospace and Defense. The study contributes to the literature by adopting a multi-conflict framework, distinguishing between direct and indirect military involvement, comparing conflict initiation and termination phases, and providing sector-level evidence on the heterogeneous effects of armed conflicts on financial markets. Full article

(This article belongs to the Special Issue Geopolitical Risk and Global Finance)

28 pages, 864 KB

Open AccessArticle

Financial Shared Services and Dynamic Adjustment of Working Capital: A Moderated Analysis of Supply Chain Concentration

by Ying Deng and Thien Sang Lim

J. Risk Financ. Manag. 2026, 19(8), 617; https://doi.org/10.3390/jrfm19080617 - 14 Aug 2026

Viewed by 536

Abstract

Digital technologies are increasingly adopted in corporate liquidity management, yet whether financial digitalization enables firms to achieve more effective working capital adjustment remains insufficiently understood. Financial shared services (FSS) may strengthen information integration, process standardization, and operational coordination, but existing research provides limited [...] Read more.

Digital technologies are increasingly adopted in corporate liquidity management, yet whether financial digitalization enables firms to achieve more effective working capital adjustment remains insufficiently understood. Financial shared services (FSS) may strengthen information integration, process standardization, and operational coordination, but existing research provides limited evidence on how external supply chain conditions shape the relationship between FSS and working capital adjustment effectiveness. Prior studies have focused primarily on adjustment speed rather than adjustment effectiveness, namely the extent to which firms maintain working capital close to target levels. Using panel data from Chinese A-share listed firms from 2014 to 2023, this study examines whether FSS is associated with the effect of working capital adjustment (DEV) and whether supply chain concentration moderates this relationship. Drawing on dynamic trade-off theory and information asymmetry theory, this study employs high-dimensional fixed-effects models to examine how internal information capabilities and external supply chain conditions jointly shape working capital adjustment. The findings show that firms adopting FSS tend to exhibit smaller deviations from target working capital levels, which is consistent with more effective adjustment. However, this association becomes weaker as supply chain concentration increases, suggesting that external dependence may constrain firms’ ability to translate enhanced internal information capabilities into improved working capital outcomes. Further analysis suggests that customer concentration plays a more prominent moderating role. This study extends the understanding of digital-enabled financial management beyond internal process improvement and identifies supply chain structure as an important boundary condition relevant to the value of FSS. Full article

(This article belongs to the Section Business and Entrepreneurship)

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