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Volume 13
Issue 4
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Int. J. Financial Stud., Volume 13, Issue 4 (December 2025) – 66 articles

Cover Story (view full-size image): Accurately forecasting stock price volatility is a critical yet challenging task due to the nonlinear and dynamic nature of financial markets. This study introduces a robust stacking ensemble framework that integrates the strengths of diverse algorithms, including statistical (ARIMA), machine learning (Random Forest), and deep learning (LSTM, GRU, Transformer) models. By employing an XGBoost meta-learner to synthesize these distinct predictions, the proposed model significantly outperforms individual baselines, achieving R2 scores between 0.9735 and 0.9905 across major financial indices. This research demonstrates the efficacy of heterogeneous ensemble learning in navigating market complexities, offering a powerful tool for enhanced financial decision-making. View this paper
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18 pages, 822 KB  
Article
Evaluating Green Finance: Investment Patterns and Environmental Outcomes
by Lala Rukh, Shakir Ullah, Ijaz Sanober, Umar Hayat and Sangeen Khan
Int. J. Financial Stud. 2025, 13(4), 245; https://doi.org/10.3390/ijfs13040245 - 18 Dec 2025
Abstract
This study aims to investigate the impact of green finance on corporate sector investments and their associated environmental outcomes. The authors collected cross-sectional survey data with a sample of four hundred firms selected from the five green-relevant industries in an emerging economy. The [...] Read more.
This study aims to investigate the impact of green finance on corporate sector investments and their associated environmental outcomes. The authors collected cross-sectional survey data with a sample of four hundred firms selected from the five green-relevant industries in an emerging economy. The results indicate that, over the last three years, seventy percent of firms have accessed at least one green instrument. Overall, the firms under study indicate that PKR 3.4 million is being allocated to green finance, and PKR 2.7 million is spent on CAPEX. However, each million PKR is associated with a ten percent capital expenditure, which exhibits the highest adoption of the renewable energy sector, while the manufacturing sector has the lowest adoption. Regression results depict that Greenhouse gas reduction is only achievable if expenditure on R&D is ensured for environmental gains. This study indicates a declining incremental impact when green finance exceeds PKR 5.00 million, suggesting that firms’ limitations in utilizing the additional amount may be a factor. Financially constrained firms achieve stronger environmental goals, confirming that strict criteria to finance projects show more responsibility and discipline in executing projects. However, small- and medium-sized firms are confronted with barriers, such as lack of information and transaction costs. The findings of this study highlight the need for a multi-layered regulatory framework, innovation-driven incentives, and fintech integration to fully realize the potential of green finance. The outcome enables financial institutions, sustainability practitioners, and regulators to connect financial markets, national climate, and development goals. Full article
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22 pages, 592 KB  
Article
Does the Change in Financial Statement Format Influence Stock Price Crash Risk?
by Qinqin Wu, Manjing Xiao, Wenli Zuo, Lingling Dai and Ping Cheng
Int. J. Financial Stud. 2025, 13(4), 244; https://doi.org/10.3390/ijfs13040244 - 17 Dec 2025
Viewed by 75
Abstract
By employing the 2017 reform of China’s financial statement presentation as an exogenous shock, we evaluate how the change shapes the likelihood of stock price crashes. Our analysis indicates that firms affected by the reform exhibit notably higher crash risk after the new [...] Read more.
By employing the 2017 reform of China’s financial statement presentation as an exogenous shock, we evaluate how the change shapes the likelihood of stock price crashes. Our analysis indicates that firms affected by the reform exhibit notably higher crash risk after the new reporting format is adopted, and this finding remains consistent across multiple robustness checks. The increase in crash risk can be largely attributed to managerial incentives to manage earnings by reclassifying held-for-sale assets and other special items. Moreover, the reform exerts a stronger effect on firms that exhibit poor information transparency and receive little oversight from internal and external monitors. Full article
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21 pages, 1304 KB  
Article
An Automated Machine Learning Framework for Interpretable Customer Segmentation in Financial Services
by Iveta Grigorova, Aleksandar Efremov and Aleksandar Karamfilov
Int. J. Financial Stud. 2025, 13(4), 243; https://doi.org/10.3390/ijfs13040243 - 17 Dec 2025
Viewed by 219
Abstract
Customer segmentation is essential in financial services for designing targeted interventions, managing dormant portfolios, and supporting marketing re-engagement strategies. Traditional approaches such as Recency–Frequency–Monetary (RFM) analysis offer interpretability but often lack the flexibility needed to capture heterogeneous behavioral patterns. This study presents an [...] Read more.
Customer segmentation is essential in financial services for designing targeted interventions, managing dormant portfolios, and supporting marketing re-engagement strategies. Traditional approaches such as Recency–Frequency–Monetary (RFM) analysis offer interpretability but often lack the flexibility needed to capture heterogeneous behavioral patterns. This study presents an automated segmentation framework that integrates machine learning-based clustering with RFM-based interpretability benchmarks. KMeans and Hierarchical clustering are evaluated across multiple values of k using internal validity metrics (Silhouette Coefficient, Davies–Bouldin Index) and interpretability alignment measures (Adjusted Rand Index, Normalized Mutual Information, Homogeneity, Completeness, and V-Measure). The Hungarian algorithm is used to align machine-learned clusters with RFM segments for comparability. The framework reveals behavioral subgroups not captured by RFM alone, demonstrating that machine learning can expose hidden heterogeneity within dormant customer populations. While outcome-based financial validation is not yet feasible due to the cold-start nature of the deployment environment, the study provides a reproducible, scalable pipeline for segmentation that balances analytical rigor with business interpretability. The findings highlight how data-driven clustering can refine traditional segmentation logic, supporting more nuanced portfolio monitoring and re-engagement strategies in financial services. Full article
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23 pages, 1608 KB  
Article
Cross-Market Risk Spillovers and Tail Dependence Between U.S. and Chinese Technology-Related Equity Markets
by Xinmiao Zhou and Huihong Liu
Int. J. Financial Stud. 2025, 13(4), 242; https://doi.org/10.3390/ijfs13040242 - 17 Dec 2025
Viewed by 96
Abstract
This study investigates risk contagion and dependence structures between U.S. and Chinese technology-related stock markets, focusing on the electronics and semiconductor sectors. We employ DCC-GARCH models to capture time-varying correlations and copula models to analyze nonlinear and tail dependencies. To highlight extreme risk [...] Read more.
This study investigates risk contagion and dependence structures between U.S. and Chinese technology-related stock markets, focusing on the electronics and semiconductor sectors. We employ DCC-GARCH models to capture time-varying correlations and copula models to analyze nonlinear and tail dependencies. To highlight extreme risk dynamics, we extend the analysis to Value-at-Risk (VaR) series derived from a GARCH(1,1)-Skewed-t model. Empirical results reveal three major findings. First, volatility clustering and negative skewness are evident across markets, with extreme downside risks concentrated during the 2015 Chinese stock market crash and the 2020 COVID-19 pandemic. Second, copula results show stronger upper-tail dependence in cross-border broad markets and more symmetric dependence within domestic Chinese markets, while U.S. sectoral linkages exhibit the highest vulnerability during downturns. Third, dynamic copula analysis indicates that downside contagion is episodic and crisis-driven, whereas rebound co-movements are structurally persistent. These findings contribute to understanding systemic vulnerability in global technology markets. They provide insights for investors, regulators, and policymakers on monitoring cross-market contagion and managing systemic risk under stress scenarios. Full article
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17 pages, 308 KB  
Article
Assessing the Impact of Digital Transformation on Manufacturing Enterprises’ Performances: An Efficiency Perspective
by Chenxi Wang, Jing Yang, Yan Lin and Biao Xue
Int. J. Financial Stud. 2025, 13(4), 241; https://doi.org/10.3390/ijfs13040241 - 16 Dec 2025
Viewed by 147
Abstract
In recent years, the impacts of the new scientific and technological revolution on the industrial system and production modes have begun to emerge. Digital transformation is gradually being integrated into the production behaviors of manufacturing enterprises and has become a component of the [...] Read more.
In recent years, the impacts of the new scientific and technological revolution on the industrial system and production modes have begun to emerge. Digital transformation is gradually being integrated into the production behaviors of manufacturing enterprises and has become a component of the micro-economy. We aim to find better methods for measuring digital transformation and to analyze its impact on both market performance and innovation performance within manufacturing enterprises. To achieve our goals, we employ an empirical study to examine the influence of digital transformation on market and innovation performance using panel data for Chinese listed manufacturing enterprises from 2012 to 2021. We emphasize digital transformation efficiency and affirm its role in relieving financing constraints. Our study shows that digital transformation effectively improves both the market and innovation performance of manufacturing enterprises. Moreover, it mitigates the financing constraint dilemma, resulting in performance enhancement. Heterogeneity analysis indicates that digital transformation has a more significant promotional effect on the market and innovation performance of large-scale and mature enterprises. Our research offers fresh perspectives for better understanding digital transformation, enriching the body of work on the impact of digital transformation in manufacturing enterprises and its underlying mechanisms. Full article
(This article belongs to the Special Issue Financial System in the Digital Age: Opportunities, Challenges and Future Directions)
19 pages, 1105 KB  
Article
Financial Traits and Convertible Bond Motives: China’s Evidence
by Jiaqi Chen, Xiuwen Lu and Xiongzhi Wang
Int. J. Financial Stud. 2025, 13(4), 240; https://doi.org/10.3390/ijfs13040240 - 16 Dec 2025
Viewed by 139
Abstract
Convertible bond financing has gained significant traction in China’s capital market, yet it poses financial risks, particularly for highly leveraged firms. This study investigates how corporate financial traits influence the decision to issue convertible bonds, challenging the direct applicability of Western theoretical frameworks [...] Read more.
Convertible bond financing has gained significant traction in China’s capital market, yet it poses financial risks, particularly for highly leveraged firms. This study investigates how corporate financial traits influence the decision to issue convertible bonds, challenging the direct applicability of Western theoretical frameworks in China’s unique institutional context. We employ a natural experiment design, constructing a binary logistic regression model to analyze data from Chinese A-share listed companies that issued convertible bonds, corporate bonds, seasoned equity offerings, or rights offerings between 2022 and 2023. Our results reveal a paradox: contrary to risk-transfer theory, firms with lower leverage exhibit a stronger propensity to issue convertible bonds. Instead, motives are driven by high profitability, operational inefficiencies, and robust operating cash flow generation—traits that align with signaling and backdoor equity theories. The study identifies China’s convertible bond market as a dual-track system where regulatory screening distorts classical motives while market frictions amplify the role of convertible bonds in resolving information asymmetry. We conclude with targeted policy implications for regulators and corporate treasurers to enhance market efficiency and governance. Full article
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22 pages, 631 KB  
Article
Executive Pay-Rank Inversion and M&A Decisions: Evidence from Chinese State-Owned Enterprises
by Shaoni Zhou, Qiyue Du and Zhitian Zhou
Int. J. Financial Stud. 2025, 13(4), 239; https://doi.org/10.3390/ijfs13040239 - 15 Dec 2025
Viewed by 247
Abstract
In typical executive compensation structures, higher corporate ranks are associated with greater pay. However, the reform of state-owned enterprises (SOEs) in China introduced strict salary caps for top executives, while lower-tier managers continued to receive market-based compensation, resulting in a phenomenon of pay-rank [...] Read more.
In typical executive compensation structures, higher corporate ranks are associated with greater pay. However, the reform of state-owned enterprises (SOEs) in China introduced strict salary caps for top executives, while lower-tier managers continued to receive market-based compensation, resulting in a phenomenon of pay-rank inversion—where subordinates earn more than their superiors. Leveraging this anomaly as a quasi-natural experiment, this study investigates the specific impact and underlying mechanism of pay-rank inversion on mergers and acquisitions (M&A) decisions and subsequent value realization within Chinese SOEs, thereby addressing the broad academic discourse on optimal executive compensation design. Employing a difference-in-differences (DID) approach with panel data spanning from 2007 to 2022, our analysis reveals that pay-rank inversion significantly reduces firms’ M&A intentions. Mechanistic analysis suggests that this negative effect arises primarily from diminished executive risk-taking. Furthermore, we find that the adverse impact is attenuated when CEOs possess longer tenures or receive equity-based incentives, but it ultimately undermines the realization of value post-M&A. These findings highlight the unintended consequences of high-level compensation reforms and emphasize the critical role of a well-structured pay hierarchy in sustaining executive incentives for strategic decision-making. Despite providing robust evidence, this study is subject to limitations, including its focus on measuring inversion only between the first and second management tiers. Future research should extend the analysis to the pay inversion between the listed firm and its controlling SOE group and explore alternative causal pathways beyond risk-taking, such as CEO work motivation, to deepen the understanding of high-level executive behavior. Full article
(This article belongs to the Special Issue Emerging Trends in Corporate Finance: ESG, Climate Risk, and Other Contemporary Issues)
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18 pages, 406 KB  
Article
Leverage or Bias? The Debt Behavior of High-Income Consumers
by Sergio Da Silva, Ana Luize Bertoncini, Marianne Zwilling Stampe and Raul Matsushita
Int. J. Financial Stud. 2025, 13(4), 238; https://doi.org/10.3390/ijfs13040238 - 11 Dec 2025
Viewed by 209
Abstract
This paper asks whether debt among affluent consumers reflects rational leverage, comparable to firms, or the influence of cognitive biases. Using survey data on Brazilian bank clients, we combine logistic regressions with a finite-mixture-inspired, rule-based classification and a test based on a ten-business-day [...] Read more.
This paper asks whether debt among affluent consumers reflects rational leverage, comparable to firms, or the influence of cognitive biases. Using survey data on Brazilian bank clients, we combine logistic regressions with a finite-mixture-inspired, rule-based classification and a test based on a ten-business-day overdraft grace period to identify heterogeneity in borrowing behavior. In the high-income subsample, Cognitive Reflection Test scores are unrelated to debt incidence, diverging from prior evidence in mixed-income populations. Among indebted affluent respondents, most borrowing is cost-sensitive and consistent with deliberate leverage (about 80 percent), while a minority displays patterns consistent with optimism bias and overconfidence (about 20 percent). The institutional feature of a temporary grace period lowers the effective cost of short-term credit and is associated with a marked reduction in overdraft use, reinforcing the leverage interpretation. Overall, consumer debt is heterogeneous; for the affluent, it largely aligns with leverage, though behavioral biases persist at the margins. Policy for high-income borrowers should prioritize targeted measures that address optimism bias and overconfidence while preserving deliberate leverage management through clear disclosures and monitoring of sensitivity to short-term credit costs. Full article
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22 pages, 831 KB  
Article
Promoting Financial Inclusion by Optimising Financial Interest Rates Based on Artificial Intelligence in Microfinance Institutions
by Ana Martín-Schubert, Juan Lara-Rubio and Andrés Navarro-Galera
Int. J. Financial Stud. 2025, 13(4), 237; https://doi.org/10.3390/ijfs13040237 - 10 Dec 2025
Viewed by 265
Abstract
In recent years, the financial sustainability and survival of microfinance institutions (MFIs) have been seriously threatened by factors such as the reduction in donations, cooperation funds and international aid, and increased competition from commercial banks. Faced with this hostile scenario, which may limit [...] Read more.
In recent years, the financial sustainability and survival of microfinance institutions (MFIs) have been seriously threatened by factors such as the reduction in donations, cooperation funds and international aid, and increased competition from commercial banks. Faced with this hostile scenario, which may limit access to credit for disadvantaged groups, MFIs must apply techniques to improve their efficiency, viability, lending capacity and survival. The objective of this study is to design a microcredit pricing model based on the Internal Ratings-Based approach, Basel III and probability of default to enhance access to credit for disadvantaged groups. We analysed a sample of 4550 microcredit transactions and 30 influential variables (25 idiosyncratic and 5 systemic). Our empirical results reveal that the IRB system is more equitable for borrowers and more efficient for MFIs, as it allows lower interest rates to be applied to borrowers with better credit histories. The application of the proposed IRB model can improve the sustainability, competitiveness and viability of MFIs by promoting operational efficiency and reducing default rates, thus contributing to financial inclusion by increasing supply. Full article
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31 pages, 492 KB  
Article
Corporate Income Tax Differential and Subsidiaries’ Profitability in Morocco: Profit-Shifting Evidence from a Pseudo-Ordinary Least Squares Framework
by Mohamed Rachidi and Abdeslam El Moudden
Int. J. Financial Stud. 2025, 13(4), 236; https://doi.org/10.3390/ijfs13040236 - 10 Dec 2025
Viewed by 288
Abstract
This study provides empirical evidence of tax-induced profit-shifting by multinational corporations (MNCs) operating in Morocco, an underexplored developing country context characterized by notable tax arbitrage potential. Using a micro-level panel dataset of foreign-owned subsidiaries from 2014 to 2023, we employ a pseudo-ordinary least [...] Read more.
This study provides empirical evidence of tax-induced profit-shifting by multinational corporations (MNCs) operating in Morocco, an underexplored developing country context characterized by notable tax arbitrage potential. Using a micro-level panel dataset of foreign-owned subsidiaries from 2014 to 2023, we employ a pseudo-ordinary least squares (POLS) framework to examine how corporate income tax (CIT) differentials affect subsidiaries’ earnings before interest and taxes (EBIT). The results indicate that higher CIT differentials significantly reduce reported profits, supporting the indirect evidence on corporate profit-shifting behaviour. Our findings also document that the effect of the CIT differential on EBIT is moderated by firm capitalization. However, contrary to investment distortion theory, subsidiaries do not reduce investment in response to higher effective capital costs. This study also assesses the impact of Morocco’s implementation of BEPS, the COVID-19 shock, and institutional quality indicators on subsidiaries’ reported EBIT. The findings highlight the strategic role of capital structure and governance in shaping MNCs’ tax-motivated behaviour. This study contributes to the literature on international taxation and corporate finance and offers important policy implications for developing economies seeking to balance revenue integrity, investment incentives, and robust anti-avoidance enforcement. Full article
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17 pages, 314 KB  
Article
CSR and Stock Price Crash Risk: Does the Firm Life Cycle Matter? An Emerging Economy Perspective
by Muhammad Zahid Iqbal, Sadia Ashraf, Abaid Ullah, Syed Sikander Ali Shah and Tamas-Szora Attila
Int. J. Financial Stud. 2025, 13(4), 235; https://doi.org/10.3390/ijfs13040235 - 9 Dec 2025
Viewed by 335
Abstract
Corporate social responsibility (CSR) plays a growing role in fostering transparency, stakeholder trust, and long-term firm sustainability, particularly in emerging markets. Firms that actively engage in CSR are more likely to disclose credible financial information, which can reduce the incentive to withhold adverse [...] Read more.
Corporate social responsibility (CSR) plays a growing role in fostering transparency, stakeholder trust, and long-term firm sustainability, particularly in emerging markets. Firms that actively engage in CSR are more likely to disclose credible financial information, which can reduce the incentive to withhold adverse news and thereby limit stock price crash risk (SPCR). This study investigates the impact of CSR on SPCR, while also examining whether this relationship varies across different stages of the firm life cycle (FLC). The analysis is based on an unbalanced panel of listed non-financial firms from the Pakistan Stock Exchange (PSX), covering the period from 2009 to 2023. Financial data were obtained from the State Bank of Pakistan (SBP) and Securities and Exchange Commission of Pakistan (SECP), while market data were collected from the PSX. Employing fixed-effects robust regression models and two crash risk proxies, negative conditional skewness (NCSKEW) and down-to-up volatility (DUVOL), the results reveal a consistent and significant negative association between CSR and SPCR. This suggests that firms with stronger CSR engagement are less prone to extreme negative stock returns. However, the moderating effect of FLC is only evident at the introduction and decline stages, indicating that the effectiveness of CSR in reducing crash risk depends on a firm’s position in its organizational life cycle. These findings contribute to the literature on CSR and financial stability in emerging markets and offer practical implications for investors, managers, and policymakers seeking to promote risk-aware, socially responsible corporate strategies. Full article
36 pages, 457 KB  
Article
From ESG to Financial Stability: Unpacking the Multi-Dimensional Impact of AI-Driven FinTech-Related Technology Adoption on Bank Performance
by Amina Hamdouni
Int. J. Financial Stud. 2025, 13(4), 234; https://doi.org/10.3390/ijfs13040234 - 8 Dec 2025
Viewed by 589
Abstract
This study examines the association between Saudi banks’ internal adoption of AI-enabled FinTech-related digital tools and their financial performance, sustainability performance, and financial stability over the period 2015–2024. Using a panel dataset of 10 banks, the analysis investigates how the adoption of AI-driven [...] Read more.
This study examines the association between Saudi banks’ internal adoption of AI-enabled FinTech-related digital tools and their financial performance, sustainability performance, and financial stability over the period 2015–2024. Using a panel dataset of 10 banks, the analysis investigates how the adoption of AI-driven technologies—such as machine-learning credit assessment, robo-advisory systems, and automated compliance tools—is related to market performance (Tobin’s Q), accounting performance (ROA and ROE), financial stability (Z-Score), and sustainability outcomes measured by both Bloomberg ESG Disclosure Score and the LSEG ESG performance-oriented score. To ensure robust inference and reduce simultaneity concerns, the empirical strategy employs Pooled OLS and Fixed Effects Models with Driscoll–Kraay standard errors, as well as a dynamic Fixed Effects Models incorporating lagged dependent variables, lagged independent variables, and shock-interaction terms. Bank-specific characteristics—including size, age, leverage, liquidity, loan-to-deposit ratio, non-performing loans, net interest margin, market capitalization, and board size—are included as controls. The findings indicate a positive and statistically significant relationship between banks’ internal adoption of AI-enabled digital/FinTech-related technologies and their financial performance, sustainability performance, and financial stability. These relationships remain robust across estimation approaches, providing insights for policymakers, regulators, and bank managers seeking to advance digital transformation while safeguarding financial soundness and supporting sustainable development in the Saudi banking sector. Full article
(This article belongs to the Special Issue Artificial Intelligence in Banking and Insurance)
32 pages, 1955 KB  
Review
Sustainable Finance, Green Bonds and Financial Performance—A Literature Review
by Roberto Rodrigues Loiola, Herbert Kimura and Ludmila de Melo Souza
Int. J. Financial Stud. 2025, 13(4), 233; https://doi.org/10.3390/ijfs13040233 - 4 Dec 2025
Viewed by 1066
Abstract
The growing relevance of sustainable finance has positioned green bonds as central instruments in debates on how capital markets can contribute to climate transition while creating value for firms. This article conducts a literature review to examine the relationship between green bond issuance, [...] Read more.
The growing relevance of sustainable finance has positioned green bonds as central instruments in debates on how capital markets can contribute to climate transition while creating value for firms. This article conducts a literature review to examine the relationship between green bond issuance, corporate financial performance, and the cost of debt. Using the PRISMA 2020 protocol, 59 articles published between 2019 and 2025 were identified and classified according to study type, methodological approach, analytical technique, sectoral and geographic focus, and performance indicators. A bibliometric analysis was also performed to map publication trends, research clusters, and thematic evolution. The results indicate a fragmented but expanding field, with most studies concentrated in developed markets, especially Europe, the United States, and China, and limited evidence from emerging economies. Empirical findings converge on modest but heterogeneous financial benefits, frequently reflected in the so-called “Greenium,” typically ranging between 1 and 63 basis points. Accounting-based effects on profitability (ROA, ROE) remain mixed, while econometric/regression, panel analysis and event studies dominate the empirical landscape. The paper’s incremental contribution lies in consolidating these quantitative insights into a reproducible classification framework that enables systematic comparison between developed and emerging markets, supporting future research on long-term financial and sustainability outcomes. Full article
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19 pages, 484 KB  
Article
The Impact of Social Trust on the Development of Digital Finance
by Fan Zeng and Benyong Hu
Int. J. Financial Stud. 2025, 13(4), 232; https://doi.org/10.3390/ijfs13040232 - 4 Dec 2025
Viewed by 357
Abstract
Social trust is a fundamental element in the evolution of digital finance, significantly influencing its development. This study presents an innovative exploration of the role and internal mechanisms of social trust in digital finance, utilizing using provincial panel data from 27 provinces in [...] Read more.
Social trust is a fundamental element in the evolution of digital finance, significantly influencing its development. This study presents an innovative exploration of the role and internal mechanisms of social trust in digital finance, utilizing using provincial panel data from 27 provinces in China spanning the period from 2012 to 2021. By focusing on trust as a core element, the study enriches the research framework on digital finance development, revealing that beyond traditional factors such as technology and the economy, social and psychological factors also affect digital finance growth. These findings provide new perspectives on understanding digital finance development. The study elucidates the complex substitution and interdependence between formal and informal institutions, offering valuable insights for optimizing institutional frameworks to promote digital finance. It also uncovers significant regional heterogeneity in the influence of social trust on digital finance, and social trust primarily enhances the depth and digitization of digital finance, while its effect on the breadth of digital finance is statistically insignificant. These insights serve as a valuable reference for policymakers aiming to ensure the sustainable expansion of the digital finance sector. Full article
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25 pages, 492 KB  
Article
The Influence of Investor Sentiment on the South African Property Market: A Comparative Assessment of JSE Indices
by Charlize Nel, Fabian Moodley and Sune Ferreira-Schenk
Int. J. Financial Stud. 2025, 13(4), 231; https://doi.org/10.3390/ijfs13040231 - 3 Dec 2025
Viewed by 238
Abstract
Investor sentiment has increasingly been recognized as a behavioural factor influencing asset prices beyond traditional rational asset pricing models, yet evidence from South Africa’s property remains limited. This study investigates the short-run and long-run relationship between investor sentiment and FTSE/JSE-listed property indices, to [...] Read more.
Investor sentiment has increasingly been recognized as a behavioural factor influencing asset prices beyond traditional rational asset pricing models, yet evidence from South Africa’s property remains limited. This study investigates the short-run and long-run relationship between investor sentiment and FTSE/JSE-listed property indices, to determine the influence of sentiment on property index pricing within the South African context. Using monthly data for selected JSE/FTSE property indices, a composite investor sentiment index was constructed through a principal component analysis (PCA) of multiple market-based sentiment proxies. Consequently, a Vector Error Correction Model (VECM) was estimated to examine both the long-run and short-run relationships, integrated with the VEC Granger causality tests to determine the direction of influence between variables. The findings report a novel relationship between investor sentiment and the FTSE/JSE property indices, as they provide new insights at the disaggregated level, which is overlooked in the literature. In the short run, the findings suggest that market psychology drives short-term property price adjustments. Moreover, in the long run, the relationship remains significant, indicating that this effect persists, underscoring the enduring influence of sentiment on market valuation. Additionally, the Granger causality results indicate uni-directional relationships, where investor sentiment drives listed property pricing and macroeconomic variables, reinforcing its predictive role. The study concludes that investor sentiment is a key determinant of South Africa’s listed property market, consistent with the rationale of behavioural finance theory, and underscores that investment decisions within this market are substantially influenced by investor psychology, contributing to property market volatility. Full article
(This article belongs to the Special Issue Advances in Behavioural Finance and Economics 2nd Edition)
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20 pages, 333 KB  
Article
ESG Ratings and Financial Performance: An Empirical Analysis
by Guido Abate, Ignazio Basile and Pierpaolo Ferrari
Int. J. Financial Stud. 2025, 13(4), 230; https://doi.org/10.3390/ijfs13040230 - 3 Dec 2025
Viewed by 650
Abstract
In light of the growing interest in sustainable finance among investors and academics, in this study, we present an empirical analysis designed to understand whether sustainable investments outperform, underperform, or perform neutrally relative to conventional investments. The literature presents a spectrum of often-opposed [...] Read more.
In light of the growing interest in sustainable finance among investors and academics, in this study, we present an empirical analysis designed to understand whether sustainable investments outperform, underperform, or perform neutrally relative to conventional investments. The literature presents a spectrum of often-opposed conclusions, precluding the establishment of a definitive, consensus-driven judgment. Therefore, our analysis examines the behavior of sustainable investments within the Eurozone equity market from January 2019 to December 2023. Twenty portfolios are constructed to simulate sustainable investment strategies differentiated by environmental, social, and governance (ESG) strategy; stock inclusion/exclusion thresholds; and the type of ESG rating employed in the selection process. The analysis reveals that sustainable investments do not statistically significantly outperform or underperform traditional investments. This finding is significant for investors committed to ESG principles, as it suggests that they can align their investment choices with their ethical convictions without sacrificing performance. Full article
33 pages, 552 KB  
Article
Data Asset Disclosure and Stock Price Crash Risk: A Double Machine Learning Study of Chinese A Share Firms
by Junzuo Zhou, Zhaoyang Zhu, Huimeng Wang, Yuki Gong, Yuge Zhang and Frank Li
Int. J. Financial Stud. 2025, 13(4), 229; https://doi.org/10.3390/ijfs13040229 - 2 Dec 2025
Viewed by 670
Abstract
In the digital economy, data assets have become key drivers of firm competitiveness and market stability. This study examines the association between data asset information disclosure and stock price crash risk. Using annual reports of Chinese A-share listed firms from 2010 to 2023, [...] Read more.
In the digital economy, data assets have become key drivers of firm competitiveness and market stability. This study examines the association between data asset information disclosure and stock price crash risk. Using annual reports of Chinese A-share listed firms from 2010 to 2023, we construct a Data Asset Information Disclosure Index through textual analysis. A double machine learning framework is employed to flexibly control for high-dimensional confounders, and the results indicate that greater disclosure is associated with lower crash risk across multiple specifications. Generalized random forest analysis further highlights heterogeneous relationships, with disclosures on both internally used and transactional data assets showing stronger negative associations with crash risk. Mechanism evidence suggests that disclosure may facilitate information dissemination, strengthen investor confidence, and improve analyst forecast accuracy. The association is more pronounced in firms with weaker corporate governance, higher reporting transparency, more competitive industries, and in regions with less developed digital economies. An industry spillover pattern is also observed, whereby one firm’s disclosure is linked to reduced crash risk among peers. Overall, this study contributes to the literature on data asset disclosure and corporate risk management by providing empirical evidence from a major emerging market and by highlighting the potential relevance of enhanced transparency for digital governance and capital market resilience. Full article
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39 pages, 3352 KB  
Article
Mapping Financial Contagion in Emerging Markets: The Role of the VIX and Geopolitical Risk in BRICS Plus Spillovers
by Chourouk Kasraoui, Naif Alsagr, Ahmed Jeribi and Sahbi Farhani
Int. J. Financial Stud. 2025, 13(4), 228; https://doi.org/10.3390/ijfs13040228 - 2 Dec 2025
Viewed by 575
Abstract
Using a time-frequency and quantile connectedness approach, our study examines the complex return spillovers dynamics between BRICS Plus stock markets, the volatility index (VIX), and the global geopolitical risk index (GPRD). By employing advanced models such as TVP-VAR, quantile connectedness, and spectral decomposition, [...] Read more.
Using a time-frequency and quantile connectedness approach, our study examines the complex return spillovers dynamics between BRICS Plus stock markets, the volatility index (VIX), and the global geopolitical risk index (GPRD). By employing advanced models such as TVP-VAR, quantile connectedness, and spectral decomposition, we demonstrate how these markets interact across different market conditions and periods. Our results indicate that the VIX consistently acts as the dominant net transmitter of shocks, especially during periods of heightened uncertainty such as the COVID-19 pandemic, the Russian-Ukraine conflict, and the Trump-era U.S.-China trade tensions. In contrast, the GPRD functions predominantly as a net receiver of shocks, indicating its potential role as a hedge during geopolitical crises. BRICS Plus markets exhibit heterogeneous behavior: Brazil, South Africa, and Russia frequently emerge as net transmitters, while China, India, Egypt, Saudi Arabia, and the UAE primarily act as net receivers. Spillovers are strongest at the extremes of the return distribution and are mainly driven by short-term dynamics, underscoring the importance of high-frequency reactions over persistent long-term effects. These findings highlight the asymmetric, nonlinear, and state-dependent nature of global financial contagion, offering important insights for risk management, asset allocation, and macroprudential policy design in emerging market contexts. Full article
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35 pages, 4264 KB  
Article
Smart Tangency Portfolio: Deep Reinforcement Learning for Dynamic Rebalancing and Risk–Return Trade-Off
by Jiayang Yu and Kuo-Chu Chang
Int. J. Financial Stud. 2025, 13(4), 227; https://doi.org/10.3390/ijfs13040227 - 2 Dec 2025
Viewed by 659
Abstract
This paper proposes a dynamic portfolio allocation framework that integrates deep reinforcement learning (DRL) with classical portfolio optimization to enhance rebalancing strategies and risk–return management. Within a unified reinforcement-learning environment for portfolio reallocation, we train actor–critic agents (Proximal Policy Optimization (PPO) and Advantage [...] Read more.
This paper proposes a dynamic portfolio allocation framework that integrates deep reinforcement learning (DRL) with classical portfolio optimization to enhance rebalancing strategies and risk–return management. Within a unified reinforcement-learning environment for portfolio reallocation, we train actor–critic agents (Proximal Policy Optimization (PPO) and Advantage Actor–Critic (A2C)). These agents learn to select both the risk-aversion level—positioning the portfolio along the efficient frontier defined by expected return and a chosen risk measure (variance, Semivariance, or CVaR)—and the rebalancing horizon. An ensemble procedure, which selects the most effective agent–utility combination based on the Sharpe ratio, provides additional robustness. Unlike approaches that directly estimate portfolio weights, our framework retains the optimization structure while delegating the choice of risk level and rebalancing interval to the AI agent, thereby improving stability and incorporating a market-timing component. Empirical analysis on daily data for 12 U.S. sector ETFs (2003–2023) and 28 Dow Jones Industrial Average components (2005–2023) demonstrates that DRL-guided strategies consistently outperform static tangency portfolios and market benchmarks in annualized return, volatility, and Sharpe ratio. These findings underscore the potential of DRL-driven rebalancing for adaptive portfolio management. Full article
(This article belongs to the Special Issue Financial Markets: Risk Forecasting, Dynamic Models and Data Analysis)
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21 pages, 755 KB  
Article
The Moderating Role of FinTech in the Relationship Between Customer Satisfaction and Retention in the Banking Sector
by Mousa Ajouz, Maha Shehadeh, Sara Issa and Haya Nawawra
Int. J. Financial Stud. 2025, 13(4), 226; https://doi.org/10.3390/ijfs13040226 - 1 Dec 2025
Viewed by 410
Abstract
This study investigates the influence of banking service quality and customer trust on customer retention behavior, considering the mediating role of customer satisfaction and the moderating role of FinTech. In light of the growing digitalization in the banking sector, the study aims to [...] Read more.
This study investigates the influence of banking service quality and customer trust on customer retention behavior, considering the mediating role of customer satisfaction and the moderating role of FinTech. In light of the growing digitalization in the banking sector, the study aims to understand how these constructs interact to drive long-term customer loyalty. A quantitative research approach was adopted using data collected through a structured questionnaire administered to banking customers. The relationships among variables were examined using Partial Least Squares Structural Equation Modeling (PLS-SEM), assessing both direct and indirect effects. The results show that banking service quality and customer trust significantly enhance customer satisfaction, which in turn positively influences customer retention behavior. Moreover, satisfaction was found to mediate the relationships between both service quality and trust with retention. FinTech demonstrated a strong direct effect on retention and also significantly moderated the satisfaction–retention link, amplifying its impact when FinTech services are effectively utilized. This study contributes to the relationship marketing literature by introducing FinTech as a novel moderating variable in the satisfaction–retention framework. It offers practical insights for banks aiming to enhance retention by improving service quality, fostering trust, and leveraging digital technologies to strengthen customer relationships. Full article
(This article belongs to the Special Issue InsurTech and FinTech Innovations: Transforming Risk Management and Governance in the Digital Era)
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22 pages, 410 KB  
Article
The Impact of Tax Avoidance on Earnings Management: The Moderating Role of Board Governance Characteristics
by Abdullah Almulhim and Abdelmoneim Bahyeldin Mohamed Metwally
Int. J. Financial Stud. 2025, 13(4), 225; https://doi.org/10.3390/ijfs13040225 - 1 Dec 2025
Viewed by 501
Abstract
The study aims to investigate the impact of tax avoidance (TA) on earnings management practices (EM). The current research also investigates the moderating role of board governance characteristics on this relationship in the Egyptian context. The sample incorporates all the non-financial companies included [...] Read more.
The study aims to investigate the impact of tax avoidance (TA) on earnings management practices (EM). The current research also investigates the moderating role of board governance characteristics on this relationship in the Egyptian context. The sample incorporates all the non-financial companies included in the Egyptian Stock Exchange between 2017 and 2021. The final sample comprises 120 enterprises from 12 industries, with 600 observations. Statistical analysis employs fixed effects regression, pooled OLS, and GMM estimations to test the proposed hypotheses. We found a significant positive impact of TA on the level of EM. Further, board gender diversity (BGD) and board independence (BIND) were found to have a negative moderating impact as they alleviate the effect of TA on the level of EM. Finally, CEO duality (CEOD) was found to have no moderating impact. To the authors’ knowledge, this is the first study examining how board governance characteristics moderate and influence the level of EM in emerging markets. This adds new insights to the TA and EM literature, as previous research mainly focused on the direct effects of BGD, BIND, and CEOD on EM levels. The current study provides fresh evidence from an emerging market context. Full article
(This article belongs to the Special Issue Financial Reporting, Reputation, and Earnings Quality)
33 pages, 2738 KB  
Article
Quantile Connectedness Between Stock Market Development and Macroeconomic Factors for Emerging African Economies
by Maroua Ben Salem, Naif Alsagr, Samir Belkhaoui and Sahbi Farhani
Int. J. Financial Stud. 2025, 13(4), 224; https://doi.org/10.3390/ijfs13040224 - 1 Dec 2025
Viewed by 414
Abstract
This paper investigates the frequency dynamics of financial and macroeconomic connectedness by measuring tail-risk and uncertainty for two emerging African economies, namely Morocco and Tunisia, over the quarterly period Q2-2010 to Q4-2024. We employ a quantile connectedness approach, which, unlike traditional mean-based methods, [...] Read more.
This paper investigates the frequency dynamics of financial and macroeconomic connectedness by measuring tail-risk and uncertainty for two emerging African economies, namely Morocco and Tunisia, over the quarterly period Q2-2010 to Q4-2024. We employ a quantile connectedness approach, which, unlike traditional mean-based methods, leads to capturing asymmetries, tail-risk dependencies, and state-dependent spillovers, and to providing early warning signals of systemic stress and financial uncertainty. Our results reveal a stark divergence between the two stock markets in their roles in transmitting and absorbing shocks. The Moroccan stock market acts as a net transmitter, occasionally driving macroeconomic conditions and propagating uncertainty throughout the system. In contrast, the Tunisian stock market acts as a net receiver, with macroeconomic fundamentals, particularly GDP and money supply. These findings highlight how structural differences in emerging markets affect the transmission of shocks and offer actionable insights for policymakers, regulators, and investors to manage financial risks and uncertainty. Full article
(This article belongs to the Special Issue Risks and Uncertainties in Financial Markets)
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21 pages, 270 KB  
Article
The Independence–Tenure Tradeoff in the Boardroom: The Impact of Excess Board Tenure on Executive Compensation and Accountability
by Paweł Mielcarz and Dmytro Osiichuk
Int. J. Financial Stud. 2025, 13(4), 223; https://doi.org/10.3390/ijfs13040223 - 25 Nov 2025
Viewed by 487
Abstract
The goal of the study is to inquire into how longer tenure on the board may undermine directors’ independence and distort the efficiency of executive compensation mechanisms. Our empirical findings based on an international panel database and static panel regression modeling demonstrate that [...] Read more.
The goal of the study is to inquire into how longer tenure on the board may undermine directors’ independence and distort the efficiency of executive compensation mechanisms. Our empirical findings based on an international panel database and static panel regression modeling demonstrate that director tenure is positively associated with executive compensation with the effect being amplified by the degree of managerial capture of the board. Longer director tenure is also shown to reduce the sensitivity of executive compensation to negative earnings surprises while simultaneously contributing to the lower overall probability of management departures even in the event of a negative earnings surprise. Board independence is evidenced to play no significant role in intermediating the studied relationships. Overall, while postulating the existence of an independence–tenure tradeoff, the paper posits a need for revision of the currently applicable formal criteria of board independence in order for them to accommodate the possible impact of director tenure on the quality of corporate oversight. The present study extends upon the existing literature by expanding the geographical scale of the sample and focusing on indirect symptoms of reduced supervisory effectiveness of the boards. Full article
26 pages, 1097 KB  
Article
Exploring the Interplay of Life Attitude and Cognitive Ability in Shaping the Intention to Stock Market Participation Among Young Professionals in the Philippines
by Eugene Burgos Mutuc
Int. J. Financial Stud. 2025, 13(4), 222; https://doi.org/10.3390/ijfs13040222 - 25 Nov 2025
Viewed by 425
Abstract
The stability of life purpose and coherence as dimensions of life attitude shapes the cognitive structures underpinning financial decision-making. This study examines how cognitive ability mediates the effect of life attitude profile on the intention to stock-market participation of 195 randomly selected young [...] Read more.
The stability of life purpose and coherence as dimensions of life attitude shapes the cognitive structures underpinning financial decision-making. This study examines how cognitive ability mediates the effect of life attitude profile on the intention to stock-market participation of 195 randomly selected young professionals in the Philippines. This study adopted a quantitative, cross-sectional framework, employing Partial least squares–Structural Equation Modeling to evaluate both predictive and mediating influence. The findings revealed that individuals with stronger life purpose, greater goal-seeking tendencies, and an overall positive outlook toward life exhibit a higher propensity to participate in stock market investments. Cognitive ability, proxied by financial literacy, emerged as a crucial mechanism that reinforces this relationship—suggesting that psychological readiness alone is not sufficient unless complemented by the knowledge and capacity to make informed financial decisions. This study contributes to the intersection of psychology and finance by demonstrating that investment intentions are not solely products of rational calculation but are shaped by the individual’s sense of meaning, life orientation, and cognitive preparedness. Full article
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30 pages, 384 KB  
Article
Does ESG Performance Reduce Bankruptcy Risk?
by Bei Gao, Haodong Liu, Shenghui Tong and Yanbo Jin
Int. J. Financial Stud. 2025, 13(4), 221; https://doi.org/10.3390/ijfs13040221 - 21 Nov 2025
Viewed by 739
Abstract
This study examines how environmental, social, and governance (ESG) performance affects firms’ bankruptcy risk and explores the mechanisms linking ESG engagement to financial stability. Using a panel dataset of Chinese-listed firms from 2009 to 2022, we employ multivariate regression analyses, instrumental variable estimation, [...] Read more.
This study examines how environmental, social, and governance (ESG) performance affects firms’ bankruptcy risk and explores the mechanisms linking ESG engagement to financial stability. Using a panel dataset of Chinese-listed firms from 2009 to 2022, we employ multivariate regression analyses, instrumental variable estimation, and robustness tests to address potential endogeneity. The results indicate that higher ESG performance significantly reduces bankruptcy risk. Mechanism analyses reveal that ESG engagement lowers bankruptcy risk by improving information transparency, alleviating financing constraints, enhancing operating performance, and reducing leverage. The effect is more pronounced for non-state-owned enterprises, firms in economically developed regions, highly competitive industries, and those in the growth and maturity stages. Among the three ESG pillars, corporate governance exerts the strongest influence on mitigating bankruptcy risk. These findings provide new evidence from an emerging market and offer important implications for sustainable corporate finance and risk management. Full article
12 pages, 484 KB  
Article
Quantum Blockchain: A Theoretical Framework and Applications in Cryptocurrency
by Yosef Bonaparte
Int. J. Financial Stud. 2025, 13(4), 220; https://doi.org/10.3390/ijfs13040220 - 20 Nov 2025
Viewed by 875
Abstract
Blockchain technology has emerged as the backbone of cryptocurrencies and decentralized finance, yet its long-term resilience is increasingly threatened by advances in quantum computing. Quantum algorithms, such as Shor’s algorithm, can undermine public-key cryptography, while Grover’s algorithm accelerates brute-force search, weakening proof-of-work schemes. [...] Read more.
Blockchain technology has emerged as the backbone of cryptocurrencies and decentralized finance, yet its long-term resilience is increasingly threatened by advances in quantum computing. Quantum algorithms, such as Shor’s algorithm, can undermine public-key cryptography, while Grover’s algorithm accelerates brute-force search, weakening proof-of-work schemes. In this paper, we propose a Quantum Blockchain Framework that integrates quantum communication protocols, quantum consensus mechanisms, and quantum-resistant cryptography. We construct a theoretical model of quantum-secured distributed ledgers, where qubits, entanglement, and quantum key distribution (QKD) enhance security and efficiency. Applications to cryptocurrency are explored, highlighting how quantum blockchain can mitigate security risks, improve consensus speed, and enable quantum-native digital assets. Full article
(This article belongs to the Special Issue Cryptocurrency and Blockchain: Opportunities and Challenges for Financial Systems)
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27 pages, 702 KB  
Article
Exploring the Psychological Drivers of Cryptocurrency Investment Biases: Evidence from Indian Retail Investors
by Manabhanjan Sahu, Furquan Uddin and Md Billal Hossain
Int. J. Financial Stud. 2025, 13(4), 219; https://doi.org/10.3390/ijfs13040219 - 18 Nov 2025
Viewed by 1411
Abstract
Cryptocurrency investment in India has quickly become a mainstream financial activity, but it is still highly prone to psychological factors that impact the decision-making of retail investors. This study examines the effect of personality traits on cryptocurrency investment behavior using the mediating variable [...] Read more.
Cryptocurrency investment in India has quickly become a mainstream financial activity, but it is still highly prone to psychological factors that impact the decision-making of retail investors. This study examines the effect of personality traits on cryptocurrency investment behavior using the mediating variable of behavioral biases. Based on the Big Five Personality Model and the theory of Behavioral Finance, data were gathered from 716 Indian retail investors using a structured questionnaire. Partial Least Squares Structural Equation Modeling (PLS-SEM) was conducted to analyze the relationships among the variables. Results show that Openness to experience and Agreeableness significantly predict Availability Bias, whereas Extraversion and Agreeableness affect the Disposition Effect. The theoretical framework shows how bias-driven investment behavior in volatile markets such as cryptocurrency is triggered by personality-based predispositions. The study adds to the behavioral finance literature by taking psychological profiling outside the realms of traditional investment contexts into digital asset investing and provides practical insights for regulators, fintech platforms, and investment advisors to design interventions to mitigate bias and enhance investor education. Full article
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27 pages, 3836 KB  
Article
Tail Risk Spillovers Between FinTech and Sustainability Sectors: Evidence from China Using Factor-Purged Quantile Connectedness
by Ke Peng, Muhammad Munir, Jifan Ren and Mariem Mejri
Int. J. Financial Stud. 2025, 13(4), 218; https://doi.org/10.3390/ijfs13040218 - 18 Nov 2025
Viewed by 450
Abstract
The rapid integration of FinTech and sustainability-oriented sectors is reshaping financial risk dynamics, particularly in emerging markets such as China. This study investigates tail-dependent spillovers among ten Chinese FinTech and sustainability-linked sectors from 2015–2024 using a factor-purged Quantile Vector Autoregression (QVAR) with generalized [...] Read more.
The rapid integration of FinTech and sustainability-oriented sectors is reshaping financial risk dynamics, particularly in emerging markets such as China. This study investigates tail-dependent spillovers among ten Chinese FinTech and sustainability-linked sectors from 2015–2024 using a factor-purged Quantile Vector Autoregression (QVAR) with generalized forecast error variance decompositions. By isolating idiosyncratic shocks, the framework uncovers how risk creation, transmission, and absorption vary across market states. Results show that (i) FinTech acts as a net transmitter of shocks in adverse (lower-tail) states, amplifying downside risk to clean energy and green innovations; (ii) policy-intensive sectors (environmental and atmospheric governance) switch roles across quantiles, revealing asymmetric regulatory spillovers; and (iii) diversification benefits compress in the tails, with cross-sector linkages intensifying during crises. These findings highlight the importance of quantile-specific stress testing for regulators and the design of state-contingent hedging strategies for portfolio managers. Full article
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59 pages, 3591 KB  
Review
Digital Regulatory Governance: The Role of RegTech and SupTech in Transforming Financial Oversight and Administrative Capacity
by Niloufar Bagherifam, Sajjad Naghdi, Vahid Ahmadian, Alireza Fazlzadeh and Milad Baghalzadeh Shishehgarkhaneh
Int. J. Financial Stud. 2025, 13(4), 217; https://doi.org/10.3390/ijfs13040217 - 14 Nov 2025
Viewed by 3705
Abstract
Rapid digitalization is transforming how public and private institutions manage regulation, compliance, and supervision. This paper explores the rise of Regulatory Technology (RegTech) and Supervisory Technology (SupTech) as instruments of digital regulatory governance and examines their implications for administrative efficiency, defined as the [...] Read more.
Rapid digitalization is transforming how public and private institutions manage regulation, compliance, and supervision. This paper explores the rise of Regulatory Technology (RegTech) and Supervisory Technology (SupTech) as instruments of digital regulatory governance and examines their implications for administrative efficiency, defined as the optimization of regulatory and supervisory processes through automation and data-driven coordination, institutional capacity, and policy innovation. Using a systematic literature review of 59 peer-reviewed studies published between 2017 and 2025, the study identifies how RegTech enhances compliance management and risk control in financial institutions, while SupTech enables regulators to improve supervisory agility, transparency, and real-time oversight. The findings show that these technologies create significant administrative value by streamlining reporting, enhancing accountability, and strengthening governance networks across the public–private interface. However, adoption is constrained by cybersecurity vulnerabilities, algorithmic opacity, regulatory fragmentation, and organizational resistance. To address these issues, the study proposes an integrated governance framework that maps opportunities and barriers across compliance, risk, technology, and institutional coordination. By synthesizing fragmented evidence, this research contributes to the field of administrative sciences by positioning RegTech and SupTech not only as technical innovations but as transformative tools of digital public administration and regulatory modernization. Full article
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23 pages, 476 KB  
Article
Executive Equity Incentive, Internal Control and Organizational Resilience
by Hongwei Zhao, Ruobin Li and Chunyu Jiao
Int. J. Financial Stud. 2025, 13(4), 216; https://doi.org/10.3390/ijfs13040216 - 12 Nov 2025
Viewed by 1245
Abstract
Moderate incentive intensity enhances an organization’s resilience, while excessive incentives increase agency issues, reducing organizational resilience. This study empirically investigates the influence of executive equity incentives on corporate organizational resilience, utilizing panel data from Chinese A-share listed companies on the Shanghai and Shenzhen [...] Read more.
Moderate incentive intensity enhances an organization’s resilience, while excessive incentives increase agency issues, reducing organizational resilience. This study empirically investigates the influence of executive equity incentives on corporate organizational resilience, utilizing panel data from Chinese A-share listed companies on the Shanghai and Shenzhen stock markets from 2009 to 2023. Research demonstrates a notable inverted U-shaped correlation between the extent of executive equity incentives and corporate organizational resilience. Further analysis reveals that high-quality internal controls can mitigate the curvature of this inverted U-shaped relationship and shift the turning point forward. Mechanism tests show that executive equity incentives primarily affect organizational resilience by influencing agency costs and short-term management behavior. Heterogeneity analysis reveals that these effects are more significant in private firms and those enterprises with high financing constraints, high information asymmetry and strong economic policy uncertainty. This work extends theoretical research on executive share-based incentives in corporate governance, offering essential empirical evidence and policy implications for companies aiming to improve organizational resilience through the strategic design of incentive structures. Full article
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