International Journal of Financial Studies

54 pages, 896 KB

Open AccessArticle

Can FinBERT2-Based Investor Sentiment Predict Gold Futures Volatility? A Fine-Grained Sentiment Category Analysis

by Hui Chai and Yang Gao

Int. J. Financ. Stud. 2026, 14(8), 225; https://doi.org/10.3390/ijfs14080225 - 20 Aug 2026

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This paper focuses on China’s gold futures market. Using East Money investor posts and the FinBERT2 model, we construct a multidimensional sentiment indicator comprising overall sentiment, positive/negative intensity, and six fine-grained sentiment categories (happiness, sadness, fear, anger, disgust, and neutral). With high-frequency 5 [...] Read more.

This paper focuses on China’s gold futures market. Using East Money investor posts and the FinBERT2 model, we construct a multidimensional sentiment indicator comprising overall sentiment, positive/negative intensity, and six fine-grained sentiment categories (happiness, sadness, fear, anger, disgust, and neutral). With high-frequency 5 min data, we compute realized volatility and, within the HAR-RV framework, systematically examine the in-sample and out-of-sample predictive power, asymmetry, and inter-period heterogeneity of sentiment dimensions. The results show that investor sentiment significantly and robustly predicts volatility, with gains increasing over horizons, relying on multi-scale cumulative effects. Predictions are asymmetric: negative sentiment drives volatility while positive sentiment does not. Among fine-grained sentiments, happiness and anger are strongest; fear and sadness are ineffective; and disgust has an effect only in long-term routine forecasts but fails under extreme volatility. During the Russia–Ukraine conflict, sadness replaces happiness and anger as the dominant predictor (long-term MSE: 0.01579 vs. benchmark 0.04384). In trending bull markets, the predictive power of happiness and positive/negative intensity is amplified (full-sample R² gains: 2.70% and 2.89%, vs. 17.08% and 9.69% in bull periods). This study reveals the multidimensional, asymmetric effects and intertemporal heterogeneity of sentiment on forecasts of gold futures volatility, providing a theoretical and empirical foundation for regime-adaptive early-warning systems and risk management. Full article

(This article belongs to the Special Issue Research in Behavioral Finance)

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23 pages, 1036 KB

Open AccessArticle

Perceived Health Taxation and Sustainable Public Welfare: An Integrated Behavioral Framework in a Pre-Implementation Policy Context

by Natavan Namazova, Zivar Zeynalova, Gunay Musayeva and Elkhan Richard Sadik-Zada

Int. J. Financ. Stud. 2026, 14(8), 224; https://doi.org/10.3390/ijfs14080224 - 19 Aug 2026

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Abstract

Health taxation has become an increasingly important fiscal policy instrument for promoting healthier consumption and improving public welfare. However, limited evidence exists regarding public perceptions of health taxation in countries where such policies have not yet been implemented. This study develops and empirically [...] Read more.

Health taxation has become an increasingly important fiscal policy instrument for promoting healthier consumption and improving public welfare. However, limited evidence exists regarding public perceptions of health taxation in countries where such policies have not yet been implemented. This study develops and empirically tests an integrated behavioral framework that examines the relationships among perceived health taxation, healthy consumption behavior, and sustainable public welfare, while considering the moderating roles of chronic disease in the family, trust in public health policy, and generation. Data were collected through a structured questionnaire administered to 402 adult respondents in Azerbaijan and analyzed using Structural Equation Modeling. The results indicate that perceived health taxation is positively associated with sustainable public welfare but negatively associated with respondents’ self-reported healthy consumption behavior. In contrast, healthy consumption behavior is positively associated with sustainable public welfare. Furthermore, chronic disease in the family negatively moderates the relationship between perceived health taxation and sustainable public welfare, whereas trust in public health policy and generation positively moderate the proposed relationships. The study contributes to the health taxation literature by providing evidence from a pre-implementation policy context. These findings offer practical implications for designing socially acceptable and effective preventive fiscal policies. Full article

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20 pages, 348 KB

Open AccessArticle

ESG Performance and Firm Value: Evidence on Nonlinear Effects and Individual ESG Dimensions from European Union Listed Companies

by Algirdas Justinas Staugaitis and Česlovas Christauskas

Int. J. Financ. Stud. 2026, 14(8), 223; https://doi.org/10.3390/ijfs14080223 - 19 Aug 2026

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Abstract

This study examines both the linear and nonlinear relationship between overall Environmental, Social, and Governance (ESG) performance and firm market value, while also comparing the effects of the Environmental, Social, and Governance dimensions in publicly listed companies from the European Union. The analysis [...] Read more.

This study examines both the linear and nonlinear relationship between overall Environmental, Social, and Governance (ESG) performance and firm market value, while also comparing the effects of the Environmental, Social, and Governance dimensions in publicly listed companies from the European Union. The analysis is based on an unbalanced panel of 1706 non-financial listed firms covering the period 2011–2025. Firm value is primarily measured by Tobin’s Q, with the Price-to-Book ratio and Return on Assets (ROA) used for robustness analysis. The results indicate a significant U-shaped relationship between overall ESG performance and firm value, suggesting that the value-enhancing effects of ESG emerge only after firms achieve sufficiently high sustainability performance. In contrast, the individual Environmental, Social, and Governance dimensions in most cases do not exhibit significantly different effects on firm market value. Additional subsample analyses reveal that the nonlinear relationship is more pronounced among Western European firms and companies with lower greenhouse gas emissions intensity. The findings suggest that investors primarily evaluate firms based on their overall sustainability profile rather than individual ESG dimensions. The study contributes to the ESG literature by providing further evidence of the nonlinear nature of the ESG–firm value relationship and by comparing the explanatory power of aggregated and disaggregated ESG measures within the European Union’s harmonized sustainability reporting environment. Full article

(This article belongs to the Special Issue Challenges of ESG Ratings and Financial Reporting)

1 pages, 114 KB

Open AccessEditorial

Publisher’s Note: Update of International Journal of Financial Studies Journal Title Abbreviation

by International Journal of Financial Studies Editorial Office

Int. J. Financ. Stud. 2026, 14(8), 222; https://doi.org/10.3390/ijfs14080222 - 19 Aug 2026

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Abstract

Starting with Issue 9 of International Journal of Financial Studies (Volume 14, 2026), the International Journal of Financial Studies (ISSN 2227-7072) will adopt the abbreviation Int [...] Full article

32 pages, 1418 KB

Open AccessArticle

The Impact of Patient Capital on Innovation Quantity and Quality Among SMEs

by Ya Li, Yihang Sun, Zhen Zhang and Hua Feng

Int. J. Financ. Stud. 2026, 14(8), 221; https://doi.org/10.3390/ijfs14080221 - 17 Aug 2026

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Abstract

Drawing on panel data from firms listed on the SME Board and Growth Enterprise Market (GEM) between 2010 and 2024, this study examines how patient capital influences SME innovation. It considers both the quantity and quality of innovation and investigates the underlying mechanisms. [...] Read more.

Drawing on panel data from firms listed on the SME Board and Growth Enterprise Market (GEM) between 2010 and 2024, this study examines how patient capital influences SME innovation. It considers both the quantity and quality of innovation and investigates the underlying mechanisms. Using the China Industrial Enterprises Database (2000–2014), it further explores the innovation effects of patient capital on unlisted SMEs. The empirical findings are as follows. First, patient capital, measured by the proportion of relationship-based debt and stable equity, exhibits a significant and robust positive association with the output and quality of SME innovation, and this association gradually strengthens over time. Second, heterogeneity analyses show that relationship-based debt is more strongly associated with innovation in state-owned enterprises and national-level “Little Giant” firms (specialized, refined, distinctive, innovative SMEs), whereas stable equity is significantly associated with innovation only in private and ordinary enterprises. The association between stable equity and innovation is more pronounced in non-regulated industries, while the association for relationship-based debt remains consistent across industries. Third, mechanism tests reveal that patient capital is linked to SME innovation through four channels: alleviating financing constraints, fostering university–industry–research collaboration, improving knowledge conversion efficiency, and strengthening market power. Fourth, an extended analysis confirms that patient capital is also significantly associated with innovation among unlisted SMEs, indicating strong external validity of the study’s conclusions. Based on these findings, this paper advocates for establishing a long-term financing mechanism oriented toward patient capital, with differentiated allocation and optimization of institutional environments across industries. Such an approach should facilitate three transmission channels—university–industry–research collaboration, knowledge transfer, and market power—while extending policy coverage to unlisted SMEs, thereby nurturing a virtuous cycle ecosystem of “long-term capital → sustained R&D → high-quality innovation.” Full article

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18 pages, 319 KB

Open AccessArticle

Gender Diversity, ESG Performance, and Investment Efficiency: Evidence from Saudi Arabia

by Belal Ali Ghaleb

Int. J. Financ. Stud. 2026, 14(8), 220; https://doi.org/10.3390/ijfs14080220 - 17 Aug 2026

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Abstract

This study examines the relationship between environmental, social, and governance (ESG) performance and investment efficiency and investigates whether board gender diversity moderates this relationship among Saudi listed firms. Using a sample of non-financial companies listed on the Saudi Stock Exchange (Tadawul) with available [...] Read more.

This study examines the relationship between environmental, social, and governance (ESG) performance and investment efficiency and investigates whether board gender diversity moderates this relationship among Saudi listed firms. Using a sample of non-financial companies listed on the Saudi Stock Exchange (Tadawul) with available ESG scores over the period 2015–2023, the study employs panel regression analysis to assess the impact of ESG performance on investment efficiency. The findings indicate that higher ESG performance is associated with a greater tendency toward overinvestment rather than improved investment efficiency. However, board gender diversity significantly weakens this relationship, indicating a moderating effect of female board representation. The results remain robust across alternative specifications. This study advances to the ESG and corporate governance literature by providing empirical evidence from Saudi Arabia, an emerging market undergoing significant institutional reforms under Vision 2030 and highlights the importance of board gender diversity in improving the effectiveness of firms’ sustainability strategies. Full article

19 pages, 7556 KB

Open AccessArticle

Cross-Quantile Dependence Between Green Bonds and Financial Markets: A Cross-Quantilogram Approach

by Haifa Talbi, Meriem Youssef, Christian de Peretti and Lotfi Belkacem

Int. J. Financ. Stud. 2026, 14(8), 219; https://doi.org/10.3390/ijfs14080219 - 17 Aug 2026

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Abstract

The opportunities in green investment have propelled the green bond market at a time when climate change has emerged as a critical issue. As more investors express a preference for environmentally responsible investments, the popularity of green bonds remains high. Such considerations motivate [...] Read more.

The opportunities in green investment have propelled the green bond market at a time when climate change has emerged as a critical issue. As more investors express a preference for environmentally responsible investments, the popularity of green bonds remains high. Such considerations motivate the exploration of the relationship between these instruments and different assets to better appreciate their potential benefits. This paper examines the relationship between green bonds and various financial markets, including conventional bonds, equities, oil, and clean energy stocks, using daily return data from July 2014 to October 2024. Hence, the cross-quantilogram approach is employed to explore how Economic Policy Uncertainty (EPU) and Financial Market Uncertainty (VIX) influence these dependence structures. The empirical results suggest a strong correlation between green bonds and conventional bonds. Moreover, green bonds can serve as a diversification tool for investors in stock, oil, and clean energy markets. The uncertainty measures do not provide any information that could affect the dependence structures among these markets. Full article

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

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34 pages, 867 KB

Open AccessArticle

Deep Quantile Forecasting: Evaluating Advanced Neural Networks for Multi-Horizon Value-at-Risk

by Minh Vo

Int. J. Financ. Stud. 2026, 14(8), 218; https://doi.org/10.3390/ijfs14080218 - 14 Aug 2026

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Abstract

This study examines whether modern deep learning architectures can improve multi-horizon value-at-risk (VaR) forecasting by learning nonlinear tail-risk dynamics that are difficult to capture with conventional econometric models. Using S&P 500 return data and realized volatility measures, we compare quantile regression (QR), Light [...] Read more.

This study examines whether modern deep learning architectures can improve multi-horizon value-at-risk (VaR) forecasting by learning nonlinear tail-risk dynamics that are difficult to capture with conventional econometric models. Using S&P 500 return data and realized volatility measures, we compare quantile regression (QR), Light Gradient Boosting Machine (LGBM), and five neural architectures—MLP, LSTM, TCN, TiDE, and TFT—within HAR, CAViaR, and realized-volatility-augmented CAViaR specifications across 1% and 5% VaR at 1-day, 5-day, 10-day, and 22-day horizons. Forecast performance is evaluated using pinball loss, formal VaR backtests, and the model confidence set procedure. The results suggest that the performance of deep neural architectures depends on the forecast horizon and the structure of the underlying tail-risk dynamics. In particular, gated memory, attention-based learning, and multi-horizon sequence design appear to improve conditional quantile forecasting by better capturing persistence, nonlinear dependence, and regime-sensitive behavior. At the same time, stronger statistical forecasting accuracy does not automatically imply regulatory validity, since a VaR model must also satisfy formal coverage and independence tests. Overall, the findings highlight the distinction between predictive skill and regulatory adequacy in financial risk measurement. Full article

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21 pages, 2676 KB

Open AccessArticle

The Degree of Interconnectedness Between Cryptocurrency and Stock Markets: A Dynamic Wavelet Analysis

by Lumengo Bonga-Bonga

Int. J. Financ. Stud. 2026, 14(8), 217; https://doi.org/10.3390/ijfs14080217 - 14 Aug 2026

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Abstract

Grounded in the theoretical frameworks of safe haven and hedging asset theory, alongside wavelet-based time-frequency analysis, this study investigates the dynamic interconnectedness between three major cryptocurrencies and six global stock markets spanning both developed and emerging economies. Unlike prior wavelet studies that rely [...] Read more.

Grounded in the theoretical frameworks of safe haven and hedging asset theory, alongside wavelet-based time-frequency analysis, this study investigates the dynamic interconnectedness between three major cryptocurrencies and six global stock markets spanning both developed and emerging economies. Unlike prior wavelet studies that rely predominantly on graphical interpretation, this paper advances the literature by complementing graphical outputs with numerical results, offering a more rigorous and reproducible analytical foundation. Using daily price data from January 2018 to October 2024, the study applies both univariate and multivariate wavelet techniques to capture return co-movements across multiple time horizons. The univariate analysis reveals significant variance in stock returns concentrated at high frequencies, particularly over 2–4-day cycles, with pronounced fluctuations during the COVID-19 pandemic. In emerging markets such as Nigeria, additional volatility is attributed to political instability and macroeconomic crises. The multivariate analysis further demonstrates that observed co-movements between cryptocurrencies and stock markets are largely driven by interdependence rather than contagion. The paper’s findings are relevant to portfolio diversification strategies across both developed and emerging markets for investors combining stock and cryptocurrency assets. Full article

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17 pages, 394 KB

Open AccessFeature PaperArticle

Assessing the Relationship Between Financial Performance, ESG Reporting, and Corporate Value: Evidence from the Portuguese Stock Market

by Sónia Monteiro, Vanda Roque and Inês Moreira

Int. J. Financ. Stud. 2026, 14(8), 216; https://doi.org/10.3390/ijfs14080216 - 14 Aug 2026

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Abstract

This study examines the relationship between financial performance, ESG reporting, and corporate value. The study uses content analysis of non-financial reports of Portuguese listed corporations from 2019 to 2022 to construct a comprehensive ESG disclosure index, based on GRI standards, as well as [...] Read more.

This study examines the relationship between financial performance, ESG reporting, and corporate value. The study uses content analysis of non-financial reports of Portuguese listed corporations from 2019 to 2022 to construct a comprehensive ESG disclosure index, based on GRI standards, as well as the respective environmental, social, and governance sub-indices. Panel regression models are used to investigate whether financial performance increases ESG reporting and whether ESG reporting enhances corporate value, while controlling for firm size, sector, and reputation. The results show that financial performance has no significant impact on ESG reporting. Only firm size seems to positively and significantly impact ESG reporting. This finding supports the prior literature linking larger and more visible firms to higher ESG disclosure levels. Furthermore, the results show that ESG reporting does not significantly impacts corporate value. Instead, corporate value is negatively and significantly affected by firm size. This result suggests that larger and more mature firms may derive comparatively fewer valuation benefits from ESG reporting, in line with recent evidence. Overall, the results suggest that structural firm characteristics (notably firm size) play a more decisive role in shaping ESG reporting and corporate value. Full article

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28 pages, 2677 KB

Open AccessArticle

Reassessment of Factors Affecting China’s Quantity-Based Monetary Policy Effectiveness: An Interpretable Machine Learning Approach

by Li Sun, Nian Jiang and Aojun Wang

Int. J. Financ. Stud. 2026, 14(8), 215; https://doi.org/10.3390/ijfs14080215 - 14 Aug 2026

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Abstract

Effective transmission of monetary policy serves as the foundational institutional guarantee for sustaining macroeconomic stability, smoothing cyclical economic fluctuations, and promoting high-quality development. Nevertheless, the underlying determinants driving the time-varying effectiveness of China’s quantity-based monetary policy have not been systematically and empirically delineated [...] Read more.

Effective transmission of monetary policy serves as the foundational institutional guarantee for sustaining macroeconomic stability, smoothing cyclical economic fluctuations, and promoting high-quality development. Nevertheless, the underlying determinants driving the time-varying effectiveness of China’s quantity-based monetary policy have not been systematically and empirically delineated in the prevailing literature. This paper first constructs a precise measurement indicator for the effectiveness of China’s quantity-based monetary policy from the output-transmission dimension, which is defined as the response of domestic real output (excluding the contribution of net exports) to orthogonalized exogenous M2 growth shocks. On this basis, the gradient-boosting decision tree (GBDT) model is integrated with the Shapley Additive Explanations (SHAP) framework to quantitatively identify the core determinants that govern the policy effectiveness across different economic cycles and structural transformation stages. The estimation results document clear stage-wise heterogeneity in the drivers of China’s quantity-based monetary policy effectiveness: population-aging and macroeconomic-policy indicators stand out as the dominant explanatory factors over 2002–2008, while economic-structure indicators assume the leading role in shaping policy effectiveness during 2009–2015. The 2016–2022 period is further characterized by the joint dominance of demographic aging and economic-structure dimensions. Within this latest phase, the old-age dependency ratio, real–virtual economy structural misalignment, and distorted aggregate supply configuration exert statistically significant negative marginal contributions to the model-predicted effectiveness of monetary policy, whereas the total fertility rate and potential output growth rate yield positive and economically meaningful contributions. Full article

(This article belongs to the Special Issue Applications of Machine Learning in Finance)

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25 pages, 2238 KB

Open AccessArticle

RMB Exposure and Macroeconomic Performance Efficiency: Holder-Side Evidence on ERPT and GVC Channels

by Changrong Lu, Lian Liu, Jiaxiang Li and Fandi Yu

Int. J. Financ. Stud. 2026, 14(8), 214; https://doi.org/10.3390/ijfs14080214 - 13 Aug 2026

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Abstract

This study investigates whether holder-side RMB-related exposure is systematically associated with macroeconomic performance efficiency. Using a multi-objective efficiency framework rather than single macroeconomic indicators, we construct economy-year efficiency scores for 25 economies over 2005–2018 based on data envelopment analysis (DEA) and cross-efficiency evaluation. [...] Read more.

This study investigates whether holder-side RMB-related exposure is systematically associated with macroeconomic performance efficiency. Using a multi-objective efficiency framework rather than single macroeconomic indicators, we construct economy-year efficiency scores for 25 economies over 2005–2018 based on data envelopment analysis (DEA) and cross-efficiency evaluation. We then examine how these scores vary with RMB-related exchange-rate exposure and China-related value-added linkage proxies, while distinguishing RMB-specific exposure from broader trade integration and structural conditions. The results suggest conditional associations between holder-side RMB-related exposure and macroeconomic performance efficiency. The exchange-rate channel is positive and statistically significant under the baseline DEA specification (p < 0.01) when using PCSE. The estimated magnitude is economically modest and sensitive to alternative ICT proxies, efficiency benchmarks, and lag structures. By contrast, the GVC channel provides suggestive rather than confirmatory evidence, as China-related value-added linkages are not robustly significant under the revised fixed-effects specifications, augmented controls, or two-way fixed effects. The positive ERPT association is consistent in sign across the pooled CCR and genuine Game Cross-efficiency benchmarks. The VRS/BCC results are used as a complementary first-stage sensitivity check on the returns-to-scale assumption. The magnitude and statistical inference remain sensitive to alternative specifications and variance estimators. Overall, the findings should be interpreted as reduced-form, mechanism-consistent associations rather than causal effects of RMB internationalization. Full article

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35 pages, 396 KB

Open AccessArticle

Green Financial Development, Green Innovation, and Resource Productivity: Static and Dynamic Evidence from the European Union

by Ulaş Ünlü, Ayhan Kuloğlu, Özkan Çıtak, İhsan Yapar and Yasin Eryılmaz

Int. J. Financ. Stud. 2026, 14(8), 213; https://doi.org/10.3390/ijfs14080213 - 12 Aug 2026

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Abstract

This study examines the relationship between green financial development, green innovation, and resource productivity in 27 European Union member states over the period 2000–2020. To capture green financial development more comprehensively, the study develops a composite indicator combining financial development and environmental taxation. [...] Read more.

This study examines the relationship between green financial development, green innovation, and resource productivity in 27 European Union member states over the period 2000–2020. To capture green financial development more comprehensively, the study develops a composite indicator combining financial development and environmental taxation. The empirical analysis employs two-way fixed-effects estimations, bootstrap mediation analysis, lagged fixed-effects models, decomposition robustness tests, and dynamic System GMM estimations to investigate both the direct and indirect channels linking green finance to circular economy performance. The results show that green financial development consistently promotes green innovation across the baseline and robustness specifications. However, the bootstrap mediation analysis does not provide statistically robust evidence that green innovation mediates the relationship between green financial development and resource productivity within the static framework. The dynamic System GMM estimations provide additional evidence by indicating a positive association between green innovation and resource productivity once persistence in the dependent variable is taken into account. These findings suggest that the relationship among green financial development, green innovation, and resource productivity is sensitive to the econometric framework employed and is better characterized as a dynamic adjustment process rather than an immediate contemporaneous transmission mechanism. Heterogeneity analysis further reveals that these relationships are primarily evident among Western EU member states, whereas comparable associations are not statistically supported in the Eastern EU subsample, highlighting the importance of differentiated policy approaches across the European Union. This study contributes to the literature in four main ways. First, it proposes a composite Green Financial Development indicator. Second, it evaluates Resource Productivity as an indicator of circular economy performance. Third, it demonstrates that static and dynamic panel approaches provide complementary evidence on the green finance–innovation–productivity nexus. Fourth, it reveals substantial regional heterogeneity within the European Union by showing that the estimated relationships are statistically significant in the Western EU subsample but not in the Eastern EU subsample, underscoring the importance of differentiated regional policy approaches. The findings offer important implications for policymakers seeking to accelerate the transition toward a more resource-efficient and sustainable European economy. Full article

(This article belongs to the Special Issue Advances in Green Finance)

66 pages, 3970 KB

Open AccessSystematic Review

Unveiling Research Trends in ESG Disclosure in the Age of Digitalization and AI: A Systematic and Bibliometric Review

by Ahlam El Ferrad, Aya Klaffa, Mohamed Oudgou and Abdeslam Boudhar

Int. J. Financ. Stud. 2026, 14(8), 212; https://doi.org/10.3390/ijfs14080212 - 11 Aug 2026

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Abstract

Conducted in accordance with the PRISMA guidelines, this systematic bibliometric review provides a structured examination of the literature on the link between digitalization, artificial intelligence (AI), and environmental, social, and governance (ESG) disclosure, focusing on the ways in which digitalization and artificial intelligence [...] Read more.

Conducted in accordance with the PRISMA guidelines, this systematic bibliometric review provides a structured examination of the literature on the link between digitalization, artificial intelligence (AI), and environmental, social, and governance (ESG) disclosure, focusing on the ways in which digitalization and artificial intelligence are likely to influence the disclosure of ESG of companies. The study employs a corpus drawn from the Scopus database. An observation of the interactions among several bibliometric indicators, depicted in statistical and graphical formats, illustrates the geographical distribution of publications, the influence of scientific journals, the evolution of keyword trends, and the organization of the field. The analysis indicates an estimated 56% annual growth in scientific output, along with a pronounced concentration of research activity in China. By contrast, regions such as Africa are underrepresented. Furthermore, the results highlight an overall positive and significant relationship between digitalization, artificial intelligence, and ESG disclosure. More specifically, the reviewed literature emphasizes the role of several explanatory factors, notably improved informational quality, transparency, and reduced information asymmetry, as well as the mediating effect of dynamic capabilities and innovation capabilities. This research offers an up-to-date and structured synthesis of the main determinants of the link between digitalization, artificial intelligence and ESG disclosure. In addition, it enriches the growing body of literature on the relationship between digitalization and sustainability. Specifically, it shows that digitalization can be a strategic tool for enhancing Environmental, Social, and Governance (ESG) disclosure. Full article

(This article belongs to the Special Issue Advances in Corporate Disclosure Practice—Novel Insights)

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31 pages, 2066 KB

Open AccessArticle

Disaggregated ESG Dimensions and the Market Valuation of European Banks

by Mitja Godec and Leo Mršić

Int. J. Financ. Stud. 2026, 14(8), 211; https://doi.org/10.3390/ijfs14080211 - 10 Aug 2026

Viewed by 382

Abstract

Environmental, social, and governance (ESG) considerations have become an increasingly important component of sustainable finance, investment decision-making, and banking regulation. As financial institutions face growing pressure to integrate sustainability objectives into their business models, understanding how sustainability performance relates to market valuation has [...] Read more.

Environmental, social, and governance (ESG) considerations have become an increasingly important component of sustainable finance, investment decision-making, and banking regulation. As financial institutions face growing pressure to integrate sustainability objectives into their business models, understanding how sustainability performance relates to market valuation has become an important issue for investors, regulators, and bank management. Despite the growing ESG literature, evidence regarding the valuation relevance of individual ESG dimensions remains limited, particularly in the European banking sector. This study examines whether ESG dimensions are uniformly associated with the market valuation of European banks or whether financial markets differentiate among individual ESG pillars. Using a panel dataset of European banks covering 2021–2024 and Bloomberg ESG indicators, the study estimates panel econometric models to evaluate the associations between disaggregated ESG pillars and market-based valuation measures. The empirical findings reveal substantial heterogeneity across ESG dimensions. The social pillar is positively associated with market valuation, whereas the environmental pillar is negatively associated, while governance exhibits weak or statistically insignificant associations. The findings remain robust across several alternative model specifications. The results indicate that investors in highly regulated European banking markets differentiate between ESG dimensions, suggesting that financial markets differentiate among ESG dimensions and that analysing ESG at the pillar level provides a more nuanced understanding of market valuation than aggregate ESG measures. Full article

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20 pages, 598 KB

Open AccessArticle

Regime-Dependent Integration, Connectedness and Contagion Between India and Global Equity Markets

by Nikhil Bhardwaj, Ivana Miklošević and Eshan Gambhir

Int. J. Financ. Stud. 2026, 14(8), 210; https://doi.org/10.3390/ijfs14080210 - 10 Aug 2026

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Abstract

The present study examined the dynamics of equity-market integration among India and five major global economies: China, Hong Kong SAR, Japan, the United Kingdom and the United States. Daily data were analysed for the period from January 2002 to December 2025. This study [...] Read more.

The present study examined the dynamics of equity-market integration among India and five major global economies: China, Hong Kong SAR, Japan, the United Kingdom and the United States. Daily data were analysed for the period from January 2002 to December 2025. This study employs Johansen co-integration and the Granger causality test, along with a DCC-GARCH model and the Diebold–Yilmaz connectedness approach, to estimate time-varying conditional correlations across crisis regimes. The findings reveal a single long-run co-integrating relationship in the pre-COVID-19 period (2002–2019) that weakens to none when the post-COVID-19 period (2020–2025) is investigated in isolation, suggesting that the intense early-pandemic coupling became moderated as monetary-policy cycles diverged. The Granger causality test showed that the United States consistently and unidirectionally drives the Indian market, while India’s pre-crisis role as a transmitter to Asian markets fades after the pandemic. The DCC-GARCH indicated that India’s conditional correlations with selected economies rose sharply during the 2008 and 2020 crises, peaking with Hong Kong SAR (0.64). The DY connectedness framework reinforced this pattern. Systemwide connectedness rose sharply during both crises, exceeding 57%, compared to roughly 45% in calmer phases. The United States emerged as the key net transmitter of shocks, and India acted as a net receiver. Full article

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17 pages, 320 KB

Open AccessArticle

Effect of Intellectual Capital, Environmental, Social and Governance Performance, and Competitive Advantage on Firm Value in Asian Companies: The Role of Board Gender Diversity as a Moderating Variable

by Mukhtaruddin Mukhtaruddin, Umi Kalsum, Rika Henda Safitri and Putri Meilanda

Int. J. Financ. Stud. 2026, 14(8), 209; https://doi.org/10.3390/ijfs14080209 - 7 Aug 2026

Viewed by 544

Abstract

Purpose: This study aims to examine the effects of intellectual capital (IC), environmental, social, and governance (ESG), and competitive advantage (CA) on firm value (FV), with board gender diversity (BGD) as a moderating variable. Methodology/Design/Approach: The population comprises companies in the Asian region [...] Read more.

Purpose: This study aims to examine the effects of intellectual capital (IC), environmental, social, and governance (ESG), and competitive advantage (CA) on firm value (FV), with board gender diversity (BGD) as a moderating variable. Methodology/Design/Approach: The population comprises companies in the Asian region from 2015 to 2023. Companies were based on specific criteria, resulting in 637 companies with 5733 observations. The study used multiple regressions and moderated multiple regressions in data analysis. Finding/Result: The findings indicate that IC has a negative and significant effect on FV. ESG performance has a positive and insignificant effect on FV, while CA has a positive and significant effect on FV. BGD moderates the relationship between IC, ESG, and CA on FV. It strengthens the effect of CA on FV and weakens the relationship between IC and ESG on FV. Practical Implications: Companies must pay attention to IC, CA and BGD, these variables influence investor’s reactions in determining investments. The government should monitor ESG-related corporate activities to ensure alignment with sustainable business strategies. Institutions related to sustainability issues develop standardized ESG disclosure. Originality/Value: The results contribute to signaling theory and resource-based theory. Limited prior research utilizes BGD as a moderating variable, highlighting the novelty of this study. Full article

18 pages, 505 KB

Open AccessArticle

Digital Financial Development and the Effectiveness of Monetary Policy: Evidence from South Africa

by Lerato Mothibi, Teboho Charles Mashao and Bertha Chipo Bangara

Int. J. Financ. Stud. 2026, 14(8), 208; https://doi.org/10.3390/ijfs14080208 - 6 Aug 2026

Viewed by 609

Abstract

Studies on the implications of digital financial development and their impact on monetary policy effectiveness have shown mixed results, with some evidence of interdependence and potential transmission challenges. While some studies highlight positive growth impacts moderated by institutions with risks to policy sovereignty [...] Read more.

Studies on the implications of digital financial development and their impact on monetary policy effectiveness have shown mixed results, with some evidence of interdependence and potential transmission challenges. While some studies highlight positive growth impacts moderated by institutions with risks to policy sovereignty from innovations, research on South Africa remains minimal, despite having a mature financial system and rapid uptake of digital finance. The study used an ARDL model with the digital financial development index, inflation, interest rate, financial deepening, and an interaction of the digital financial development index and interest rate to analyse the implications of digital finance and its impact on monetary policy effectiveness in South Africa. Utilising annual data from 1990 to 2024, the results showed that the digital financial development index positively influences inflation in the long run. In addition, interest rates have a significant negative impact on inflation in the long run, while financial deepening, exchange rate and GDP per capita are insignificant in the long run. Furthermore, interest rate interactions with the digital financial development index exert downward inflationary pressure, but the interaction term is statistically significant in the long run. Therefore, digital financial development mitigates the inflationary effect of interest rates and appear to strengthen the monetary policy effectiveness in controlling inflation in the long run. We recommend that policymakers consider incorporating digital financial development indicators into the model for determining interest rates when developing a strategy to control inflation, thereby enhancing monetary policy effectiveness. Full article

(This article belongs to the Special Issue Technologies and Financial Innovation)

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19 pages, 3188 KB

Open AccessReview

Scientific Mapping of Green Finance: A Bibliometric Analysis of Research Dynamics and Sustainable Financial Instruments

by Yassine Ech-chatty and Azzouz Elhamma

Int. J. Financ. Stud. 2026, 14(8), 207; https://doi.org/10.3390/ijfs14080207 - 6 Aug 2026

Viewed by 382

Abstract

This study conducts a bibliometric analysis of green finance research from 2000 to 2025 using Scopus data and VOSviewer (version 1.6.21) and Bibliometrix^® (version 5.4.1). It analyzes publication trends, geographic distribution, collaboration patterns, and thematic evolution. A clear inflection appears around 2015, [...] Read more.

This study conducts a bibliometric analysis of green finance research from 2000 to 2025 using Scopus data and VOSviewer (version 1.6.21) and Bibliometrix^® (version 5.4.1). It analyzes publication trends, geographic distribution, collaboration patterns, and thematic evolution. A clear inflection appears around 2015, aligned with the Paris Agreement, followed by rapid growth in output. Keyword mapping identifies core themes, including green finance, sustainable finance, green bonds, climate finance, and climate change. Citation and co-citation networks reveal an increasingly coherent knowledge structure, signaling rising intellectual maturity. The findings inform future research agendas and support evidence-based policy design for green finance development across markets and institutions globally. Full article

(This article belongs to the Special Issue Recent Development in Sustainable Finance, New Trends and Future Directions)

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21 pages, 2399 KB

Open AccessArticle

Determinants of Financial Inclusion in Morocco: Evidence from a PLS-SEM Analysis

by Said Mabrouk and Ahlam Qafas

Int. J. Financ. Stud. 2026, 14(8), 206; https://doi.org/10.3390/ijfs14080206 - 5 Aug 2026

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Abstract

This article aims to analyze the determining factors behind the persistence of barriers to financial inclusion in Morocco. It also seeks to highlight the relationship between several economic, social, cultural, regulatory and institutional constraints on the access and use of financial services by [...] Read more.

This article aims to analyze the determining factors behind the persistence of barriers to financial inclusion in Morocco. It also seeks to highlight the relationship between several economic, social, cultural, regulatory and institutional constraints on the access and use of financial services by underserved populations. Thus, our methodology is exclusively quantitative and relies on a survey conducted through a questionnaire targeting a sample of 562 individuals from diverse socio-economic backgrounds. The collected data were analyzed using the partial least squares method (SmartPLS). The study reveals the importance of improving financial education, digital infrastructure, and regulatory flexibility to overcome financial exclusion. It also underscores the need to strengthen trust in financial institutions, adapt financial products to user needs, and implement inclusive public policies that promote financial empowerment for all segments of the population. Full article

(This article belongs to the Special Issue Advances in Inclusive Finance and Microfinance Institutions: Risk, Resilience, and Development)

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24 pages, 6895 KB

Open AccessArticle

Weather Shocks and Banking Credit Risk: Evidence for Small Rural Municipalities in Colombia

by Julián Benavides Franco, Jaime Andrés Carabali, Luis Ángel Meneses Cerón, Alex Pérez and Yudith Cristina Caicedo

Int. J. Financ. Stud. 2026, 14(8), 205; https://doi.org/10.3390/ijfs14080205 - 5 Aug 2026

Viewed by 398

Abstract

This paper studies the impact of weather shocks on the credit risk of bank portfolios in small and rural municipalities in Colombia, which are highly vulnerable to these climate variations. It addresses the relationship between extreme temperature and precipitation events and the increase [...] Read more.

This paper studies the impact of weather shocks on the credit risk of bank portfolios in small and rural municipalities in Colombia, which are highly vulnerable to these climate variations. It addresses the relationship between extreme temperature and precipitation events and the increase in the proportion of loans at risk, using data from 2011 to 2023. Extreme climate shocks negatively affect loan portfolio quality in Colombian rural municipalities, especially in microcredits. Credit risk decreases in municipalities with higher per capita incomes. It varies according to the type of loan and the nature of the weather shock. The results show that low temperature shocks increase risk in commercial and consumer loans. In contrast, low-precipitation shocks increase risk in microcredit. The increasing importance of climatic disturbances stresses the need for banks to develop their own models to manage these risks and to deepen analysis that incorporate borrower-specific information and banking policies to protect both financial institutions and borrowers from the impacts of climate change. The integration of sustainable practices and climate education can be key to improving financial resilience in these vulnerable areas. Full article

(This article belongs to the Special Issue Banking Stability, Credit Risk and Financial Resilience in Emerging Markets)

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21 pages, 806 KB

Open AccessReview

Beyond Value Maximization: A Capital Structure Perspective Based on Financial Resilience

by Fernando SanJuan-Paz, Ricardo Cristhian Morales Pelagio, Arturo Briseño-García, Miguel Reyna-Castillo and Jorge-Alberto Pérez-Cruz

Int. J. Financ. Stud. 2026, 14(8), 204; https://doi.org/10.3390/ijfs14080204 - 5 Aug 2026

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Abstract

Capital structure theory has historically been dominated by the objective of maximizing firm value through the optimal combination of debt and equity. However, contemporary environments characterized by systemic uncertainty, financial volatility, and elevated risk exposure have highlighted the limitations of an exclusively value-oriented [...] Read more.

Capital structure theory has historically been dominated by the objective of maximizing firm value through the optimal combination of debt and equity. However, contemporary environments characterized by systemic uncertainty, financial volatility, and elevated risk exposure have highlighted the limitations of an exclusively value-oriented perspective. In response, this study adopts a theory-building approach and develops a conceptual framework grounded in corporate financial resilience through an integrative theoretical review. Drawing on a critical examination of the principal theories of capital structure, including Modigliani and Miller’s propositions, trade-off theory, pecking order theory, agency theory, signaling theory, and market timing theory, the study argues that long-term financial sustainability depends not only on value maximization but also on the organizational capacity to absorb shocks, preserve liquidity, maintain solvency, and reduce vulnerability to financial distress. As its primary theoretical contribution, the study extends the explanatory domain of capital structure theory by formalizing a resilience-oriented framework that integrates key constructs, conceptual relationships, and theoretical propositions linking leverage, liquidity, solvency, financial flexibility, and financial resilience. Within this framework, moderate leverage, financial flexibility, and operational stability emerge as central mechanisms for strengthening corporate continuity under conditions of systemic uncertainty. Full article

(This article belongs to the Special Issue Advances in Corporate Finance: Theory and Practice)

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22 pages, 2015 KB

Open AccessFeature PaperArticle

Behavioral Intention, Personality and Consumer Credit Use

by Hsu-Chi Weng and Cecilia Hermansson

Int. J. Financ. Stud. 2026, 14(8), 203; https://doi.org/10.3390/ijfs14080203 - 4 Aug 2026

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Abstract

This paper examines how behavioral intention, combined with risk tolerance, financial confidence, and self-control, relates to consumer credit usage. Inspired by the theory of planned behavior, which suggests that behavioral intention is the direct precursor to actual behavior, our study investigates how these [...] Read more.

This paper examines how behavioral intention, combined with risk tolerance, financial confidence, and self-control, relates to consumer credit usage. Inspired by the theory of planned behavior, which suggests that behavioral intention is the direct precursor to actual behavior, our study investigates how these financial personality traits moderate the relationship between intention and the uptake of consumer credit. Using a combination of survey and bank register data, we focus on the amount of outstanding balance on consumer credit as the objective measure of consumer credit behavior. The results show that higher risk tolerance and greater financial confidence both are associated with increased credit use among those with the intention to borrow, while self-control mitigates this relationship. We observe that gender differences in financial behavior are notable: men who report high confidence and an intention to use consumer credit tend to carry higher outstanding balance, whereas higher self-control in men is linked to lower credit use. Additionally, although strong behavioral intention and higher income both predict greater consumer credit use, self-control mitigates this association among high-income individuals. Our study adds to consumer credit research by revealing the complex interplay between behavioral intention, risk tolerance, financial confidence, and self-control in relation to actual consumer credit usage. Full article

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33 pages, 394 KB

Open AccessArticle

How Does Climate Risk Affect the Cost of Debt in Chinese A-Share Listed Firms? Evidence from Financial and Non-Financial Transmission Channels

by Qian Wang and Siyu Chen

Int. J. Financ. Stud. 2026, 14(8), 202; https://doi.org/10.3390/ijfs14080202 - 4 Aug 2026

Viewed by 454

Abstract

Drawing on a panel of Chinese A-share listed firms covering 2007 to 2024, we construct a firm-level measure of climate risk exposure based on textual analysis of annual reports. Employing a three-way fixed effects model combined with endogeneity corrections and a battery of [...] Read more.

Drawing on a panel of Chinese A-share listed firms covering 2007 to 2024, we construct a firm-level measure of climate risk exposure based on textual analysis of annual reports. Employing a three-way fixed effects model combined with endogeneity corrections and a battery of robustness checks, we empirically identify the causal effect of climate risk on the cost of debt, as well as its underlying transmission mechanisms and heterogeneous boundary conditions. Our analysis yields three core findings. First, climate risk exerts a statistically significant and economically meaningful positive effect on the cost of debt, indicating that greater climate risk exposure amplifies firms’ debt financing burdens. Second, the impact operates through two parallel transmission channels. On the one hand, climate risk erodes corporate financial fundamentals by disrupting production and operations and elevating default risk. On the other hand, it damages non-financial reputation by triggering downgrades in Environmental, Social, and Governance (ESG) ratings and weakening long-term financing credibility. Third, the relationship between climate risk and the cost of debt is significantly moderated by firm- and industry-level characteristics: high-quality information disclosure attenuates the adverse financing impact of climate risk, while affiliation with heavily polluting industries strengthens this positive association. These findings remain robust to alternative measures of climate risk and the cost of debt, alternative clustering specifications, high-dimensional interactive fixed effects, and subsample tests with restricted sample windows. To address endogeneity concerns stemming from reverse causality and omitted variable bias, we adopt two complementary identification strategies: using one-period lagged values of the core explanatory variable and conducting instrumental variable estimation via two-stage least squares (2SLS). Estimates from both approaches remain statistically and economically consistent with our baseline results. Further heterogeneity analyses show that the cost-increasing effect of climate risk is more pronounced for firms without ESG fund ownership, non-state-owned enterprises (non-SOEs), and firms located in non-eastern regions of China. Overall, this study provides novel firm-level evidence on the microeconomic consequences of climate risk in emerging economies, develops a dual transmission framework integrating financial fundamentals and non-financial reputation, and offers actionable implications for policymakers, financial institutions, and firms to improve climate risk governance and optimize the financing environment amid the low-carbon transition. Full article

19 pages, 426 KB

Open AccessFeature PaperArticle

Fintech Adoption, Financial Inclusion, and Bank Performance: Evidence from the Asian Banking Industry

by Helal Uddin and Munim Kumar Barai

Int. J. Financ. Stud. 2026, 14(8), 201; https://doi.org/10.3390/ijfs14080201 - 4 Aug 2026

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Abstract

Financial technology (fintech) provides access to financial services without relying on physical branch infrastructure, thereby overcoming geographical barriers and reducing transaction costs for users, including those previously excluded. Evidence from global financial databases suggests that fintech has played a significant role in bringing [...] Read more.

Financial technology (fintech) provides access to financial services without relying on physical branch infrastructure, thereby overcoming geographical barriers and reducing transaction costs for users, including those previously excluded. Evidence from global financial databases suggests that fintech has played a significant role in bringing unbanked adults into the formal financial system, although its impact on bank-level financial inclusion and performance remains empirically contested, particularly across economies at different stages of development. This study advances understanding of the impact of fintech adoption on financial inclusion and bank performance across 14 Asian countries, divided into four subgroups. Using bank-level panel data from Bloomberg for 173 banks over the period 2016–2024 and employing Driscoll–Kraay fixed-effects estimation, the study finds that, regardless of a nation’s level of development, fintech adoption significantly and generally consistently advances financial inclusion across Asian banking systems. They also show that the impacts of fintech on profitability are not ubiquitous nor instantaneous, and that in more technologically sophisticated economies, these effects may initially be detrimental before any longer-term performance advantages are materialize. Full article

(This article belongs to the Special Issue Digital Banking, FinTech, and AI for Climate and Sustainable Finance)

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33 pages, 444 KB

Open AccessArticle

Do Boards Shape REIT Performance? Evidence from the South African REIT Sector

by Thabelo Sean-Vincent Mofokeng and Chioma Sylvia Okoro

Int. J. Financ. Stud. 2026, 14(8), 200; https://doi.org/10.3390/ijfs14080200 - 3 Aug 2026

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Abstract

We examine whether board activity (B_ACTIV), board size (B_SIZE), board independence (BIND), and board tenure (BOARD_TEN) are associated with the performance of South African real estate investment trusts (REITs) over the period 2013 to 2025. The REIT framework provides a rigorous setting to [...] Read more.

We examine whether board activity (B_ACTIV), board size (B_SIZE), board independence (BIND), and board tenure (BOARD_TEN) are associated with the performance of South African real estate investment trusts (REITs) over the period 2013 to 2025. The REIT framework provides a rigorous setting to evaluate corporate governance theory, as statutory distribution mandates constrain payout discretion and contracted-income business models limit managerial opportunism, suggesting that governance effects concentrate within specific performance channels. We estimate dynamic panel models using a two-step system GMM framework with collapsed instruments, year fixed effects, Windmeijer-corrected standard errors, and firm-level controls for firm size (SIZE), leverage (LEV), and asset growth (GROWTH) to address endogeneity, unobserved heterogeneity, and performance persistence. We evaluate robustness through an endogenous-regressor specification, a bootstrap bias-corrected LSDVC estimator, and outlier-adjusted estimations. The sample comprises 30 JSE-listed REITs. We evaluate performance across funds from operations per share (FFO_PS), dividend yield (DIV_YIELD), return on assets (ROA), return on equity (ROE), return on invested capital (ROIC), and earnings per share (EPS). Our findings reveal that B_SIZE exhibits a statistically significant negative association with accounting profitability, where each additional director corresponds to a 1.0 percentage point reduction in ROE and a 0.32 percentage point reduction in ROA. The ROE effect remains robust across every identification strategy, including specifications treating board composition as endogenous and estimations winsorizing the dependent variables. Because firm SIZE remains statistically insignificant while LEV and GROWTH display their expected theoretical signs, the B_SIZE effect is isolated from firm scale. BIND demonstrates a directionally positive but specification-sensitive association with returns and payouts, whereas BOARD_TEN shows no robust association with any performance metric, and B_ACTIV effects attenuate once endogeneity is addressed. Overall, governance effects concentrate in operating efficiency and payout measures while remaining absent from per-share metrics, reflecting the precise channels through which boards exercise authority. Our findings caution against board expansion in this sector, highlight board scale as a transparent governance screen for investors, and demonstrate that meeting frequency and tenure benchmarks offer no reliable performance signal. Full article

(This article belongs to the Special Issue Real Estate Markets and Financial Intermediation: Policy Shocks, Micro Responses, and Economic Consequences)

18 pages, 685 KB

Open AccessArticle

Financial Regulatory Intensity and Corporate Liquidity Risk: Evidence from Chinese A-Share Listed Companies

by Guofeng Luo and Jiaze Liu

Int. J. Financ. Stud. 2026, 14(8), 199; https://doi.org/10.3390/ijfs14080199 - 1 Aug 2026

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Abstract

Against the backdrop of escalating financial regulation in China, this study examines how regulatory enforcement intensity affects corporate liquidity risk among A-share listed non-financial firms over 2015–2024. We construct a composite regional regulatory intensity index (Enforce) integrating the frequency and monetary magnitude of [...] Read more.

Against the backdrop of escalating financial regulation in China, this study examines how regulatory enforcement intensity affects corporate liquidity risk among A-share listed non-financial firms over 2015–2024. We construct a composite regional regulatory intensity index (Enforce) integrating the frequency and monetary magnitude of administrative penalties issued by local securities regulators and employ firm- and year-fixed-effects panel regressions with the current ratio (CR) as the primary liquidity measure. We find that tighter regulatory enforcement significantly depresses the current ratio, consistent with a compliance-cost channel that constrains short-term debt-servicing capacity. Mediation analysis—conducted separately for each ESG sub-dimension and verified via bootstrap tests—reveals that the corporate governance dimension (G) generates a significant positive indirect effect (consistent partial mediation), the social responsibility dimension (S) generates a significant negative indirect effect (competing partial mediation), and the environmental dimension (E) yields no statistically significant indirect effect. Ownership-type heterogeneity tests confirm that non-state-owned enterprises (non-SOEs) are substantially more sensitive to regulatory tightening than state-owned enterprises (SOEs). Moderation analysis further shows that financial leverage plays a non-monotonic role: the regulation–liquidity effect is negative at low leverage levels and reverses to positive above an estimated threshold (Lev ≈ 0.56). Robustness is established through subsample regressions and a lagged-variable endogeneity test. These findings enrich the institutional finance literature and provide evidence-based guidance for differentiated regulatory policymaking. Full article

(This article belongs to the Special Issue Corporate Finance and Market Microstructure)

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28 pages, 1126 KB

Open AccessArticle

Financing the Chain in China: Industry–Finance Collaboration and the Resilience of Corporate Supply Networks

by Guanfen Hua, Jinliang Wang, Xuesheng Chen and Zhenying Zuo

Int. J. Financ. Stud. 2026, 14(8), 198; https://doi.org/10.3390/ijfs14080198 - 1 Aug 2026

Viewed by 449

Abstract

Recent disruptions have made supply chain resilience a central concern for firms and policymakers, yet the financial-policy foundations of resilience remain insufficiently understood. This study examines whether policy-driven industry–finance cooperation strengthens corporate supply chain resilience and through which financial channels this effect operates. [...] Read more.

Recent disruptions have made supply chain resilience a central concern for firms and policymakers, yet the financial-policy foundations of resilience remain insufficiently understood. This study examines whether policy-driven industry–finance cooperation strengthens corporate supply chain resilience and through which financial channels this effect operates. Using the China Industry–Finance Cooperation (IFC) Pilot Policy as an exogenous policy shock, we analyze Chinese A-share listed manufacturing firms from 2014 to 2023. The SDID estimates show that the IFC Pilot Policy increases firms’ supply chain resilience by 0.061 standard deviations, and this result remains stable across multiple robustness checks. Mechanism tests indicate that the policy improves resilience by reducing debt financing costs, promoting supply chain finance, and enhancing real investment efficiency. Further heterogeneity analysis shows that the effect is stronger among technology-intensive firms and firms located in less favorable business environments. Theoretically, this study links industry–finance cooperation to supply chain resilience through a “funding cost–chain cash flow–capital use” framework. Practically, it shows that better coordination between financial services and industrial needs can help firms strengthen their capacity to withstand supply chain risks. Full article

(This article belongs to the Special Issue Advances in Financial Risk Management)

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31 pages, 2629 KB

Open AccessArticle

External Financial Dominance Under Sanctions: Financial Fragmentation and Exchange Rate Determination in Russia

by Sugeng Suroso, Sri Wulandari and Chajar Matari Fath Mala

Int. J. Financ. Stud. 2026, 14(8), 197; https://doi.org/10.3390/ijfs14080197 - 28 Jul 2026

Viewed by 683

Abstract

This paper examines whether prolonged sanctions and major geopolitical episodes associated with financial fragmentation alter exchange-rate dynamics and weaken the explanatory power of domestic macroeconomic channels and strengthen external financial dominance of traditional exchange-rate transmission mechanisms. Standard exchange rate theories are based on [...] Read more.

This paper examines whether prolonged sanctions and major geopolitical episodes associated with financial fragmentation alter exchange-rate dynamics and weaken the explanatory power of domestic macroeconomic channels and strengthen external financial dominance of traditional exchange-rate transmission mechanisms. Standard exchange rate theories are based on the concepts of Purchasing Power Parity (PPP) and Uncovered Interest Parity (UIP). However, the application of continuous sanctions could weaken this explanatory power and change exchange rate dynamics. The present study applies a combined framework of Autoregressive Distributed Lag (ARDL), Error Correction Modeling (ECM), Vector Autoregression (VAR) and structural break analysis to study the exchange-rate behavior in response to repeated geopolitical shocks using monthly data for Russia from 2005 to 2025. The results indicate that external variables such as the US dollar index and oil prices are important determinants of exchange rates, while inflation and interest rate differentials associated with PPP and UIP have little explanatory power. Structural break tests detect major regime shifts associated with the Global Financial Crisis, Crimea-related sanctions episode, COVID-19 pandemic and Russia–Ukraine conflict. The error correction process indicates that the speed of adjustment to equilibrium is slow, which means that traditional exchange-rate relationships will continue to diverge. In general, the results suggest a regime-dependent exchange rate environment in which external financial factors tend to dominate domestic adjustment mechanisms. Our study contributes to the literature on exchange rates, sanctions and financial fragmentation by providing evidence on how geopolitical shocks shift the relative importance of domestic and external determinants in a highly sanctioned economy. Full article

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23 pages, 987 KB

Open AccessArticle

Extreme Capital Structure and Firm Performance in Emerging Economies: The Moderating Role of Liquidity

by Owen Ncube and Godfrey Marozva

Int. J. Financ. Stud. 2026, 14(8), 196; https://doi.org/10.3390/ijfs14080196 - 24 Jul 2026

Viewed by 642

Abstract

This study examines the moderating role of liquidity in the relationship between extreme capital structure and firm performance among listed firms in emerging markets. It is motivated by the need to better understand how financing constraints and liquidity management influence firm performance in [...] Read more.

This study examines the moderating role of liquidity in the relationship between extreme capital structure and firm performance among listed firms in emerging markets. It is motivated by the need to better understand how financing constraints and liquidity management influence firm performance in environments characterised by high financial frictions and limited access to external capital. Extreme capital structure is defined as firms maintaining very low levels of debt, measured using thresholds of 1% (ultra-low debt) and 5% for both long-term debt and total debt. The analysis is based on a panel dataset of non-financial listed firms over the period 2006–2024 and employs a dynamic panel System Generalised Method of Moments (System GMM) complemented by a Random Effects model for robustness. Empirical results indicate that liquidity has a meaningful and predominantly positive moderating effect. This is observed when firms maintain extremely low long-term debt (1% threshold) and low long-term debt (5% threshold). Liquidity enhances firm performance. This effect is strongest for return on assets (ROA) and return on equity (ROE). The effect on Tobin’s Q is weaker but remains generally positive. These findings highlight the strategic importance of liquidity in improving profitability and financial resilience under conservative financing structures. However, the findings are limited to listed non-financial firms in emerging markets and may not be generalizable to SMEs or unlisted firms. Future research could explore the threshold at which liquidity ceases to generate benefits or begins to produce diminishing returns in ultra-low leverage contexts. Full article

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Int. J. Financ. Stud., Volume 14, Issue 8 (August 2026) – 31 articles

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