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Special Issue "Corporate Sustainability, Multi-layered Governance and the Financial Distress Likelihood Worldwide"
A special issue of Journal of Risk and Financial Management (ISSN 1911-8074). This special issue belongs to the section "Sustainability and Finance".
Deadline for manuscript submissions: 20 July 2023 | Viewed by 6858
Special Issue Editors
Interests: sustainability; accountability; governance
Special Issues, Collections and Topics in MDPI journals
Interests: accounting, finance, governance, development and sustainability; accounting and governance (corporate governance and financial reporting, market-based accounting research); accountability, ethics, and sustainability (social and environmental accounting, corporate social responsibility, and sustainability accounting and reporting); finance and development (corporate finance, market-based finance research and financial economics, development finance)
Special Issues, Collections and Topics in MDPI journals
Special Issue Information
The rapid growth of the socially responsible investment (SRI) market during the last 20 years has contributed to the integration of sustainability performance (proxied by the Environmental, Social, and Governance (ESG) score) into traditional asset management (Cellier and Chollet, 2016; Gray, 2002; Von Wallis and Klein, 2015). According to the Global Sustainable Investment Alliance (2018), the total assets allocated to SRI strategies recorded $30.7 trillion internationally at the beginning of 2018, with a 34% rise since 2016. The assets’ value that was managed after checking for negative ESG issues scored $19.77 trillion, although the value of assets that include ESG-related elements into the financial analysis recorded around $17.54 trillion in 2018. This highlights the significance of sustainability practices as a valuable asset that can effectively enhance firms’ legitimacy and survival prospects in the future (Cho and Patten, 2007; Deegan, 2014; Gerged, Beddewela and Cowton, 2021).
Given this global pressure/concern on sustainability, it is essential to understand the relationships among sustainability performance/reporting (ESG), corporate governance (CG), national governance (NG), and Financial Distress likelihood (FDL). However, such attempts are still relatively rare (Shahab, Ntim, Chengang, Ullah, and Fosu, 2018; Mangena, Priego, and Manzaneque, 2020), except for a few. For example, Shahab et al. (2018) provided empirical evidence suggesting that increased environmental performance driven by good environmental policies strategically reduces the probabilities of financial distress incidence. Similarly, Mangena et al. (2020) investigated the effects of CG structures, including bank power, block ownership, and board independence, on the likelihood of financial distress. However, to date, the question of whether multilayered governance, including CG mechanisms and global governance indicators, affect the ESG–FDL nexus in an international context remained unanswered.
Therefore, this Special Issue focuses on establishing a robust link between sustainability performance/reporting and FDL in a global context. Suitable topics include but are not limited to the following:
- Examining the impact of sustainability performance (ESG) on financial distress likelihood internationally;
- Exploring the moderating impact of corporate governance on the association between sustainability reporting and firms’ financial distress;
- Understanding the impact of multilayered governance, including corporate governance and national-level governance, on financial distress likelihood;
- Examining whether the impact of sustainability performance/reporting on firms’ financial distress likelihood is contingent on the control of corruption and government effectiveness;
- Determining whether national governance can affect the association between corporate governance and sustainability performance/reporting internationally;
- Examining whether national governance moderates the impact of corporate governance on financial distress likelihood through sustainability performance.
Cellier, A., & Chollet, P. (2016). The effects of social ratings on firm value. Research in International Business and Finance, 36, 656–683.
Cho, C. H., & Patten, D. M. (2007). The role of environmental disclosures as tools of legitimacy: A research note. Accounting, Organizations and Society, 32(7-8), 639-647.
Deegan, C. (2014). An overview of legitimacy theory as applied within the social and environmental accounting literature. Sustainability Accounting and Accountability, 266-290.
Gerged, A. M., Beddewela, E., & Cowton, C. J. (2021). Is corporate environmental disclosure associated with firm value? A multicountry study of Gulf Cooperation Council firms. Business Strategy and the Environment, 30(1), 185-203.
Global Sustainable Investment Alliance (2018). 2018 global sustainable investment review. Global Sustainable Investment Alliance, www.gsialliance.org
Gray, R. (2002). The social accounting project and Accounting Organizations and Society Privileging engagement, imaginings, new accountings and pragmatism over critique?. Accounting, Organizations and Society, 27(7), 687-708.
Mangena, M., Priego, A. M., & Manzaneque, M. (2020). Bank power, block ownership, boards and financial distress likelihood: An investigation of Spanish listed firms. Journal of Corporate Finance, 64, 101636.
Shahab, Y., Ntim, C., Chengang, Y., Ullah, F., & Fosu, S. (2018). Environmental policy, environmental performance, and financial distress in China: Do top management team characteristics matter?. Business Strategy and the Environment, 27(8), 1635-1652.
Von Wallis, M., & Klein, C. (2015). Ethical requirement and financial interest: A literature review on socially responsible investing. Business Research, 8, 61–98.
Dr. Ali Meftah Gerged
Prof. Dr. Collins Ntim
Manuscript Submission Information
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- corporate sustainability performance
- corporate sustainability disclosure ESG score
- corporate governance mechanisms
- global governance indicators
- financial distress likelihood