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21 pages, 306 KiB  
Article
Beyond Compliance: How ESG Reporting Influences the Cost of Capital in UK Firms
by Ahmed Saber Moussa and Mahmoud Elmarzouky
J. Risk Financial Manag. 2024, 17(8), 326; https://doi.org/10.3390/jrfm17080326 - 26 Jul 2024
Cited by 14 | Viewed by 5243
Abstract
This research examines the effect of ESG disclosure on the cost of capital for non-financial firms in the UK, indexed by the FTSE All-Share Index, during the period from 2014 to 2018. Using multivariate analysis with ordinary least squares (OLS), fixed effects, robust [...] Read more.
This research examines the effect of ESG disclosure on the cost of capital for non-financial firms in the UK, indexed by the FTSE All-Share Index, during the period from 2014 to 2018. Using multivariate analysis with ordinary least squares (OLS), fixed effects, robust regression, and Tobit models, this research assesses the effect of ESG reporting, governance, and the cost of capital, including robustness checks using an alternative ESG indicator, the environmental pillar score. Contrary to expectations, ESG reporting is positively associated with the cost of capital. However, corporate governance moderates this relationship, weakening the positive correlation and reversing it to a negative association for firms with strong governance practices, consistent with the hypotheses. This research also finds that firm size, liquidity, profitability, and leverage, positively affect the cost of capital, while board size, independent board composition, audit committee independence, and auditor type do not significantly influence it. Notably, non-executive directors on the audit committee have a significant negative effect on the cost of capital. These findings are valuable for investors, companies, regulators, auditors, policymakers, and the academic and research community. Specifically, for investors, this study provides insights into how ESG disclosures can influence investment risks and returns, highlighting the importance of robust corporate governance. Companies can leverage these insights to enhance their governance practices and optimize their capital costs. Regulators and policymakers can use the findings to develop guidelines that encourage transparent ESG reporting and strong governance frameworks, thereby improving market stability and investor confidence. Auditors can utilize the results to better understand the effect of non-financial reporting on financial metrics, helping to provide more accurate audits and assessments. These findings inform investors, companies, regulators, auditors, and academia, in fostering a more sustainable and transparent financial environment. Full article
(This article belongs to the Section Sustainability and Finance)
20 pages, 357 KiB  
Article
Does a Female Director in the Boardroom Affect Sustainability Reporting in the U.S. Healthcare Industry?
by Hani Alkayed, Esam Shehadeh, Ibrahim Yousef and Khaled Hussainey
J. Risk Financial Manag. 2024, 17(2), 49; https://doi.org/10.3390/jrfm17020049 - 26 Jan 2024
Cited by 8 | Viewed by 3663
Abstract
In this in-depth study, we explored the nuanced dynamics of boardroom gender diversity and its consequential impact on sustainability reporting within the U.S. Healthcare sector. Leveraging a comprehensive dataset from Refinitiv Eikon, our analysis spanned a spectrum of 646 observations across 57 healthcare [...] Read more.
In this in-depth study, we explored the nuanced dynamics of boardroom gender diversity and its consequential impact on sustainability reporting within the U.S. Healthcare sector. Leveraging a comprehensive dataset from Refinitiv Eikon, our analysis spanned a spectrum of 646 observations across 57 healthcare entities listed in the S&P 500, covering the period from 2010 to 2021. Our methodology combined various empirical techniques to dissect correlations, unravel heterogeneity, and account for potentially omitted variables. Central to our findings is the discovery that various metrics of board gender diversity, such as the proportion of female directors and the Blau and Shannon diversity indices, exhibit a robust and positive correlation with the intensity and quality of sustainability reporting. This correlation persists even when controlling for a multitude of factors, including elements of corporate governance (such as board size, independence, and meeting attendance), as well as intrinsic firm characteristics (such as size, profitability, growth potential, and leverage). The presence of female directors appears to not only bolster the breadth and depth of sustainability reporting but also align with a broader perspective that their inclusion in boardrooms significantly influences corporate reporting practices. These insights extend beyond academic discourse by offering tangible and actionable intelligence for policymakers and corporate decision-makers. By elucidating the intrinsic value of gender diversity in governance, our study contributes a compelling argument for bolstering female representation in leadership roles as a catalyst for enhanced corporate responsibility and stakeholder engagement. Full article
(This article belongs to the Section Business and Entrepreneurship)
23 pages, 400 KiB  
Article
Fintech, Board of Directors and Corporate Performance in Saudi Arabia Financial Sector: Empirical Study
by Ebrahim Mohammed Al-Matari, Mahfoudh Hussein Mgammal, Mushari Hamdan Alosaimi, Talal Fawzi Alruwaili and Sultan Al-Bogami
Sustainability 2022, 14(17), 10750; https://doi.org/10.3390/su141710750 - 29 Aug 2022
Cited by 43 | Viewed by 7213
Abstract
On a global scale, the Fintech sector has become increasingly important for keeping abreast of developments and progressions in the financial field. This study aimed to examine the impact of Fintech on the financial sector of Saudi Arabia and the role of Fintech [...] Read more.
On a global scale, the Fintech sector has become increasingly important for keeping abreast of developments and progressions in the financial field. This study aimed to examine the impact of Fintech on the financial sector of Saudi Arabia and the role of Fintech in the relationship between the board of directors and corporate performance among Saudi financial firms listed on the stock market. Data were obtained from financial sector firms, covering banks and insurance firms from 2014 to 2020. The results revealed that board size, board independence, board meeting, board experience, and Fintech have a significant relationship with corporate performance. In relation to additional analyses, this study found that the board of directors’ score has a significant association with performance. Moreover, this study found that Fintech does not moderate the relationship between the board of directors’ score and corporate performance. This study sheds light on the effect of Fintech on the financial sector of Saudi Arabia, contributing new information to the literature. The study results are expected to have implications for several stakeholder groups. First, the study findings can be beneficial to academics, in terms of new knowledge and understanding of Fintech in the context of Saudi Arabia, a country that represents the Gulf region and the Arab World. The findings also have implications for policy-makers and practitioners in the Saudi and Middle-Eastern countries, Asia, and developing nations that have a similar culture, socio-economic institutions, or socio-economic environments. Full article
12 pages, 345 KiB  
Article
Universities without Walls: A Blended Delivery Approach to Training the Next Generation of HIV Researchers in Canada
by Francisco Ibáñez-Carrasco, Catherine Worthington, Sean Rourke and Colin Hastings
Int. J. Environ. Res. Public Health 2020, 17(12), 4265; https://doi.org/10.3390/ijerph17124265 - 15 Jun 2020
Cited by 10 | Viewed by 3214
Abstract
(1) Background: Although HIV has not diminished in importance in Canada, the field of HIV research remains small, and the graduate students who decide to pursue careers within it feel isolated and uncertain about their professional skills and opportunities. Universities Without Walls (UWW) [...] Read more.
(1) Background: Although HIV has not diminished in importance in Canada, the field of HIV research remains small, and the graduate students who decide to pursue careers within it feel isolated and uncertain about their professional skills and opportunities. Universities Without Walls (UWW) was created in 2009 to help redress these shortcomings. This paper presents a case study of UWW, a non-credit training program for emerging HIV researchers in Canada. In particular, we focus on the possibilities of experiential learning via online and blended delivery. UWW uses both online and in-person teaching modalities to teach engaged scholarship, interdisciplinarity, community-based research (CBR), intervention research, and ethics. (2) Methods: Using a case study, we elucidated the research question: “What are the factors that make Universities Without Walls a viable training environment in the contemporary HIV/AIDS field?” Focus groups were conducted with 13 UWW key stakeholders in 2012 during a program mid-point evaluation; in 2014, telephone or in-person interviews with the three directors were conducted by a UWW fellow (the 4th author of this paper), and in 2019 the authors analyzed the information and anecdotal evidence, which had been incorporated as thick description. In addition, fellows’ self-assessments via portfolio and results from formal learning assessments were included. We also thematically analyzed 65 student self-reports (2009–2015). (3) Results and Discussion: Each UWW cohort lasted 9 months to one year and was comprised of: a) sustained mentorship from the co-directors (e.g., phone conversations, assistance with grant writing, letters of reference, etc.); b) fortnightly online webinars that aim to develop fellows’ knowledge of community-based research (CBR), research ethics, intervention research, and interdisciplinary research; c) community service learning in the form of a “field mentoring placement”; d) face-to-face engagement with fellows and mentors, most notably at the week-long culminating learning institute; e) a stipend for fellows to carry out their training activities. The UWW pedagogical framework features experiential learning, critical pedagogy, and heutagogy made manifest in the field mentoring placements (community service learning), mentorship mediated by technologies, and in-person learning institutes. Our analysis showed that experiential learning was imparted by UWW’s a) transparency about its “implicit curriculum”, the attitudes, values, character, and professional identity imparted in the program as well as the overarching programmatic elements, such as commitment to diversity, the inclusion of those with lived experience, the flexible admissions policies and procedures, interdisciplinary faculty, flexible team, administrative structure, and valuing of technology in conducting research, learning, and teaching; b) curriculum co-designing and co-teaching, and c) sustaining a community of practice. The main results reported in our case study included significant “soft outcomes” for UWW fellows, such as developing a “social presence” as a precursor to lasting professional connections; learning to experience community-based research, intersectionality, and interdisciplinarity by interacting online with persons living with HIV, leaders in the field, and a variety of stakeholders (including nonprofit staff and policymakers). (4) Limitations: While fellows’ self-evaluation data were collected by an independent assessor and anonymized to the extent this was possible, the co-authors inevitably bring their preconceptions and positive biases to UWW’s assessment. As UWW was developed to function outside of traditional academic structures, it is unlikely that the UWW program could be transferred to a post-secondary environment in its entirety. UWW was also built for the socio-political environment of HIV health research. (5) Conclusions: The experiences of those involved with UWW demonstrate that explicit curricular components—such as interdisciplinarity, community-based research, intervention research, and applied ethics—can be learned through a blended delivery when combined with opportunities to apply the knowledge in ways, such as a field mentoring placement and a learning institute. Related to this outcome, our case study describes that implicit curricular components in the formation of a professional—the sense of self in the field as a researcher, student, and community member—can also be delivered through a blended model. However, the tools and activities need to be tailored to each student for their context, while pushing their disciplinarian and professional boundaries. Full article
26 pages, 634 KiB  
Article
Intellectual Capital Performance and Profitability of Banks: Evidence from Pakistan
by Muhammad Haris, HongXing Yao, Gulzara Tariq, Ali Malik and Hafiz Mustansar Javaid
J. Risk Financial Manag. 2019, 12(2), 56; https://doi.org/10.3390/jrfm12020056 - 4 Apr 2019
Cited by 108 | Viewed by 13049
Abstract
The study contributes to the existing literature on intellectual capital (IC) performance and profitability by extending evidence from Pakistan. The study examines the impact of IC performance on the profitability of Pakistani financial institutions. It further examines how corporate governance, bank specific, industry [...] Read more.
The study contributes to the existing literature on intellectual capital (IC) performance and profitability by extending evidence from Pakistan. The study examines the impact of IC performance on the profitability of Pakistani financial institutions. It further examines how corporate governance, bank specific, industry specific, and country specific indicators effect Pakistani banks’ profitability. The result reports both the linear and non-linear impact of IC performance on profitability, which affirms an inverted U–shaped relationship. Among the three value added intellectual coefficient (VAIC) components, capital employed efficiency (CEE), and human capital efficiency (HCE) are found to have a significantly positive and structural capital efficiency (SCE) is found to have a significantly negative impact on bank profitability. The study notes a positive impact on profitability of factors like board independence, directors’ compensation, and higher capitalization. It reports a negative impact on profitability of factors like board size, board meetings, credit risk, industry concentration and economic growth. The results also indicate low profitability of banks during the period of government transition. The study provides insights into the important profitability drives and suggests that the impact of investment in IC on profitability is limited to an extent. The findings of this study are likely to be useful for policy makers, management, and academics. Full article
(This article belongs to the Section Banking and Finance)
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20 pages, 274 KiB  
Article
Corporate Social Responsibility Disclosure and Stock Price Crash Risk: Evidence from China
by Jingwen Dai, Chao Lu and Jipeng Qi
Sustainability 2019, 11(2), 448; https://doi.org/10.3390/su11020448 - 16 Jan 2019
Cited by 45 | Viewed by 9540
Abstract
We take Chinese A-share listed companies in years 2010–2015 as a sample to examine the relationship between Corporate Social Responsibility (CSR) information disclosure and stock price crash risk using the fixed effect model. The results show that: (1) There is an inverted U-shaped [...] Read more.
We take Chinese A-share listed companies in years 2010–2015 as a sample to examine the relationship between Corporate Social Responsibility (CSR) information disclosure and stock price crash risk using the fixed effect model. The results show that: (1) There is an inverted U-shaped nonlinear relationship between CSR information disclosure and stock price crash risk. That is, as the CSR information disclosure level increases, the CSR information disclosure first aggravates and then reduces the stock price crash risk; (2) under different disclosure motives, there is a significant difference in the impact of CSR information disclosure on stock price crash risk. There is still an inverted U-shaped relationship between mandatory CSR information disclosure and stock price crash risk, but not for the semi-mandatory and voluntary disclosure; (3) the academic independent director has a positive adjustment effect on the relationship between CSR information disclosure and stock price crash risk, while the institutional investor has a negative adjustment effect on the relationship between CSR information disclosure and stock price crash risk. The research is of great significance for promoting the fulfillment of CSR, improving corporate governance and stabilizing the capital market. Full article
(This article belongs to the Special Issue Sustainable Finance)
26 pages, 807 KiB  
Article
Firms’ Board Independence and Corporate Social Performance: A Meta-Analysis
by Eduardo Ortas, Igor Álvarez and Eugenio Zubeltzu
Sustainability 2017, 9(6), 1006; https://doi.org/10.3390/su9061006 - 10 Jun 2017
Cited by 74 | Viewed by 9854
Abstract
This paper investigates the influence of organizations’ board independence on corporate social performance (CSP) using a meta-analytic approach. A sample of 87 published papers is used to identify a set of underlying moderating effects in that relationship. Specifically, differences in the system of [...] Read more.
This paper investigates the influence of organizations’ board independence on corporate social performance (CSP) using a meta-analytic approach. A sample of 87 published papers is used to identify a set of underlying moderating effects in that relationship. Specifically, differences in the system of corporate governance, CSP measurement models and market conditions have been considered as moderating variables. The results show that the independence of a company’s board positively influences CSP. This is because companies with more independent directors in their boards are more likely to commit to stakeholder engagement, environmental preservation and community well-being. Interestingly, the results also show that the positive connection between board independence and CSP is stronger in civil law countries and when CSP is measured by self-reporting data. Finally, the strength of the influence of the independence of a firm’s board on CSP varies significantly in different market conditions. The paper concludes by presenting the main implications for academics, practitioners and policy makers. Full article
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