Search Results (19)

In recent years, scandals regarding the malpractices of many nonprofit organizations (NPOs) for selfish ends have eroded public trust in them. Therefore, it is necessary to consider whether the credibility of NPOs, as one of the three key implementers in cause-related marketing (CRM) campaigns, has a transfer effect on enterprise brand image. The aim of the current study is to examine the relationship between NPO credibility and enterprise brand image, along with its underlying mechanism and boundary conditions. Drawing on the affect-transfer model as well as attribution theory, we propose a theoretical model. This model highlights the mediating role of perceived corporate hypocrisy in the relationship between NPO credibility and enterprise brand image. Moreover, it incorporates public emergency, specifically in reference to the COVID-19 pandemic, as a moderator. Three experiments were conducted to test our model. Results reveal that consumers perceive a more negative enterprise brand image when the company partners with a low-credibility NPO compared to a high-credibility NPO. Additionally, the impact of NPO credibility on enterprise brand image is mediated by perceived corporate hypocrisy, which is weakened in the presence of a public emergency. Full article

In contemporary times, energy sustainability and security have become essential economic concerns globally. Nonetheless, in addition to these concerns, inadequate governance inside a corporation within the energy industry may result in corruption and energy instability within the sector. The primary purpose of this study was to examine the influence of a new array of corporate governance controversies on the energy security of 102 listed energy businesses in Europe. To achieve the purpose of this study, entropy weight and TOPSIS multicriteria approaches were used. The data were obtained from the Refinitiv Eikon database for fiscal year 2024. The findings reveal that the most significant influence, among the identified governance concerns that affect the energy security of European energy corporations, is the detrimental effect of the directors’ people. Moreover, the criteria that constitute bribery, corruption, and fraud scandals seem to be the second most significant element affecting the energy security of the enterprises in this industry. The risk of corruption in governance is exacerbated in the realm of renewable energy due to several converging factors: the urgent demands to implement new projects in response to the climate crisis, apprehensions regarding energy security, potential access to lucrative contracts, and the existence of ‘rent-seeking’ gatekeepers within the processes central to the development and operation of renewable energy assets. Full article

The evolving landscape of Corporate Social Responsibility (CSR) has transcended its traditional boundaries, transitioning into Environmental, Social, and Governance (ESG) principles and their more advanced iteration, ESG 2.0. Unlike traditional CSR, which primarily emphasizes voluntary ethical practices, ESG integrates sustainability into the core business strategy, transforming how corporations address environmental and societal challenges while enhancing shareholder value. This entry focuses specifically on the European and North American contexts, where regulatory pressures, investor demands, and societal expectations have played pivotal roles in accelerating this transition. Understanding the evolution from CSR to ESG practices is crucial, given the increasing complexity of global challenges such as climate change, inequality, and governance scandals. The emphasis on ESG 2.0 highlights a proactive, strategic approach to embedding sustainability into corporate DNA, ensuring relevance in a rapidly changing world. Full article

This study presents a comprehensive bibliometric analysis of studies on financial information/accounting manipulation. The dataset of research includes 1.266 studies from the Web of Science database for the period 1991–2023. All studies included in the research contain either the term ‘financial information manipulation’ or ‘accounting manipulation’ in the topic (title, abstract, or keywords). The bibliometric network mapping technique was used for the analysis of the data. The analysis was conducted utilizing the Biblioshiny interface of the R package programs Bibliometrix and Vosviewer. The results pointed out a notable upward trend in the publication and citation rates of financial information/accounting manipulation studies over the last two decades. Several key findings were identified. Firstly, a substantial rise in research output on financial information/accounting manipulation was observed, particularly after 2000, driven by global financial scandals. Secondly, prolific contributors to this field include authors such as Valaskova and Durana. Thirdly, the United States leads in research output, with significant contributions from institutions like the State University System of Florida and the State University System of Ohio. Lastly, The Accounting Review was identified as the most prolific journal in this domain, with the Journal of Accounting Economics being the most impactful based on citations. The most frequently used keywords indicate that the research topics focus on earnings management as a method of manipulation, fraudulent financial reporting, and the relationship with corporate governance. The comprehensiveness of the bibliometric data lends itself to a further examination of how financial information/accounting manipulation has progressed as a subject in the literature since the 2000s. In addition, this study reveals the social and intellectual structures of the issue, the key research streams, and potential research directions for future research. Full article

Japanese firms have historically followed a country-specific model of corporate governance. Yet, Japan has had to adapt its corporate model over the last 30 years, along with the transformation of distinctive characteristics of Japanese capitalism in the same period. We review the historical evolution of Japanese corporate governance over the last three decades with a specific emphasis on the changes in the capital structure of major companies and the efforts to correct ineffective board of directors monitoring. By doing this, we investigate to what extent specific Japanese corporate governance features may explain the nation’s economic situation over this period. Thereby, we try to clarify the influences that have presided over recent corporate governance reforms in Japan despite the existence of managerial failures and corporate scandals. This paper places itself into the debate over the diversity of capitalism as it portrays the specificities, differences, and converging trends of Japanese corporate governance practices. Full article

The fast fashion industry is subject to growing calls for transparency, from civil society groups as well as consumers. Despite universal pressure on retailers to disclose information on supply chain practices, uptake of transparency policies and practices has been heterogenous amongst large fast fashion companies. In this paper, we explain variation in transparency practices through a comparison of the four largest fast fashion retailers: H&M, Inditex, Gap, and Fast Retailing. Drawing on cross-case comparison and within-case process tracing, we offer insights into why some retailers are more transparent than others. Our findings suggest that sustainability scandals are a necessary but insufficient condition for motivating firms to increase transparency in their supply chains. Scandals can be an important driver of increased transparency, but only when accompanied by support from senior management and alignment with domestic norms about appropriate corporate conduct. These findings contribute to the literature on transnational business governance, corporate transparency, and sustainable supply-chain management. Full article

This paper aimed to better understand business students’ expectations of Brazilian corporate governance after recent scandals, focusing on capturing their perceptions after the Lava Jato (Car Wash) police investigation. Adapting a prior survey applied to business students, data were collected from three colleges in São Paulo, the largest city in Latin America, with a total of 328 responses. The data were initially submitted to confirmatory factor analysis (CFA), after which we employed a structural equation model (SEM). Our main finding indicates that students are skeptical of an increase in Brazilian corporate governance after this police operation. This result is supported by the prior literature and denotes student consciousness of the need for deep reforms in the business environment and compliance rules. Furthermore, strategic human resources management is the most prominent corporate governance tool today, and the survey revealed disbelief that the Board of Directors and internal audits will act as potential inhibitors of fraud and corruption. These findings are associated with a broad view related to sustainability which denotes that future firm leaders, who are currently business students, comprehend that an ethical business environment needs to be built by professionals who are able to understand the role of corporate governance mechanisms. This paper contributes to the literature by offering a holistic assessment of business student perceptions and encourages a discussion of current models and instruments of Brazilian corporate governance. The scarcity of studies involving education and governance can be considered a constraint to building sustainable companies from a long-term perspective. Comprehending business students’ perceptions about corporate governance mechanisms can be considered a path to increasing the number of business courses with topics aligned with practical effects on environmental, social, and governance subjects, mainly when these mechanisms are evaluated from an integrated perspective. Full article

Open Innovation (OI) models have been studied in many fields. However, the challenges and opportunities of a possible OI paradigm application in external auditing have been under-researched. Recent corporate scandals are currently triggering changes and improvements in the regulatory framework by targeting, in particular, the dominance of the so-called “Big Four”. The main research question is whether a permissioned blockchain ecosystem could better enhance an OI paradigm and prove more suitable than the Semi-Open Innovation (SOI) paradigm that currently shapes the external audit field. Some challenges are considered in this article. Notably, blockchain requires suitable legal frameworks to ensure legally binding transactions. Moreover, multidisciplinary teams and high investments are required to develop efficient blockchain ecosystems and exploit the power of data analytics. Systematic analysis is performed based on a relevant literature review, along with abductive reasoning and applied modelling methodologies. The analyses demonstrate that the current Semi-Open Innovation external audit model is inefficient because it has led to market concentration, conflicting interests, and even fraud. Therefore, the regulators’ role in promoting fully Open Innovation models in the audit industry is essential to ensure transparency, information sharing, fair competition, innovation, and collaboration among audit professionals. Hence, this research aims at providing a different perspective by focusing on the necessary assumptions needed to ensure successful application of technologies in the audit field. The innovative introduction of a permissioned blockchain-based audit system is also suggested to ensure the feasibility of the shift from Semi-Open to Open Innovation. Full article

Corporate social irresponsibility (CSIR) scandals are frequently reported in China and have a huge impact on the enterprise and society. Aiming to understand the underlying mechanisms between CSIR and enterprise outcomes, this study uses a sample of 2618 firms from the 2018 National Survey of Private Entrepreneurs Survey and examines the corporate social irresponsibility punishments from the perspective of stakeholders by introducing transaction costs. The results indicate that although the punishments for corporate irresponsible behaviors may not be strong enough to deter enterprises from irresponsibility in China, punishments from various stakeholders are increasing in terms of transaction costs. In addition, crisis management capacity may negatively moderate the relationship between CSIR and transaction costs, while regional economic development positively moderates it. This study adds to the extant research on CSIR consequences by combining stakeholders with transaction costs and provides new insights into transaction costs. Full article

In March 2021, a case of speculation that abused private internal information came to light, which involved a group of public officials from the Korea Land and Housing Corporation (LH), and has since been labeled the ‘LH Scandal’. In this scandal, land was misappropriated as a means of creating fraudulent values, instead of returning it to marginalized people in real need of residential space. As a result of this, preventive measures for similar cases have become warranted. Consequently, related laws have been passed, but this is only expected to show its effect as a follow-up response, therefore requiring a preemptive response plan. In this paper, we will propose a conceptual framework that can detect speculation that abuses private internal information, enabling a preemptive response, utilizing outlier detection and Latent Dirichlet Allocation (LDA) methods. The system is designed to create a database (DB) with private inside real estate information, which is linked to another DB with a list of outlier-detected areas that can potentially indicate speculation, and then the system confirms any speculation by comparing the two DBs accordingly. Once a speculation case is confirmed, the system automatically reports the case to the investigative agency. By using this system, we expect to detect hidden speculation cases already committed, as well as speculation cases in real-time. Ultimately, we hope to protect the original purpose of redevelopment and the construction of new towns (housing/retail mixed-use zones), redistributing available land on behalf of marginalized people, who are lacking in residential space, by raising the utility of land. Full article

Recent financial scandals and the global financial crisis have generated numerous criticisms of the value and use of annual financial and sustainability reports prepared by companies. This has generated the elaboration and use of a new model of corporate-information reporting that considers strategic, social, economic, and environmental aspects. This study synthesizes the knowledge of the use of integrated reporting as a source of information, and bibliometrically analyzes of 268 articles published in the Web of Science database in 2011–2019. Results show that 77.6% of the academic articles were from developed countries, and the five most influential countries are Italy, South Africa, Australia, the United Kingdom, and the United States. Results show that the development of this type of research is scarce in emerging economies. The most influential authors are García, Rodríguez, and De Villiers. A high level of interconnections is observed in used keywords, of which the most used are ‘sustainability’ and ‘management’. Lastly, this article contributes to the international discussion on integrated reporting by carrying out a structured review of the literature, highlighting previous research. Full article

After almost every economic crisis and corporate scandal, political actors announce the need for stricter regulatory measures for financial markets and companies, in an attempt to appease their voters and defend their political agenda. Regarding the latest international financial crisis, the EU responded, among other things, with comprehensive regulation of the European audit market. In the context of auditor rotation, after 17 June 2016, the duration of audit engagements should not exceed a maximum of 10 years. In this paper, we therefore investigate whether there is empirical evidence behind the 10-year threshold—or is it simply arbitrary? Our aim is to evaluate the audit market reform by the European Union (EU) (Regulation (EU) No 537/2014 and Directive, 2014/56/EU) related to the objective of improving the quality of audits. Therefore, our article addresses the most crucial element of this reform, the implementation of a mandatory audit firm rotation for public interest entities (Regulation (EU) No 537/2014, Article 17). Based on a unique dataset of 11,834 firm observations from all listed companies within the EU between 2008 and 2017, we provide for the first time a discussion basis for the assessment of audit market interventions by the EU. Hence, we compare the new maximum durations with average audit tenure in the particular member states. Even where we present only descriptive results, our results at least indicate that the “magic number” 10 (years) could be more the result of a political process—i.e., a consent between the European institutions—rather than evidence based. Therefore, our findings shall serve as a first starting point in the discussion of a vast and interdisciplinary research field. Full article

One of the main controversial aspects of sustainability metrics relies on the accuracy, transparency, and reliability of the information at the basis of environmental, social and governance (ESG) scores. This paper investigates whether firms that have their ESG reporting audited by independent firms exhibit a higher quality of ESG scores. We performed an analysis investigating the change in ESG scores following the unveiling of a corporate misconduct. We documented that, overall, no significant ESG score adjustment occurs after the scandal becomes public, thus, implying that rating agencies provide an accurate interpretation of the firm’s sustainability. However, our results differed when we distinguished between audited and unaudited reports. Firms whose reports are audited by third parties did not exhibit significant changes in their scores after a scandal, whereas for companies whose reports are not audited, we detected a worsening of the ESG scores that are statistically significant. Our findings were also confirmed in a multivariate analysis. Overall, our results suggest that the reliability of ESG scores can benefit from the auditing of sustainability reporting by third parties, which has an assurance effect on the quality of the company’s ESG information. Full article

This paper examines the moral reasoning trends of CEOs (chief executive officers) in the automotive industry, gauging their relations to ethical behaviors and scandals as well as analyzing the influence of scandals and other factors on their moral reasoning. For such a purpose, we carried out a moral reasoning categorization for the top 15 automotive companies in vehicle production in 2017 by applying Weber’s method to letters written by CEOs for the period 2013–2018. A positive global trend was observed, with some CEOs reaching high levels, although the evolution was uneven without clear patterns and, in the light of facts, not sufficient, at least in the short term. We also found evidence linking the moral reasoning stages with the ethical performance of companies and introduced the concept “tone ‘into’ the top”, reflecting how CEO moral reasoning can be shaped by the company and external factors. This paper stresses the importance of considering the moral tone at the top in relation to company ethical behaviors and the interest of education in business ethics. The outcome is useful for CEOs and other managers seeking to improve corporate social responsibility (CSR) and company ethical performance and to anticipate conflicts as well as to leverage for future research. Full article

This research is carried out in the backdrop of increasing product quality and environmental degradation scandals associated with Chinese Pharmaceuticals in recent years. We examined the data of 125 Chinese Pharmaceuticals between 2010–2016 to investigate the impact of overall corporate social responsibility (CSR) performance as well as the performance on five unique aspects of CSR such as shareholders, employees, customers and suppliers, environmental practices, and the society to gauge the impact of these individual dimensions on the firm’s financial performance. The Hexun rating system is used to gauge a firm’s CSR performance on various stakeholder dimensions as it is one of the widely accepted CSR measurement criteria in China. The firm performance is measured by Tobin’s Q, return on assets (ROA), return on equity (ROE), and earnings per share (EPS) ratios. The outcome of the panel-based regression models reveals that the overall CSR score has a positive and significant influence on a firm’s financial indicators. Moreover, although all the CSR dimensions relate positively to firm performance, the environmental aspect of CSR has the most profound impact on firm performance followed by customers and suppliers, and employees. However, the shareholders and social dimensions have a relatively lesser influence on firm performance. These results imply that Chinese Pharmaceuticals shall further optimize each aspect of CSR performance as it can not only create a favorable brand image for various stakeholders but also results in sustainable financial performance. Full article