Search Results (9)

The integration of artificial intelligence (AI) into environmental, social, and governance (ESG) disclosure represents a critical frontier for corporate transparency in emerging markets. This study investigates the relationship between AI adoption in ESG reporting, disclosure quality, and financial performance among 180 Saudi-listed companies (2021–2024) within Vision 2030’s transformative context. Using the System Generalized Method of Moments (GMM) estimation with panel unit root and cointegration testing to ensure stationarity assumptions and addressing endogeneity through bounding analysis, the study finds that AI adoption intensity significantly enhances ESG disclosure quality (β = 0.289, p < 0.001), with coefficient significance assessed through t-tests using firm-clustered robust standard errors. Enhanced disclosure quality translates into meaningful financial performance improvements: 0.094 percentage points in return on assets (ROA), 0.156 in return on equity (ROE), and 0.0073 units in Tobin’s Q. Mediation analysis reveals that 73% of AI’s total effect operates through improved ESG quality rather than direct operational benefits. The findings demonstrate parametric bounds robust to macroeconomic confounders, suggesting AI-enhanced transparency creates substantial shareholder value through strengthened stakeholder relationships and reduced information asymmetries. Full article

This study investigates the relationship between corporate shared institutional equity (SIE) holders and eco-transparency reporting (ETR). Specifically, it examines three distinct types of SIE: (1) common institutional shareholders with industry peers, (2) the average count of unique institutional owners holding shares in both the focal company and its peers, and (3) the total percentage of SIE within the focal company. The findings indicate that firms with higher levels of SIE are more likely to disclose ETR, signaling a commitment to enhancing public trust and aligning with governmental expectations. Furthermore, the study explores the impact of SIE across different stages of the firm’s life cycle, revealing that the influence of SIE on ETR is more pronounced during the growth and mature stages. The results remain robust even when alternative thresholds for SIE are applied, such as adjusting from a 5% to a 3% threshold. To account for potential misspecification and omitted variables, propensity score matching (PSM), System generalized method of moments (Sys GMM) and two-stage least squares (2SLS) methods were employed. This research contributes to the literature by highlighting the role of shared institutional ownership in promoting environmental transparency, offering novel insights into how institutional investors can drive corporate sustainability practices across different firm life cycles. Full article

Greening the environment cannot be achieved satisfactorily, considering that the private sector lags behind the public sector in participation levels. The purpose of this study was to determine the reasons behind the gap in green finance between the two sectors using numerically derived outcomes. Six-year data in the form of total shareholder returns, comprising capital gains and dividends paid from the largest banks in China, the USA, and Europe involved in financing fossil fuels, were extracted from Yahoo.com finance and Macrotrends public forums. Equity premiums were calculated from the total shareholder returns and risk-free rates. A 95% confidence interval was established to determine the lower and upper limits of the equity premiums. The resulting upper limits were used to project premiums that could attract the private sector by 2030. Equity premiums averaged 2.73%, 9.73%, and 4.31% for China, the USA, and Europe, respectively, indicating the substantial task in the USA of attracting the private sector compared to Europe and China. The projections of total shareholder returns showed the same patterns in equity premiums among China, the United States (USA), and Europe. To bridge the gap, the significant need for economic benefits for the private sector should ideally be addressed through green bonds, tailored to green financing projects that are earmarked for revenue generation. Full article

Corporate Social Responsibility (CSR) was usually referred to as a concept where companies initiate voluntary action towards social and environmental concerns in the context of business operations related to the stakeholders of the company prior to the CSR Act 2013 in India. Post-2013, the voluntary initiative was replaced by regulatory guidelines to address social and environmental concerns. The CSR applicability–investment gap was used as a base concept in this study with instrumental theory; the study offers a strategic perspective of CSR and how organizations emphasized maximizing stakeholders’ value. In order to further investigate the effect of CSR on corporate financial performance (CFP) through the measure of shareholders’ value, i.e., the return on equity (ROE), the study used the sample from the National Stock Exchange (NSE)-Nifty-100 indexed companies of Emerging Economy—India for a span of fourteen years (2009–2023). The vast majority of research in this domain is conducted in developed countries; the research gap is filled by this study by considering India and drawing samples from multiple industries. The empirical model was developed by using panel data regression, where the dependent variable was ROE, and the independent variables were earning per share (EPS), log total income (LTI), CSR applicability/profit after tax (CRSAPPPAT), and CSR investment/profit after tax (CSRIPAT). The findings also highlighted the CSR applicability and investment of the firms during pre- and post-Sustainable Development Goal (SDG) periods. The same was also analyzed for the firms committed to CSR and not committed to CSR. The results indicated that there is no significant impact of the CSR/ESG initiatives (applicability and investment) on the ROE of the firms. The performance could be better if the companies minimize the CSR/ESG promise–performance gap through effective communication with stakeholders. Full article

Over the past few decades, financial performance has attracted researchers’ attention, especially in the insurance sector. Insurance is a tool for the growth and sustainability of both rising and developing economies. It promotes economic stability for people, organizations, and governments by taking on risk and spreading it across the market. We intend to classify insurance companies’ financial performance in Jordan’s Amman Stock Exchange (ASE). The sample size is 15 out of 22 selected insurance firms from 2008 to 2020. We apply the Multi-Layer Perceptron (MLP) model for the detection of (high/low) total asset turnover (TAT) as output, while we select the subrogation (SB), claims paid (CP), market capitalization (MC), and total shareholders’ equity (SE) as input to the MLP model. The performance of the MLP model is evaluated using different criteria, namely the false positive rate (FP rate), false negative rate (FN rate), F-measure, precision, and accuracy (ACC). The results show that MLP is efficient and performs well in multiple criterion tests through iteration growth. Based on our knowledge, the paper assesses the financial performance of Jordanian insurance firms, which has not been investigated previously. Furthermore, this study gives valuable information to regulators and policymakers to improve asset management efficiency in the insurance sector. Full article

Are shareholders better off hiring directors with in-depth specialties in the company’s core business or hiring directors with broader perspectives? This study addresses the question by investigating the relationship between directors’ career diversity and firm performance. It employs Tobin’s Q, total shareholder return, and return on equity as measures of firm performance. Accordingly, board career diversity has a significant and positive effect on firm performance. Moreover, we find that board directors with diverse industry experiences create value for firms via advisory (e.g., R&D and capital expenditures) and monitoring (e.g., equity compensation) roles. Given that diversity in career matters, corporations can seriously consider board composition and promote career diversity among board members. Full article

Most of the empirical studies on board remuneration have focused on finding explanatory performance measures. There are studies that analyze if the compensation contracts of directors reward managers in such a way that they strive to maximize firm performance and shareholders’ wealth; however, there are few studies on the social aspect of corporate governance, or agent–employee and principal–employee relationships. Thus, in this study, our aim is to test whether there is a causal relationship between the remuneration of the board of directors of listed companies and the personnel policies of the companies, expressed through the cost of personnel and layoffs. For that, we used a sample of Spanish listed companies, and we found that two performance measures (return on equity and earnings per share on market price) have a greater effect on the growth rate of board remuneration when layoffs occur. Additionally, we found that the sales revenue and cash flow on total assets subsequently influenced personnel management. Full article

The automobile industry is one of the largest economies in the world, by revenue. Being one of the industries with higher employment output, this has become a major determinant of economic growth. In view of the declining automobile production after a period of continuous growth in the 2008 global auto crisis, the re-evaluation of automobile manufacturing is necessary. This study applies the Malmquist productivity index (MPI), one of the many models in the Data Envelopment Analysis (DEA), to analyze the performance of the world’s top 20 automakers over the period of 2015–2018. The researchers assessed the technical efficiency, technological progress, and the total factor productivity of global automobile manufacturers, using a variety of input and output variables which are considered to be essential financial indicators, such as total assets, shareholder’s equity, cost of revenue, operating expenses, revenue, and net income. The results show that the most productive automaker on average is Volkswagen, followed by Honda, BAIC, General Motors, and Suzuki. On the contrary, Mitsubishi and Tata Motors were the worst-performing automakers during the studied period. This study provides a general overview of the global automobile industry. This paper can be a valuable reference for car managers, policymakers, and investors, to aid their decision-making on automobile management, investment, and development. This research is also a contribution to organizational performance measurement, using the DEA Malmquist model. Full article

Contingent Convertible (CoCo) is a hybrid debt issued by banks with a specific feature forcing its conversion to equity in the event of the bank’s financial distress. CoCo carries two major risks: the risk of default, which threatens any type of debt instrument, plus the exclusive risk of mandatory conversion. In this paper, we propose a model to value CoCo debt instruments as a function of the debt ratio. Although the CoCo is a more expensive instrument than traditional debt, its presence in the capital structure lowers the cost of ordinary debt and reduces the total cost of debt. For preliminary equity holders, the presence of CoCo in the bank’s capital structure increases the shareholder’s aggregate value. Full article