Biochar is a soil—improving substrate made from phytomass pyrolysis. In Southeast Asia, its application decreases due to the long-term growth of biochar cost and thus caused further prolongation of the payback period. In the Euro-American civilization the biochar application is already almost forgotten once it has been much earlier recognized that the crop yields can be increased much faster with higher doses of nutrients and other agrochemicals. The payback period can be expected in decades. Such a long-time investment into soil (...) fertility raises also many ethical questions. The final decision combines issues of social responsibility, risk and other financial indicators as well as personal preferences and more. The attitudes of Western and Central European decision makers in the agriculture business segment were analyzed on the basis of electronic questionnaire survey and a subsequent interview through their local unions. According to the data, most of them did not know about the possibilities of a more environmentally friendly approach to soil enhancement based on the addition of a fertilizer in the form of biochar. Among others, the collected data also shows that the decision makers from Western Europe have a much different ethical approach to the land and financial indicators than the Central Europeans. (shrink)

This study aims to examine the relationship between public financial management and indicators of well-being among 29 Economic Co-operation and Development (OECD) countries using a balanced panel dataset over the period between 2005 and 2019. This study used a matrix of seven proxy measures of public financial management, which works as an integrated financial system to improve the objective quality of well-being measured by employment, education level, productivity, and wages. Using the generalised method of moments, the (...) estimator's results, indicate that higher government revenues, expenses (% of GDP) lead to lower well-being while the higher net lending /net borrowing, cost of business start-up procedures, and adjusted gross savings (% of GNI) lead to increase well-being measured by spending on education. The higher government revenues, regulatory quality, government effectiveness, and higher net lending /net borrowing lead to improved well-being, while the higher cost of business start-up procedures (% of GNI per capita) leads to lower well-being measured by wages. The higher government revenues, government effectiveness, and higher net lending/net borrowing lead to increased well-being. In contrast, the higher expense (% of GDP) leads to lower well-being measured by productivity labor. The higher government revenues, government effectiveness, regulatory quality, net lending /net borrowing and adjusted gross savings lead to lower well-being, while the higher cost of business start-up procedures leads to increased well-being measured by employment rates. The OECD countries should prepare fiscal policies to ensure the sustainability of public finances in the long run and identify emergency response mechanisms to overcome the challenges of improving the objective quality of well-being. (shrink)

In this paper, wavelet coherences and quantile autoregressive distributed lag approaches are used to study the effect of economic policy uncertainty, infectious disease EMV tracker, and implied volatility on illiquidity during the tranquil and COVID-19 epidemic periods in the US financial market. Our results show that lagged EPU, current VIX, and lagged VIX positively affect illiquidity during the calm period, while the lagged EPU and current VIX decrease illiquidity during the pandemic period. Furthermore, infectious diseases in the financial (...) market during the pandemic crisis play a significant role in instantaneously improving liquidity, while it was not significant during the tranquil period. Similarly, we suggest that with the combined effect of the EPU and the VIX, the uncertainty caused by implied volatility decreases liquidity in a lagged and contemporaneous manner, while an improvement in liquidity is revealed in the case of the EPU. (shrink)

Companies will prioritize external corporate social responsibility (CSR) practices over internal ones, a phenomenon known as the corporate social responsibility gap (CSR gap). Previous studies have mostly focused on its consequences, little is known about its antecedents. We argue that such practice is illegitimate because it goes against stakeholder expectation that primary stakeholders' interests should be prioritized, but it also has potential to gain differentiation benefit for intense investment on external CSR. Drawing on compensatory orchestration logic and the three types (...) of firm legitimacy, we argue that firms that have gained high pragmatic legitimacy are more likely to engage in morally illegitimate but differentiation gaining activities such as CSR gap. Using financial distress to indicate low pragmatic legitimacy, we predict that distressed firms are inclined to practice low CSR gap. Considering the competing logics in China, we further argue that this negative relationship will be less pronounced if firms are state-owned or operating in a competitive industry. Using Chinese listed firms from 2010 to 2019 as an empirical sample, the results provide support for our arguments. (shrink)

This study investigates the financial effects of additions to and deletions from the most well-known social stock index: the MSCI KLD 400. Our study makes use of the unique setting that index reconstitution provides and allows us to bypass possible issues of endogeneity that commonly plague empirical studies of the link between corporate social and financial performance. By examining not only short-term returns but also trading activity, earnings per share, and long-term performance of stocks that are involved in (...) these events, we bring forward evidence of a ‘social index effect’ where unethical transgressions are penalized more heavily than responsibility is rewarded. We find that the addition of a stock to the index does not lead to material changes in its market price, whereas deletions are accompanied by negative cumulative abnormal returns. Trading volumes for deleted stocks are significantly increased on the event date, while the operational performances of the respective firms deteriorate after their deletion from the social index. (shrink)

Women are commonly stereotyped as more risk averse than men in financial decision making. In this paper we examine whether this stereotype reflects gender differences in actual risk-taking behavior by means of a laboratory experiment with monetary incentives. Gender differences in risk taking may be due to differences in valuations of outcomes or in probability weights. The results of our experiment indicate that value functions do not differ significantly between men and women. Men and women differ in their probability (...) weighting schemes, however. In general, women tend to be less sensitive to probability changes. They also tend to underestimate large probabilities of gains more strongly than do men. This effect is particularly pronounced when the decisions are framed in investment terms. As a result, women appear to be more risk averse than men in specific circumstances. (shrink)

With a meta-analysis of 85 studies and 190 experiments, the authors test the relationship between socially responsible investing and financial performance to determine whether including corporate social responsibility and ethical concerns in portfolio management is more profitable than conventional investment policies. The study also analyses the influence of researcher methodologies with respect to several dimensions of SRI on the effects identified. The results indicate that the consideration of corporate social responsibility in stock market portfolios is neither a weakness nor (...) a strength compared with conventional investments; the heterogeneous results in prior studies largely reflect the SRI dimensions under study. (shrink)

ABSTRACT:Officials must understand why and how the public lost confidence in the federal government’s ability to manage financial turmoil. Officials outsourced to private parties responsibility for monitoring and policing the safety-net exposures that were bound to be generated by weaknesses in the securitization process. When the adverse consequences of this imprudent arrangement first emerged, officials claimed for months that the difficulties that short-funded, highly leveraged firms were facing in rolling over debt reflected only a shortage of aggregate liquidity and (...) not individual-firm shortages of economic capital. Then, in September 2008, the president and other officials created an unwise sense of urgency that delays in implementation show to have been greatly exaggerated.That authorities and financiers violated common-law duties of loyalty, competence, and care they owe to taxpayers indicates a massive incentive breakdown in industry and government. Taxpayers deserve a thorough-going reorientation of: (1) how regulatory agencies report on their regulatory performance and back-room interactions with Congress and the Treasury, and (2) the contract structures and performance measures used by the financial industry and its government overseers. (shrink)

As climate change continues to be a pressing issue affecting businesses, firms are taking proactive measures by integrating carbon considerations into their overall strategic planning for environmental sustainability. Nonetheless, the question of whether it pays to be green remains inconclusively answered. Based on an analysis of the 200 largest public listed firms by market capitalisation in Malaysia, the findings indicated that most of the firms are still reactive in managing their carbon activities; however, corporate carbon strategy does, indeed, lead to (...) better financial performance. The findings reaffirmed that going green pays off, particularly for firms with higher levels of foreign ownership. Interestingly, an inverse relationship was observed among firms with higher levels of government shareholdings. Additionally, the firms have been categorised into six different groups based on their scope and level of corporate carbon strategies, ranging from “wait-and-see” to “all-round explorer” classifications. Taken together, these findings enrich corporate carbon and sustainability literature and offer insights into theoretical and policy implications, along with suggestions for future research. (shrink)

Women are commonly stereotyped as more risk averse than men in financial decision making. In this paper we examine whether this stereotype reflects gender differences in actual risk-taking behavior by means of a laboratory experiment with monetary incentives. Gender differences in risk taking may be due to differences in valuations of outcomes or in probability weights. The results of our experiment indicate that value functions do not differ significantly between men and women. Men and women differ in their probability (...) weighting schemes, however. In general, women tend to be less sensitive to probability changes. They also tend to underestimate large probabilities of gains more strongly than do men. This effect is particularly pronounced when the decisions are framed in investment terms. As a result, women appear to be more risk averse than men in specific circumstances. (shrink)

The rising tide of corporate scandals and audit failures has shocked the public, and the integrity of auditors is being increasingly questioned. It is crucial for auditors and regulators to understand the main causes of audit failure and devise preventive measures accordingly. This study analyzes enforcement actions issued by the China Securities Regulatory Commission against auditors in respect of fraudulent financial reporting committed by listed companies in China. We find that auditors are more likely to be sanctioned by the (...) regulators for failing to detect and report material misstatement frauds rather than disclosure frauds. Further analysis of the material misstatements indicates that auditors are more likely to be sanctioned for failing to detect and report revenue-related frauds rather than assets-related frauds. In sum, our results suggest that regulators believe auditors have the responsibility to detect and report frauds that are egregious, transaction-based, and related to accounting earnings. The results contribute to our knowledge of auditors’ responsibilities for detecting frauds as perceived by regulators. (shrink)

Large changes of financial market prices without exogenous causes deviate significantly from the Gaussian behavior of random variables. This indicates that financial markets should be treated as complex systems, for which nonlinear interactions of its subunits/agents are crucial. I focus on how the complex systems perspective impacts the notion of explanations in economics. The mechanistic model seems to fit the bill, but problems surface on closer scrutiny. One characteristic of complex systems is that their behavior is surprisingly independent (...) from microscopic details. Thus, mechanistic explanations in the microreductionist manner seem unavailable. Despite these conflicts, I defend a modified structural mechanistic approach. (shrink)

The relationship between firm financial performance and sustainability reporting (SR) has been extensively researched previously, but with inconsistent results. By incorporating the coercive isomorphism of the institutional theory, this study examines if the relationship is moderated by the ownership of institutional investors. Using data from a sample of 270 Malaysian public listed firms, the study tested two ordinary least square (OLS) regression models. The results show that firm performance and institutional ownership have a positive link to SR. Further examination (...) however discloses a negative moderation of institutional ownership on the relationship between firm performance and SR, thus fail to support the indication that institutional investors coerce the investee firms to utilise their firm performance for sustainability activities. This study adds to SR-related literature by providing reliable and objective findings and directions for future studies in this context. (shrink)

In the mid-1980s, social scientists compared outcome measures of related drug studies, some funded by private companies and others by nonprofit organizations or government agencies. The concept of a “funding effect” was coined when it was discovered that study outcomes could be statistically correlated with funding sources, largely in drug safety and efficacy studies. Also identified in tobacco research and chemical toxicity studies, the “funding effect” is often attributed, implicitly or explicitly, to research bias. This article discusses the meaning of (...) scientific bias in research, examines the strongest evidence for the “funding effect,” and explores the question of whether the “funding effect” is an indicator of biased research that is driven by the financial interests of the for-profit sponsor. This article argues that the “funding effect” is merely a symptom of the factors that could be responsible for outcome disparities in product assessment. Social scientists should not suspend their skepticism and choose as a default hypothesis that bias is always or typically the cause. (shrink)

This paper employs theory of normal organizational wrongdoing and investigates the joint effects of management tone and the slippery slope on financial reporting misbehavior. In Study 1, we investigate assumptions about the effects of sliding down the slippery slope and tone at the top on financial executives’ decisions to misreport earnings. Results of Study 1 indicate that executives are willing to engage in misreporting behavior when there is a positive tone set by the Chief Financial Officer, regardless (...) of the presence or absence of a slippery slope. A negative tone set by the CFO does not facilitate the transition from minor indiscretions to financial misreporting. In Study 2, we find that auditors evaluating executives’ decisions under the same conditions as those in Study 1 do not react to the slippery slope condition, but auditors assess higher risks of fraud when the CFO sets a negative tone. Overall, our results indicate that many assumptions about the slippery slope and tone at the top should be questioned. We provide evidence that pro-organizational behaviors and incrementalism yield new insights into the causes of ethical failures, financial misreporting behavior, and failures of corporate governance mechanisms. (shrink)

Financial accountants falsify financial statements by means of financial techniques such as financial practices and financial standards, and when compared with conventional financial data, it is found that the falsified financial data often lack correlation or even contradict each other in terms of financial data indicators. At the same time, there are also inherent differences in reporting patterns from conventional financial data, but these differences are difficult to test manually. In (...) this paper, the fuzzy C-means clustering method is used to amplify these differences and thus identify false financial statements. In the proposed algorithm, firstly, the normalization constraint of the FCM clustering algorithm on the sum of affiliation of individual samples is relaxed to the constraint on the sum of affiliation of all samples, thus reducing the sensitivity of the algorithm to noise and isolated points; secondly, a new affiliation correction method is proposed to address the problem that the difference in affiliation is too large after the relaxation of the constraint. In the discussion of this paper, most of the information comes from the annual reports of companies, administrative penalty decisions of the Securities Regulatory Commission, and some information comes from research reports made by securities institutions, which are limited sources of information. The proposed method can correct the affiliation to a reasonable range, effectively avoiding the problem that some samples have too much affiliation and become a class of their own and also avoiding the problem that it is difficult to choose the termination threshold of the algorithm iteration due to too little affiliation, and can ensure that the constraint on the sum of affiliation of all samples is always satisfied during the iteration of the algorithm. The method has the characteristics of high recognition accuracy and has the significance of theoretical method innovation. (shrink)

Using the emerging technology of large-scale textual analysis, this study examines the use of the term ‘customer satisfaction’ and its variants in the annual reports issued by publicly traded U.S. corporations and filed with the Securities and Exchange Commission as Form 10-K. We document the frequency of the term’s occurrence in 10-Ks over the 1995–2013 period and the differences in usage across industries. We then relate the term’s usage in 10-Ks to subsequent scores from the American Customer Satisfaction Index to (...) determine whether management’s discussion of customer satisfaction in financial disclosures is credible. The commitment of management to shareholders versus, more broadly, stakeholders is a central question in business ethics, and the integrity of management communication is a fundamental construct in the American Marketing Association’s Statement of Ethics. We document a complex relation between management’s discussion of customer satisfaction and subsequently reported satisfaction. We find that the general use of customer satisfaction in 10-K documents is negatively correlated with subsequent ACSI scores. However, for retail firms, when the phrase is located near words indicating measurement or monitoring of the phenomenon, the empirical relation is reversed and becomes positive. (shrink)

This book approaches the question of the relation between financial crises and earnings management from two philosophical perspectives: positivism and critical realism. The results obtained using the positivist approach indicate that financial crises tend to have no consistent effect on earnings quality since managers’ earnings behavior does not differ from the pre-crisis to the crisis period. The author accordingly argues against the existence of a causal law based on a constant conjunction model and concludes that financial crises (...) cannot be seen as the cause of earnings management. The critical realism perspective, on the other hand, casts light on managers’ reasons for acting like an earnings manager; in conjunction with the more traditional positivist approach, it assists in refuting the idea of financial crises as a generative mechanism for earnings management. The author concludes by exploring other structures at work that might be responsible for earnings management. This book will be of interest to both academics and a wide range of professionals. (shrink)

This research note analyzes the relationship between indicators of corporate social and financial performance within a comprehensive theoretical framework. The results, based on data for 67 large U.S. corporations for 1982-1992, reveal no significant negative social-financial performance relationships and strong positive correlations in both contemporaneous and lead-lag formulations.

In this article an attempt is made to determine what financial support was given between 1790 and 1815 to some of the principal French scientific institutions situated in Paris. Systematic budgeting was not established until after 1815, so it has not been possible to provide a complete picture of development. The financial and economic background have been surveyed, together with some political arguments for and against investment in science and education. Eight institutions have been chosen as representative of (...) the general situation, and archive sources have been studied to provide, as far as possible, an analysis of their varying budgets. This gives an indication of government attitudes to the financing of science. (shrink)

Operational and financial sustainability have, over time, remained as issues in the microfinance industry. The microfinance industry is struggling to gain self-sufficiency in Pakistan due to non-performing loans and operating costs. Simultaneously, deliberation on corporate social responsibility is also considered in academic literature and organizational practices. However, studies on CSR and financial performance in the microfinance sector are scarce, especially in Pakistan. CSR will develop customer attraction and loyalty, employee attraction, motivation and commitment, MFIs' reputation and access to (...) capital, and eventually build financial performance. Interviews were conducted with branch managers of microfinance institutions to test previous questionnaires. A self-administered survey was conducted to collect data from the managers of the microfinance banks operating in Punjab. Descriptive and inferential statistics were performed to answer research questions using Smart PLS. Most of the microfinance institutions believe in social responsibilities but lacks fund allocation and approval from higher management, and results are in line with prior studies. These empirical findings lead to the perception that CSR is not a barrier performance in microfinance banks as they have access to capital. The results indicated a strong positive correlation between CSR and the financial performance of the MFIs. CSR also positively correlates with customer retention, employees' motivation and attraction, and business reputation. CSR was associated with access to capital but was found to be weak. The research also narrated the limitation and practical implications of the study. The study also discusses further research directions. (shrink)

This study formulates a two-factor empirical model under the intertemporal CAPM framework to evaluate the cross-sectional implications of socially responsible investments in the US equity market. Our results show that socially responsible investments have no asset pricing impact on the US market. We argue that this ‘no financial impact’ finding indicates that investors will not be disadvantaged financially by investing in socially responsible funds or corporations.

Based on the research of currency crisis pressure index, bank crisis pressure index, and asset bubble crisis pressure index, this paper introduces an external shock pressure index reflecting the impact of global economic changes on economy and synthesizes systemic financial crisis pressure based on the above four pressure indexes; then, all the alternative early warning indicators and the systemic risk pressure index constructed in this paper were tested for Granger causality. We build financial systemic risk pressure indexes, (...) including currency crisis pressure banking crisis pressure index, bubble crisis pressure index, and external shock pressure index to predict financial crises. Finally, four indicators that have a significant impact on the systemic financial crisis pressure index were selected, namely, the stock price index change rate, industrial added value growth rate, domestic and foreign real deposit interest rate differential, and foreign direct investment as a percentage of GDP. A dynamic Logit model with lagging binary variables is constructed, and compared with the traditional static Logit line, the actual dynamic fitting effect is better than the static Logit model. The dynamic Logit model is used to predict the early warning status of systemic financial crisis in 2020, and the forecast of various early warning indicators is realized by the ARIMA model. The final prediction results show that the probability of a systemic financial crisis in China in 2020 is extremely low, almost zero. This is in line with the overall improvement in the international economic situation in 2020 and the steady growth of the domestic economy. (shrink)

This article analyzes the financial performance and managerial abilities of a sample of US and European socially responsible (SR) mutual funds. The period analyzed commences from January 1994 and concludes in January 2013 and yields 18 US and 89 European green funds. The results obtained for green fund managers are compared with those achieved for conventional and other forms of SR mutual fund managers. We control for the mutual fund investment objective (distinguishing between domestic and global portfolios) and for (...) the effect of crisis market periods. For US SR funds, partitioning the data into crisis and normal periods reveals that SR funds obtain statistically insignificant performance in crisis periods but underperform relative to the market in normal periods. Furthermore, the findings indicate that green funds do not perform worse than other forms of SR mutual funds. For European SR funds partitioning the data into crisis and normal periods reveals that SR funds obtain statistically insignificant performance irrespective of market conditions. Similar to the US findings, green Europe SR funds do not perform worse than other forms of SR mutual funds. Managerial abilities are not evident in the findings though unsuccessful timing of the market is revealed for both Europe and US global green funds. When analyzing managerial abilities in crisis and non-crisis market periods, US green fund managers achieve better results in crisis market periods and the opposite occurs for green fund managers in European market. (shrink)

Speculative bubbles present a problem for the development of sophisticated financial markets in developing economies. This paper discusses the evolution of regulatory institutions in Pakistan pertaining to the Karachi stock exchange and empirically tests for the presence of stock market bubbles in that stock market in recent years. A fundamental is estimated using a VAR approach, and residuals of this fundamental are tested for trends using Hamilton regime switching and Hurst rescaled range methods. Nonlinearities beyond ARCH are also tested (...) for using the BDS test. We are unable to reject the hypothesis of no bubbles or non nonlinearities during the period studied, indicating that Pakistan faces this difficult problem in developing appropriate regulations and institutions for the oversight of its financial markets. (shrink)

This paper reviews the current and future implications of the recent farm financial problems of Missouri for the rural and state economy. To provide a backdrop against which the current and future financial situation may be assessed, the paper first looks at the farm income trends of the state for the period 1964–1985. Although the level has dropped drastically since 1982, the study found that net income had increased significantly for most of the study period.However, the trend in (...) farm debt shows that between 1974 and 1982, total farm debt of Missouri farmers almost tripled. In fact, the farm financial situation in the state deteriorated faster than did farm financial situations in the nation. As a result, Missouri was the leader in the number of farm bankruptcies in the nation in 1985.The paper shows that, since the full-time family farms make up over seventy (70%) percent of the state's total farm, the greater financial problems, resulting in farm losses, occurred in these groups of farms, which are the source of the economic and social health of rural Missouri. It then indicates the serious effects that this wave of farm failures, which amounts to a depopulation of farms and farm families, has on the social and economic structure of rural communities, cheap but reliable food supply system, and competition within the farm sector.To keep the farm sector competitive and for the family farm to survive, the paper identifies the need for innovative policies (and suggests some), and for the cooperation and coordination of efforts among different agencies and organizations in the country. (shrink)

Important strides have been made toward understanding the relationship between self-efficacy and life satisfaction. However, existing studies have largely focused on work and academic domains, leaving self-efficacy in the finance domain less frequently investigated. The present study applied the self-efficacy construct to the finance domain, namely “financial self-efficacy”, and tested the sequential mediating roles of high standards tendency and investment satisfaction in the relationship between FSE and general life satisfaction. A total of 323 employees from finance-related businesses completed anonymous (...) questionnaires regarding FSE, high standards tendency, investment satisfaction, and general life satisfaction. Results indicated that FSE influenced general life satisfaction through investment satisfaction, and sequentially through high standards tendency and investment satisfaction. These results provide contributions to the current literature on life satisfaction, and positive psychology literature by shedding light on the roles of high standards tendency and investment satisfaction in the relation between FSE and general life satisfaction. (shrink)

Entrepreneurship plays an important role in the development of national economy. The study aims to accelerate the construction of social and economic structure by improving the success rate of new entrepreneurs in the process of innovation and entrepreneurship. First, the related theories of financial risk prediction are introduced, and entrepreneurial psychological status and the psychological states on entrepreneurship are analyzed. Second, the current situation of entrepreneurial psychology of new entrepreneurs is analyzed through a questionnaire survey and model test. The (...) results show that private enterprises account for the largest proportion, with a percentage of 58.14% of 125. In total, 32 Chinese-foreign joint ventures rank second and account for 14.88% of the total, and the scale of each type of enterprises accounts for 25%, respectively. The operating years of enterprises are mainly between 10 and 20 years. Among the enterprises surveyed, the significant level of entrepreneurial psychology and entrepreneurial opportunity of entrepreneurs is p = 0.000–0.01. It indicates that males’ psychological adjustment ability and entrepreneurial ability in the entrepreneurial process are higher than females’, and their entrepreneurial psychological states and entrepreneurial ability will improve with the growth of age, education levels, and positions. It is concluded that entrepreneurial psychological capital and entrepreneurial opportunity are significantly positively correlated with financial risk expectation. The research results prove the impact of financial risks on the entrepreneurial psychology of new entrepreneurs, and provide a reference for new entrepreneurs in predicting financial risks. (shrink)

There is a long-running debate among legal scholars regarding the propriety and enforceability of SEC attempts to mandate disclosures of antisocial or illegal corporate activities that do not materially impact a company’s financial statements. This debate was recently revived by the issuance of SEC Staff Accounting Bulletin 99, Materiality in Financial Statements (SEC 1999), which suggests that quantitatively immaterial information relating to unlawful transactions or regulatory non-compliance should be considered for disclosure. This issue has important implications for the (...) accounting profession, although it has generally been ignored in the accounting literature. This paper reviews legal and ethical considerations raised by the issue of qualitative disclosures, and also presents the results of a preliminary empirical test of the impact of such disclosures on financial statement users’ judgments. The results of this study indicate that investors consider the nondisclosure of immaterial illegal acts to be unethical, and reject suggestions that such information lacks moral intensity. The results also suggest that immaterial illegal acts have a significant effect on investors’perceptions of the quality of corporate management and the likelihood of investment in a company. This effect was more pronounced when the illegal act was combined with self-dealing on the part of corporate executives. (shrink)

The aim of the article is to present possible consequences caused by the development of commodity market financialization understood by the influence of financial investor’s speculation. Also the task of elaboration is to outline the existence of financial factors in the price creation process of commodities. The existing impact of financialization on the volatility of commodity prices significantly modifies the market. The results of the research and analyzes carried out indicate a similarity in the behavior of the markets (...) of commodities. The situation results from the redistribution of the risk of financial investors who having a few goods in the investment portfolio, next to large transaction volumes affect the unification of price trends. Price shaping factors are being transformed. The decrease importance of supply or consumption in the context of the commodities market changes its form. The growing influence of investors who create numerous speculations transforms the market. Trade in futures contracts affects the level of commodities prices. (shrink)

This study examines whether differences in financial performance exist for investment trusts which base their portfolio selection primarily on an ethical screen, compared to indexes which incorporate a broader spectrum of investments. Results indicate that on a risk-adjusted basis there is an insignificant difference in the financial performance of these trusts against three common market benchmarks. However as to the extent of the directional effect, there does exist slightly superior financial performance by ethical trusts against their respective (...) industry average indexes, but an underperformance against a smaller company's index and the market as a whole. The lack of a distinct advantage in the short to medium term for applying an ethical screen, may in part be due to the recent development of ethical investments in Australia. Stronger performances by older ethical investment trusts may indicate superior returns are more likely to occur over a longer term. (shrink)

There is a long-running debate among legal scholars regarding the propriety and enforceability of SEC attempts to mandate disclosures of antisocial or illegal corporate activities that do not materially impact a company’s financial statements. This debate was recently revived by the issuance of SEC Staff Accounting Bulletin 99, Materiality in Financial Statements (SEC 1999), which suggests that quantitatively immaterial information relating to unlawful transactions or regulatory non-compliance should be considered for disclosure. This issue has important implications for the (...) accounting profession, although it has generally been ignored in the accounting literature. This paper reviews legal and ethical considerations raised by the issue of qualitative disclosures, and also presents the results of a preliminary empirical test of the impact of such disclosures on financial statement users’ judgments. The results of this study indicate that investors consider the nondisclosure of immaterial illegal acts to be unethical, and reject suggestions that such information lacks moral intensity. The results also suggest that immaterial illegal acts have a significant effect on investors’perceptions of the quality of corporate management and the likelihood of investment in a company. This effect was more pronounced when the illegal act was combined with self-dealing on the part of corporate executives. (shrink)

There is a long-running debate among legal scholars regarding the propriety and enforceability of SEC attempts to mandate disclosures of antisocial or illegal corporate activities that do not materially impact a company’s financial statements. This debate was recently revived by the issuance of SEC Staff Accounting Bulletin 99, Materiality in Financial Statements (SEC 1999), which suggests that quantitatively immaterial information relating to unlawful transactions or regulatory non-compliance should be considered for disclosure. This issue has important implications for the (...) accounting profession, although it has generally been ignored in the accounting literature. This paper reviews legal and ethical considerations raised by the issue of qualitative disclosures, and also presents the results of a preliminary empirical test of the impact of such disclosures on financial statement users’ judgments. The results of this study indicate that investors consider the nondisclosure of immaterial illegal acts to be unethical, and reject suggestions that such information lacks moral intensity. The results also suggest that immaterial illegal acts have a significant effect on investors’perceptions of the quality of corporate management and the likelihood of investment in a company. This effect was more pronounced when the illegal act was combined with self-dealing on the part of corporate executives. (shrink)

The corporate financial performance (CFP)–corporate social performance (CSP) relationship has been investigated many times over the past few decades, yet the notion of CSP has generally been understood to be a single, monolithic aspect of corporate strategy. This article examines the common CFP–CSP understanding in three distinct ways: (1) by extending the evaluation of CSP as a complex, multistakeholder notion; (2) by analyzing CSP's relationship with the firm's financial performance at a given point in time as a lead (...) (independent) variable in the relationship and as a lag (dependent) variable in the relationship; and (3) for both positive and negative stakeholder relationships. The results indicate that the employee emerges as the stakeholder group most strongly linked to CFP, followed by the consumer stakeholder. The natural environment and the community stakeholder group are minimally associated with CFP. General support is found for a CFP–CSP relationship at a given point in time, with some support found for CSP as a lead (independent) variable. When used as a measure of financial performance, return on assets is more often correlated with CSP than is return on equity. These results and their implications are discussed. (shrink)

Many jurisdictions have put regulatory strategies in place to provide incentives and safeguards to whistleblowers to encourage whistleblowing on corporate wrongdoings. One such strategy is the provision of a financial incentive to the whistleblower if the complaint leads to a successful regulatory enforcement action against the offending organization. We conducted an experiment using professional accountants as participants to examine whether such an incentive encourages potential whistleblowers to report an observed financial reporting fraud to a relevant external authority. We (...) also examine the effect of perceived seriousness of the wrongdoing on accountants’ intention to whistleblow. We find that a financial incentive results in a higher intention to whistleblow to a relevant external authority. We also find that perceptions of the seriousness of the wrongdoing are significantly and positively associated with accountants’ intention to whistleblow to a relevant external authority. We find a significant interaction between the provision of a financial incentive and the perceived seriousness of the wrongdoing on the intention to report the wrongdoing externally. The intention to report the financial reporting fraud externally is higher when the level of perceived seriousness is higher, regardless of the availability of a financial incentive. However, when the perceived level of seriousness is lower, the presence of financial incentive results in a higher intention to report the financial reporting fraud externally. These findings indicate that the impact of a financial incentive on the intention to whistleblow is moderated by perceptions of the seriousness of the wrongdoing. (shrink)

This study employs the Porter hypothesis framework to test the moderating role of production cost in the relationship between resource-efficiency actions and financial performance for German small and medium-sized enterprises (SMEs). For this purpose, we employ the 2012, 2018, and 2021 Flash Eurobarometer surveys to analyze how consistently SMEs adopt resource-efficiency actions, and the impact of these actions on their performance and costs. We also conduct a generalized method of moments regression analysis (GMM). Among the seven resource-efficiency actions proposed, (...) saving water had a significant positive (negative) influence on financial performance in 2012, 2021, and (2018). Saving energy and using renewable energy had a positive and significant (insignificant) effect on financial performance in 2018, 2021, and (2012). Finally, selling scrap material to other companies had a positive and significant impact in all years. Furthermore, increased production costs negatively moderate the relationship between eco-efficiency action scores and financial performance. The results indicate that the “strong” version of the Porter hypothesis is not supported: It only holds when the implementation of eco-efficiency actions reduces production costs and increases financial performance. (shrink)

The early warning of financial risk is to identify and analyze existing financial risk factors, determine the possibility and severity of occurring risks, and provide scientific basis for risk prevention and management. The fragility of financial system and the destructiveness of financial crisis make it extremely important to build a good financial risk early-warning mechanism. The main idea of the K-means clustering algorithm is to gradually optimize clustering results and constantly redistribute target dataset to each (...) clustering center to obtain optimal solution; its biggest advantage lies in its simplicity, speed, and objectivity, being widely used in many research fields such as data processing, image recognition, market analysis, and risk evaluation. On the basis of summarizing and analyzing previous research works, this paper expounded the current research status and significance of financial risk early-warning, elaborated the development background, current status and future challenges of the K-means clustering algorithm, introduced the related works of similarity measure and item clustering, proposed a financial risk indicator system based on the K-means clustering algorithm, performed indicator selection and data processing, constructed a financial risk early-warning model based on the K-means clustering algorithm, conducted the classification of financial risk types and optimization of financial risk control, and finally carried out an empirical experiments and its result analysis. The study results show that the K-means clustering method can effectively avoid the subjective negative impact caused by artificial division thresholds, continuously optimize the prediction process of financial risk and redistribute target dataset to each cluster center for obtaining optimized solution, so the algorithm can more accurately and objectively distinguish the state interval of different financial risks, determine risk occurrence possibility and its severity, and provide a scientific basis for risk prevention and management. The study results of this paper provide a reference for further researches on financial risk early-warning based on K-means clustering algorithm. (shrink)

This paper examines the business practices of socially responsible entrepreneurs with particular focus on activities that directly impact their companies’ finances. We collect case studies of 30 recognized socially responsible entrepreneurial firms from a wide range of industries. We analyze how and to what extent the entrepreneurs and their companies balance their profit objectives with their social or environmental goals. Our results indicate that the companies pursue profits in manners comparable to those of most conventional businesses. However, we learn that (...) our companies make certain deliberate exceptionsin their business practices to exercise their beliefs, although such actions may reduce profi ts. We also observe the entrepreneurs making efforts to identify situations that simultaneously increase the companies’ profits and serve their causes. Most companies choose to stay private and commit to building an enduring organization rather than pursue the conventional exit strategies. Finally, we find that many of the companies in our list commit themselves to and proactively manage formalized giving programs. (shrink)

Financial products and options are frequently complex and difficult for consumers to understand, which, alongside positively oriented sales pitches and predatory practices, may lead to uninformed and hazardous financial decisions. While several legal reforms have been implemented to improve consumers’ understanding of financial products, these modifications have only achieved mixed results. An ongoing challenge is the passive nature of such modifications, giving rise to confirmation bias—noticing the information which confirms one’s belief about a product, while ignoring or (...) not paying enough attention to the potential risks. The aim of this study was to test an implementable form of public policy to help older adults successfully navigate these financial decisions. We tested whether a self-evaluation worksheet, involving an active manipulation of financial content, would significantly impact older adult participants’ responses in an experimental reverse mortgage scenario. Forty community-dwelling, healthy older adults were randomized to one of two conditions: Control Condition and Manipulation Condition. In addition to completing a comprehensive neuropsychological examination, participants were administered the Reverse Mortgage Task. Results indicated that a simple yet active manipulation—imparting accurate and understandable information regarding a complex financial product that must be further manipulated—led to the following among participants in the Manipulation Condition: declines in mood; superior understanding of the financial product; and reduced intention of purchasing the financial product. In order for older adults to be well informed about reverse mortgages, policies must be put in place to ensure that adequate and accurate information has been not only provided but also actively processed by the individual. (shrink)

The relationship between corporate social responsibility and corporate financial performance has long been a central and contentious debate in the literature. However, prior empirical studies provide indefinite conclusions. The purpose of this study is to review systematically and quantify the CSR–CFP link in a meta-analytic framework. Based on 119 effect sizes from 42 studies, this study estimates that the overall effect size of the CSR–CFP relationship is positive and significant, thus endorsing the argument that CSR does enhance financial (...) performance. Furthermore, this work sheds light on the causal relationship between CSR and CFP. Subsequent financial performance is associated with prior social responsibility, while the reverse direction is not supported. This finding supports the instrumental stakeholder theory. As predicted, the meta-analysis results indicate that the measurement strategies of the two key constructs of CSR and CFP explain some variations of the CSR–CFP relationship. Last, this study examines the moderating effect of the environmental context on the CSR–CFP link. This work proposes that CSR in the developed world, with a relatively mature institutional system and efficient market mechanism, will be more visible than CSR in the developing world. The results show that the CSR–CFP relationship is stronger for firms from advanced economies than for firms from developing economies. (shrink)

Peut-on prédire si un projet sera jugé socialement acceptable par ses principales parties prenantes? Dans un contexte où l’acceptabilité sociale en est venue à être considérée comme une condition à la réalisation de tout grand projet, cette question s’avère centrale pour tout développeur de projet, de même que pour les investisseurs qui les soutiennent. C’est dans cette perspective qu’a été développé l’Indice du risque social dans les projets miniers, une initiative soutenue par l’Autorité des marchés financiers à laquelle a travaillé (...) une équipe interdisciplinaire de chercheurs. Au-delà de jeter un éclairage sur la pertinence d’aller de l’avant ou non avec un projet, cet outil prédictif peut surtout permettre de moduler ledit projet, de concert avec ses parties prenantes, pour le rendre davantage acceptable à leurs yeux. Nous souhaitons ici rendre compte des possibilités offertes par cet indice en l’appliquant à deux projets miniers récemment discutés au Québec, soit le projet de mine aurifère développé par Osisko dans la municipalité de Malartic, en Abitibi-Témiscamingue, et celui de Mine Arnaud, à Sept-Îles, qui vise cette fois l’exploitation de l’apatite. Cet exercice nous permet de réaffirmer la pertinence de l’outil que constitue l’Indice, mais également de relever les limites qui lui sont inhérentes. (shrink)

Peut-on prédire si un projet sera jugé socialement acceptable par ses principales parties prenantes? Dans un contexte où l’acceptabilité sociale en est venue à être considérée comme une condition à la réalisation de tout grand projet, cette question s’avère centrale pour tout développeur de projet, de même que pour les investisseurs qui les soutiennent. C’est dans cette perspective qu’a été développé l’Indice du risque social dans les projets miniers, une initiative soutenue par l’Autorité des marchés financiers à laquelle a travaillé (...) une équipe interdisciplinaire de chercheurs. Au-delà de jeter un éclairage sur la pertinence d’aller de l’avant ou non avec un projet, cet outil prédictif peut surtout permettre de moduler ledit projet, de concert avec ses parties prenantes, pour le rendre davantage acceptable à leurs yeux. Nous souhaitons ici rendre compte des possibilités offertes par cet indice en l’appliquant à deux projets miniers récemment discutés au Québec, soit le projet de mine aurifère développé par Osisko dans la municipalité de Malartic, en Abitibi-Témiscamingue, et celui de Mine Arnaud, à Sept-Îles, qui vise cette fois l’exploitation de l’apatite. Cet exercice nous permet de réaffirmer la pertinence de l’outil que constitue l’Indice, mais également de relever les limites qui lui sont inhérentes. (shrink)

This article uses the “Green Credit Guidelines” issued in 2012 as a quasi-natural experiment, using the statistics of A-share listed companies from 2008 to 2017, using the PSM-DID model to examine the effect and mechanism of green credit policies on the investment efficiency of heavily polluting companies, and taking into consideration the heterogeneous influence of the financial ecological environment on the relationship between the two. The research indicates that, after the Green Credit Guidelines were promulgated, the investment efficiency of (...) heavy-polluting companies has been slightly improved compared with non-heavy-polluting companies and that the impact is more obvious in regions with better financial ecological environment. The research conclusions confirm the beneficial effects of the Green Credit Guidelines policy on the prudent investment of companies that cause serious pollution to the environment and improve investment efficiency, a provision of empirical evidence for financial leverage to drive the green economy transformation. (shrink)

In modern conditions the questions of personnel management, including motivation, acquire new meaning. Particularly given the problems relevant to the service sector, where at the beginning of the XXI century employing more than 60% of the workforce in developed countries. These circumstances determine the need for a modern concept of material and immaterial motivation of service industries. Such factors determine the need for the development modern concept of material and immaterial motivation of service industries staff. To obtain indicated objective during (...) research analyzed the existing concepts and paradigm of staff motivation with highlighting their advantages and disadvantages. The results obtained allowed to establish that scientific and expert community does not have the unified approach to the classification and identification of the most effective ones. Special attention is given to modern developments and approaches to the motivation problem. This fact caused the structure of follow studies, including three interlinked vectors: analysis of the essential content of the fundamental concepts in the field of staff motivation; defining features of employee motivation at the enterprises sphere of services; introduction to the key successful international practices which apply by service companies. In general, the results obtained enabled the author’s model of the modern concept of material and non-material motivation at the enterprises the service sector and the corresponding mechanism for the implementation. (shrink)

This study aims to explore how CSR-related messages posted by CEOs on social media are beneficial in fostering social capital, which in turn impacts the FP and online reputation of the firm. The study also examines whether there is any difference in FP due to sharing of CSR-related messages by CEOs before and during the pandemic. Hierarchical regression is used to examine the influence of CEOs CSR related tweets on FP and online reputation. The study reveals that by posting CSR-related (...) messages on Twitter, CEOs can build social capital available on social media, which leads to better FP and online reputation. Findings also indicate that there is no statistically significant difference in FP and online reputation of the firm due to sharing of CSR-related messages by CEOs before and during the pandemic. Our research makes a significant addition to the empirical studies of CSR, social media and social capital theory. (shrink)

The construction of a financial risk prediction model has become the need of the hour due to long-term and short-term violations in the financial market. To reduce the default risk of peer-to-peer companies and promote the healthy and sustainable development of the P2P industry, this article uses a model based on the LightGBM algorithm to analyze a large number of sample data from Renrendai, which is a representative platform of the P2P industry. This article explores the base LightGBM (...) model along with the integration of linear blending to build an optimal default risk identification model. The proposed approach is applicable for a large number of multi-dimensional data samples. The results show that the prediction accuracy rate of the LightGBM algorithm model on the test set reaches 80.25%, which can accurately identify more than 80% of users, and the model has the best prediction performance in terms of different performance evaluation indicators. The integration of LightGBM and the linear blending approach yield a precision value of 91.36%, a recall of 75.90%, and an accuracy of 84.36%. The established LightGBM algorithm can efficiently identify the default of the loan business on the P2P platform compared to the traditional machine learning models, such as logistic regression and support vector machine. For a large number of multi-dimensional data samples, the LightGBM algorithm can effectively judge the default risk of users on P2P platforms. (shrink)

Islamic family law plays a significant role in minimizing the unpleasant effects of the family break up faced by the divorced women and their children by protecting their rights to financial support after divorce. This study undertakes to discuss the historical development of the financial rights after divorce applicable among the Muslims in the pre and post colonial periods, particularly with reference to the iddah maintenance, mut’ah, arrears of maintenance, and child maintenance. The study indicates that despite the (...) provisions were inconformity with the Islamic principles, the applications were restricted and influenced by the Shafi’i madhhab. However, the amount of iddah maintenance and mut’ah were substantial taking into account the standard of living of the Malay society in the 15th and 16th century. This means that the welfare of the divorced women was taken care of since the codification of the Islamic law and its implementation in the Malay society. (shrink)

The discussion about the relationship between tone at the top and financial reporting practices has been primarily focused on the oversight role played by the board of directors and other structural elements of corporate governance. Another relevant determinant of tone at the top is the corporate narrative language, since it is a fundamental way in which the chief executive officer enacts leadership. In this study, we empirically explore the association between financial reporting aggressiveness and five thematic indicators (...) capturing different traits of ethical leadership from 535 annual letters to shareholders. We find that aggressive financial reporting is positively associated with CEO letters using a language which is resolute, complex, and not engaging. Our empirical findings highlight the importance of examining discretionary corporate narratives for the auditing process and the role of tone at the top in influencing accounting practices. (shrink)

Financial wellbeing is an emerging variable in business psychology that is expected to measure overall financial status and future financial trajectories. Financial intelligence and wellbeing have been key determining factors for the financial performance of entrepreneurs. The present study aimed to examine the crucial financial determinants and social capital factors for the entrepreneurial intentions and their financial performances among the 326 entrepreneurs in China. The study's findings showed that the key financial (...) class='Hi'>indicators and social capital are significantly related to entrepreneurial intentions, which considerably predict the entrepreneurial financial performance. The mediating relationships also reported that entrepreneurial intentions and financial intelligence significantly mediate the relationship among social capital, financial wellbeing, and entrepreneurial financial performance. The present study has highlighted the implications for potential entrepreneurs for improving their financial performance through sustainable social capital, financial wellbeing, and financial intelligence. This study will also help the strategists in screening the individuals registering as entrepreneurs based on their financial intelligence quotient. The present study enriches the literature by offering an integrated model on financial wellbeing and entrepreneurial financial performance. (shrink)