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Article
Publication date: 12 May 2023

Jihad Al-Okaily

This paper aims to examine the effect of family control on corporate anticorruption disclosures of UK publicly listed firms and whether female board directors moderate the latter…

Abstract

Purpose

This paper aims to examine the effect of family control on corporate anticorruption disclosures of UK publicly listed firms and whether female board directors moderate the latter relationship.

Design/methodology/approach

This paper uses Poisson regression analysis for a sample of 1,546 FTSE 350 firm-year observations. Weighted least squares and propensity score matching are then used to assess the robustness of the findings.

Findings

The results show that family ownership and involvement are negatively associated with anticorruption disclosures. The tests of moderation indicate that female directors decrease the negative effect of family control on anticorruption disclosures.

Originality/value

To the best of the researcher’s knowledge, this paper is the first to investigate the impact of family control on anticorruption disclosures while taking into consideration the moderating effect of female directors.

Details

Meditari Accountancy Research, vol. 32 no. 2
Type: Research Article
ISSN: 2049-372X

Keywords

Article
Publication date: 26 March 2024

Jaspreet Kaur

This study aims to determine experimentally factors affecting the satisfaction of retail stock investors with various investor protection regulatory measures implemented by the…

Abstract

Purpose

This study aims to determine experimentally factors affecting the satisfaction of retail stock investors with various investor protection regulatory measures implemented by the Government of India and Securities and Exchange Board of India (SEBI). Also, an effort has been made to gauge the level of satisfaction of retail equities investors with the laws and guidelines developed by the Indian Government and SEBI for their invested funds.

Design/methodology/approach

To accomplish the study’s goals, a well-structured questionnaire was created with the help of a literature review, and copies of it were filled by Punjabi retail equities investors with the aid of stockbrokers, i.e. intermediaries. Amritsar, Jalandhar, Ludhiana and Mohali-area intermediaries were chosen using a random selection procedure. Xerox copies of the questionnaire were given to the intermediaries, who were then asked to collect responses from their clients. Some intermediaries requested the researcher to sit in their offices to collect responses from their clients. Only 373 questionnaires out of 1,000 questionnaires that were provided had been received back. Only 328 copies were correctly filled by the equity investors. To conduct the analysis, 328 copies, which were fully completed, were used as data. The appropriate approaches, such as descriptives, factor analysis and ordinal regression analysis, were used to study the data.

Findings

With the aid of factor analysis, four factors have been identified that influence investors’ satisfaction with various investor protection regulatory measures implemented by government and SEBI regulations, including regulations addressing primary and secondary market dealings, rules for investor awareness and protection, rules to prevent company malpractices and laws for corporate governance and investor protection. The impact of these four components on investor satisfaction has been investigated using ordinal regression analysis. The pseudo-R-square statistics for the ordinal regression model demonstrated the model’s capacity for the explanation. The findings suggested that a significant amount of the overall satisfaction score about the various investor protection measures implemented by the government/SEBI has been explained by the regression model.

Research limitations/implications

A study could be conducted to analyse the perspective of various stakeholders towards the disclosures made and norms followed by corporate houses. The current study may be expanded to cover the entire nation because it is only at the state level currently. It might be conceivable to examine how investments made in the retail capital market affect investors in rural areas. The influence of reforms on the functioning of stock markets could potentially be examined through another study. It could be possible to undertake a study on female investors’ knowledge about retail investment trends. The effect of digital stock trading could be examined in India. The effect of technological innovations on capital markets can be studied.

Practical implications

This research would be extremely useful to regulators in developing policies to protect retail equities investors. Investors are required to be safeguarded and protected to deal freely in the securities market, so they should be given more freedom in terms of investor protection measures. Stock exchanges should have the potential to bring about technological advancements in trading to protect investors from any kind of financial loss. Since the government has the power to create rules and regulations to strengthen investor protection. So, this research will be extremely useful to the government.

Social implications

This work has societal ramifications. Because when adequate rules and regulations are in place to safeguard investors, they will be able to invest freely. Companies will use capital wisely and profitably. Companies should undertake tasks towards corporate social responsibility out of profits because corporate houses are part and parcel of society only.

Originality/value

Many investors may lack the necessary expertise to make sound financial judgments. They might not be aware of the entire risk-reward profile of various investment options. However, they must know various investor protection measures taken by the Government of India & Securities and Exchange Board of India (SEBI) to safeguard their interests. Investors must be well-informed on the precautions to take while dealing with market intermediaries, as well as in the stock market.

Details

International Journal of Law and Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1754-243X

Keywords

Article
Publication date: 19 December 2023

Udani Chathurika Edirisinghe, Md Moazzem Hossain and Manzurul Alam

This study aims to explore the managerial conception of the determinants and barriers of sustainability integration into management control systems (MCS) of manufacturing…

Abstract

Purpose

This study aims to explore the managerial conception of the determinants and barriers of sustainability integration into management control systems (MCS) of manufacturing companies in Sri Lanka. Although existing literature has explored the factors that influence the adoption of specific management controls to handle environmental and social issues, the role of management conception has been underrepresented. Specifically, literature is scarce in identifying contextual and organisational factors that influence corporates beyond mere adoption of controls but to integrate with regular controls, especially in developing countries such as Sri Lanka.

Design/methodology/approach

A multiple case study approach has been used to identify the management conception of barriers and enablers for sustainability control integration. The analysis is conducted based on a theoretical framework extending the work of Gond et al. (2012) and George et al. (2016). To obtain an in-depth and multifaceted view, semi-structured interviews were conducted with managers in charge of different functional departments of five manufacturing companies.

Findings

The findings identified managers’ perceived factors, such as environmental impact, stakeholder pressure (customer, competitor and regulatory authorities) and top management commitment, showing a clear difference between strongly and weakly integrated companies. Contrary to the literature, domestic regulatory pressure and multinational ownership do not sufficiently drive MCS sustainability integration.

Practical implications

The findings have implications for managers and practitioners to anticipate the potential barriers and determinants of sustainability integration and provide guidance to take proper measures to deal with them when designing and implementing their MCS.

Originality/value

The study adds value to the literature by presenting a theoretical framework based on the triangulation of different theories to recognise the significance of management idea in sustainable integration. Furthermore, because sustainable integration of MCS is a novel idea, this research is one of the earlier attempts to highlight problems from the perspective of developing countries.

Details

Qualitative Research in Accounting & Management, vol. 21 no. 2
Type: Research Article
ISSN: 1176-6093

Keywords

Article
Publication date: 12 February 2024

Trevor England

This study aims to examine whether and how the experience of specialized external governance mechanisms mandated by the Employee Retirement Income Security Act of 1974 – the…

Abstract

Purpose

This study aims to examine whether and how the experience of specialized external governance mechanisms mandated by the Employee Retirement Income Security Act of 1974 – the actuary and auditor – affect pension plan funding.

Design/methodology/approach

This study uses data from annual pension plan regulatory reports (Form 5500), Form 10-K filings, Form DEF 14A filings (company proxy statements) and publicly available data sources. The hand-collected data include information related to the pension plan’s actuary and auditor and various pension plan data disclosed in the company’s financial statement footnotes.

Findings

The author finds that more experienced actuaries and auditors are associated with better funded pension plans, especially when the company has higher financial risk or lower board independence. Additional analyses indicate that companies with more experienced actuaries and pension plan auditors are more likely to make higher annual pension plan contributions and hold fewer Level 3 fair value assets.

Originality/value

The dearth of pension plan governance research generally focuses on whether and how internal governance mechanisms affect pension plan funding. To the best of the author’s knowledge, this is the first empirical study of the relationship between external pension plan governance mechanisms and pension plan funding.

Details

Managerial Auditing Journal, vol. 39 no. 3
Type: Research Article
ISSN: 0268-6902

Keywords

Article
Publication date: 25 March 2024

Kristin B. Munksgaard, Morten H. Abrahamsen and Kirsten Frandsen

This study aims to investigate how companies’ understanding of the business network influences the creation of value in business-to-business relationships. The authors do this by…

Abstract

Purpose

This study aims to investigate how companies’ understanding of the business network influences the creation of value in business-to-business relationships. The authors do this by analysing dimensions in actors’ “network pictures” and illustrating how value perception and network understanding influence actors’ mutual effort to create value. Approaching relationship value from the point of actors’ cognitive understanding of their business network has so far been largely overlooked in relationship value research.

Design/methodology/approach

This study applies a qualitative case study methodology whereby dyadic data from a well-established business-to-business relationship is collected from 18 company representatives through personal interviews and group interviews supplemented by participant observations and company data.

Findings

The findings contribute with new insight into how companies’ understanding of their surrounding network influence (facilitates or limits) relationship value creation. The authors find that companies continuously reflect on changes in their networks and the related changes in partners’ value perceptions. Through value articulations, companies seek to explicitly express their value perception. Value reflections and value articulations create a dynamic process formed not only by the individual actor but also through their relationship and engagement in their network environment. This requires companies to develop their networking capabilities.

Research limitations/implications

This paper presents findings, insights and contributions limited to a case study of a particular business relationship within an industrial setting. Although the findings and contributions are valid and in line with the criteria for rigorous qualitative research, the authors advocate and call for additional studies that investigate relationships value creation and address the interplay between actors’ network understanding and their actions and behaviour. One way to approach this would be to test the four propositions derived and presented as part of the present study.

Practical implications

The findings imply that management needs to be aware not only of the value created and delivered to a specific partner but also of how the partner’s understanding of the wider network will influence the value delivering and capturing process.

Originality/value

This study contributes to the growing literature on relationship value creation by outlining a dynamic process where relationship partners reflect upon and articulate value. Such activities are influenced by the partners’ network understanding and form the basis of the mutual relationship value creation effort. The findings also contribute to the network pictures literature by emphasizing insights into the formation of value perceptions through actors’ understanding of their surrounding networks.

Details

European Journal of Marketing, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0309-0566

Keywords

Article
Publication date: 5 July 2023

Alireza Rohani and Mirna Jabbour

This study investigates whether carbon media legitimacy is influenced by carbon performance and/or carbon disclosure using a direct measure of carbon media legitimacy in UK…

Abstract

Purpose

This study investigates whether carbon media legitimacy is influenced by carbon performance and/or carbon disclosure using a direct measure of carbon media legitimacy in UK context.

Design/methodology/approach

To test this study's hypotheses, the authors employ Tobit regression analysis of 95 UK companies listed in FTSE350. The authors use balanced panel data (475 observations in total) to reduces the noise introduced by unit heterogeneity.

Findings

The authors find that while corporate carbon performance is not reflected in carbon media legitimacy, carbon media legitimacy is positively and significantly affected by voluntary carbon disclosure (irrespective of its quality). Thus, voluntary carbon disclosure is shown to be an effective tool in legitimising corporate activities.

Research limitations/implications

The results show a certain degree of naivety on the part of the media in assessing corporate carbon behaviour, since it values carbon disclosure (irrespective of its quality) more than carbon performance. Such media behaviour may hinder future improvement in carbon performance of firms.

Practical implications

This study's results indicate that the existing UK carbon disclosure policy does not address the heart of climate change and global warming. Thus, tougher regulations should be considered by policy-makers in relation to voluntary carbon disclosure in the UK.

Originality/value

To the best of the authors' knowledge, this is the first study to examine whether carbon media legitimacy is associated with both carbon performance and carbon disclosure using a direct measure of carbon media legitimacy, and to use the UK context when addressing this association. It also examines the effectiveness of quality of carbon disclosure as legitimation tool.

Details

Journal of Applied Accounting Research, vol. 25 no. 2
Type: Research Article
ISSN: 0967-5426

Keywords

Open Access
Article
Publication date: 9 February 2024

Luca Menicacci and Lorenzo Simoni

This study aims to investigate the role of negative media coverage of environmental, social and governance (ESG) issues in deterring tax avoidance. Inspired by media…

1115

Abstract

Purpose

This study aims to investigate the role of negative media coverage of environmental, social and governance (ESG) issues in deterring tax avoidance. Inspired by media agenda-setting theory and legitimacy theory, this study hypothesises that an increase in ESG negative media coverage should cause a reputational drawback, leading companies to reduce tax avoidance to regain their legitimacy. Hence, this study examines a novel channel that links ESG and taxation.

Design/methodology/approach

This study uses panel regression analysis to examine the relationship between negative media coverage of ESG issues and tax avoidance among the largest European entities. This study considers different measures of tax avoidance and negative media coverage.

Findings

The results show that negative media coverage of ESG issues is negatively associated with tax avoidance, suggesting that media can act as an external monitor for corporate taxation.

Practical implications

The findings have implications for policymakers and regulators, which should consider tax transparency when dealing with ESG disclosure requirements. Tax disclosure should be integrated into ESG reporting.

Social implications

The study has social implications related to the media, which act as watchdogs for firms’ irresponsible practices. According to this study’s findings, increased media pressure has the power to induce a better alignment between declared ESG policies and tax strategies.

Originality/value

This study contributes to the literature on the mechanisms that discourage tax avoidance and the literature on the relationship between ESG and taxation by shedding light on the role of media coverage.

Details

Sustainability Accounting, Management and Policy Journal, vol. 15 no. 7
Type: Research Article
ISSN: 2040-8021

Keywords

Article
Publication date: 18 April 2023

Abdul Rashid, Muhammad Akmal and Syed Muhammad Abdul Rehman Shah

This study aimed at exploring the differential effects of different corporate governance (CG) indicators on risk management practices in Islamic financial institutions (IFIs) and…

Abstract

Purpose

This study aimed at exploring the differential effects of different corporate governance (CG) indicators on risk management practices in Islamic financial institutions (IFIs) and conventional financial institutions (CFIs) of Pakistan. It also investigated the moderating role of institutional quality (IQ) in shaping the effects of CG practices on financial institutions of Pakistan.

Design/methodology/approach

A sample of 57 financial institutions including commercial banks, insurance companies and Modarba companies over the period 2006–2017 is used to carry out the empirical analysis. The authors applied the robust two-step system-generalized method of moments estimator, which is also called the dynamic panel data estimator. They also built the PCA-based composite index of CG and IQ by using different indicators to investigate the moderating role of IQ. They used three proxies for risk taking, five for CG and one for Shari’ah governance. To test the validity of the instruments, they applied the Arellano and Bond’s (1991) AR (1) and AR (2) tests and the J-statistic of Hansen (1982).

Findings

The results provided strong evidence that several individual characteristics of CG and the composite index are significantly related to the operational risk, the liquidity risk and the Z-score (a proxy for solvency risk). The results also revealed that IQ significantly and substantially contributes in reducing the level of risks. Finally, the estimation results indicated that the effects of CG on risk management are significantly different at IFIs and CFIs. This differential impact is mainly attributed to the fundamental differences in business models, operational strategies and contractual obligations of both types of institutions.

Practical implications

The findings of this study are important for enhancing our understanding of how CG relates to risk taking in Islamic and conventional financial services industries and how good quality institutions are important for formulating the governance effects on the risk-taking behavior of financial institutions. The findings suggest that a suitable size of board should be chosen to manage the risk effectively. As the findings show that the risk-taking behavior of IFIs differs from that of CFIs, the regulators and international standard setting bodies should tailor the regulatory frameworks accordingly.

Originality/value

This paper is different from the existing studies in four aspects. First, to the best of the authors’ knowledge, this is the first empirical investigation in Pakistan, which does the comparison of IFIs and CFIs while examining the impacts of CG on risk management. Second, the paper constructs the composite index of CG by considering several different indicators of governance and examines the combined effect of governance indicators on risk management process. Third, this paper adds to the growing literature on the role of IQ by investigating whether it acts as a moderator between CG structures and risk management and if yes, then whether this moderating role is different for IFIs and CFIs. Finally, the paper builds upon the existing research work on the CG effects for different types of financial institutions by proposing a single regression based analytical framework for comparing the effects across two different types of institutions, harvesting the benefits of higher degrees of freedom and avoiding/minimizing the measurement error.

Details

Journal of Islamic Accounting and Business Research, vol. 15 no. 3
Type: Research Article
ISSN: 1759-0817

Keywords

Article
Publication date: 16 May 2023

Nisansala Wijekoon, Umesh Sharma and Grant Samkin

This paper aims to examine the perceptions of owners and accountants of small- and medium-sized entities (SMEs) on the users and their financial information needs of SME financial…

Abstract

Purpose

This paper aims to examine the perceptions of owners and accountants of small- and medium-sized entities (SMEs) on the users and their financial information needs of SME financial reporting.

Design/methodology/approach

Postal questionnaire surveys with owners and accountants of SMEs were used to identify users and their financial information needs. In total, 1,498 questionnaires were sent to SME owners and accountants. A total of 358 questionnaires were returned, generating 323 useable questionnaires. The management branch of stakeholder theory is used for the study which asserts that company management is expected to meet the expectations of those stakeholders who are more powerful than others.

Findings

The users of Sri Lanka SME financial information were limited to owners, banks and Department of Inland Revenue. Users and financial information needs of owners varied in relation to the size of the SME. Financial information are useful for making capital investment and planning decisions for owners regardless of the size of the SME. By sharing information with outside parties, disclosures can diminish information asymmetries between the firms and its stakeholders. The top three reasons for which owners use SME financial information are for planning purposes, estimating income tax liabilities, and taking marketing and pricing decisions.

Research limitations/implications

Since the study focuses only on the views of owner-managers and accountants of SMEs, the holistic understanding of uses of SME financial information by other user groups cannot be achieved.

Practical implications

The results of this study provide international and local standard setters with an indication of future direction for SME financial reporting.

Social implications

This paper extends existing knowledge on users and their financial information needs of SMEs in developing countries. Consequently, the findings of this paper make a valuable contribution to the work of practitioners such as local and international standards-setters and regulators who may be considering developing/revising financial reporting framework for SMEs either worldwide or in developing countries.

Originality/value

Although SME financial reporting has attracted enormous attention in the recent accounting literature, academic research into SME financial reporting is scant. This paper extends existing knowledge on users and their financial information needs of SMEs in developing countries. The general purpose financial reporting model and the accounting standard IFRS for SMEs in particular would not be applicable to Sri Lankan SMEs unless it modifies to reflect the financial information needs of users of Sri Lankan SME financial information.

Details

Journal of Accounting in Emerging Economies, vol. 14 no. 2
Type: Research Article
ISSN: 2042-1168

Keywords

Article
Publication date: 4 July 2023

Lexis Alexander Tetteh, Cletus Agyenim-Boateng and Samuel Nana Yaw Simpson

The study examines the instigating factors behind the development of the local content (LC) policy in Ghana and it further investigates the accountability mechanisms that drive…

Abstract

Purpose

The study examines the instigating factors behind the development of the local content (LC) policy in Ghana and it further investigates the accountability mechanisms that drive the LC policy implementation to promote sustainable development.

Design/methodology/approach

The study reports on a series of interviews with key actors using Institutional Theory and the application of Bovens’ (2010) Global Accountability Framework as a lens for discussion and interpretation of results.

Findings

The results reveal that two forces instigated LC policy enactment. One is external funding pressure from the Norwegian government and the World Bank. The other is the government’s engagement of Civil Society Organisations and other internal stakeholders to justify its activities and missions to signal adherence to impartiality, neutrality, and, to a lesser extent, solidarity. The analysis also reveals tensions in how accountability legitimacy relates to implementation of the LC policy. The study further discovers that while participation, transparency, monitoring, and evaluation are frequently invoked as de jure institutional legitimacy in oil and gas contracts, actual practices follow normative (de facto) institutionalism rather than what the LC policy law provides.

Research limitations/implications

The interview had a relatively small number of participants, which can be argued to affect the study’s validity. Nevertheless, given the data saturation effect and the breadth of the data obtained from the respondents, this study represents a significant advancement in LC policy enactment knowledge, implementation mechanisms and enforcement in an emerging O&G industry.

Practical implications

The findings of this study suggest that future policy development in emerging economies should involve detailed consultations to increase decision-maker knowledge, process transparency and expectations. This will improve implementation and reduce stakeholder tension, conflict and mistrust.

Originality/value

The findings of this study build on earlier investigations into legitimacy, accountability and impression management in and outside the O&G sector. Also, the findings reveal the legitimising tactics used by O&G actors to promote local content sustainable development targets.

Details

Journal of Applied Accounting Research, vol. 25 no. 2
Type: Research Article
ISSN: 0967-5426

Keywords

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