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Article
Publication date: 15 September 2022

Ali Uyar, Hany Elbardan, Cemil Kuzey and Abdullah S. Karaman

This study aims mainly to test the effect of audit committee independence and expertise attributes on corporate social responsibility (CSR) reporting, assurance and global…

Abstract

Purpose

This study aims mainly to test the effect of audit committee independence and expertise attributes on corporate social responsibility (CSR) reporting, assurance and global reporting initiative (GRI) framework adoption and to investigate how CSR committee existence moderates this main relationship.

Design/methodology/approach

The study uses a large global sample that includes all (59,172) firm-year observations having CSR-related data in the Thomson Reuters Eikon database for a period between 2002 and 2019. The empirical analyses are based on random-effects logistic panel regression and Hayes methodology for the moderation analysis.

Findings

The study finds that audit committee independence and expertise are significantly associated with CSR reporting, CSR report assurance and GRI framework adoption. Moderation analysis largely supports the existence of a substitution role between audit and CSR committees and implies that audit committees are significant predictors of CSR reporting, assurance and GRI framework adoption mostly in the absence of the CSR committee.

Practical implications

The findings propose audit committee members be extra-vigilant in CSR reporting and assurance practices arising from undertaking substitution roles with the CSR committee. Hence, firms may configure their corporate structure in line with the results such as augmenting the audit committee with independent and expert members if they do not constitute a CSR committee. If firms establish a CSR committee, audit committee members may allocate less time to CSR reporting and assurance and more time to financial reporting quality.

Originality/value

This is the first study, to the best of the authors’ knowledge, to investigate the direct and indirect effect of audit committees’ attributes not only on CSR disclosure but also on GRI implementation and CSR reporting external assurance, considering the CSR committee’s possible substitutability or complementarity moderating role. This research develops a deeper understanding of audit committees’ non-financial role.

Details

International Journal of Accounting & Information Management, vol. 31 no. 1
Type: Research Article
ISSN: 1834-7649

Keywords

Article
Publication date: 30 September 2020

Candida Bussoli and Danilo Conte

The purpose of this paper is to verify whether the benefits gained by granting extended payment terms can lead to higher profitability for Italian companies. Moreover, the…

Abstract

Purpose

The purpose of this paper is to verify whether the benefits gained by granting extended payment terms can lead to higher profitability for Italian companies. Moreover, the analysis aims to investigate whether trade credit offered at a higher level than the sector average can contribute to the profitability of companies. Finally, it aims to test whether the profitability connected to granting trade credit is higher for the unconstrained and financially sound companies.

Design/methodology/approach

The empirical analyses are conducted on a sample of Italian firms, over the period 2008–2016. The methodologies used to test research hypotheses are panel analysis with fixed effects and random effects models, as well as the generalized method of moment (GMM).

Findings

The results show the contribution of trade credit to the profitability of Italian companies. The empirical analysis also suggests that companies might improve their profitability by increasing investments in trade receivables to a greater extent than companies in their business sector. Finally, the greater use of payables to suppliers and the higher incidence of bank debt reduce the contribution of accounts receivable to the profitability of companies.

Originality/value

This study contributes to the existing literature as very few studies have analyzed whether trade credit offered at a higher level than the sector average may contribute to the profitability of companies. Moreover, the study provides new evidence on the moderation effect of payables to banks and suppliers on the contribution of granting trade credit to company performance.

Details

Journal of Small Business and Enterprise Development, vol. 27 no. 6
Type: Research Article
ISSN: 1462-6004

Keywords

Article
Publication date: 28 February 2023

Zorica Aničić

The prevailing view in the existing literature is that open innovations (OI) increase the innovative performance of enterprises. The author examines whether the same OI practices…

Abstract

Purpose

The prevailing view in the existing literature is that open innovations (OI) increase the innovative performance of enterprises. The author examines whether the same OI practices are equally important for sole entrepreneurs, micro firms, small firms, medium-sized and large enterprises in introducing radical innovations and which set of OI practices is best for a firm, given the firm's size.

Design/methodology/approach

In this study probit models were used on a sample of 915 innovative Serbian enterprises.

Findings

OI is important for all enterprises introducing radical innovations. However, not all OI practices are equally effective in each enterprise size group. The set of OI practices leading to radical innovations depends on the firm size. Cooperation with others is not important for sole entrepreneurs and micro and large companies in introducing radical innovations. Still, cooperation's role is predominant in small and medium-sized enterprises. Also, certain OI practices are important for all enterprises, whilst others do not contribute to radical innovations, regardless of the firm size.

Practical implications

Owners/managers can save considerably by avoiding the allocation of resources to OI practices that result in little to no contribution to radical product commercialisation. At the macroeconomic level, these findings can help policymakers create adequate (tailor-made) public policies to achieve innovation in each specific group of firms.

Originality/value

This study demonstrates that not all OI practices are equally important for achieving radical production solutions in each group of enterprises.

Details

European Journal of Innovation Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1460-1060

Keywords

Article
Publication date: 8 November 2013

Kusum Mundra

This paper revisits the derivation and properties of the Allen-Uzawa and Morishima elasticities. Using a Swiss dataset, this paper empirically estimates various elasticities both…

Abstract

Purpose

This paper revisits the derivation and properties of the Allen-Uzawa and Morishima elasticities. Using a Swiss dataset, this paper empirically estimates various elasticities both in a dual and primal framework using a production theory open economy model and tests for linear homogenous technology. In addition to reporting elasticity at the mean, the standard practice in the literature, this paper also calculates nonparametric distribution of various elasticities. The paper aims to discuss these issues.

Design/methodology/approach

To assess the effect of price change on input, the paper estimates a translog cost function and to assess the effect of quantity change on price, the paper estimates the translog distance function using the data on Swiss economy. The paper estimates Allen-Uzawa and Morishima elasticity both under homogenous and non-homogenous technology using the Swiss dataset of one aggregate gross output and four inputs (resident labor, non-resident labor, imports, and capital) over 1950-1986. Elasticities are reported and compared at the mean as well as explored by looking at the range and nonparametric distribution.

Findings

This paper shows that constant returns to scale are easily rejected in this dataset and that the elasticities, both qualitatively and quantitatively, are very different under homogenous and non-homogenous technology. These elasticities can switch from complements to substitutes or vice versa when one moves away from the mean of the sample. The equality of the nonparametric elasticity distributions under homogenous vs non-homogenous technology is rejected in all cases except one.

Originality/value

This paper gives a clear derivation and interpretation of different elasticities as well as demonstrates using a dataset how to systematically go about empirically estimating these elasticities in a dual and primal framework. It shows that linear homogenous technology can be easily rejected and the elasticities, both quantitatively and qualitatively, are very different under homogenous and non-homogenous technology. This paper is also very valuable because it shows that the standard practice of reporting elasticity at the mean might not be adequate and there is a possibility that these elasticities can switch from complements to substitutes or vice versa when one moves away from the mean of the sample.

Details

Indian Growth and Development Review, vol. 6 no. 2
Type: Research Article
ISSN: 1753-8254

Keywords

Book part
Publication date: 10 August 2016

Ulf Andersson, Suma Athreye and Georgios Batsakis

We argue that a foreign-based R&D subsidiary of a multinational enterprise (MNE) can potentially source knowledge from three diverse knowledge networks, namely (i) external…

Abstract

We argue that a foreign-based R&D subsidiary of a multinational enterprise (MNE) can potentially source knowledge from three diverse knowledge networks, namely (i) external knowledge network of the home country, (ii) external knowledge network of the host country, and (iii) internal (MNE) knowledge network. Drawing on the relative costs and benefits associated with the process of synergistic knowledge, this study examines whether a substitutive or a complementary relationship exists when two of the aforementioned networks collaborate in order to generate new knowledge at the subsidiary level. Our study’s sample is based on a survey questionnaire addressed to foreign-based R&D subsidiaries of Fortune 500 companies. We assess the existence of complementarity/substitutability using the “production function approach.” Our results indicate that a complementary relationship exists between external knowledge network of the host and the home country, as well as between external knowledge network of the host country and internal knowledge network. On the other hand, external knowledge network of the home country and internal knowledge network form a substitutive relationship. Our study offers a more comprehensive view of the diverse sources/knowledge networks that R&D subsidiaries are sourcing knowledge from when compared to existing research. We also specify and account for the costs/benefits involved in knowledge sourcing and thereby detect possible substitution/complementarity between different sources of knowledge. So far, there has been limited to nonexistent research into the diversity of knowledge networks of R&D subsidiaries and the examination of potential substitutabilities and complementarities. Hence our empirical study contributes to the development of this particular research stream.

Details

Perspectives on Headquarters-subsidiary Relationships in the Contemporary MNC
Type: Book
ISBN: 978-1-78635-370-2

Keywords

Article
Publication date: 9 October 2019

Moulay Othman Idrissi Fakhreddine and Yan Castonguay

The purpose of this paper is to draw on recent developments in the open innovation literature to explore whether the openness of SMEs to the four categories of external sources of…

Abstract

Purpose

The purpose of this paper is to draw on recent developments in the open innovation literature to explore whether the openness of SMEs to the four categories of external sources of information (ESI) is complementary, substitute or independent, while assessing the determinants of SMEs’ openness to these ESI.

Design/methodology/approach

This research is based on data from a survey of 451 manufacturing SMEs in the province of Québec, Canada. Data have been elaborated through a multivariate probit model to empirically show that SMEs are considered to be simultaneously open to different ESI. The results of this study show significant heterogeneity in the determinants of SMEs’ openness to these ESI.

Findings

The study found that the SMEs’ openness to different ESI seems to be complementary rather than substitute; and not all variables included in the model explain the SMEs’ openness to the different ESI.

Practical implications

The paper provides practical implications for managers and policy makers including the SMEs’ managers’ role to recognize the consolidation of different ESI jointly instead of separately. Furthermore, managers and policy makers should attempt to provide a fair context to SMEs to manage their openness ecosystem.

Originality/value

This study is virtually the first to investigate both the complementarity and the determinants of SMEs’ openness to different ESI using a sophisticated econometric model.

Details

European Journal of Innovation Management, vol. 22 no. 5
Type: Research Article
ISSN: 1460-1060

Keywords

Article
Publication date: 5 March 2018

Candida Bussoli and Francesca Marino

The purpose of this paper is to investigate the use of trade credit in a sample of small and medium enterprises in Europe, before and after the outbreak of the subprime financial…

1007

Abstract

Purpose

The purpose of this paper is to investigate the use of trade credit in a sample of small and medium enterprises in Europe, before and after the outbreak of the subprime financial crisis and the sovereign debt crisis (2006-2013). This study aims to verify whether trade credit is an alternative source of funding compared to other sources of financing. In addition, it tests whether firms that grant extended payment terms to their customers demand delayed accounts payable terms from their suppliers.

Design/methodology/approach

The empirical analysis is conducted on a sample of European SMEs that were observed over the period immediately before and after the outbreak of the subprime crisis (2008) and the sovereign debt crisis (2010-2011). A panel data analysis is conducted using the generalized method of moment.

Findings

The results suggest that SMEs with a high probability of insolvency use trade credit more extensively. Distressed and weaker SMEs are less able to match accounts receivable to accounts payable. Finally, the evidence suggests that during the financial crises, the substitution hypothesis is weakened and liquidity shocks are propagated through trade credit channels.

Originality/value

This study contributes to the extant literature as very few studies have analyzed intercompany financing for European SMEs during periods of financial crisis. The results suggest that supporting trade credit channels, through timely injections of liquidity to companies, could reduce the impact of both financial and intercompany credit crunch on SMEs.

Details

Journal of Small Business and Enterprise Development, vol. 25 no. 2
Type: Research Article
ISSN: 1462-6004

Keywords

Article
Publication date: 22 August 2022

Samir Belkhaoui

The purpose of this paper is to investigate empirically the channels through which Islamic and/or conventional banking can spur economic growth in MENA region.

Abstract

Purpose

The purpose of this paper is to investigate empirically the channels through which Islamic and/or conventional banking can spur economic growth in MENA region.

Design/methodology/approach

The study uses a range of developed econometric approaches, including panel cointegration technique, panel Granger causality test and a panel-based vector error correction model (VECM), to analyze explicitly all the causal relationships among Islamic banking, conventional banking development and economic growth in a unified framework.

Findings

The empirical results show that Islamic banking in MENA countries not only leads to economic growth but also affects positively and significantly conventional banking development. Thus, Islamic banking has an active role and could be classified as “supply-following” since its development only leads to economic growth, whereas conventional banking, with passive role, could be classified as “demand-following” since it only reacts to economic growth in long run.

Research limitations/implications

The study has two principal limitations. It is conducted within a relatively limited time period and sample of countries. Also, the used models did not take into account the impact of others financial and macroeconomic variables like stock market development, interest rate, inflation and financial crisis.

Practical implications

The results have two main implications. First, in MENA countries, well-functioning Islamic banking sector could not only promote economic growth but also can be served as a development factor for their conventional one. Second, unlike conventional banks, the customer of Islamic banks seems not to be motivated by interest and profits. Rather religious factors are recommended as the main motive for investing and saving in Islamic banks.

Originality/value

The study tries to perceive whether there exists a substitution or complementarity effect between Islamic and conventional banking in promoting economic growth for MENA countries. This situation is neither revealed nor clarified in the relevant literature.

Details

Journal of Islamic Accounting and Business Research, vol. 14 no. 2
Type: Research Article
ISSN: 1759-0817

Keywords

Article
Publication date: 4 November 2014

Justin Doran and Geraldine Ryan

Eco-innovation is any form of product, process or organisational innovation that contributes towards sustainable development. Firms can eco-innovate in a variety of ways. The…

Abstract

Purpose

Eco-innovation is any form of product, process or organisational innovation that contributes towards sustainable development. Firms can eco-innovate in a variety of ways. The purpose of this paper is to identify nine different eco-innovation activities – including such items as reducing material use per unit of output, reducing energy use per unit of output, reducing carbon dioxide (CO2) “footprint” – and the authors ask whether these act as substitutes or complements to one another.

Design/methodology/approach

Eco-innovation is any form of product, process or organisational innovation that contributes towards sustainable development. Firms can eco-innovate in a variety of ways. In this paper the authors identify nine different eco-innovation activities – including such items as reducing material use per unit of output, reducing energy use per unit of output, reducing CO2 “footprint” – and the authors ask whether these act as substitutes or complements to one another.

Findings

Introducing only one eco-innovation activity has little payoff (in terms of turnover per worker) with only those firms who reduce their CO2 “footprint” having higher levels of turnover per worker. When introducing more than one eco-innovation activity the authors find that certain eco-innovation activities complement one another (e.g. reducing material use within the firm at the same time as improving the ability to recycle the product after use) others act as substitutes (e.g. reducing material use within the firm at the same time as recycling waste, water or materials within the firm).

Practical implications

The results suggest that firms can maximise their productive capacity by considering specific combinations of eco-innovation. This suggests that firms should plan to introduce eco-innovation which act as complements, thereby, boosting productivity. It also suggests that eco-innovation stimuli, introduced by policy makers, should be targeted at complementary eco-innovations.

Originality/value

The paper analyses whether eco-innovations act as complements or substitutes. While a number of studies have analysed the importance of eco-innovation for firm performance, few have assessed the extent to which diverse types of eco-innovation interact with each other to complement or substitute for one another.

Details

International Journal of Social Economics, vol. 41 no. 11
Type: Research Article
ISSN: 0306-8293

Keywords

Article
Publication date: 1 June 2012

Ana Ma Serrano‐Bedia, Ma Concepción López‐Fernández and Gema García‐Piqueres

The purpose of this paper is to analyze the existence of complementarity between innovation activities (internal innovation, external innovation and cooperative R&D), as well as…

1694

Abstract

Purpose

The purpose of this paper is to analyze the existence of complementarity between innovation activities (internal innovation, external innovation and cooperative R&D), as well as their impact on firms' innovation performance.

Design/methodology/approach

Drawing on the Third Community Innovation Survey (CIS‐3) for Spain, a multiple regression model is used to study the existence of complementarity between innovation activities and their impact on innovation performance. The sample for the study is 3,964 innovative firms.

Findings

First of all, the empirical results propose that the complementarity appears only between internal innovation and either external or cooperative innovation – but not with both together, which is in‐line with the “absorption capacity” notion. Second, the use of external and cooperation innovation in isolation does not yield positive effects on innovation performance. This finding contradicts the substitution argument and supports the absorptive capacity argument. Finally, innovation strategies do not seem to be dissimilar between industries.

Research limitations/implications

The main limitation of the paper is the use of cross‐section data, which implies less robust results as an empirical test.

Practical implications

The empirical results allow the authors to recommend company managers and public administration officials to improve and support internal innovation. These activities should be combined with the high levels of external acquisitions that Spanish firms have in order to increase their innovation performance as the absorption capacity theory and this paper's empirical results suggest.

Originality/value

The first contribution of the paper is the inclusion of the third form of innovation: cooperation. The second contribution refers to the inclusion of the service sector in the authors' sample.

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