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1 – 10 of over 25000Isaac Boadi, Raymond Dziwornu and Daniel Osarfo
The marginalization of women on boards is a heavily discussed topic across the world, especially in Ghana. Apart from estimating the link between boardroom gender diversity and…
Abstract
Purpose
The marginalization of women on boards is a heavily discussed topic across the world, especially in Ghana. Apart from estimating the link between boardroom gender diversity and technical efficiency of banks, this study aims to test the presence of upper echelons theory in the Ghanaian banking sector.
Design/methodology/approach
The study examines data from 2000 to 2019 annual reports of 23 banks in Ghana. The stochastic frontier analysis is used to estimate the impact of boardroom gender diversity on technical efficiency of banks in Ghana.
Findings
This study finds that greater boardroom gender diversity generates technical efficiencies for banks. The results remain unchanged after accounting for bank types (listed and non-listed). Thus, all banks benefit in terms of technical efficiency from more boardroom gender diversity. The upper echelons theory is validated in the Ghanaian banking context. Overall, the study supports pro-gender diversity on boards.
Practical implications
The results have implications at corporate, social and national levels. It supports the need for policies that improve greater boardroom gender diversity.
Originality/value
This study adds to a growing number of non-developed countries by investigating the link between the boardroom gender diversity and technical efficiency of banks in Ghana, a country which historically has had minimal female participation in the workforce. New insight is, therefore, offered into this relationship by using data which examines the technical efficiency of banks periods before and after the Women in Finance Charter in 2016.
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Irfan Ullah, Aurang Zeb, Muhammad Arif Khan and Wu Xiao
The purpose of this study is to investigate the relationship between board diversity measured as relation-oriented, task-oriented and board overall diversity and firm’s investment…
Abstract
Purpose
The purpose of this study is to investigate the relationship between board diversity measured as relation-oriented, task-oriented and board overall diversity and firm’s investment efficiency.
Design/methodology/approach
This study estimates four dimensions of board diversity, including age, gender, tenure and education. The four dimensions are further categorized in relation-oriented diversity (i.e. age and gender), task-oriented diversity (i.e. tenure and education) and overall board diversity (relation and task oriented). Panel data analysis is used to examine the board diversity–investment efficiency relationship in Chinese listed firms during the years 2003–2018. The findings of the study are robust to a battery of econometric techniques.
Findings
This study finds relation-oriented, task-oriented and overall diversity of a board curb investment inefficiency by discouraging sub-optimal investment (over- or under-investment). In other words, board diversity improves firms’ investment efficiency.
Practical implications
The results suggest that board diversity plays a significant role in corporate decisions. The findings illustrate that board diversity disciplines the management, reduces agency conflicts and thereby improves corporate governance, resulting in higher investment efficiency.
Originality/value
This study has two important contributions. First, this study extends the prior literature of investment efficiency by considering socio-psychological dimension of the board diversity by constructing relation- and task-oriented diversity. Second, contrary to earlier studies on board diversity, this study takes four facets of board diversity, i.e. age, gender, education and tenure that improve corporate governance mechanism.
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David Adeabah, Agyapomaa Gyeke-Dako and Charles Andoh
This study aims to analyze the efficiency of banks under board gender diversity and to examine the determinants of bank efficiency.
Abstract
Purpose
This study aims to analyze the efficiency of banks under board gender diversity and to examine the determinants of bank efficiency.
Design/methodology/approach
Data for analysis were sourced from annual reports of 21 banks for the period from 2009 to 2017. A two-step framework was used: first, an examination of efficiency scores with and without board gender diversity computed using data envelopment analysis; and second, a regression of board gender diversity as a determinant of bank efficiency using panel estimation on an unbalanced panel data.
Findings
The results reveal that gender diversity promotes bank efficiency up to a maximum of two female directors on a nine-member board of directors, suggesting a threshold effect on bank efficiency. Board size improves bank efficiency. Board independence is negatively related to bank efficiency. Also, powerful chief executive officers are detrimental for bank efficiency. Finally, the authors find that ownership structure, bank size, bank age and loan-to-deposit ratio are important factors affecting bank efficiency.
Research limitations/implications
All bank-year observations with no female representation on the board were excluded. As such, this paper is limited to 21 banks. Future research should look at a larger data set and account for dynamic endogeneity.
Practical implications
The paper contributes to bank governance structure, namely, gender composition of boards, and provides an insight for regulators and shareholders to estimate the role of men and women on boards.
Originality/value
The novel feature of the efficiency model used is that it incorporates board gender diversity as an additional input variable, in line with the preposition of proponent of resource dependency theory.
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Farman Ali, Man Wang, Khalil Jebran and Syed Tauseef Ali
The purpose of this paper is to explore how multiple facets of board diversity influence technical efficiency (TE) and total factor productivity (TFP).
Abstract
Purpose
The purpose of this paper is to explore how multiple facets of board diversity influence technical efficiency (TE) and total factor productivity (TFP).
Design/methodology/approach
The authors measure board diversity in two dimensions: relation-related dimension (age and gender) and task-related dimension (tenure, education and expertise). The authors use a balanced panel data of 806 nonfinancial Chinese firms over the period 2009–2017. The authors use a two-stage approach for analysis. In the first stage, the authors use a non-parametric frontier approach to calculate the TE and factor productivity scores. In the second stage, the authors regressed these scores on board diversity attributes (relation-related diversity and task-related diversity).
Findings
By using tobit regression and two-step system GMM, the authors find that board diversity improves TE and TFP. The authors’ analyses illustrate that a higher diversity on corporate board (in terms of age, gender, tenure, education and expertise) positively influence firm efficiency.
Practical implications
The findings have important implications for policymakers. The findings suggest that regulators should devise policies to encourage board diversity. Because a diverse board can bring knowledge, skills, abilities, expertise and experience of diverse group members, which will ultimately enhance a firm’s efficiency. Especially, in the emerging markets (such as China), there is still a need for standard governance mechanisms; therefore, the authors suggest that policymakers should develop regulations and promote diversity of directors as one of the factors for improving the governance mechanisms, which will ultimately improve firms productivity.
Originality/value
Prior studies mostly considered only one dimension (such as gender) of diversity and, therefore, have overlooked how other dimensions influence firms. The authors consider several dimensions of diversity and quantify them into relation-related (age and gender) and task-related (tenure, education and expertise) attributes and show how they influence firms’ efficiency. To the best of the authors’ knowledge, this is the first study to comprehensively investigate how several facets of diversity influence a firm’s TE and TFP.
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The purpose of this paper is to answer the question of workforce diversity and efficiency. It departs from the rather ad hoc approach used in most recent empirical papers…
Abstract
Purpose
The purpose of this paper is to answer the question of workforce diversity and efficiency. It departs from the rather ad hoc approach used in most recent empirical papers exploiting firm-level evidence, and suggests focusing on the estimation of the degree of concavity of the production function.
Design/methodology/approach
Workforce diversity is optimal when the technology displays concavity in the share of workers considered (e.g. decreasing marginal contribution of rising shares of more productive/skilled workers). What is also shown in this paper is that a generalised version of the production function à-la-Hellerstein-Neumark (HN) – where workforce diversity is captured via an index of labour shares – is suitable for estimating the concavity of the technology, and thus for assessing the case for/against workforce diversity.
Findings
The paper contains an application to two panels of Belgian firms covering the 1998-2012 period. The main empirical result is that of an absence of strong evidence that age, gender or educational diversity is good or bad for efficiency.
Originality/value
The key idea of the paper is that the degree of convacity/convexity in the share of workers considered of firm-level technology and the desirability/efficiency of workforce diversity are intrinsically connected. It is also that a non-linear/CES version of the HN labour-quality index can be used in empirical work to assess the degree of concavity/convexity of the technology and quantify the efficiency gains/losses of workforce diversity.
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Rodrigo Restrepo and Juan G. Villegas
The purpose of this paper is to present a case study in which data envelopment analysis (DEA) is used to evaluate and classify the suppliers of a Colombian motorcycle assembly…
Abstract
Purpose
The purpose of this paper is to present a case study in which data envelopment analysis (DEA) is used to evaluate and classify the suppliers of a Colombian motorcycle assembly company. This tool allows the integration of several attributes into single performance measures (cross-efficiency and diversity efficiency) and subsequent classification based on the values obtained for these two metrics.
Design/methodology/approach
The classification uses a methodology based on two main tools. The first is an input-oriented cross-efficiency DEA model with ordinal variables to evaluate the suppliers’ performance, and the second is a classification of these into categories that identifies those with good performance for features that make them outstanding.
Findings
The assembly company segments its suppliers according to supply frequency. The results show that suppliers working under a just-in-time system achieve superior performance with respect to other suppliers.
Practical implications
The application of this methodology in a real-world case illustrates how DEA can be a useful tool to support the evaluation and classification of suppliers (a process of increasing complexity given the current trend to include multiple strategic measures together with classical operational measures). Moreover, the methodology illustrated in the study can be adapted to other similar settings.
Originality/value
The main contributions of this paper are twofold. First, to the best of our knowledge, this is the first study to illustrate the use of DEA in a real case related to supplier evaluation. Second, the presence of ordinal variables (e.g. quality or environmental ratings) gives rise to DEA variants seldom used in this context.
Propósito
Este artículo presenta un caso de estudio en el que se utiliza análisis envolvente de datos (DEA) para evaluar y clasificar los proveedores de una ensambladora colombiana de motocicletas. Dicha herramienta permite integrar múltiples atributos en dos medidas de desempeño (eficiencia cruzada y de diversidad) y la posterior clasificación de éstos con base en los valores obtenidos para ambas medidas.
Diseño/metodología/enfoque
La clasificación usa una metodología basada en dos herramientas. La primera es un modelo DEA de eficiencia cruzada orientado a las entradas con variables ordinales que se usa para evaluar el desempeño de los proveedores. La segunda es una clasificación de los proveedores en categorías para identificar aquellos con buen desempeño en algunas características que los hacen sobresalientes.
Resultados
La compañía segmenta sus proveedores de acuerdo con la frecuencia de abastecimiento. Los resultados muestran que los proveedores que operan bajo justo a tiempo (Just-in-time, JIT) tienen un desempeño superior con respecto a los demás proveedores.
Implicaciones prácticas
La aplicación de esta metodología en un caso real ilustra como DEA es una herramienta útil para apoyar la evaluación y clasificación de proveedores (un proceso de complejidad creciente gracias a la tendencia actual de incluir medidas estratégicas junto a las medidas operacionales comúnmente utilizadas). Además, la metodología utilizada puede adaptarse fácilmente a otras situaciones similares.
Originalidad/valor
Las contribuciones de este artículo son dos. Primero, hasta donde sabemos, este es el primer estudio que ilustra el uso de DEA en un caso real de evaluación de proveedores. Segundo, la presencia de variables ordinales (por ejemplo, evaluaciones de calidad y medioambiente) resultan en modelos DEA que son poco utilizados en este contexto.
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The purpose of this study is to explore the link between aggregate production efficiency and the extent of linguistic clustering in Indonesia.
Abstract
Purpose
The purpose of this study is to explore the link between aggregate production efficiency and the extent of linguistic clustering in Indonesia.
Design/methodology/approach
The author draws on the stochastic frontier model and applies it to the data on Indonesian provinces to compute the effects of various determinants on these provinces' aggregate production efficiency. The key determinant is the spatial index of linguistic clustering that the author believes has never been applied before in this context.
Findings
Linguistic clustering is an important determinant of aggregate production efficiency. Linguistic diversity is positively associated with productive efficiency if members of a specific linguistic group are not clustered beyond a certain level.
Originality/value
To the best of the author’s knowledge, this is the first study that links the spatial index of linguistic clustering (because of Massey and Danton) to production efficiency. In other words, the contribution of this study is to introduce a geographical dimension to the mainstream analysis of the association between ethnic diversity and economic performance.
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Ahmad Al-Hiyari, Abdussalaam Iyanda Ismail, Mohamed Chakib Kolsi and Oyewumi Hassan Kehinde
This paper aims to explore whether environmental, social and governance (ESG) performance is positively associated with firm investment efficiency (IE) in emerging economies. It…
Abstract
Purpose
This paper aims to explore whether environmental, social and governance (ESG) performance is positively associated with firm investment efficiency (IE) in emerging economies. It also examines whether board cultural diversity can moderate the ESG–IE relationship.
Design/methodology/approach
This paper uses a cross-country sample of listed firms located in seven emerging countries over the 2011–2019 period. The authors use a fixed effect panel regression to empirically test the hypotheses. The authors also use a lagged model and a Heckman’s (1979) two-stage procedure to mitigate potential endogeneity issues. In addition, a two-stage least squares regression analysis was done as an additional robustness check.
Findings
This study finds that firms with stronger ESG performance have a higher investment efficiency. Interestingly, this study finds that board cultural diversity negatively moderates the impact of ESG performance on IE for firms operating in settings prone to overinvestment. This result suggests that ESG performance plays a less important role in mitigating managers' tendencies to overinvest when corporate boards have more foreign directors. However, the authors do not find such evidence in firms prone to underinvestment. These findings hold after using an alternative measure of IE and controlling for endogeneity concerns.
Originality/value
This paper adds to the existing body of knowledge in three dimensions. First, to the best of the authors’ knowledge, this is the first cross-country study that investigates the linkage between ESG performance and corporate IE in the context of emerging countries. Second, the authors have enriched the prior literature by examining the moderating effect of board cultural diversity on the positive association between ESG performance and corporate IE. Finally, this study has important implications for policymakers and capital suppliers in emerging countries, which strive to facilitate the efficient allocation of scarce resources.
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Helena Kahiluoto, Hanna Mäkinen and Janne Kaseva
The purpose of this paper is to contribute to the theory and practice of supply chain management in terms of how an organisation should structure its supply base to be resilient…
Abstract
Purpose
The purpose of this paper is to contribute to the theory and practice of supply chain management in terms of how an organisation should structure its supply base to be resilient to supply uncertainties and disruptions. An empirical assessment of supplier response diversity is demonstrated, and the following research question posed: Is response diversity of suppliers positively associated with supply chain resilience, more positively than mere supplier diversity is?
Design/Methodology/Approach
Resilience is operationalised as the maintenance of sales of two food products in 27 southern Finnish retail stores during two distinct disruptions. Response diversity is operationalised as 1) diversity in the personnel sizes of slaughterhouse suppliers of pork under domestic strikes and as 2) evenness in the proportions of imports and domestic supply of food oil under global price volatility. A five-step quantitative assessment is performed.
Findings
Response diversity is positively related to the maintenance of sales, more positively than diversity of individual suppliers is.
Research limitations/Implications
Response diversity is an advancement to the theory of supply chain resilience and supply base management, and access to big data increases practical potential.
Practical implications
Empirical assessments of response diversity of suppliers provide buyer companies an effective means to enhance their supply base management for resilience.
Social implications
The proposed approach is useful for teaching and for authorities to enhance food security.
Originality/value
This first assessment of response diversity of supply chain operations presents an important advancement in the theory and practice of supply base management for resilience.
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King Carl Tornam Duho and Joseph Mensah Onumah
The purpose of this paper is to examine the impact of intellectual capital and its components on bank diversification choice.
Abstract
Purpose
The purpose of this paper is to examine the impact of intellectual capital and its components on bank diversification choice.
Design/methodology/approach
Both asset and income diversification are computed and an unbalanced panel data set of 32 banks covering the period 2000–2015 have been used. The panel corrected standard error regression has been used to account for serial correlation and heteroscedasticity.
Findings
The study found that intellectual capital determines the choice of diversifying. Precisely, intellectual capital motivates asset diversity but it dissuades income diversification. Human capital and structural capital are major components that determine asset diversity decisions. Income diversification decision, in this case to choose a focus strategy, is determined by human capital. This gives credence for the human capital theory in Ghana. Competition encourages a focus strategy. Bank size and leverage enhances income diversification while stock exchange listing and government ownership fosters the focus strategy.
Practical implications
Diversification strategy, knowledge base of staff, corporate governance and internal control have been considered as factors leading to the collapse of some Ghanaian banks in 2017–2018. The study provides relevant insights for regulators, decision support units and corporate boards. Intellectual capital and value added metrics should be used for modelling and decision making as they have value relevance.
Originality/value
This is a premier study that has examined the nexus between diversification strategy and intellectual capital in banks.
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