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This study aims to examine information (stock return, volatility and extreme risk) spillovers and interconnectedness within dual-banking systems.

Using multilayer information spillover networks, this paper conduct a deep analysis of contagion dynamics among 24 Islamic and 46 conventional banks from 2006 to 2022.

The findings show the network’s rapid response to financial shocks. Through cross-sector analysis, this paper identify information spillovers between and within Islamic and conventional banking systems. Furthermore, this research illustrates distinct roles played by Islamic and conventional banks within the multilayer network structure, contingent upon the nature of the financial shock.

Understanding the differential roles of Islamic and conventional banks in information transmission can aid policymakers and financial institutions in devising more effective risk management strategies, thereby enhancing financial stability within dual-banking systems.

This study contributes to the literature by emphasizing the necessity of examining contagion mechanisms beyond traditional single-layer network structures, shedding light on the shadow dynamics of information transmission in dual-banking systems.

The recent meeting of G-20 world leaders, held in New Delhi, in 2023, highlighted that the physical effect of climate change has considerable macro-economic costs at the national and global levels and they have also pledged to accelerate the clean, sustainable and inclusive energy transition along a variety of pathways. Climate change could pose various emerging risks to the firm’s operational and financial activities, specifically for those which are belonging to the energy sector. Thus, this study aims to investigate the impact of climate risks on the financial performance of select energy companies from G-20 countries.

The study considered 48 energy companies from G-20 countries as the sample for the period of 2017 to 2021. To measure the climate change-related physical risks, the study has considered the ND-GAIN climate vulnerability score and the firm’s financial performance has been measured by return on assets, return on equity, return on capital used and price-to-book ratio. To examine the impact of climate risks on the financial performance of the sample companies, the authors have used pooled ordinary least squares (OLS) and fixed/random effect regression analysis and required data diagnosis tests are also performed.

The empirical results suggested that climate risks negatively impacted the financial performance of the sample companies. The market performances of the firms are also being impacted by the physical climate change. The results of panel data regression analysis also confirmed the robustness of the empirical results derived from the pooled OLS analysis suggesting that firms that operated in a less climate-risky country, financially performed better than the firms that operated in a more climate-risky country.

The paper has significant practical implications like it could be helpful for the policymakers, investors, suppliers, researchers and other stakeholders in developing deeper insights about the impact of climate risks on the energy sectors from an international perspective. This study may also help the policymakers in developing policies for the management of climate risk for the energy sector.

This study adds insights to the existing literature in the area of climate risks and firm’s financial performance. Moreover, this may be the first study that attempts to evaluate the impact of climate risks on the financial performance of select energy companies from the G-20’s perspective.

This study sought to examine the interaction between rural bank performance, information and communication technology (ICT) investment, ICT diffusion and financial development.

Data were sourced from the Association of Rural Banks (ARB) Apex and World Development Indicators (WDI) for the period 2014–2020. A total of 122 rural banks were used for this study. The study adopted the two-step system generalized method of moments (SGMM) estimation technique in assessing the interactions among variables.

This study found compelling evidence to support the positive effect of ICT investment on banks’ performance (return on asset and net interest margin). Further, ICT diffusion and financial development positively influence banks’ performance. The results show a positive moderating effect exerted by ICT diffusion and financial development on the impact of bank risk (bank stability) and ICT investment on all three performance measures.

The study focuses on the rural banking sector in the Ghanaian economy, compared to related studies that examine the subject matter for commercial banks. The moderating effects of ICT diffusion and financial development are assessed to guide policy on rural banking development in Ghana.

Digital transformation misalignment refers to disparities in digital transformation levels between suppliers and buyers across the production and operation process. It has negatively affected supply chain stability. However, the existing research concerning the economic consequences has not been adequately addressed. Therefore, this paper aims to investigate whether such digital transformation misalignment increases supplier financial risk and to identify the factors influencing this relationship.

This paper examines binary combinations of suppliers and buyers listed on China’s A-share market between 2011 and 2021. This group constitutes a sample to empirically test the influence of digital transformation misalignment on the supplier’s financial risk, as well as the moderating effect of the geographical and organizational distances.

The paper’s findings demonstrate that digital transformation misalignment has indeed a significant increase in the supplier’s financial risk. Moreover, the impact is more intense when the geographical or organizational distance between the supplier and the buyer is relatively large.

The existing literature rarely explores the potential risks arising from digital transformation misalignment between supply chain partners. Therefore, this paper fills a notable gap as it is the first to study the impact of digital transformation misalignment on the supplier’s financial risk and the specific applied mechanisms. The contribution significantly improves the field of corporate digital transformation, particularly, within the context of supply chain management.

The precise relationships between neoliberalization, financialization, and rising risk are still being debated in the literature. This paper examines, and challenges, the Financial Instability Hypothesis (FIH) developed by Hyman Minsky and his adherents. In this perspective, the level of financial risk builds over time as participants orient their behavior in relation to assessments of past levels of risk performance, leading them to overly optimistic valuation estimates and increasingly risky behavior with each subsequent cycle. However, there are problems with this approach, and many questions remain, including how participants modify their exposure to risk over time, how risk is scaled, and who benefits from changes in exposure to risk. This paper examines such questions and proposes an alternate perspective on financial instability and risk, in light of the history of risk management within Canada’s housing finance sector. The rise of financialization in Canada has been accompanied by shifts in the sectoral and scalar locus of risk within the housing sector, from the federal state, to lower levels of government, third-sector organizations, and finally, private households. In each case, the transfer of risk has occurred as participants in each stage sought to reduce their own risk exposure in light of realistic and even pessimistic (not optimistic) expectations deriving from past exposure, contradicting basic assumptions of Minsky’s FIH. This is the process that has driven the neoliberalization of housing finance in Canada, characterized by the socialization of lender risk while households increasingly take on the financial and social risks relating to shelter.

Standard financial risk management practices proved unable to provide an adequate understanding and a timely warning of the financial crisis. In particular, the theoretical foundations of risk management and the statistical calibration of risk models are called into question. Policy makers and practitioners respond by looking for new analytical approaches and tools to identify and address new sources of financial risk. Financial markets satisfy reasonable criteria of being considered complex adaptive systems, characterized by complex financial instruments and complex interactions among market actors. Policy makers and practitioners need to take both a micro and macro view of financial risk, identify proper transparency requirements on complex instruments, develop dynamic models of information generation that best approximate observed financial outcomes, and identify and address the causes and consequences of systemic risk. Complexity analysis can make a useful contribution. However, the methodological suitability of complexity theory for financial systems and by extension for risk management is still debatable. Alternative models drawn from the natural sciences and evolutionary theory are proposed.

Systemic risk has been one of the most interesting issues in banking and financial literature during the last years, particularly in evaluating its effects on the stability of the whole financial system during crises. Differently from other studies which analyze systemic risk focusing on European countries, we explore the determinant of systemic risk in other regional or continental banking systems, as Latin America. Using the CoVaR approach proposed by Adrian and Brunnermeier (2016), we study the impact of corporate variables on systemic risk on a sample of 30 Latin American banks belonging to seven countries, continuously listed from 2002Q1 to 2015Q4. We investigate the contribution of the corporate variables over different economic periods: the Subprime crisis (2007Q3–2008Q3), the European Great Financial Depression (2008Q4–2010Q2), and the Sovereign debt crisis (2010Q3–2012Q3).

Purpose: This chapter discusses some policy options that central banks may find useful in dealing with climate change risk in the financial sector.

Methodology: This chapter uses discursive analysis to suggest policy options which central banks can use to deal with the risk of climate change in the financial sector.

Findings: Five policy options are proposed in the chapter, which includes: imposing a climate change capital surcharge; impose a fixed-rate risk capital – based on Tier 2 capital; a reduction in lending to industries whose activities destroy the environment and climate; creating a climate bank; and requiring financial institutions to relocate their important assets to areas less prone to climate change events.

Implication: Several policy experiments are needed to identify the best policy option that works best for each country while taking into account the unique financial sector, financial system, and climate change history of each country.

Originality: Central banks play an important role in regulating the financial sector and in managing its inherent risks, yet there are no studies that suggest policy solutions to help central banks and other financial sector regulators deal with the risk that climate change poses to the financial sector. This chapter suggests policy options that central banks can use to deal with the risk that climate change poses to the financial sector.

Cryptoassets have recently attracted the attention of national and international financial regulators. Since the mid-2010s blockchains have increasingly been adapted to automate and replace many aspects of financial intermediation, and by 2015 Ethereum had created the smart contract language that underpins the digitization of real assets as asset-backed tokens (ABTs). Those were initially issued by FinTech companies, but more recently banks active on international capital and financial markets, and even central banks, for example, the Bank of Thailand, have developed their own digital platforms and blockchains. A wide variety of real and financial assets underpins ABTs, viz., real-estate, art, corporate and sovereign bonds, and equity. Consequently, owing to the significant market capitalization of cryptocurrencies, the Basel Committee on Banking Supervision (BCBS) published two consultative papers delineating its approach on cryptoasset regulation. In this study, the authors analyze the mechanics of ABTs and their potential risks, relying on case studies of recent issuance of tokens in equity, real-estate, and debt markets, to highlight their main characteristics. The authors also investigate the consequences of the increasingly oligopolistic structure of blockchain mining pools and Bitcoin exchanges for the integrity and security of unregulated distributed ledgers. Finally, the authors analyze the BCBS’ regulatory proposals, and discuss the reaction of international financial institutions and cryptocurrency interest groups. The main findings are, firstly, that most ABTs are akin to asset-backed securities. Secondly, nearly all ABTs are “off-chain/on-chain,” that is, the underlying is a traditional asset that exists off-chain and is subsequently digitized. The main exception is the World Bank’s bond-i that is genuinely native to the blockchain created by the Commonwealth Bank of Australia, and has no existence outside it. Thirdly, all ABTs are issued on permissioned blockchains, where anti-money laundering/anti-terrorist funding and know-your-customer regulations are enforced. From a prudential regulatory perspective, ABTs do not appear to pose serious systemic risks to international financial markets. This may account for the often negative reactions of banks, banking associations, and cryptocurrency interest groups to the BCBS’ 2021 proposals for risk-weighted capital provisions for cryptoassets, which are viewed as excessive. Finally, we found that issuance of ABTS and other smart contracts on permissionless blockchains such as Bitcoin and Ethereum could potentially generate financial instability. A precedent involving Ethereum and The DAO in 2016 shows that (i) there is a significant accountability gap in permissionless blockchains, and (ii) the core developers of blockchains and smart contract technology, and Bitcoin mining pools, exercise an unexpectedly high- and completely unregulated-amount of power in what is supposedly a decentralized network.

Integrating interdisciplinary studies with Human Capital Management Accounting (HCMA) refers to the dynamics of organized interdisciplinary action that are transversal or cross-cutting. This approach requires the mastery of a certain number of technical skills and disciplines, as well as the capacity to use them in a process to solve problems of financial performance. This is accomplished through the specific interaction tasks that are performed by each management function and operational unit, which act in real time with others, in the same direction as an organizational team, using a selected risk appetite threshold base.

Putting business fields side by side, (i.e., business disciplines silos, as is normally the case in MBA programs), is not enough to create the transversal interaction dynamic needed for firms to achieve expected financial performance goals. As a result, few graduates today have the cross-cutting or vertical skills required to act, in real time, from their workstation in accordance with the pyramid shape of the organization chart in order to create value.

This chapter presents the results of the interface established by a faculty member in the Accounting Department of the University of San Francisco with a “seasoned leader in the FinTech industry.” It proposes a single portal for employers and HRMs to which the continuing education services of professional training associations, executive education departments of colleges, and MBA schools and universities, can connect to issue the HCMA certificate supplementing their training offerings focused on “Leadership Development”.