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1 – 10 of 296Olfa Ben Salah and Anis Jarboui
The objective of this paper is to investigate the direction of the causal relationship between dividend policy (DP) and earnings management (EM).
Abstract
Purpose
The objective of this paper is to investigate the direction of the causal relationship between dividend policy (DP) and earnings management (EM).
Design/methodology/approach
This research utilizes the panel data analysis to investigate the causal relationship between EM and DP. It provides empirical insights based on a sample of 280 French nonfinancial companies listed on the CAC All-Tradable index during the period of 2008–2015. The study initiates with a Granger causality examination on the unbalanced panel data and employs a dynamic panel approach with the generalized method of moments (GMM). It further estimates the empirical models simultaneously using the three-stage least squares (3SLS) method and the iterative triple least squares (iterative 3SLS) method.
Findings
The estimation of our various empirical models confirms the presence of a bidirectional causal relationship between DP and EM.
Practical implications
Our study highlights the prevalence of EM in the French context, particularly within DP. It underscores the need for regulatory bodies, the Ministry of Finance, external auditors and stock exchange organizers to prioritize governance mechanisms for improving the quality of financial information disclosed by companies.
Originality/value
This research is, to the best of our knowledge, the first is to extensively investigate the reciprocal causal relationship between DP and EM in France. Previous studies have not placed a significant emphasis on exploring this bidirectional link between these two variables.
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Investors who can transfer their savings to investments in a well-regulated market benefit not only themselves but also economic development. Hence, it is crucial for fund owners…
Abstract
Purpose
Investors who can transfer their savings to investments in a well-regulated market benefit not only themselves but also economic development. Hence, it is crucial for fund owners to evaluate their stock market investment decisions. The goal of the study is to understand which model determines the asset returns most efficiently. In this regard, the validity of single and multi-index asset pricing models (capital asset pricing model-CAPM and Fama–French models) has been examined in the Turkish Stock Exchange for 2009–2020, with the quantile regression (QR) approach.
Design/methodology/approach
On 18 portfolios comprised of quoted stocks in the Istanbul Stock Exchange 100 (ISE-100/BIST-100), we test the CAPM, the Fama and French three factor model (FF3) and the Fama and French five factor model (FF5). Empirical analyses have been carried out via QR approach regressing the portfolios' average weekly excess returns on risk premium/market factor (Rm-Rf), firm size, book value/market value (B/M), profitability and investments factors. QR estimation has been employed since QR is more effective and provides a better definition of the distribution’s tails.
Findings
Our empirical findings have revealed that the average excess weekly returns can be explained more strongly via CAPM. Moreover, Fama and French models are expected to give more reliable result with more data, whereas the market premium would give robust results for the Turkish Capital Market.
Practical implications
Individuals investing in financial assets must find the price model that best fits the market. The return can be approximated in the most appropriate manner using the right variables.
Originality/value
The study differs from other research by comparing the asset pricing models via examining the assets' weekly returns with QR in the Istanbul Stock Exchange 100 (ISE-100).
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Matias G. Enz, Salomée Ruel, George A. Zsidisin, Paula Penagos, Jill Bernard Bracy and Sebastian Jarzębowski
This research aims to analyse the perceptions of practitioners in three regions regarding the challenges faced by their firms during the pandemic, considered a black-swan event…
Abstract
Purpose
This research aims to analyse the perceptions of practitioners in three regions regarding the challenges faced by their firms during the pandemic, considered a black-swan event. It examines the strategies implemented to mitigate and recover from risks, evaluates the effectiveness of these strategies and assesses the difficulties encountered in their implementation.
Design/methodology/approach
In the summer of 2022, an online survey was conducted among supply chain (SC) practitioners in France, Poland and the St. Louis, Missouri region of the USA. The survey aimed to understand the impact of COVID-19 on their firms and the SC strategies employed to sustain operations. These regions were selected due to their varying levels of SC development, including infrastructure, economic resources and expertise. Moreover, they exhibited different responses in safeguarding the well-being of their citizens during the pandemic.
Findings
The study reveals consistent perceptions among practitioners from the three regions regarding the impact of COVID-19 on SCs. Their actions to enhance SC resilience primarily relied on strengthening collaborative efforts within their firms and SCs, thus validating the tenets of the relational view.
Originality/value
COVID-19 is (hopefully) our black-swan pandemic occurrence during our lifetime. Nevertheless, the lessons learned from it can inform future SC risk management practices, particularly in dealing with rare crises. During times of crisis, leveraging existing SC structures may prove more effective and efficient than developing new ones. These findings underscore the significance of relationships in ensuring SC resilience.
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Mabrouka Ben Mohamed, Emna Klibi and Salma Damak
This study aims to examine the relationship between corporate social responsibility (CSR) award and sustainability assurance levels for the French CAC 40 companies.
Abstract
Purpose
This study aims to examine the relationship between corporate social responsibility (CSR) award and sustainability assurance levels for the French CAC 40 companies.
Design/methodology/approach
A sample of 57 French companies in the CAC 40 index corresponding to 448 observations was analyzed between 2008 and 2020 using an ordinal regression.
Findings
The main results conclude that the inclusion in the Dow Jones Sustainability Index World, the CSR award and the introduction of the Grenelle 2 law have a significant influence on sustainability assurance levels. However, incentive compensation does not appear to be relevant to explain sustainability assurance levels.
Research limitations/implications
The present study focuses on a sample, limited to companies belonging to the CAC 40 index. To enhance the understanding of sustainability assurance levels, this research may include other global sustainability indices, such as the MSCI World and the FTSE4Good World, in the CSR awards.
Practical implications
This study could be useful for audit practitioners, leading them to reconsider their evaluation methods and take into account CSR incentives for a more objective analysis. Regulators should investigate the current CSR issues to improve CSR disclosure standards. Finally, these findings could motivate other researchers to expand the scope of the research to diverse contexts.
Originality/value
This study helps fill the gap existing in sustainability assurance literature by highlighting the relationship between CSR rewards and sustainability assurance levels.
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Min Bai, Yafeng Qin and Feng Bai
The primary goal of this paper is to investigate the relationship between stock market liquidity and firm dividend policy within a market implementing the tax imputation system…
Abstract
Purpose
The primary goal of this paper is to investigate the relationship between stock market liquidity and firm dividend policy within a market implementing the tax imputation system. The main aim is to understand how the tax imputation system influences the relationship between firm dividend policy and stock market liquidity within a cross-sectional framework.
Design/methodology/approach
This paper investigates the relationship between stock market liquidity and the dividend payout policy under the full tax imputation system in the Australian market. This study uses the Generalized Least Squares regressions with firm- and year-fixed effects.
Findings
In contrast to the negative relationship between the liquidity of common shares and the firms' dividends documented in countries with the double tax system, the study reveals that in Australia, the dividend payout ratios are positively associated with liquidity after controlling for various explanatory variables with both the contemporaneous and lagged time periods. Such a finding is robust to the use of alternative liquidity proxies and to the sub-period tests and remains during the COVID-19 pandemic period.
Research limitations/implications
The insights derived from this study have significant implications for various stakeholders within the economy. The findings provide regulators with valuable insights to conduct a more holistic assessment of how the tax system impacts the economy, especially concerning the dividend choices of firms. Within the context of a full tax imputation system, investors can make investment decisions without factoring in the taxation impact. Simultaneously, firms can be relieved of concerns about losing investors who prioritize liquidity, particularly when a high dividend payout might not align optimally with their financial strategy.
Originality/value
This study contributes to the literature by extending the literature on the tax clientele effects on dividend policy, providing evidence that the tax imputation system can moderate the impact of liquidity on dividend policy. This study examines the impact of the dividend tax imputation system on the substitution effect between dividends and liquidity.
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Mondher Bouattour and Anthony Miloudi
The purpose of this paper is to bridge the gap between the existing theoretical and empirical studies by examining the asymmetric return–volume relationship. Indeed, the authors…
Abstract
Purpose
The purpose of this paper is to bridge the gap between the existing theoretical and empirical studies by examining the asymmetric return–volume relationship. Indeed, the authors aim to shed light on the return–volume linkages for French-listed small and medium-sized enterprises (SMEs) compared to blue chips across different market regimes.
Design/methodology/approach
This study includes both large capitalizations included in the CAC 40 index and listed SMEs included in the Euronext Growth All Share index. The Markov-switching (MS) approach is applied to understand the asymmetric relationship between trading volume and stock returns. The study investigates also the causal impact between stock returns and trading volume using regime-dependent Granger causality tests.
Findings
Asymmetric contemporaneous and lagged relationships between stock returns and trading volume are found for both large capitalizations and listed SMEs. However, the causality investigation reveals some differences between large capitalizations and SMEs. Indeed, causal relationships depend on market conditions and the size of the market.
Research limitations/implications
This paper explains the asymmetric return–volume relationship for both large capitalizations and listed SMEs by incorporating several psychological biases, such as the disposition effect, investor overconfidence and self-attribution bias. Future research needs to deepen the analysis especially for SMEs as most of the literature focuses on large capitalizations.
Practical implications
This empirical study has fundamental implications for portfolio management. The findings provide a deeper understanding of how trading activity impact current returns and vice versa. The authors’ results constitute an important input to build and control trading strategies.
Originality/value
This paper fills the literature gap on the asymmetric return–volume relationship across different regimes. To the best of the authors’ knowledge, the present study is the first empirical attempt to test the asymmetric return–volume relationship for listed SMEs by using an accurate MS framework.
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The purpose of this study is to investigate the moderating effect of board gender diversity on the relationship between sustainability reporting (SR) and earnings management (EM…
Abstract
Purpose
The purpose of this study is to investigate the moderating effect of board gender diversity on the relationship between sustainability reporting (SR) and earnings management (EM) in the East Africa Community (EAC).
Design/methodology/approach
The study analyzed a sample of 71 publicly traded companies from 2011 to 2021.
Findings
The study finds that both SR and board gender diversity have a negative and significant effect on EM and that board gender diversity moderates the relationship between SR and EM.
Practical implications
The findings suggest that boards should support the adoption of SR and increase female representation as a practical way to reduce EM. Policymakers should also implement appropriate measures, such as imposing mandatory SR and gender quotas on corporate boards, to address EM.
Originality/value
This research adds to the limited knowledge of SR and EM in the EAC and also fills a gap in the existing literature by investigating the influence of board gender diversity on the link between SR and EM.
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Poonam Oberoi and Fatiha Naoui-Outini
This study aims to investigate purchasing manager’s core competencies during supplier collaboration and explain the mechanism through which these competencies can affect…
Abstract
Purpose
This study aims to investigate purchasing manager’s core competencies during supplier collaboration and explain the mechanism through which these competencies can affect purchasing firm’s innovative performance.
Design/methodology/approach
The authors conducted 22 semidirective interviews with managers in diverse functions such as purchasing, supply-chain management and product development across industries and across nations (mostly India and France), which allow to formulate the propositions.
Findings
Through open coding, the authors identify three path-dependent, causally ambiguous and socially complex core competencies of purchasing managers: relational and emotional, communicational and creative and cognitive competencies; and through axial coding, the authors explain how these intangible core competencies support implementation of market orientation. To provide supporting arguments for the propositions, the authors use the resource-based view of the firm and dynamic capability theory.
Research limitations/implications
The first theoretical contribution of this study is focusing on the impact of competency–capability dyad in terms of performance. The second theoretical contribution of this study is to identify market orientation as a flexible and dynamic managerial capability.
Practical implications
The first managerial contribution is that the authors have identified and described three sets of a purchasing manager’s core competencies during supplier collaboration that affect the firm’s performance: relational and emotional, communicational and creative and cognitive competencies. The second managerial contribution relates to the mechanism through which purchasing managers’ core competencies during supplier collaboration affect firms’ outcomes.
Originality/value
The value of the results is in the explanation of the mechanism, i.e. market orientation dynamic capability, through which the competencies of purchasing managers can affect purchasing firm’s innovative performance.
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Tariq H. Ismail, Esraa Saady Mohamed Zidan and Emad Ali Seleem
This study aims to theoretically investigate the effect of activating corporate governance (CG) mechanisms on the association between adopting corporate social responsibility…
Abstract
This study aims to theoretically investigate the effect of activating corporate governance (CG) mechanisms on the association between adopting corporate social responsibility (CSR) and tax avoidance (TA). Based on the analyzing of the previous studies, the authors support the results of studies that found a positive effect for activating CG on the adoption of CSR. Also, they found that there is a negative impact of activating CG mechanisms on TA, as CG includes controls and procedures that contribute to limiting opportunistic behaviors of management and ensures making decisions that maximize value for shareholders. To the best of the authors' knowledge, it is the only chapter that examines the effect of activating CG mechanisms on the association between CSR and TA.
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Luis Otero González, Raquel Esther Querentes Hermida, Pablo Durán Santomil and Celia López Penabad
The primary objective of this study is to analyze the performance and risk characteristics of portfolios composed of Spanish family businesses (FBs) when sustainability and…
Abstract
Purpose
The primary objective of this study is to analyze the performance and risk characteristics of portfolios composed of Spanish family businesses (FBs) when sustainability and quality factors are taken into account. By comparing different portfolio compositions against a benchmark, the study aims to provide insights into the impact of these factors on portfolio performance.
Design/methodology/approach
This study employs an empirical approach to evaluate the performance and risk of portfolios consisting of Spanish family businesses (FBs) by incorporating sustainability and quality factors. It compares the results of various portfolios against a benchmark, utilizing GARCH models and the extended six-factor model of Fama and French for the period 2018–2023.
Findings
The findings reveal that investing in Spanish family businesses (FBs) yields higher returns compared to the index, with portfolios incorporating quality factors demonstrating superior performance. However, the inclusion of sustainability factors negatively affects portfolio performance. These results highlight the significance of considering sustainability and quality factors in portfolio construction and investment decisions.
Originality/value
This study contributes to the existing literature by examining the performance and risk implications of incorporating sustainability and quality factors into portfolios of family businesses. The findings offer valuable insights for investors and managers interested in constructing portfolios or developing financial products that balance risk and return effectively.
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