Search results

This paper aims to examine the effect of governance mechanisms (board size, board independence, duality, the Sharia board size, Sharia board meetings and ownership concentration) on the performance of insurance providers of distinguishable Muamalah contracts (wakalah and hybrid), moderated by the length of senior leaders’ servicing time.

The full sample includes 21 listed Takaful companies divided into two subsamples – 12 insurance wakalah contracts offered in the South East Asian (SEA) countries and 9 insurance hybrid contracts offered in the Gulf Cooperation Council (GCC) countries over the period of 2012–2018. The methodology is informed by Baron and Kenny’s (1986) moderation process approach.

The results of this study indicate that the larger the size of directors’ board and the higher the number of outside directors, the greater the SEA wakalah Takaful insurance performance. Nondual functions and a larger size of Sharia board along with a highly-concentrated ownership structure have a positive effect on the Takaful insurance performance in both the SEA and GCC regions. Furthermore, the higher the Sharia board meetings, the higher performance of all types of Takaful insurance providers in the sample. As for the moderating effect of the director’s seniority, it is found to negatively moderate the relationship between the governance mechanisms and the Takaful performance in both regions.

This paper highlights that the leader’s entrenchment stands as an obstructing factor impeding the governance mechanisms from enhancing Takaful performance. Thus, it serves to contribute to clearly understanding the appropriate governance mechanisms usefully fit for a Takaful insurance effective performance, applying the wakalah and hybrid contract types. Such a contribution should be appreciated by the concerned regulators engaged in setting up limited serving periods for the directors whereby the Takaful insurance practice could be efficiently managed and supervised.

The purpose of this paper is to examine the effect of R&D intensity on the real earnings management index.

The authors proceed with dividing the full sample into two sub-samples, in accordance with the R&D associated intensity median. The final test sample proves to involve 73 firms along with 949 relating observations, while the control sample appears to enclose 65 firms and 845 relevant observations for the period 2000-2012.

The main finding of this study is the great influence of R&D intensity on the real earnings management index on the test sample. Accordingly, the proposed hypothesis stipulating that the innovative firms engage in upward real earnings management turns out to be strongly supported.

The study was conducted using robust methods to test the effect of R&D intensity on the real earnings management index. The generalized least squares method was used to fit panel data and overcome heteroscedasticity and autocorrelation problems. The aim of the study was to prove the great effect of R&D intensity on the real earnings management index. As this study was based on data from American companies, the results cannot be generalized to all contexts.

This paper differs from previous work and tests the effect of innovative firms, the market-to-book ratio on real earnings management. The findings of this study will enrich the literature on real earnings management by suggesting R&D intensity that can significantly enhance the real earnings management index. Therefore, these findings will be helpful to investors, managers and regulators because they have implications for the interactive decision-making process.

This research attempts to explain the decentralization of investment decision. To do so, it highlights the role of the internal capital market in the allocation of decision rights and control as a factor explaining the effectiveness of investment management. The authors aim to apply the theory of the organizational architecture to the investment decision to understand its complexity and its efficiency.

An empirical test was realized on a sample of 63 Tunisian firms using the methods of canonical correlation and cross tabulations.

Even if organizational complexity has a linear and negative impact (opposite sign to what is expected) on the investment decision decentralization, which creates value, it appears that there is a positive association with the uncertainty of the environment, and a negative one with the scarcity and sharing of financial resources between units on the internal capital market.

The authors show that the role played by the internal capital market in the value creating requires the setting of a centralized organizational structure.