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This paper aims to examine the impact of bank’s capital buffer on return on equity (ROE) in the context of Islamic and conventional banks in GCC countries.

The authors collect data from 83 commercial banks comprising of 49 conventional banks and 34 Islamic banks for the period 2010–2019. The final data set comprises of 744 bank-year observations. The authors apply generalized methods of moments estimation technique and panel least square to analyze the data.

The authors document that Tier-1 capital, total regulatory capital (TRC) and equity to asset ratio (EAR) negatively affect banks’ ROE. However, the impact disappears for conventional banks and sustains for Islamic banks if these two clusters of banks are treated separately. Furthermore, the negative impact of equity capital on earning is more pronounced for large and listed commercial banks.

Findings of this research imply that Islamic banks in GCC countries has scope to manage equity capital more efficiently. Hence, they should concentrate on using banks equity wisely to successfully compete with the conventional banks.

Since the global financial crisis of 2009, Islamic banks of GCC countries have been reporting lower ROE compared to their conventional counterparts. On the other hand, Islamic banks maintain higher level of Tier-1 capital, TRC and EAR. This evidence hypothetically suggests that Islamic banks are overly cautious in managing their capital buffer that results in lower ROE. To the best of the author’s/authors’ knowledge, no other study in the literature tests this hypothesis in the GCC context.

This study aims to empirically examine the influence of CEO characteristics on the sustainability performance of listed banks in Bangladesh through the lens of upper echelons theory.

The authors estimated sustainability performance score based on a hand collected data set from the annual report and sustainability reports of the Bangladeshi listed banks. Following Clarkson et al. (2008), the sustainability index developed by Ong et al. (2016) and the G4 sustainability reporting standards of the global reporting initiative (GRI), a unique scoring index was developed to gather and assess sustainability data from listed banks. A panel regression analysis model is used to investigate the impact of CEO attributes on sustainability performance.

The findings of this study reveal that higher academic qualifications, greater industry experience and a longer tenure of the CEO have a significant and positive impact on the sustainable performance of the Bangladeshi listed banks. Furthermore, this study reveals that Bangladeshi listed banks are considerably behind in implementing the sustainability recommendations of Bangladesh Bank.

This study provides new evidence of how CEOs’ attributes can affect the sustainability reporting of Bangladeshi listed banks. Furthermore, this study measures the real contribution towards sustainability performance compared with the general claims about sustainability made by listed banks in Bangladesh.

This study aims to examine the association between national culture and corporate carbon emissions. Specifically, the research explores how firm-level carbon emissions are associated with Hofstede’s four cultural dimensions: power distance, individualism/collectivism, masculinity/femininity and uncertainty avoidance.

The study examines 36,945 firm-year observations across 39 countries and uses panel regressions to assess the association between firm-level carbon emissions and national culture. This research also uses instrumental variable regression to address the potential endogeneity issues. Alternative proxies for culture are used to test the sensitivity of the findings.

The findings of this study reveal that power distance and uncertainty avoidance are negatively while individualism and masculinity are positively associated with corporate carbon emissions. The results are robust to the instrumental regressions and alternative measures of culture.

For policymakers, this research highlights the importance of national culture in assessing the efficacy of potential emissions reduction policies, identifying the possible challenges posed by the cultural differences of the targeted groups and designing policy adjustments accordingly. The local culture in which the branches of multinational corporations operate should be considered when the management implements emissions reduction policies for the business units in diverse cultural settings.

Aligning emissions reduction policies with regional cultural dimensions has the potential to enhance the effectiveness of corporate and national emissions reduction policies, which can contribute to mitigating global climate change adversities.

This study provides insights into firm-level carbon emissions and Hofstede’s four cultural dimensions in a global setting.

Drawing on the job demands-resources (JD-R) model, the authors examine how working in the hybrid workplace model (telework and flexible work) affects job performance via the intervening role of work engagement.

The authors adopted a quantitative approach and collected data from 277 employees working in universities in Nigeria. Partial least square structural equation modelling was used to analyse the data and test the hypotheses.

The findings reveal that flexible work, not telework, has a significant and positive effect on job performance. It also emerges that flexible work positively affects work engagement, and work engagement significantly mediates the relationship between flexible work and job performance. However, the findings do not support the effect of telework on work engagement and the mediating role of work engagement in the proposed relation between telework and job performance.

The paper provides fresh insights by linking the components of the hybrid workplace model with job performance and employee work engagement and extending the JD-R model to the hybrid workplace setting. The practitioners can benefit from the findings of this study by factoring in the importance of the hybrid workplace model in designing policies and procedures to promote job performance.

This study investigates the association between debt overhang and carbon emissions (both direct and indirect emissions) using a sample of US publicly listed firms.

The study applies generalized least squares (GLS) regression analyses to a sample of 2,043 US firm-year observations over a period of 14 years from 2007 to 2020. The methods include contemporaneous effect, lagged effect, alternative measures of carbon emissions and debt overhang, intensive versus non-intensive analysis, channel analysis, firm fixed effects, change analysis, controlling for credit rating analysis, propensity score matching approach, instrumental variable analysis with industry and year fixed effect.

This study's findings reveal that the debt overhang problem increases carbon emissions. This finding holds when the authors use alternative measures of carbon emissions and debt overhang. The authors find that carbon abatement investment is a channel that is negatively impacted by debt overhang, which in turn increases carbon emissions. This study's results are robust for several endogeneity tests, including firm fixed effects, change analysis, propensity score matching approach and two-stage least squares (2SLS) instrumental variable analysis.

The outcome of this research has policy implications for several stakeholders, including investors, firms, market participants and regulators. This study's findings offer insights for investors and firms, helping them allocate resources effectively and make financing decisions aimed at reducing carbon emissions. Regulators and policymakers can also use the findings to formulate policies that promote alternative sustainable finance practices.

The outcome of this research is likely to help firms develop their understanding of the debt overhang problem and undertake strategies that yield a significant amount of funding to invest in reducing carbon emissions.

This chapter provides a case study on a Sharīʿah-compliant home facility contract based on the Bai Bithaman Ājil (BBA) contract, generally used by Islamic banks in Malaysia. The study emphasises on the need to comply with the existing legal framework and execute relevant contracts in line with the Sharīʿah resolutions of the Sharīʿah Advisory Council of Bank Negara Malaysia without causing harm (ḍarar) to the customers or introducing uncertain elements or procedures (gharar) in the execution of the agreements. This chapter is based on doctrinal analysis of the relevant issues as well as a qualitative legal research through content analysis of relevant BBA agreements, case law as well as statutory provisions. The case study used in this chapter is completely anonymised. The study finds that the execution of BBA agreements in Malaysia leaves much to be desired. Even though the regulatory framework for Sharīʿah-compliant home financing in Malaysia is robust, there are some legal and Sharīʿah considerations which the stakeholders need to look into in order to project Malaysia as the main global hub of Islamic finance. This study demonstrates the need for proper Sharīʿah auditing of the practical execution of BBA agreements to avoid an incorporated element of gharar at the time of execution of the agreements, which might ultimately lead to unforeseen reputation risks for the bank. Though there are several studies on the Sharīʿah, financing and accounting aspects of the BBA home facility agreement, this study focusses on both Sharīʿah and legal issues, using the case study approach. The recommendations are expected to provide a good policy framework for the stakeholders in the Islamic financial services industry in Malaysia.

This case study discussion will enable students to: • Understand and evaluate the steel industry’s nature, opportunities, threats and challenges in an emerging market such as Bangladesh.• Review the techniques used to analyse competition and attractiveness of an industry using Porter’s five forces model. • Identify the corporate-level strategic decisions that can impact the survival and growth of a single business/product company in a highly competitive market. • Evaluate amongst different types of corporate-level growth strategies and their appropriate applications. • Synthesise various internal, industry and market-related information into the selection and justification of any particular corporate-level growth strategy.

BSRM group established Bangladesh’s first-ever steel mill in 1952. For around 70 years, BSRM had been leading the steel industry of Bangladesh with a single product – long steel. Over the recent decade (2010–2020), Bangladesh had been one of the world’'s fastest-growing economies. As the economic development was closely tied with the consumption of steel products, per capita steel consumption in Bangladesh became more than double. Moving from 24 kg in 2010, per capita steel consumption became 55 kg in 2021. Industry experts predicted the per capita steel consumption to be 75 kg by 2024, indicating an enormous scope for the steel industry to grow. Moreover, the industry’s growth momentum was predicted to continue until the nation became a developed one in 2041. This growth momentum kept attracting new competitors to this business. Nevertheless, BSRM maintained the market leadership by dint of its first mover’s advantage, superior quality, branding, innovation and large-scale operations and ultimately accumulated substantial free cash flow over the years. Now, Aameir Alihussain, the Managing Director and CEO of BSRM, was concerned about managing the growth of his business. Would BSRM continue to concentrate on producing steel and building forte by the backward and forward integration of the value chain? Or should the firm opt for some related diversification? Alternatively, was it the right time for BSRM to consider opportunities for unrelated diversification? While opportunities were many, the amount for investment was limited. Thus, Alihussain was in a dilemma pursuing the right corporate-level growth strategy for the overall sustainability of his business in the long run.

This case can be taught in the corporate-level strategy chapter of a core course on strategic management at the undergraduate programs. This case would facilitate students to comprehend the context of corporate-level strategies in managing the growth of a business in an emerging market.

Teaching Notes are available for educators only.

CSS 11: Strategy.

The purpose of this paper is to examine potential determinants of halal perception and to validate the mediating model of halal perception on purchasing decision of Malaysian consumers.

This study uses a survey to obtain the relevant data. The survey involved self-administration of questionnaires to 420 consumers and 96 per cent responded. The questionnaire consists of four sections designed to obtain information on demography, halal perception, determinants of halal perception and purchase decision.

The main finding reiterates the role of credible signals in credence items purchased as suggested by the signaling theory. Halal perception has association with respondents’ purchase decision. Thus, it highlights that halal perception is the mediating variable that intervenes in the relationship of a few independent variables and the purchase decision trends. The independent variables such as manufacturer identity, product label, physical product and packaging as well country of origin are considered to be important extrinsic cues that deliver messages regarding the halal of certain food products. The association of the four variables with halal perception is also found to be significant.

The originality of this study lies in its attempt to explore the role of halal perception in the marketing of food products especially within the scope of a Muslim’s market. Besides, this study attempts to investigate the halal issue based on a specific model that includes potential variables and the intervening role of halal perception.

The purpose of this study is to describe cosmetics purchase behavior of young, educated Muslim females in Malaysia and to explore its relationship with certain potential antecedents.

This study uses a survey on a sample of female consumers from four higher education institutions in the urban area of Bangi Selangor, Malaysia. From their respective institutions, 150 respondents were selected through the purposive sampling method. Self-administered questionnaire has been used to gather information from the respondents. The survey data were analyzed using descriptive, t-test and correlation analyses to accomplish the study objectives.

The study indicates that millennial Muslim cosmetic purchase behavior falls under the “Limited Decision Making” classification. The classification is due to the pattern of pro-active behaviors exhibit through the information search for details about ingredients, halal clue, countries of origin, health safety guarantee and the benefits of the cosmetic products. Young, educated female consumers adore branded cosmetic items and show willingness to accept higher prices for the branded items. Despite brand consciousness, they demonstrate a relatively high concern on the halalness of the product. Based on the correlation analysis, all variables were found to be significant and the most significant of them was brand.

Millennial consumers are information technology savvy and have access to vast information about products. As a result, the findings reiterate that millennial consumers demonstrate different purchase behavior, which is worth exploring by future researchers. In addition, other latent antecedents such as religiosity and world view are worth including in future studies.

Cosmetic manufacturers and marketers must ensure that their products signal positive images to fit the expectations of young and educated Muslim consumers. Although brand conscious, such consumers demonstrate prudent behavior in terms of searching for halalan and toyyiban products.

This study adds value in the area of halal product marketing because of two unique focuses. First, it examines the purchase of cosmetic products, which are relatively understudied compared to halal food. Second, it considers the perspectives of educated Muslim millennials, who are expected to demonstrate more specific purchase behaviors than a generalized millennial group. Therefore, the originality of this study revolves around the consideration of these two aspects, which are relevant to contemporary business marketing discussions.

This study aims to investigate the effects of zakat and business assistance on the growth and well-being of mustahiqs (zakat recipients). This study also investigates the impact of macroeconomic variables on the welfare of mutahiqs.

The partial least squares-structural equation modelling method is used in this quantitative study, examining data from 137 mustahiqs. The data was collected from seven zakat institutions, which run effective zakat programmes to empower mustahiqs.

Zakat empowerment programmes and business assistantships positively impact the growth of mustahiqs’ businesses, beneficial to their well-being. Nevertheless, their well-being is unaffected by the proxy of the macroeconomy.

This study adds to the zakat literature by identifying the relationship between zakat, business growth, macroeconomic conditions and mustahiq welfare. Accordingly, this approach was made by combining primary and secondary data. This research offers a unique measure of welfare based on the concept of the Islamic objectives (Maqasid al-Shariah).