The purpose of this paper is to investigate the direct and indirect links between environmental, social and governance (ESG) practices and financial performance using the mediate role of green innovation.,To test the current study hypotheses, the authors applied linear regressions with a panel data using the Thomson Reuters ASSET4 and Bloomberg database from a sample of 115 UK and 90 Germany companies selected from the ESG index over the period 2005–2019.,The results show that the strengths ESG increase the firm value and the weaknesses decrease it. In addition, the authors find that green innovation fully mediates the relationship between ESG practices and financial performance in UK and Germany.,The findings provide interesting implications to academics practitioners and regulators who are interested in discovering ESG score, financial performance and green innovation. The results also provide insights to regulators and the board of directors on future growth opportunities for the company and the country.,This study is unique in examining the mediation effect of green innovation on the relationship between ESG practices and financial performance.

ESG and corporate financial performance: the mediating role of green innovation: UK common law versus Germany civil law

The objective of this study was to investigate the effect of appearance, lifestyle and status similarity on interaction intensity, satisfaction with a banker and repurchase intention. Also examined was the moderating effect of client knowledge in the enhancement of customer satisfaction with a banker.,A total of 800 questionnaires using the snowball sampling technique were performed to distribute the questionnaires to bank customers at different ethnic community centers in New Zealand. A total of 377 useable questionnaires were collected for further analysis.,The findings indicated that the three types of similarity affect interaction intensity differently. Lifestyle similarity was found to positively influence interaction intensity. The similarity constructs of appearance and status were found to have an insignificant relationship with interaction intensity. The findings show that appearance similarity and interaction intensity are able to enhance customer satisfaction with a banker. Customer satisfaction with a banker has a significant relationship with repurchase intention. Client knowledge influences the degree of interaction intensity and satisfaction with a banker.,The findings of this study help bankers to understand the importance of their similarities with a customer and to design recruitment strategies and training sections to improve customer satisfaction.,This study contributes to the body of knowledge by incorporating interaction intensity, similarity and satisfaction with a bank into the repurchase intention model.

Repurchase intention: the effect of similarity and client knowledge

This paper aims to examine the differences in investors’ reactions toward firms’ corporate social responsibility (CSR)-related news announcements between individuals and institutions.,Analyzed by the short-term event study and ordinary least squares (OLS) methods using a unique CSR data set collected from newspapers in Japan from 2001 to 2016.,The study finds, first, the different reactions toward CSR-related news announcements among shareholders. Second, the findings indicate that individual investors are more sensitive to CSR-related positive news, whereas institutional investors are more concerned about the negative news, providing one of the reasons for mixed results in the studies on the CSR and financial performance linkage. Those findings indicate that CSR-related news affects investors’ behaviors differently based on their purpose, ability and accessible information.,This study deepens the understanding of the different investing behaviors toward CSR-related announcements by shareholder type. Second, different attitudes among investors require different investor relations (IR) approaches depending on the type. It also provides valuable implications not only for Japanese business managers or policymakers but also for those from countries with a similar stage of market maturity in the CSR context.,This paper is original in two ways. First, to the best of the author’s knowledge, this is the first paper to deepen the understanding of investors’ reactions toward CSR-related events through analysis by the main shareholder, which provides some insights into mixed results in the previous studies. Second, the original CSR data set collected from newspapers by the author allows the analysis to use a larger data set than other research, resulting in more robust conclusions.

Do investors’ reactions to CSR-related news communication differ by shareholder? An empirical analysis from Japan


Purpose
This study aims to investigate the effects of firm- and governance-specific characteristics on digital trust (DT) and firm value. Firm-specific factors include return on assets (ROA), market-to-book ratio (M/B ratio), size and leverage, whilst governance-related factors comprise board size, percentage of female board members, board independence and institutional ownership. All listed US firms over the period of 2011–2016 were analysed in this study.


Design/methodology/approach
This study provides a novel method to empirically measure DT by combining multiple variables to create a combined DT score. The variables include security and privacy scores, security rankings and data breaches, amongst others. Subsequently, a linear regression was performed to evaluate the effect of firm- and governance-specific characteristics on DT, as well as the effect of DT on firm value.


Findings
By using signalling theory, this study finds significant evidence that a firm’s profitability (ROA) decreases whilst its size increases DT. This could be due to the fact that firms with lower DT monetise data more actively, decrease DT and increase short-term profitability. Significant evidence also shows that increasing DT leads to an increase in firm value.


Originality/value
Although numerous studies have been conducted on developing customers’ trust by incorporating corporate social responsibility to improve firm value, the literature remains still on its digital analogue. Therefore, this study extends the knowledge of corporate digital responsibility (CDR) by providing a novel method for calculating DT across industries as an antecedent of CDR. Specifically, it sheds light on how firms can enhance DT by utilising firm- and governance-level factors. This enhanced DT can subsequently increase firm value. The study provides important managerial implications by providing empirical evidence that cybersecurity investments increase firm value. This value increase is related to the rise in shareholder value amongst investors and the increase in the organisation’s consumer perceptions as the latter’s interests are better managed.


The impact of digital trust on firm value and governance: an empirical investigation of US firms

The purpose of this research is to show how ethical banks can build a dynamic operation that can provide financial services accomplishing sustainable development pillars objectives considering profitability according to community context. The data of the community were collected by questionnaires which were designed by different faculties’ staff members from 600 respondents representing a random sample of the population of around 35000 residents in Sharkia villages. Cronbach has been utilized to measure data reliability, two dynamic frameworks have been designed; the first determine the main source of different financial services package and main approaches of allocation and investments, second three dynamic frameworks showing how to implement according to Sharkia community context. The research suggested dynamic frameworks can contribute to developing community by providing suitable financial services by utilizing the appropriate source of finance to be granted for suitable categories and supporting them through integral network considering sustainable development pillars and also contribute in widening responsible fields of investments.

Dynamic Ethical Bank operations proposal framework for developing countries: Case of Sharkeia – Egypt

Purpose




The purpose of this paper is to show how overall performance can help foster trust in financial institutions. While a climate of mistrust amongst investors and the general public toward financial institutions has developed since the recent turmoil in the financial markets, it is believed that mutual funds adopting the overall performance approach can help recover a climate of trust owing to the implied balance between economic, social and environmental performance. More specifically, overall performance promotes values that are similar to investors’ values and could be used by responsible investment funds if they want to contribute to the restoration of trust in investment funds.




Design/methodology/approach




This paper uses an innovative, experimental design to test the effect of value similarity on the trust that investors have in the investment fund. This effect cannot be studied in isolation, which is why it is compared with the effects of financial performance and ethical labeling on trust.




Findings




The authors find that funds with similar values are perceived as more trustworthy by investors. Consequently, overall performance should be added to fund managers' toolbox if they want to foster trust in their fund. The effect of financial performance on trust applies only when the investor has no other information regarding the fund. As for the ethical labeling of funds, it has no effect on trust.




Research limitations/implications




The findings encourage research that aims to develop a comprehensive approach of integrated overall performance focusing on financial and extra-financial values. Bonnet et al.’s (2016) fieldwork on socio-economic management and Naro and Travaille©’s (2016) work on management controllers provide promising examples in this regard.




Practical implications




Investment funds can acquire an edge by communicating on overall performance and specific values of their target investors. Merely labeling funds as ethical is not sufficient to increase trust.




Social implications




Increasing similarity in values to investors and adopting the overall performance approach in investment funds will increase investors' trust. Trust contributes to social capital and allows societies to create flexible large-scale businesses needed to be competitive in a global environment.




Originality/value




Using an innovative experimental methodology, this paper shows that the underlying factor of overall performance on trust in investment funds is value similarity. It provides researchers and practitioners with insight about the underlying mechanisms of the effect of overall performance on trust.

Value similarity and overall performance: trust in responsible investment

Afin de verifier si les motivations exprimees par les investisseurs individuels pour l’investissement socialement responsable (ISR) affectent leurs investissements, un jeu de simulation a ete mis en place. Une methodologie combinant analyse quantitative et qualitative, fait apparaitre un decalage entre le dire et le faire des investisseurs. Ce decalage est interprete par recours au concept de dissonances cognitives. Des solutions permettant de limiter les perturbations du mecanisme decisionnel sont alors envisagees.

When does CSR motivate investors? A simulation study

Cette recherche s’interesse a l’opinion des individus, concernant le pilotage strategique de la taxe carbone par les entreprises, en fonction des facteurs de justice sociale. Pour cela elle applique une technique empruntee aux sciences cognitives. Elle aboutit a deux clusters. Le premier regroupe des individus qui jugent acceptable la combinaison des trois choix de gestion de la taxe carbone suivants : augmentation des prix, investissements « low carbon » et absence de delocalisation, conformement aux justices distributive et retributive. Les membres du second cluster quant a eux, jugent acceptable tout choix de gestion de la taxe carbone qui autorise le maintien des prix selon la justice reparatrice. Ces resultats sont a considerer dans la definition des strategies RSE et dans la recherche d’un equilibre des differentes composantes de la performance globale.

Katia Lobre-Lebraty

Papers

Value similarity and overall performance: trust in responsible investment

When does CSR motivate investors? A simulation study

Pilotage stratégique de la taxe carbone par les entreprises : les enjeux de la performance globale