Showing papers in "Corporate Governance in 2012"
TL;DR: In this article, the authors investigate the relationship between environmental reporting and corporate governance attributes of companies in Australia and find a significant positive relationship between the extent of environmental reporting with the proportions of independent and female directors on a board.
Abstract: Purpose – The purpose of this paper is to investigate the relationship between environmental reporting and corporate governance attributes of companies in Australia.Design/methodology/approach – The paper adopts a quantitative analysis approach. It examines the 2008 annual reports of the largest 100 Australian firms listed on the Australian Stock Exchange (ASX) to determine the amount of environmental reporting – these data are compared with various corporate governance measures.Findings – Analysis found a significant positive relationship between the extent of environmental reporting and the proportions of independent and female directors on a board. The analysis did not, however, support a negative relationship between the extent of environmental reporting and institutional investors and board size as has been previously predicted, rather, it showed a positive relationship.Originality/value – This paper offers insights to both regulators and company strategists. Regulators such as the Australian Stock E...
343 citations
TL;DR: In this article, the authors investigated the impact of corporate board characteristics on the financial performance of Nigerian quoted firms using the random effects and fixed effects generalised least squares (GLS) regression to test the six hypotheses formulated for the study, while controlling for firm size and firm age.
Abstract: – The purpose of this paper is to investigate the impact of corporate board characteristics on the financial performance of Nigerian quoted firms. Board characteristics studied comprise board size, board skill, board nationality, board gender, board ethnicity and CEO duality., – The study employed the random‐effects and fixed‐effects generalised least squares (GLS) regression to test the six hypotheses formulated for the study, while controlling for firm size and firm age., – Using panel data from 122 quoted firms in Nigeria between 1991 and 2008, it was found that board size, CEO duality and gender diversity were negatively linked with firm performance, whereas board nationality, board ethnicity and the number of board members with a PhD qualification were found to impact positively on firm performance. The result of the robustness test using the same board characteristics for 160 small firms showed that board duality was positively linked to firm performance, while a PhD qualification was negatively linked to firm performance., – The study contributes to the understanding of the board‐performance link by examining both the traditional variables such as board size, CEO duality and other organisational attributes such as ethnic diversity, foreign nationality and competence variables represented by women and PhD holders, respectively. The results provide an insight for practitioners and policy makers on the importance of relying on institutional specifics in the prescription of corporate governance codes., – The study adds value to the global corporate governance discourse in two ways: first, the use of Nigeria, which is claimed to have one of the weakest business cultures in the world, and secondly, using a good number of proxies that are country‐specific for corporate boards.
267 citations
TL;DR: In this article, the authors investigated whether there has been a change in the level of corporate social responsibility disclosure and to determine whether corporate governance attributes influence CSR disclosure in corporate annual reports of Malaysian government-linked companies (GLCs).
Abstract: Purpose – The purpose of this paper is to investigate whether there has been a change in the level of corporate social responsibility (CSR) disclosure and to determine whether corporate governance attributes influence CSR disclosure in corporate annual reports of Malaysian government‐linked companies (GLCs).Design/methodology/approach – The annual reports of 27 GLCs for two years (2005 and 2007) were analysed using content analysis. Multiple regression analysis was performed to identify factors influencing CSR disclosure in annual reports.Findings – Consistent with expectations, the paired‐sample t‐tests showed that there was an increase (significant at the 1 percent level) in the extent of CSR disclosure. The multiple regression analysis revealed that board size was positively associated and statistically significant (at the 1 percent level) with the extent of CSR disclosure.Research limitations/implications – The regression model reported an R2 of 33.9 percent, which means that almost 66 percent of fact...
234 citations
TL;DR: In this paper, the authors examined the relationship between board characteristics and corporate social performance and found that board gender diversity was positively related to institutional and technical strength ratings, while board racial diversity is positively associated with institutional strength rating only.
Abstract: – Drawing on agency theory and resource dependence theory, the study aims to link board demographic diversity and independence to corporate social performance., – Data were collected from various sources for a sample of 475 publicly traded Fortune 500 companies between the years 2007 and 2008., – It is found that board gender diversity is positively related to institutional and technical strength ratings, while board racial diversity is positively related to institutional strength rating only. Both the proportion of outside directors and CEO non‐duality were negatively associated with institutional and technical weakness ratings., – The sample was predominantly large, publicly traded national and international corporations, which might limit the generalizability of the findings., – Management personnel should be cognizant of how board configurations and leadership structure may influence their corporate reputation for social responsibility. Efforts should be made to foster a group dynamic that is conducive to effective board functioning., – Few empirical studies have examined the relationship between board characteristics and corporate social performance. This study contributes to the literature by examining such associations.
150 citations
TL;DR: In this article, the authors investigated whether corporate governance attributes such as board size, outside directors, ownership concentration, managerial ownership, director remuneration, and CEO duality affect capital structure choices of Pakistani firms.
Abstract: Purpose – The aim of this empirical study is to investigate whether corporate governance attributes such as board size, outside directors, ownership concentration, managerial ownership, director remuneration, and CEO duality affect capital structure choices of Pakistani firms.Design/methodology/approach – Multiple regression analysis is used to estimate the relationship between corporate governance measures and capital structure of non‐financial firms listed on the Karachi Stock Exchange, Pakistan, during 2004‐2008.Findings – The results suggest that board size, outside directors, and ownership concentration are positively related to the total debt ratio and the long‐term debt ratio, whereas director remuneration is negatively related. Managerial ownership is negatively related to the long‐term debt ratio. CEO duality is found to be highly insignificant in all regressions. Control variables such as profitability and liquidity are negatively related to the total debt ratio and the long‐term debt ratio, whe...
143 citations
TL;DR: In this paper, a case study on the collaboration between BASF, FEE and the AndreMaggi Group does qualify as a shared value strategy, more precisely as a case of redesigning productivity in the value chain.
Abstract: Purpose - This paper aims to create empirical evidence regarding shared value strategies recently propagated by Michael Porter and Mark Kramer. Design/methodology/approach - The authors analyze a single case study of a collaboration between BASF, AndreMaggi Group and Fundacao Espaco Eco in Brazil. The objective is to evaluate whether the applied strategy can be considered as a case of shared value creation. Findings - The case study on the collaboration between BASF, FEE and the AndreMaggi Group does qualify as a shared value strategy, more precisely as a case of redesigning productivity in the value chain. Research limitations/applications - This single case study creates some evidence for shared value strategies; however, more research is needed to generalize the results. Practical implications - The socio-eco-efficiency analysis offered by Fundacao Espaco Eco creates a differentiation strategy for BASF in Brazil. The work enables BASF's clients to reduce negative impacts while increasing their financial, social and environmental performance. Originality/value - This paper is the first empirical verification of the shared value concept. It demonstrates that shared value strategies do enhance financial as well as socio-environmental performance and build stronger client relationships. Keywords BASF, Fundacao Espaco Eco, Sustainable development, Brazil, Shared value, Efficiency, Organizational performance, Management strategy Paper type Case study
103 citations
TL;DR: In this article, the authors examined the relationship between board committees and firm performance and the moderating effect of family ownership for public companies in Hong Kong and found that family ownership does have an adverse effect on the relationship among board committees, specifically the remuneration committee and the performance of public companies.
Abstract: Purpose – This paper seeks to examine the relationship between board committees and firm performance and the moderating effect of family ownership for public companies in Hong Kong.Design/methodology/approach – This study employs publicly available data from financial databases and annual reports of a sample of 346 firm‐year observations of public companies in Hong Kong for the periods 2001‐2003.Findings – The empirical evidence indicates that a nomination (remuneration) committee is positively (negatively) related to firm performance, depending on the independence of its composition. Furthermore, family ownership does have an adverse effect on the relationship between board committees, specifically the remuneration committee, and the performance of public companies in Hong Kong.Research limitations/implications – This study is based on publicly available data and the board process is not actually observed.Practical implications – The effectiveness of a board committee is contingent on its independence an...
103 citations
TL;DR: In this paper, the antecedents of effective corporate governance regulation in Nigeria are investigated and a survey of corporate governance professionals in academia, in practice (including board directors, managers, current and former CEOs and chairmen across different industries, as well as members of professional accounting and audit associations).
Abstract: Purpose – Whilst taking Nigeria's peculiar institutional configurations into consideration, this paper aims to critically evaluate the Nigerian corporate governance regulatory system, which is characterised by endemic corporate corruption, and to explore how regulatory policy responses can be strategically formulated to ensure corporate vitality and prevent market failures. The paper investigates the antecedents of effective corporate governance regulation in Nigeria.Design/methodology/approach – This paper employs research method triangulation in order to provide an informative and comprehensive account. The following data collection methods were employed to conduct a survey of corporate governance professionals in academia, in practice (including board directors, managers, current and former CEOs and chairmen across different industries, as well as members of professional accounting and audit associations), and in the Nigerian polity: in‐depth interviews, focus groups, direct observations and case studi...
96 citations
TL;DR: In a context of state failure (immature institutions), paying taxes can guarantee neither the peaceful management of company operations nor the sustainable development of local communities as mentioned in this paper, therefore, multinationals have experienced that making resources and opportunities available to local communities is not enough.
Abstract: Purpose – The international awareness of corporate social responsibility (CSR) issues and the socio‐political context of emerging countries are increasing the pressure on businesses, including multinational corporations, to take another look at their societal role. In a context of state failure (immature institutions), paying taxes can guarantee neither the peaceful management of company operations nor the sustainable development of local communities. Moreover, multinationals have experienced that making resources and opportunities available to local communities is not enough. The Niger Delta in Nigeria is, in this regard, a textbook case that demonstrates the challenge of achieving sustainable development in the context of acute inequalities. This paper seeks to address these issues.Design/methodology/approach – Drawing on fieldwork – quantitative and qualitative surveys – carried out in Nigeria for the past seven years, the paper builds on initiatives and approaches undertaken by Total, Agip and NPDC/Sh...
70 citations
TL;DR: The purpose of this research paper is to understand the underlying operating principles of these self‐sustainable business models aimed at providing healthcare services to the BoP segment in India.
Abstract: Purpose – The access to high quality, a reliable and affordable basic healthcare service is one of the key challenges facing the rural and semi‐urban population lying at base of the pyramid (BoP) in India. Realizing this as a social challenge and an economic opportunity (shared value), there has been an emergence of healthcare service providers who have bundled entrepreneurial attitude and passion with available scarce resources to design and implement cost‐effective, reliable and scalable market solutions for the BoP. The purpose of this research paper is to understand the underlying operating principles of these self‐sustainable business models aimed at providing healthcare services to the BoP segment in India.Design/methodology/approach – The empirical context involves the use of case study research methodology, where the source of data is published case studies and the company websites of four healthcare organizations who have made a socio‐economic difference in the lives of the rural and semi‐urban p...
64 citations
TL;DR: In this paper, the authors present a multidisciplinary theoretical framework for explaining the adoption of CSR policies and practices on the part of mining companies, including strategic adaptation to external pressures, learning processes associated with CSR, and internalization of sustainable development norms, understood as standards of appropriate behavior.
Abstract: Purpose – The purpose of this paper is to provide an explanation for the global influences and dynamics that have led major mining companies to adopt corporate social responsibility (CSR) policies, and frame them in terms of sustainable development. Bad reputations stemming from environmental disasters and social disharmony led mining multinationals to adopt CSR policies and improve their practices. Rationalist expectations about what is driving firm responses to external pressures are a necessary, but insufficient, explanation of how and why mining companies have sought to improve their reputations. Three elements are necessary to explain firm responses, including strategic adaptation to external pressures, learning processes associated with CSR, and internalization of sustainable development norms, understood as standards of appropriate behavior.Design/methodology/approach – The paper presents a multidisciplinary theoretical framework for explaining the adoption of CSR policies and practices on the part...
TL;DR: In this paper, the authors provide a framework for understanding and analysing business's role as a development actor, and the distinction between development tool and development agent, and present a theoretical analysis based on secondary data and empirical research.
Abstract: Purpose – The purpose of this paper is to provide a framework for understanding and analysing business's role as a development actor, and the distinction between development tool and development agent.Design/methodology/approach – The paper presents a theoretical analysis based on secondary data and empirical research.Findings – Business has various roles to play in the social and economic development of poorer countries, but are all of them equally important and laudable? Mainstream economics has long held that the private sector is essential to economic prosperity, and this has led policy‐makers and neoliberal thinkers to treat it as a tool for development. But under what circumstances does business go beyond acting out its assigned role as a tool of development to become what this article calls a “development agent” – something that consciously strives to deliver, and moreover be held to account for, developmental outcomes?Research limitations/implications – The article presents a framework for a more ...
TL;DR: A systematic review of the literature on industrial clusters and CSR in developing countries is presented in this article, where the authors identify the main strengths, weaknesses, and gaps in this literature, pointing to future research directions and policy implications in the area of CSR and industrial cluster development.
Abstract: Purpose: The paper seeks to review the literature on CSR in industrial clusters in developing countries, identifying the main strengths, weaknesses, and gaps in this literature, pointing to future research directions and policy implications in the area of CSR and industrial cluster development. Design/methodology/approach: A literature review is conducted of both academic and policy-oriented writings that contain the keywords "industrial clusters" and "developing countries" in combination with one or more of the following terms: corporate social responsibility, environmental management, labor standards, child labor, climate change, social upgrading, and environmental upgrading. The authors examine the key themes in this literature, identify the main gaps, and point to areas where future work in this area could usefully be undertaken. Feedback has been sought from some of the leading authors in this field and their comments incorporated in the final version submitted to Corporate Governance. Findings: The article traces the origins of the debate on industrial clusters and CSR in developing countries back to the early 1990s when clusters began to be seen as an important vehicle for local economic development in the South. At the turn of the millennium the industrial cluster debate expanded as clusters were perceived as a potential source of poverty reduction, while their role in promoting CSR among small and medium-sized enterprises began to take shape from 2006 onwards. At present, there is still very little conceptual and empirical work that systematically investigates the linkages between industrial clusters and CSR in developing country contexts. Hence, the authors recommend that future work in this area should focus on conceptually developing and empirically testing "cluster and CSR" impact assessment methodologies in Asia, Africa, and Latin America. This will provide insights into whether joint CSR interventions in clusters bring about their intended consequences of improving economic, social, and environmental conditions in the South. Originality/value: This article is likely to be the first systematic review of the literature on industrial clusters and CSR in developing countries. © Emerald Group Publishing Limited.
TL;DR: In this article, the authors examine the state of the art on sustainable energy and business involvement, and present their own research on illustrative cases from local companies involved in renewable, off-grid rural electrification.
Abstract: Purpose – Although the crucial role of business, and of business‐based approaches, in development is increasingly emphasised by academics and practitioners, insight is lacking into the “whether and how” of viable business models, in environmental, social and economical terms. This article analyses private‐sector involvement in development, including a business perspective of firm‐level factors, taking the case of sustainable energy in developing countries.Design/methodology/approach – In the framework of the international business and development debate, the authors examine the “state of the art” on sustainable energy and business involvement, and present their own research on illustrative cases from local companies involved in renewable, off‐grid rural electrification. Implications are discussed, as viewed from the broader perspective of business models.Findings – Existing studies on sustainable energy take macro‐economic and/or policy‐oriented approaches, containing specific case studies of rural electr...
TL;DR: In this paper, the authors analyzed relations among Italian listed firms belonging to financial or manufacturing sectors and traced the evolution networks of interlocking directorates among them, and analyzed the co-competitive nature of inter-locking directors among firms acting in the same sector that are in direct competition and their impact on M&A processes.
Abstract: Purpose – The prevalent literature considers interlocking directorates as a mechanisms of cooperation among companies, but if the same director seats on the boards of two companies that are in competition, interlocking directorates, matching cooperation with competition, become a coopetition mechanism. This article aims to argue that the analysis of both the structure and the evolution of interlocking directorates provides some relevant insights on the driving forces behind the coopetition among firms.Design/methodology/approach – Through a longitudinal study the authors analyzed relations among Italian listed firms belonging to financial or manufacturing sectors and traced the evolution networks of interlocking directorates among them. They then analyzed the coopetitive nature of interlocking directorates among firms acting in the same sector that are in direct competition and their impact on M&A processes.Findings – It was evidenced that interlocking directorates among firms belonged to the same industr...
TL;DR: In this article, the effect of the family as a controlling owner on firms' performance, valuation and capital structure is analyzed. But the authors do not consider the impact of family ownership on the stock market.
Abstract: Purpose – Most countries often have public companies with large controlling owners, typically a family. This empirical evidence aims to contrast with the classical view of the largest dispersed firm presented by Berle and Means and challenge the findings by Bhattacharya and Ravikumar, who predict that the shares held by families will decrease if an efficient financial market is put in place. Therefore, family firms represent an important group in the stock market today. Thus, the purpose of this paper is to analyze the effect of the family as a controlling owner on firms' performance, valuation and capital structure.Design/methodology/approach – The paper reviews the current literature related to how family (taking into account specific governance characteristics such as family ownership, family control and family management) affects firms' performance and value.Findings – The literature review showed that founder family control and professional (outside) management increase performance, whereas excess co...
TL;DR: In this article, the authors present a collection of ongoing experiences with a value-added reporting model in Latin America, positing its pertinence with regards to CSR accountability and social implications.
Abstract: Purpose – The purpose of this paper is to present a collection of ongoing experiences with a value-added reporting model in Latin America, positing its pertinence with regards to CSR accountability. Design/methodology/approach – The paper utilises a qualitative methodology in which a series of semi-structured telephone interviews and/or e-mail questionnaires with managers from six reporting companies in Latin America (Chile, Colombia, Uruguay) was conducted. The fact that one of the authors of this paper created the reporting model facilitated easier access to company managers and a deeper understanding of each situation. A literature review from European, US and Latin American sources provides a framework for discussion. Findings – The paper illustrates how value-added statements (which are based on conventional financial accounting) can provide relevant information for CSR accountability. The variety of experiences shown (different industries and diverse company ownership in separate countries) may suggest the wide potential of this reporting model. Research limitations/implications – As the paper deals with a recent, ongoing experience (this model has been in use for the last six years only), the results have to be treated with caution. Even though many firms are interested in adopting this value-added model, there are currently fewer than 20 reporting firms using it. Social implications – The paper aims to position value distribution and its accountability as relevant issues in CSR, particularly for developing countries. In addition, such an intuitive model might more easily reach the general public, something that rarely happens with conventional CSR reporting models. Originality/value – This is the first academic paper that demonstrates the application of this reporting model (though the authors already published a practitioner-oriented article in Spanish). Furthermore, there are few documented cases of value-added reporting experiences in emerging markets, particularly in Latin America.
TL;DR: In this article, the authors provide an overview of corporate governance structures in the UK and Germany addressing the extent to which corporate governance structure may have been a contributory factor to the recent banking crisis.
Abstract: Purpose – The purpose of this paper is to provide an overview of corporate governance structures in the UK and Germany addressing the extent to which corporate governance structures may have been a contributory factor to the recent banking crisis. Following a review of shareholder and stakeholder theories of corporate governance and a comparative overview of corporate governance codes in the UK and Germany, the authors aim to provide some country level macroeconomic data and performance related data for a small number of large banks in the UK and Germany. Design/methodology/approach – The paper is structured as follows. It first reviews the existing literature that underpins the stakeholder vs shareholder debate within corporate governance. It then reviews the current codes of conduct and governance structures implemented by UK and German banks. An analysis of the extent to which the banking crises can be attributed to failures in governance is presented and finally some conclusions and recommendations ar...
TL;DR: In this article, the authors examined the relationship between chief executive officer turnover and firm performance and the moderating effects of ownership structure and board structure with respect to listed non-financial companies in Thailand.
Abstract: Purpose – This paper seeks to examine the relationship between chief executive officer (CEO) turnover and firm performance and the moderating effects of ownership structure and board structure with respect to listed non‐financial companies in Thailand.Design/methodology/approach – Logit model is employed to analyze the relationship between CEO turnover and firm performance.Findings – The paper finds that both ownership and board structure have effects on the relationship between CEO turnover and firm performance. The probability of CEO turnover is lower when the firm is controlled by family, the CEO is part of the controlling family, and board size is larger. Contrary to previous studies, sensitivity of CEO turnover to firm performance is higher with the presence of CEO duality and lower degree of board independence. When a CEO continues to work beyond retirement age, the probability of turnover is not associated with firm performance.Originality/value – This study provides evidence that CEO duality and l...
TL;DR: In Central Eastern Europe (CEE), the transition to market democracy significantly influenced the emerging corporate governance practice as discussed by the authors, however, the region demonstrates much more diversity in corporate governance than expected in generally similar transition economies and the variables and their impacts only partially overlap with the variables of corporate governance in other regions.
Abstract: Purpose – In Central Eastern Europe (CEE) the transition to market democracy significantly influenced the emerging corporate governance practice. The region, however, demonstrates much more diversity in corporate governance than expected in generally similar transition economies and the variables and their impacts only partially overlap with the variables of corporate governance in other regions. This research aims to focus on how to help discover and explain these similarities and differences.Design/methodology/approach – This paper is a review of the secondary literature. The review is carried out with the intention of providing an opportunity to map out new terrains or provide critiques of the direction of a research field. The majority of literature reviewed in the paper is published in refereed journals, but other resources like book chapters, conference papers, reports and in certain cases unpublished materials are added. The paper discusses the key topics and variables according to the requirements...
TL;DR: In this article, the authors investigate the phenomenon of earnings management in Egypt, with particular reference to the pricing of IPOs, and discuss its respondents' perceptions of the factors that are likely to weaken the effectiveness of internal corporate governance mechanisms in preventing the engagement in earnings management practices.
Abstract: Purpose – The aim of this paper is to investigate the phenomenon of earnings management in Egypt, with particular reference to the pricing of IPOs. In addition, it aims to discuss its respondents' perceptions of the factors that are likely to weaken the effectiveness of internal corporate governance mechanisms in preventing the engagement in earnings management practices.Design/methodology/approach – To achieve the objectives of this paper, a multi‐method approach was adopted. This approach includes secondary data analysis and the collection of primary data from a number of semi‐structured interviews.Findings – The results indicate that Egyptian IPO managers have no incentive to affect the offering proceeds of their firms through exercising their discretion over the accounting accruals before going public. On the contrary, the results suggest that the amount of equity retained by issuers and the size of IPOs have a very significant impact on determining offering prices in the Egyptian stock market. The re...
TL;DR: In this article, the authors present a conceptual framework and a set of conditions within which nations and business can strive to embed sustainability in corporate/national strategy, and the objective is to motivate business and national leaders to do so with sustainability mindsets and strategic leadership.
Abstract: Purpose – The purpose of the paper is to present a conceptual framework and a set of conditions within which nations and business can strive to embed sustainability in corporate/national strategy. The objective is to motivate business and national leaders to do so with sustainability mindsets and strategic leadership. The pre‐conditions that will accelerate the “motivation” to do so are identified, as are interventions identified. The sphere of influence business and national leaders have to impact sustainable globalization is identified.Design/methodology/approach – The approach is to focus on information in the public domain that outlines the “real” challenges faced by nations and business as they consider the need for sustainability and key issues such as “poverty and climate change”, which if not addressed could have detrimental strategic implications for the planet, business and nations. The changes that have taken place since 1982 when global leaders signed up to Agenda 21 and the relatively insigni...
TL;DR: In this paper, the authors analyze corporate governance practices of Canadian companies in the post-Enron period and investigate whether the convergence phenomenon evidenced in prior studies is limited to the minimum mandatory requirements imposed by regulators or reflects a real behavioral transformation.
Abstract: Purpose – The objective of the study is to analyze corporate governance practices of Canadian companies in the post‐Enron period. The attempt is to investigate whether the convergence phenomenon evidenced in prior studies is limited to the minimum mandatory requirements imposed by regulators or reflects a real behavioral transformation.Design/methodology/approach – Changing governance structure might be slow except in times of financial crisis, increased public scrutiny and reforms. These conditions are met in the post‐Enron period (2002 to 2005) where major reforms have been launched including the Sarbanes‐Oxley Act (SOX) in the USA and Bill 198 in Canada. The authors expect changes in corporate governance to be more important during this period, therefore, enhancing the robustness and reliability of their results. They measure corporate governance on a global scale, relying on the ROB index published by the Globe and Mail. The index distinguishes between four blocks of corporate governance, namely, boar...
TL;DR: In this article, the authors proposed a model and several propositions to predict what determines the origin of interim CEOs, the length of the interim tenure, and the career prospects for the interim CEO after an interim tenure.
Abstract: Purpose – There is no previous systematic and theoretical investigation of the interim CEO succession practice. This research attempts to fill the gap by studying this phenomenon and hence advance executive succession research/practice.Design/methodology/approach – Based on agency theory, the authors propose a model and several propositions to predict what determines the origin of interim CEOs, the length of the interim tenure, and the career prospects for the interim CEO after the interim tenure.Findings – Both firm performance and environmental uncertainty play an important role in the dynamic interim CEO succession process.Research limitations/implications – The paper provides the foundations for future empirical research on interim CEO succession.Practical implications – Board members at companies experiencing sudden CEO departures should choose a loyal non‐aggressive veteran to be the interim CEO so as to minimize disruption and to smooth the transition. They should use caution when choosing an inter...
TL;DR: In this paper, the status of CSR in Nepalese companies is examined based on a review of the literature, and the results show that there is a low intensity of corporate social responsibility in Nepal.
Abstract: Purpose – The paper aims to examine the status of corporate social responsibility (CSR) in Nepalese companies.Design/methodology/appoach – The study is descriptive‐cum‐analytical and is based on a review of the literature.Findings – The cases presented in the paper show a low intensity of CSR in Nepal. Both government and employers are somehow not serious in implementing labor laws. At the company level, employees' awareness of CSR can bring a positive attitude towards the company.Practical implications – This paper is useful to academicians and companies seeking to understand the factors supporting and inhibiting CSR in Nepalese companies.Research limitations/implications – The main limitation is that although there are many variables by which to measure CSR initiatives, only labor laws, employees' awareness and a few HRM dimensions have been covered.Originality/value – This is perhaps the very first investigation of its kind in the Nepalese context.
TL;DR: In this article, an incentive framework is proposed for corporate executives by utilizing the contributions of information technology in the decision-making process of corporate governance, and it is found that the stakeholder perspective promotes a value-laden approach to corporate governance as opposed to other views that are unilateral.
Abstract: Purpose – The purpose of this paper is to understand how information technology can be utilized as a driver of incentives in the decision‐making process of corporate governance.Design/methodology/approach – The existing theories in corporate governance are compared to understand the incentives offered to executives. Based on the analysis of the theories presented here, an incentive framework is proposed for corporate executives by utilizing the contributions of information technology.Findings – It is found that find that the stakeholder perspective promotes a value‐laden approach to corporate governance as opposed to other views that are unilateral. The study posits tapping in to the values and beliefs of corporate executives to produce viable and lasting results as opposed to monetary incentives. Information technology is proposed as an “enabler” in empowering executives towards promoting a stakeholder perspectivePractical implications – The paper's recommendations can be used by researchers, executives ...
TL;DR: In this paper, the authors examined evidence to support or refute that directors may act in their own best interests at the expense of shareholders and found a highly positive significant relation between the aver...
Abstract: Purpose – Takeovers create a potential conflict of interest between target shareholders and directors. While mergers generally create value for the target shareholders, their directors will typically lose their board seats and likely face a financial loss or loss of prestige. The purpose of this paper is to examine evidence to support or refute that directors may act in their own best interests at the expense of shareholders.Design/methodology/approach – The authors reason that if directors act in their own best interests, then acquiring firms will seek targets with older board members who are closer to director retirement and are therefore less reluctant to give up their board seats. The paper uses data of 528 banks between 1999 and 2004 to estimate logistic regressions controlling for variables relevant to takeover probability. In the hypotheses, the authors test for the significance of the average director age on a board.Findings – The paper finds a highly positive significant relation between the aver...
TL;DR: In this paper, the authors explore the issue of corporate governance mechanisms by including the importance of stakeholders, primary objectives of the firm and the ownership of top financial managers of listed firms in Kuwait in the survey tool.
Abstract: Purpose – This paper aims to explore the issue of corporate governance mechanisms by including the importance of stakeholders, primary objectives of the firm and the ownership of top financial managers of listed firms in Kuwait in the survey tool. It attempts to investigate whether theory aligns with the behaviour of financial managers in practice in an emerging market case.Design/methodology/approach – A survey was developed to focus primarily on the current corporate finance practices implemented by CFOs in listed companies in Kuwait. The target respondents are listed firms in the Kuwaiti Stock Exchange (KSE). The survey includes questions on topics that are closely related to capital budgeting, capital structure, cost of capital and dividend policy. For example, the survey asks the managers how they estimate their cost of equity (CAPM or other methods) and whether the impact of the weighted average cost of equity is taken into consideration in their capital structure choices.Findings – A surprising num...
TL;DR: In this article, the authors examine whether corporate governance has an impact on portfolio selection within the usual mean-variance framework, the idea being that by reducing agency conflicts, corporate governance increases the value of the firm.
Abstract: Purpose – The purpose of this paper is to examine whether corporate governance has an impact on portfolio selection within the usual mean‐variance framework, the idea being that by reducing agency conflicts, corporate governance increases the value of the firm.Design/methodology/approach – Using a sample of 460 American firms between 1995 and 2004, the authors first determine the optimal mean‐variance portfolio. The authors then test whether governance characteristics explain the optimal portfolio weights.Findings – The results show that the optimal portfolio weights are sensitive to internal control mechanisms, ownership concentration, managerial entrenchment and incentive compensation.Originality/value – The results are relevant to academicians and investors concerned with portfolio selection. In fact, they underline the importance of including governance characteristics in their portfolio selection.
TL;DR: In this paper, the authors provide insights into the necessary conditions for a new era of development and specifically the potential contribution of business and academia in this new era, and provide an explorative study based on expert interviews and summary of the discussion of the EABIS Colloquium 2011 (Corporate Responsibility and Developing Countries).
Abstract: Purpose – A new era for development is needed and business needs to play a significant role in this era. This paper aims to provide insights into the necessary conditions for such a new era of development and specifically the potential contribution of business and academia.Design/methodology/approach – This explorative study is based on expert interviews and the summary of the discussion of the EABIS Colloquium 2011 (“Corporate Responsibility and Developing Countries”).Findings – Innovative companies are moving from building “shareholder value” to “shared value” for all stakeholders; from “quarterly capitalism” to “long‐term capitalism”. They are also providing resources, open access systems and capital to entrepreneurs and communities to support technology and knowledge transfers. Companies that integrate future development concerns into their business model will be ideally placed to secure long‐term licences to operate, develop loyal new consumer bases, and innovate in new market segments.Research limit...