Managing gender diversity and board dynamics: The role of male chairpersons of large listed firms

To better understand the links between gender diversity and board dynamics, 45 male chairs of large Australian Securities Exchange (ASX) firms were interviewed to identify the impacts of the appointment of women on board functioning. Chairs held very positive perceptions about the influence of women board members, including improved dynamics around reflexivity, communication and debate which assisted chairs to promote a sense of shared group membership and cohesion. Every chair consciously worked to ensure that board member gender was not made a salient attribute or social category. Irrespective of gender, chairs encouraged board members to judge themselves as fulfilling specific components of the board skills matrix, while also identifying as a social category of highly qualified professionals rather than as unique individuals or factions categorised by gender difference or business track records. A preliminary social-psychological framework is proposed to guide future research and to promote improved boardroom practices. JEL classification: D23, D74, G41

The differential effects of integral pride and gratitude on divergent moral judgment for the self versus others

Individuals tend to have divergent moral judgment when judging oneself versus others, which is termed moral hypocrisy. While prior research has examined different factors that might influence moral hypocrisy, there are limited insights on the influences of different, discrete emotions. The present research seeks to address this gap and examines the differential influences of pride and gratitude on moral hypocrisy. Results of a pilot study and three main studies demonstrate that pride (but not gratitude) leads to moral hypocrisy. These effects are replicated across different cases of questionable behaviors and prosocial behaviors in a team setting. More importantly, this research identifies one mechanism that potentially explains this effect—the appraisal of self-other similarity. The findings of this research thus provide empirical evidence that distinct emotions arising from an organizational setting can differentially influence moral hypocrisy and offer practical implications. JEL Classification: C91, D23, D91

How an idiosyncratic (zero-beta) risk can greatly increase the firm’s cost of capital

The celebrated capital asset pricing model (‘CAPM’) brought numerous appealing insights and spawned a new theory of capital budgeting. One key intuition is that there is ‘no penalty for diversifiable risk’ – that is, any risky payoff that has zero-correlation with the wider economy, and hence zero-beta, is treated as ‘risk-free’. Does that mean that managers can bet the firm on a spin of the roulette wheel without attracting a higher CAPM discount rate? Our re-interpretation of CAPM reveals that potential financial losses which are conventionally regarded as firm-specific ‘unpriced’ risks can bring a large increase in the firm’s beta and CAPM cost of capital, despite having zero-beta and making only negligible difference at the aggregate market level. This mathematical result clashes with textbook expositions but is easily demonstrated and can be traced to authoritative but overlooked parts of the theoretical CAPM literature. JEL Classification: G11, G12

Research on unhealthy food and beverages advertising targeting children: Systematic literature review and directions for future research

The rising level of childhood obesity across the globe has escalated the worries of World Health Organization (WHO), health practitioners, policymakers, and regulators. One of the most prominent factors that promote unhealthy eating habits of children is the heavy advertising of food and beverages (F&B) targeted at children. This has deepened the concerns of stakeholders about the persuasion ethics of firms aggressively promoting unhealthy foodstuff to young consumers. This article presents a systematic literature review of scholarly research on the advertising of unhealthy F&B targeted at children. A systematic review of 70 peer-reviewed articles is conducted through the theoretical lens to present their contributions. Synthesising the findings of empirical studies, the scholarly research is classified into six core research themes. We elaborate on directions for future research: Theory, Context, and Methods and distil specific research questions for future studies. JEL Classification:

Effects of employee engagement on customer responses: Examining the mediating role of customer engagement

Drawing on emotional contagion theory, this study offers an integrated framework showing the effects of employee engagement (EE) on customer engagement (CE), repeat purchase and word-of-mouth (WOM). The data were collected from 65 employees and 352 customers of 28 retail stores using 2 separate survey instruments. A dyadic data set was created by matching customer data with the employee data corresponding to each store. The findings reveal that two key facets of EE – dedication and absorption – positively influence CE, which eventually influences WOM and repeat purchase. In line with balance theory, CE is found to fully mediate the effects of absorption on WOM and repeat purchase. Furthermore, employee length of service (ELS) is found to moderate the absorption on CE effects. Thus, the findings extend emotional contagion theory and balance theory by providing empirical evidence supporting the differential effects of the facets of EE on CE en route to WOM and repeat purchase. JEL Classification: M31

Attribute specification effect on hedonic and utilitarian options

Integrating ideas and theories from the numerosity effect and utilitarian/hedonic consumption, this research explores how hedonic and utilitarian attributes specified with contracted and expanded specifications affect consumer preferences. Results from two experiments indicate an expanded utilitarian attribute enhances consumer preference for choosing the utilitarian option. However, an expanded hedonic attribute does not influence preference for choosing the hedonic option. The relative perceived guilt of the hedonic option and the perceived attractiveness of the utilitarian option mediate the effect. Acquisition format (purchase vs windfall) moderates this effect by influencing consumers’ perceived guilt from choosing the hedonic option. JEL Classification: C91, D12, M31

Current demand and supply of impact investments across different geographic regions, sectors, and stages of business: Match or mismatch?

We examine the match/mismatch between the demand and supply of impact investments. We show that some geographic regions display an upward match, while others exhibit a downward match. We explain how regions with well-developed (or less-developed) economies are not necessarily equal to regions with well-developed (or less-developed) impact investment markets. We also highlight the sectors exhibiting a match or mismatch between the demand and supply of investments, and explain the potential reasons. Regarding both geographic and sector concentration, the demand for investments is much more concentrated than their supply. Finally, early-stage companies suffer from an undersupply of investments, while growth-stage companies display an upward match and mature companies have an oversupply of investments. These findings have implications for impact investing theory and practice, including the attainment of Sustainable Development Goals. JEL Classification: D53; E41; E51; G15; G23

Winning the Australasian Reporting Awards: An analysis of accounting and economic outcomes

Despite the intuition that winning reporting awards should be primarily based on reporting quality, we find no evidence that Australian Securities Exchange (ASX)-listed firms winning the Australasian Reporting Awards (ARA) over the period 2003–2016 exhibit higher financial reporting quality. However, we find that winning reporting awards is associated with higher annual report readability. Next, firms winning the ARA neither show superior future accounting performance nor higher market valuation. We also find that investors are not compensated with higher stock returns. Taken together, our findings suggest that the criteria applied to decide the ARA winners capture higher levels of readability but do not correlate with common academic signals of financial reporting quality. Users of the ARA outcomes should also be cautious with the immediate interpretation that the ARA are reliable signals of superior corporate performance. JEL Classification: D82, L15, M41

Antecedents to firm performance during re-internationalization

There is a paucity of research on re-internationalization, where firms re-enter international operations after complete withdrawal from previous international operations. The extant literature is largely silent on what drives firm performance during re-internationalization. We conducted an empirical investigation of re-internationalized enterprises from India to identify key antecedents to firm performance during the re-internationalization phase. Data analysis using partial least squares structural equation modeling (PLS-SEM) indicates that initial internationalization experiences, presence of dynamic capabilities, and organizational commitment to internationalization positively contribute to re-internationalization performance. The findings have implications for firm strategies, organization systems, managerial attention to knowledge management, policies supporting subventions, and for future research into de-internationalization and re-internationalization. JEL Classification: F23

National culture and corporate carbon performance

This study investigates the effects of cultural, institutional and natural ecosystems on corporate response to climate change. We find that national cultural tendencies towards future orientation, uncertainty avoidance, gender egalitarianism and humane orientation strengthen corporate performance, whereas certain other cultural dimensions, such as in-group collectivism, pose barriers to optimal carbon performance. We suggest that culture provides an incremental explanation for corporate climate behaviours beyond socioeconomic or regulatory determinants. Our study contributes to the carbon literature by comprehensively examining the role of a country’s national culture in determining corporate carbon performance, and its findings may help in the implementation of international climate accords (such as the Paris Agreement of 2015) in countries with heterogeneous cultural values and natural environmental contexts. JEL Classification: G54, Q56, P48