The influence of board characteristics on environmental performance: evidence from East Asian manufacturing industries

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Linh-TX Nguyen ◽  
Cuong-Le Thanh
Keyword(s):  
Environmental Performance ◽  
Fixed Effects ◽  
East Asian ◽  
Manufacturing Firms ◽  
Manufacturing Industries ◽  
Quadratic Functions ◽  
Board Size ◽  
Content Type ◽  
Multidimensional Construct ◽  
Board Characteristics

PurposeThe purpose of this study is to examine the influence of board characteristics on environmental performance in manufacturing firms of the emerging East Asian markets. The authors adopt a triple perspective of environmental performance that focusses on three major environmental areas including resource reduction, emission reduction and product innovation.Design/methodology/approachThe authors consider three main board characteristics, namely, board size, board independence and board leadership structure, and investigate their impacts on a multidimensional construct of environmental performance. Specifically, both linear and quadratic functions are applied to address a possibility of the non-linear relationship between board size and environmental performance. The authors use fixed-effects estimations on a sample of manufacturing firms in the emerging East Asian countries between 2011 and 2016.FindingsThe study explores an inverse U-shaped relationship between board size and environmental performance. The authors also reveal that manufacturing firms are more likely to have better environmental performance when the proportion of independent directors on board increases. However, the separation of CEO and board chair roles has no impact on environmental performance.Practical implicationsThe findings have important implications by identifying the role of a board of directors in implementing environmental protection strategies and by providing a foundation for corporate efforts to enhance sustainable development.Originality/valueThe study provides complete understanding of environmental performance as a multidimensional construct and sheds light on the influence of board characteristics, especially the inverse U-shaped influence of board size, on environmental performance in the East Asian manufacturing industries.

Digital service innovation: a paradigm shift in technological innovation

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Marco Opazo-Basáez ◽  
Ferran Vendrell-Herrero ◽  
Oscar F. Bustinza
Keyword(s):  
Technological Innovation ◽  
Qualitative Comparative Analysis ◽  
Service Innovation ◽  
Manufacturing Firms ◽  
Manufacturing Industries ◽  
Necessary Condition ◽  
Content Type ◽  
Digital Service ◽  
Product Innovations ◽  
Computer Based

PurposeExisting innovation frameworks suggest that manufacturing firms have traditionally developed a complementary model of technological innovations comprising process and product innovations (e.g. Oslo Manual). This article presents digital service innovation as a novel form of technological innovation that is capable of enhancing the performance of firms in certain manufacturing industries.Design/methodology/approachDrawing on technological innovation and digital servitization fields of research, this study argues that digital service innovation, in manufacturing contexts, complements traditional sources of technological innovation, so increasing the profit margins of firms. This effect is significant in industries characterized by business-to-business contexts, high presence of link channels and long product life spans (e.g. manufacturing and computer-based industries). Predictions are tested on a unique sample of 423 Spanish manufacturing firms using parametric (t-test) and nonparametric (fuzzy-set qualitative comparative analysis, fsQCA) approaches.FindingsThe results of this analysis show that a necessary condition so that manufacturing firms can increase profits is the deployment of simultaneous process and product innovations. It also reveals that optimal configuration requires that digital service innovation be undertaken, particularly in machinery and computer-based manufacturing industries. Hence, all three sources of technological innovation are brought together in order to reach the highest levels of company performance. The evidence suggests that technological innovation and digital servitization are closely interrelated in highly innovative manufacturing contexts.Originality/valueThis study's originality and value reside in the fact that it reveals the existence of firms incorporating digital service innovation – a new, technological innovation dimension that challenges existing innovation frameworks – to complement traditional technological innovation sources, namely process and product innovation. Moreover, the study conceptualizes and empirically tests the value-adding role of digital services in firms' technological innovation portfolio.

Sustainable supply chain collaboration: incentives in emerging economies

2018 ◽  
Vol 29 (2) ◽  
pp. 273-294 ◽  
Author(s):  
Nutcharee Pakdeechoho ◽  
Vatcharapol Sukhotu
Keyword(s):  
Supply Chain ◽  
Environmental Performance ◽  
Manufacturing Industry ◽  
Social Performance ◽  
Emerging Economy ◽  
Manufacturing Firms ◽  
Supply Chain Collaboration ◽  
Sustainable Supply Chain ◽  
Food Manufacturing ◽  
Content Type

Purpose The purpose of this paper is to investigate the relationship between sustainable supply chain collaboration (SSCC) and sustainability performance, and examine whether two types of incentives moderate this relationship. This empirical investigation of the Thai food manufacturing industry provides insight in the context of an emerging economy. Design/methodology/approach Survey data were collected from 215 food manufacturing firms in Thailand, and the hypotheses were tested by exploratory factor analysis, hierarchical regression analysis, and cluster analysis. Findings The results indicate that SSCC leads to better economic and social performance, but not necessarily better environmental performance; incentives provided by firms in the supply chain enhance the effects of SSCC on social performance. Practical implications The findings provide useful suggestions for supply chain managers and policy makers about effective collaboration and the use of incentives to improve the sustainability of individual firms in the supply chain. They also reveal the challenges faced by manufacturing firms in improving environmental performance in an emerging economy. Originality/value This study contributes to the literature on the implementation of sustainable supply chain management by explaining the role of incentives.

Corporate governance and value relevance of accounting information

2020 ◽  
Vol 36 (2) ◽  
pp. 249-262
Author(s):  
Hesham I. Almujamed ◽  
Mishari M. Alfraih
Keyword(s):  
Financial Reporting ◽  
Value Relevance ◽  
Accounting Information ◽  
Empirical Support ◽  
Board Size ◽  
Content Type ◽  
Book Value ◽  
Board Characteristics ◽  
Market Participants ◽  
The Impact

Purpose This paper aims to explore how the characteristics of the board of directors (BoD) shape earnings and book value information available to market participants. Design/methodology/approach The authors investigated the impact of board size, presence of non-executives and role duality as proxies of effective corporate governance on the value relevance of financial reporting for 178 firms on the Kuwait stock exchange in 2013. Regression analysis based on Ohlson’s (1995) valuation model was used to test hypotheses. Findings The authors found that board size was significantly associated with company value and that Kuwaiti firms with large boards increased the value-relevance of earnings and book value. The influence of role duality was positive although not significant. The presence of non-executives on the board had a negative correlation with market value (not significant). Research limitations/implications These findings deliver empirical support for the prediction that the characteristics of the BoD improve the value relevance of financial reporting. Limitations such as small sample size and one-year duration of the study did not negate the basic findings, however. Future studies will use larger samples, longer duration and additional board characteristics. Practical implications This study provides empirical support for the hypothesis that board size influences market valuation. This study may benefit managers, investors and other decision-makers. Originality/value This study delivers empirical evidence on the impact of board characteristics on the value relevance of accounting information. It will be useful for regulators and market participants monitoring the influence of board characteristics on the value relevance of accounting information.

Development of an integrated framework of LGSS strategies for Indian manufacturing firms to improve business performance: an empirical study

2020 ◽  
Vol 33 (1) ◽  
pp. 257-291 ◽  
Author(s):  
Lokpriya Gaikwad ◽  
Vivek Sunnapwar
Keyword(s):  
Six Sigma ◽  
Positive Impact ◽  
Manufacturing Sector ◽  
Manufacturing Firms ◽  
Manufacturing Industries ◽  
Environmental Benefits ◽  
Future Research ◽  
Continuous Growth ◽  
Content Type ◽  
Indian Industries

PurposeThis article aims to explore synergies between Lean, Green and Six Sigma practices in order to propose an integrated LGSS framework for continuous and incremental improvement in the Indian manufacturing industries. The three-dimensional LGSS framework seeks to provide various combinations and support operational, financial, environmental and social needs.Design/methodology/approachIn the research method, first, the current problems faced by Indian manufacturing industries are considered and proposition of a conceptual framework that qualitatively integrates synergistic aspects of Lean, Green and Six Sigma practices, and second, the framework is checked by a survey taken from 203 Indian firms by using SPSS-AMOS.FindingsThe hypothesized result suggests that the positive impact of integrated practices on firm performance in terms of operational, financial, social and environmental outcomes. It also provides a systemic and holistic approach to problem-solving through constant and incremental enhancement in the manufacturing sector.Research limitations/implicationsIn this research, only Indian manufacturing industries have been studied but can be extending into different geographical areas and sectors. Future research is also possible for different behavior and characteristics of companies that can lead to recommending strategies on how companies can improve performance. Most importantly, future research can try to understand which specific practice can contribute to competitive advantage and business success.Practical implicationsManufacturing firms that want to improve environmental sustainability should implement integrated LGSS practices into their supply chain. The set of combined practices improves operational, social, economical and environmental benefits.Social implicationsThe research presents an integrated approach of LSS for the manufacturing industry which leads their business processes to achieve economic sustainability through continuous growth and improved operational efficiency. Manufacturing industries result in outcomes like reduced cost, lead time, improved quality, sustainable market position, profitability, customer satisfaction, etc.Originality/valueThis research is different from previous studies because it integrates Lean, Green and Six Sigma practices into a unique framework that fulfills a specific need of the Indian manufacturing sector that guides operational, social, environmental and financial issues in Indian industries.

scholarly journals Corporate governance and dividend pay-out policy in UK listed SMEs

2017 ◽  
Vol 25 (4) ◽  
pp. 459-483 ◽  
Author(s):  
Mohamed H. Elmagrhi ◽  
Collins G. Ntim ◽  
Richard M. Crossley ◽  
John K. Malagila ◽  
Samuel Fosu ◽  
...  
Keyword(s):  
Corporate Governance ◽  
Fixed Effects ◽  
Audit Committee ◽  
Gender Diversity ◽  
Negative Relationship ◽  
Corporate Board ◽  
Board Size ◽  
Content Type ◽  
Board Gender Diversity ◽  
Alternative Investment

Purpose The purpose of this paper is to examine the extent to which corporate board characteristics influence the level of dividend pay-out ratio using a sample of UK small- and medium-sized enterprises from 2010 to 2013 listed on the Alternative Investment Market. Design/methodology/approach The data are analysed by employing multivariate regression techniques, including estimating fixed effects, lagged effects and two-stage least squares regressions. Findings The results show that board size, the frequency of board meetings, board gender diversity and audit committee size have a significant relationship with the level of dividend pay-out. Audit committee size and board size have a positive association with the level of dividend pay-out, whilst the frequency of board meetings and board gender diversity have a significant negative relationship with the level of dividend pay-out. By contrast, the findings suggest that board independence and CEO role duality do not have any significant effect on the level of dividend pay-out. Originality/value This is one of the first attempts at examining the relationship between corporate governance and dividend policy in the UK’s Alternative Investment Market, with the analysis distinctively informed by agency theoretical insights drawn from the outcome and substitution hypotheses.

scholarly journals Corporate governance and voluntary risk and forward-looking disclosures

2018 ◽  
Vol 19 (4) ◽  
pp. 592-607 ◽  
Author(s):  
Mohammed M. Elgammal ◽  
Khaled Hussainey ◽  
Fatma Ahmed
Keyword(s):  
Corporate Governance ◽  
Global Financial Crisis ◽  
Negative Impact ◽  
Annual Reports ◽  
Board Size ◽  
Content Type ◽  
Board Characteristics ◽  
Panel Regressions ◽  
The Impact ◽  
Forward Looking

PurposeThe purpose of this paper is to examine the impact of corporate governance on risk and forward-looking disclosures in Qatar.Design/methodology/approachThe authors automatically measure levels of risk and forward-looking disclosures in the annual reports of Qatari firms for the period 2008–2014. The authors also use two ways clustered error pooled panel regressions to examine the determinants of these disclosures.FindingsThe authors find that firms with a higher percentage of foreign ownership disclose more forward-looking information; conversely, board size has a negative impact on the forward-looking disclosure. Financial firms tend to disclose less forward-looking information, however, they tend to disclose more forward-looking information after the 2008 global financial crisis. The authors also find negative relationships between the risk disclosure and both the number of non-executive members of the board of directors and duality role of the CEO.Research limitations/implicationsThe study uses the quantity of disclosure as a proxy for the quality of disclosure.Practical implicationsThe findings should help the users of corporate annual reports in Qatar to understand managerial incentives for reporting risk and forward-looking information. This should help regulators to set a proper set of disclosure rules. Moreover, this study increases our understanding of the behavior of international investors and the board characteristics (i.e. board size) in motivating risk and forward-looking disclosures in Qatari firms.Originality/valueThe authors provide the original empirical evidence on the impact of corporate ownership and board characteristics on risk and forward-looking disclosures for Qatari firms using two ways clustered error pooled panel regressions.

Board size, ownership concentration and future firm risk

2016 ◽  
Vol 10 (4) ◽  
pp. 692-709 ◽  
Author(s):  
Junaid Haider ◽  
Hong-Xing Fang
Keyword(s):  
Fixed Effects ◽  
Generalized Method Of Moments ◽  
Ownership Concentration ◽  
Firm Risk ◽  
Board Size ◽  
Content Type ◽  
Managerial Decisions ◽  
Large Shareholders ◽  
Moderating Role

Purpose The purpose of this paper was first to find out whether the negative relationship between board size and future firm risk persists in China while contemplating all sorts of endogeneity. Second, the authors have investigated the role of large shareholders in influencing the managerial decisions concerning future firm risk via board size. Finally, the authors examined whether the moderating role of large shareholders is any different in state-owned enterprises (SOEs) and non-state-owned enterprises (NSOEs) in China. Design/methodology/approach The sample included all the A-listed firms listed on the Shanghai and the Shenzhen stock exchanges over a sample period from 2008 to 2013. The authors used fixed effects regression and the generalized method of moments (GMM) to test the three hypotheses. Findings The authors found that board size is negatively associated with future firm risk when measured as volatility in future stock prices and future cash flows. Second, large shareholders directly influence managerial decisions about future firm risk, irrespective of board size. Third, the moderating role of ownership concentration is insignificant in both SOEs and NSOEs. Originality/value To the best of the authors’ knowledge, this is the first study which has analyzed the role of large shareholders in the relationship between board size and future firm risk. This study provides valuable insights, particularly in the context of a developing country, into the role played by large shareholders in influencing managerial decisions concerning future firm risk.

scholarly journals Family control and influence on JV investment – the moderating effect of JV type and IC components

2021 ◽  
Vol 22 (7) ◽  
pp. 68-91
Author(s):  
Giovanna Gavana ◽  
Pietro Gottardo ◽  
Anna Maria Moisello
Keyword(s):  
Human Capital ◽  
Joint Ventures ◽  
Fixed Effects ◽  
Family Firms ◽  
Joint Venture ◽  
Content Type ◽  
Family Control ◽  
Board Characteristics ◽  
Capital Efficiency ◽  
Investment Size

PurposeThis paper aims to investigate the effect of the nature of ownership and board characteristics on the investment choices in joint ventures (JVs) from the dimensional point of view, controlling for the effect of JV type and other components of intellectual capital.Design/methodology/approachThe authors study a sample of Italian, Spanish, German and French nonfinancial listed firms over the 2010–2018 period, controlling for the fixed effects of the company's sector of operation and the year. The authors also analyze the effect of family control and influence on JV investment size, taking into consideration certain board characteristics, the type of JV, human capital efficiency, structural capital efficiency and capital employed efficiency while also controlling for a firm's profitability and size. To test the hypotheses, GLS panel data was used.FindingsThe results indicate that the size of the investment in JVs is smaller for family firms than for nonfamily businesses. The presence of CEO duality has an opposing effect on the size of the investment in joint ventures as it has a lowering effect in family businesses while it exerts an amplifier influence in nonfamily businesses. Moreover, the type of joint venture has a significant effect for family firms: the choice of a link joint venture reduces the size of the investment. The authors find that human capital efficiency increases JV investment size for all firms.Originality/valueThis study is the first to analyze the effect of the main dimension of socioemotional wealth – family control and influence – on a firm's JV investment size. It controls for the effect of JV type – link or scale – and the interplay of the other IC components.

Environmental management accounting, board role performance, company characteristics and environmental performance disclosure

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Stephen Korutaro Nkundabanyanga ◽  
Bruno Muramuzi ◽  
Kassim Alinda
Keyword(s):  
Environmental Management ◽  
Environmental Performance ◽  
Management Accounting ◽  
Manufacturing Firms ◽  
Performance Information ◽  
Role Performance ◽  
Cross Sectional ◽  
Content Type ◽  
Industry Type ◽  
Environmental Management Accounting

Purpose The increasing environmental challenges require efforts to expand the scope of accounting to better evaluate organizations’ behaviour/practices. This paper aims to report the results of studying the link between environmental management accounting (EMA), board role performance (BRP), company characteristics and environmental performance disclosure (EPD) of Ugandan manufacturing firms. Design/methodology/approach The study was correlational and cross-sectional. The results are obtained through content analysis of company reports, websites and a questionnaire survey of 102 large and medium manufacturing firms in four districts of Uganda. Findings Results indicate that EMA causes significant variances in EPD in manufacturing firms. Also, BRP and firm size explain variances in EPD through EMA. Research limitations/implications The research does not control for industry type. Still, the results offer hope on how the reliability of environmental performance information that companies voluntarily provide outside financial statements, can be improved. Originality/value Results potentially extend available literature by providing a mechanism through which the environmental performance information is obtained for onward disclosure.

Non-linear relationship of board size and board independence with firm performance – evidence from India

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Srikanth Potharla ◽  
Balachandram Amirishetty
Keyword(s):  
Financial Performance ◽  
Linear Relationship ◽  
Fixed Effects ◽  
Board Independence ◽  
Tobin’S Q ◽  
Board Size ◽  
Tobin's Q ◽  
Content Type ◽  
Non Linear ◽  
Relationship Of

Purpose This study aims to examine the significance of the non-linear relationship of board size and board independence on the financial performance of listed non-financial firms in India. Design/methodology/approach The study draws the sample of the listed non-financial firm in the Indian market from the year 2011–2018 and applied panel least squares regression with and without industry fixed effects on the model with quadratic equation. Quantile regression is also used to test the robustness of the results. The financial performance is measured through one accounting measure (i.e. return on assets [ROA]) and one market-based measure (i.e. Tobin’s Q). The empirical model also controls firm-specific variables which are expected to have an impact on financial performance. Findings The study found that the relationship of board size and board independence with the financial performance of a firm is in a non-linear inverted U-shape. The results are qualitatively similar for both ROA and Tobin’s Q after controlling industry fixed effects. Originality/value This is the first study in India which tests the non-linear relationship of board size and board independence with the financial performance of the firm. The study contributes to the limited literature on the implications of board characteristics on the performance of the firms in India.

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