scholarly journals The financial services industry and society

2017 ◽  
Vol 22 (43) ◽  
pp. 168-190 ◽  
Author(s):  
Noel Murray ◽  
Ajay K. Manrai ◽  
Lalita Ajay Manrai
Keyword(s):  
Moral Hazard ◽  
Financial Services ◽  
Financial Incentives ◽  
Financial Services Industry ◽  
Conflicts Of Interests ◽  
2008 Financial Crisis ◽  
Content Type ◽  
Services Industry ◽  
The 2008 Financial Crisis

Purpose This paper aims to present an analysis of the role of financial incentives, moral hazard and conflicts of interests leading up to the 2008 financial crisis. Design/methodology/approach The study’s analysis has identified common structural flaws throughout the securitization food chain. These structural flaws include inappropriate incentives, the absence of punishment, moral hazard and conflicts of interest. This research sees the full impact of these structural flaws when considering their co-occurrence throughout the financial system. The authors address systemic defects in the securitization food chain and examine the inter-relationships among homeowners, mortgage originators, investment banks and investors. The authors also address the role of exogenous factors, including the SEC, AIG, the credit rating agencies, Congress, business academia and the business media. Findings The study argues that the lack of criminal prosecutions of key financial executives has been a key factor in creating moral hazard. Eight years after the Great Recession ended in the USA, the financial services industry continues to suffer from a crisis of trust with society. Practical implications An overwhelming majority of Americans, 89 per cent, believe that the federal government does a poor job of regulating the financial services industry (Puzzanghera, 2014). A study argues that the current corporate lobbying framework undermines societal expectations of political equality and consent (Alzola, 2013). The authors believe the Singapore model may be a useful starting point to restructure regulatory agencies so that they are more responsive to societal concerns and less responsive to special interests. Finally, the widespread perception is that the financial services sector, in particular, is ethically challenged (Ferguson, 2012); perhaps there would be some benefit from the implementation of ethical climate monitoring in firms that have been subject to deferred prosecution agreements for serious ethical violations (Arnaud, 2010). Originality/value The authors believe the paper makes a truly original contribution. They provide new insights via their analysis of the role of financial incentives, moral hazard and conflicts of interests leading up to the 2008 financial crisis.

The effects of IFRS adoption and firm size on audit fees in financial institutions in Ghana

2019 ◽  
Vol 32 (3) ◽  
pp. 436-453
Author(s):  
William Coffie ◽  
Ibrahim Bedi
Keyword(s):  
Financial Institutions ◽  
Firm Size ◽  
Financial Services ◽  
Audit Fees ◽  
Financial Services Industry ◽  
Content Type ◽  
Listed Firms ◽  
Ifrs Adoption ◽  
Services Industry ◽  
The Cost

Purpose This study aims to investigate the effects of international financial reporting standards (IFRS) adoption and firm size on auditors’ fees determination in the Ghanaian financial industry. Design/methodology/approach The authors use the annual report of 52 listed and non-listed firms spanning from 2003 to 2014. Guided by the hypotheses, the authors conditioned audit fees on IFRS adoption and firm size and execute robust fixed effects panel regression. Findings The results show that IFRS adoption has a positive coefficient with audit fees suggesting that the adoption of IFRS, indeed, increases the audit fees paid by banks and insurance firms, as well as the industry as a whole. The results are consistent with the idea that IFRS adoption increases auditor efforts with respect to time and complex nature of some aspect of the standards. Again, as expected, the coefficient of size is positively and significantly related to audit fees. This indicates that the size of the auditee plays a vital role in determining audit fees. Research limitations/implications The study is limited by industry (i.e. the financial services industry) and geography (i.e. Ghana). The authors propose further research that will widely consider other sectors and countries to improve the current scanty literature in this area. Besides, theoretically, the study is limited to the lending credibility theory and feels compelled to reiterate the importance of considering alternative theoretical perspective(s) in future research. Practical implications This study is significant to practitioners as it demonstrates the importance of the determinants of the auditors’ fees. It helps auditors to apply the relevant charging formula when determining audit fees, while it helps managers to improve upon the quality of reporting to control audit bill and forecasting their audit expenditure. Originality/value The results of the study extend the literature on the cost side of IFRS adoption by investigating the financial services industry and non-listed firms in a new context, i.e. a developing country where this research is uncharted. The existing studies based their analysis on either cross-section or pooled analysis and shorter post-adoption period (Cameran and Perotti, 2014). However, using an extended post-adoption period data, the authors base the study on analytical panel model, which directly examine the cost side of IFRS adoption with size as joint key explanatory variables with emphasis on financial institutions and external auditors.

The role of customers and employees in the buffer effect of corporate social responsibility in times of crisis

2020 ◽  
Vol 46 (7) ◽  
pp. 955-975 ◽  
Author(s):  
Dorra Ellouze
Keyword(s):  
Financial Crisis ◽  
Negative Impact ◽  
Employee Productivity ◽  
Negative Events ◽  
Buffer Effect ◽  
2008 Financial Crisis ◽  
Content Type ◽  
Cooperative Relationships ◽  
The 2008 Financial Crisis

PurposeThe purpose of the paper is to investigate the role of customers and employees in the buffer effect of CSR around the 2008 financial crisis in the European context.Design/methodology/approachUsing a sample of 323 European firms listed in STOXX Europe 600 Index, different models are estimated to test whether the effect of CSR ratings on firms' relationships with their customers and employees could be different during the 2008 financial crisis relative to the pre-crisis and post-crisis periods.FindingsThe paper shows that CSR rating has a significantly negative impact on firms' accounts receivable and a significantly positive effect on employee productivity during the crisis period (from 2007 to 2009). However, there is no significant effect of CSR rating during the non-crisis periods. These results suggest that during negative events, customers are willing to continue supporting high-CSR firms by paying their invoices faster. Furthermore, these firms benefit from higher productivity of their employees who are willing to work harder in periods of uncertainty.Research limitations/implicationsFirms should invest in CSR practices to maintain strong and cooperative relationships with their customers and employees. Also, investors should choose firms engaging in more social capital. Moreover, policymakers should encourage implementing CSR practices which act as an insurance-like protection in times of negative events.Originality/valueThis paper adds to the previous studies by investigating whether the cooperative role of customers and employees can explain the buffer role of CSR around the crisis. Furthermore, it considers companies located in several European countries for a long period (from 2004 to 2012) to compare periods of crisis and non-crisis.

Prospects of an online dispute resolution framework for Islamic Banks in Malaysia

2017 ◽  
Vol 25 (1) ◽  
pp. 39-55 ◽  
Author(s):  
Umar A. Oseni ◽  
Sodiq O. Omoola
Keyword(s):  
Dispute Resolution ◽  
Financial Services ◽  
Internet Banking ◽  
Internet Survey ◽  
Islamic Banking ◽  
Financial Services Industry ◽  
Access To Justice ◽  
Content Type ◽  
Online Dispute Resolution ◽  
Services Industry

Purpose This study aims to examine the prospects of using an online dispute resolution (ODR) platform for resolving relevant Islamic banking disputes in the usual banker–customer relationship in Malaysia. It is argued that through proper regulation, such innovative dispute management mechanism would not only address some legal risks associated with banking disputes but could also prevent reputational risks in the Islamic financial services industry. Design/methodology/approach Based on an internet survey, responses were obtained from about 109 respondents in Malaysia. The data obtained were subjected to multivariate statistical analyses considering factors such as access to justice, attitude of stakeholders, resolving disputes, practical issues and understanding of ODR. Findings The results obtained showed that “access to justice”, “attitude of stakeholders” and “resolving disputes” are the most influencing factors affecting the intention to use ODR among stakeholders, particularly customers and bankers in the Islamic financial services industry in Malaysia. Practical implications This study provides a way in which the recently introduced Islamic Financial Services (Financial Ombudsman Scheme) Regulations 2015 can be better enhanced to cater for internet banking disputes which might require an ODR framework. Originality/value Though there have been numerous studies on the dispute resolution framework in the Islamic banking industry in Malaysia generally, the current study focuses on a less explored framework – ODR– a new framework for handling banking disputes.

The impact of entrepreneurial leadership on innovation management and its measurement validation

2017 ◽  
Vol 9 (1) ◽  
pp. 2-19 ◽  
Author(s):  
Avanti Fontana ◽  
Soebowo Musa
Keyword(s):  
Financial Services ◽  
Innovation Management ◽  
Innovation Performance ◽  
Financial Services Industry ◽  
Entrepreneurial Leadership ◽  
Content Type ◽  
Two Samples ◽  
Measurement Validation ◽  
Services Industry ◽  
The Impact

Purpose This paper aims to validate the measurement of entrepreneurial leadership (EL) in the context of innovation management and strategic entrepreneurship, and to examine the relationship between EL and the innovation process (IP). It proposes the measurement of EL and outlines the reason and the importance of EL in the IP. The study further examines whether the IP would have direct impact on innovation performance. Design/methodology/approach The paper opted for an explanatory and confirmatory study using a quantitative approach employing an online survey/questionnaire distributed to two groups of employees representing middle and senior management having mixed background such as finance, marketing, operations and management. The first group consists of 222 respondents spread across multiple industries, and the second group consists of 60 respondents mainly from the financial services industry to validate the measurement of the EL construct. Findings The paper provides empirical insights into the validation of EL measurement through two samples, and on the impact of EL in fostering all elements in the IP (i.e. idea generation, idea selection and development or idea conversion and idea diffusion). The paper also confirms some of the literature views on the difficulty of identifying a significant relationship between the IP and innovation performance. It suggests counterintuitively that the IP may not necessarily have a positive relationship with innovation performance. Research limitations/implications Most of the respondents were those from the financial services industry, which may have an impact on the overall model but less on the validation of the EL measurement. The research affirms the theoretical concept of the dimensions of EL and validates its measurement. The research also shows intriguing findings on the missing link between the IP and innovation performance. Therefore, researchers are encouraged to identify variables or factors that should link the influence of the IP on innovation performance so that the contribution of innovation management to competitiveness can be clearly identified. Practical implications The research validates the measurement of the EL construct, which could be used as a screening tool in measuring the EL capacity at all levels within an organization as part of its leadership development in fostering its IP. Originality/value This paper fulfills an identified need to have a validated measurement of EL and its relationship with the IP.

Identity and Access Management

2011 ◽  
pp. 208-239
Author(s):  
Nick Pullman ◽  
Kevin Streff
Keyword(s):  
Financial Institutions ◽  
Financial Services ◽  
Financial Services Industry ◽  
Access Management ◽  
Broad Concept ◽  
Services Industry

This chapter discusses the role of identity and access management in the financial services industry. Identity and access management is a very broad concept that has far reaching rewards or consequences within an organization. This chapter provides a survey of the topics within identity and access management so that managers and security administrators of financial institutions can gain an understanding of the issues and possible solutions.

Brand knowledge transfer via sponsorship in the financial services industry

2014 ◽  
Vol 28 (6) ◽  
pp. 452-459 ◽  
Author(s):  
Sujin Yang ◽  
Sejin Ha
Keyword(s):  
Knowledge Transfer ◽  
South Korea ◽  
Financial Services ◽  
Corporate Image ◽  
Brand Awareness ◽  
Financial Services Industry ◽  
Content Type ◽  
Brand Knowledge ◽  
Services Industry ◽  
Sales Agents

Purpose – The main aim of this study is to develop a framework of brand knowledge transfer through sponsorship for sponsors within an insurance industry in South Korea. To this end, this study explores: how pre-event brand knowledge and perceived sponsor–event fit contribute to post-event brand knowledge and if and how consumers’ attitudes toward insurance agents play a role as a moderator in the model. Brand knowledge is examined in terms of brand awareness and corporate image. Design/methodology/approach – Using a paper-and-pencil survey method, data were gathered from consumers (n = 330) who participated in a parenting education program in which an insurance company partnered with a baby food manufacturer in South Korea. Hypotheses were tested using structural equation modeling. Findings – The results confirm the occurrence of brand knowledge transfer for sponsors via sponsorship. Pre-event brand awareness and corporate image affect post-event brand awareness and corporate image, respectively, while perceived event–sponsor fit affects both attributes of post-event brand knowledge. Further, consumer attitude toward sales agents partially moderates brand knowledge transfer. Research limitations/implications – Because the data focused on a single segment of sponsorship events in the financial service industry in South Korea, the results must be carefully applied to other forms of sponsorship, industries and cultures. Practical implications – This study highlights the effectiveness of sponsorship in the financial services industry. By aligning sponsorship events with sponsors’ characteristics and managing their brand knowledge, companies can maximize brand knowledge transfer contributing to brand equity. Originality/value – This study identifies consumers’ pre-extant attitudes toward sales agents as a moderator that controls brand knowledge transfer, the pre-event and post-event corporate image relationship, specifically.

Leveraging Technologies to Redefine Business: Technology Perspective

2018 ◽  
Vol 1 (3) ◽  
pp. 1-3
Author(s):  
B. Vijaya Lakshmi ◽  
B. Ravi Kumar
Keyword(s):  
Digital Technology ◽  
Financial Services ◽  
New Technology ◽  
Big Data Analytics ◽  
Financial Services Industry ◽  
Financial Products ◽  
Services Industry ◽  
Business Technology ◽  
Financial Technology

The disruptors in the financial services industry are rewriting the rules, banks used to perform operations traditionally. The financial services industry known for conservative and resistant to change has been challenged by financial technology (fintech) companies that compete by combining digital technology, social media, and big data analytics to replace traditional models with financial products and services enabled by new technology. The present study is an attempt to portray the Role of Fin Techs, Challenges etc.

Exploring the determinants and consequences of salesperson market orientation behavior

2018 ◽  
Vol 28 (2) ◽  
pp. 170-195 ◽  
Author(s):  
Yen-Chun Chen ◽  
Adriana Amaya Rivas ◽  
Wann-Yih Wu
Keyword(s):  
Market Orientation ◽  
Financial Services ◽  
Sales Performance ◽  
Financial Services Industry ◽  
Orientation Behavior ◽  
Research Attention ◽  
Content Type ◽  
Adaptive Selling ◽  
Services Industry ◽  
Antecedents And Consequences

Purpose While the importance of salesperson market orientation behavior (SMOB) is widely acknowledged, as evidenced by the increasing research attention this concept is receiving, discussion of its antecedents and consequences in the literature remains limited. The purpose of this paper is to focus on the antecedents of SMOB and the underlying process through which it influences sales performance. Design/methodology/approach A causal model was developed to analyze the antecedents and consequences of SMOB. This proposed model and various hypotheses were tested using data obtained from a sample of 264 salespeople in the Taiwanese financial services industry. Findings The learning orientation and behavioral controls of salespeople positively influence SMOB. In addition, SMOB plays a critical role in improving two types of “working-smart” behaviors (i.e., sales planning and adaptive selling), thereby achieving better sales performance. Originality/value This report sheds light on the importance of SMOB in today’s personal sales environment and uncovers the underlying mechanisms through which SMOB contributes to sales performance. It also offers specific guidelines for the assessment and management of SMOB to enhance the performance of salespeople within the financial services industry.

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