Editorial: COVID-19, corporate governance, sustainability, and the post-neoliberal world

The five papers in this special issue reflect the initial impact of the COVID-19 pandemic, in its first year, on corporate governance and sustainability. What is common throughout these papers is how the pandemic has created disequilibria for many organisations. The question continues to be posed as to the new forms of organising and managing as the world reorientates or pivots in a pandemic and post-pandemic world

Estimated impact of COVID-19 on the Jordanian economy

This study aims to estimate the negative effects of COVID-19 on the Jordanian economy. These effects are expected to coincide with the results of studies carried out by international institutions. For example, the International Labor Organization (ILO) estimated indicate an increase in the number of unemployed to 5.3 million (the “low” scenario) and 24.7 million (the “high” scenario), from a baseline of 188 million in 2019 (ILO, 2020a). Experts from the World Bank and the International Monetary Fund (IMF) confirmed that the global economic downturn (caused by the coronavirus pandemic) is the largest in the past eight decades, which will lead to an increase in poverty and inequality and harm economic growth in the long term. (News 18, 2020). To measure the impact of COVID-19 on the Jordanian economy, the following indicators were adopted: an economic growth, an unemployment rate, a foreign trade (imports and exports), public revenues, public spending, a public debt, and a budget deficit. The study relied on data contained in reports issued by international institutions and official institutions in Jordan. The results indicate a slowdown in the rate of economic growth, an increase in the unemployment rate, a decrease in exports and imports, an increase in the public debt and the budget deficit

Effect of corporate governance practices on bank performance: The perspective of board members

The lingering poor financial performance by banks and bank failure in the past three decades, despite various regulatory actions, has led to a debate on the efficacy of the various regulatory actions and the effectiveness of the practices of corporate governance in Nigerian banks (CBN, 2014; Berger, Imbierowicz, & Rauch, 2016). The study seeks to understand how corporate governance practices influence banks’ performance. The qualitative approach purposively selected three banks and three board interview respondents. Using thematic analysis, the results show that, large board size is not sufficient to improve performance but the broader expertise and other resources the directors bring are the critical elements. The study finds consensus that, outsider directors were desirable, as they provide additional expertise, and assist in making strategic input to improve management decisions. Enhanced monitoring and oversight responsibilities and access to information of board committees improve board effectiveness with favourable effects on bank performance. While the moderating effect of female representation with other governance characteristics on bank performance is subject to the female complementary expertise and their proportion of the board, that of foreign directors appear to be negligible. Bank boards are recommended to be of the right caliber and quantity with adequate resources to offer enhanced monitoring and oversight responsibilities

Corporate governance and financial performance of listed companies: A case of an emerging market

Corporate financial performance (CFP) is a key benefit that comes with the adoption and implementation of a good corporate governance structure in organizations. The objective of this paper is to analyze the effect of the six (6) broad corporate governance structures (board composition, board committees, separation of CEO/chairman, size of board, number of board meetings held, and shareholder concentration) on CFP measured by ROA, ROE, EPS, and Tobin’s Q among Ghanaian companies. The target population for the study was the companies that were listed on the Ghana Stock Exchange (GSE) for the period 2015–2020 and purposive sampling methods were deployed in the sample selection. The study found that using ROA as a performance indicator, corporate governance variables affected CFP by 18.95% whilst it influenced ROE by 29.71%. Additionally, corporate governance mechanisms impacted EPS by 52.53% when it was used as a performance indicator and 18.01% when Tobin’s Q was the performance index. The paper concludes that companies that implement the corporate governance guidelines on best practices stand a better chance of enhancing CFP especially with performance targets that integrate shareholder value maximization.

Do Egyptian listed companies support SDGs? Evidence from UNCTAD guidance on core indicators disclosures

This paper provides an exploratory analysis of the extent of Sustainable Development Goals disclosure (SDGD) by the top 30 Egyptian companies. We use the 33 core indicators of the United Nations Conference on Trade and Development (UNCTAD), which span economic, institutional, social, and environmental areas. Overall, the results suggest that SDGD in Egypt is still gaining traction, as indicated by a relatively low average disclosure score of only 25%, which translates to approximately eight indicators. We also document a variation in SDGD among the four areas, where disclosure addressing economic and institutional indicators is higher than that of social and environmental areas. This variation could be attributed to the differential regulatory and legal intensity. Disclosure is most noticeable for taxes, employment, women empowerment, financial transparency, corporate governance, and energy. We argue that Egypt has the legislative infrastructure and clear political will from the state to support sustainable development. However, there is a need for coordinated awareness efforts to establish a culture of sustainable development among various stakeholders, including businesses. Finally, there should be a stronger conviction regarding the importance of information sharing as well as comprehensive reporting standards and enhanced regulatory enforcement. To the best of our knowledge, this is the first paper to address the status of SDGD in Egypt. Accordingly, there is a need for future research that analyzes both the determinants of SDGD and its consequences

Corporate social responsibility in the time of COVID-19 pandemic: An exploratory study of developing country corporates

COVID-19 pandemic has long-lasting consequences on the health, economic and social life of a country (He & Harris, 2020). In a developing country like India, the socio-economic disruption has led to collaborative action between the central government and state government machinery together with the development sector to curb the impact caused by the virus. Academia substantiates the symbiotic relationship existing between the business and the society (McGuire, 1963; Carroll & Shabana, 2010). The corporates are contributing towards alleviating the pandemic situation through their corporate social responsibility (CSR) activities (Mahmud, Ding, & Hasan, 2021). This article provides insights into the CSR strategies adopted by corporates in India during the COVID-19 pandemic through exploratory research. The study is based on semi-structured interviews of 27 CSR managers involved in strategizing and implementation of CSR activities in their respective organizations. The results outline the commitment shown by corporates towards alleviating the consequence of the virus by multiple CSR strategies. Thus, this research furthers the understanding of CSR and forms a base for future research on COVID-19 and CSR

Corporate governance, institutional investor type and firm performance: Evidence from an emerging market

The study analyses the role of institutional investors in improving firm performance. Unlike in developed economies where firm ownership is widely dispersed, firms in emerging economies such as India have substantial promoter shareholdings (often in a majority or close to a majority). Given the promoter control of Indian companies, the role of institutional investors as external monitors is analysed. Following Brickley, Lease, and Smith (1988) and Almazan, Hartzell, and Starks (2005), the study categorises institutional investors as pressure-sensitive and pressure-insensitive institutional investors. Panel data for non-financial firms from India included in National Stock Exchange (NSE) 500 over the period 2008–2017 is studied using fixed-effects models. The study finds that the increased ownership of pressure-insensitive institutional investors is positively associated with firm performance. Also, the increased ownership of pressure-sensitive institutional investors is negatively associated with firm performance. These findings are consistent with the view that pressure-insensitive institutional investors are more effective monitors compared to pressure-sensitive institutional investors. The study offers insights into the role of institutional investors in economies where firms have a substantial promoter shareholding. The study documents that even with a substantial promoter shareholding and control, pressure-insensitive institutional investors aid in enhancing firm value

US-China trade war: Impact on chemical exporting firms from India to US

With the onset of the US-China trade war in July 2018, the trade patterns between China, the US, and India have undergone a tremendous change. The number of products in which China had a competitive advantage in terms of exports to the US has declined in the last 9 months. A number of developing countries may be benefitted from the ongoing tariff war between the US and China, like Vietnam, Brazil, India, and Korea. In the present study, an attempt has been made to analyse the impact of the US-China trade war on exports of India to the US. The sector which has been selected is the chemical sector comprising of organic and inorganic chemicals as chemicals are one of the top-exported products from India to the US. To analyse the impact, the difference-in-differences technique of regression has been applied. The results indicate that after July 2018, i.e., the commencement of the US-China trade war, the impact on firms exporting chemicals from India to the US has been significant and firms in India may be a potential source for chemicals for the US provided the right policy measures are exercised in India. The results indicate that the trade war between the US and China has had a positive impact on the chemical exports from India to the US. The chemical exports from India to the US have increased post-July 2018, though not at a steep rate. This indicates that India has the potential to export chemicals to the US

Sustainability reporting and strategic legitimacy: The influence of operating in emerging economies on the level of GRI reporting in Canada’s largest companies

Corporate sustainability reporting is a contributor to strategic legitimacy (Chelli, Durocher, & Fortin, 2018) and certain traditional corporate characteristics (size, industry vulnerability) can influence the level of sustainability reporting (Drempetic, Klein, & Zwergel, 2020). However, limited literature exists in regards to sustainability reporting by Canadian companies operating in emerging countries. Content analysis of sustainability reports examined the current use of the Global Reporting Initiative (GRI) framework. Principal component analysis (PCA) provided a sustainability reporting index (SRI) measure for each firm using factor scores. Correlations and independent-samples t-testing tested the association of the level of reporting to a firm’s size, industry, level of internationalization, and level of activity in emerging economies. A review of 234 large Canadian-based, publicly-traded companies found a total of 86 companies employed the GRI framework, and data from these companies was used in this study. Asset size and vulnerable industries had no significant association with the level of sustainability reporting contrary to prior studies. Operating in emerging economies resulted in greater levels of sustainability reporting when compared to firms that do not. This finding is consistent with the external legitimacy strategy and contributes to the limited literature in this area

Association between rewards and employee performance: An empirical research on Omani banks

The current paper aims to explore the association between rewards and employee performance in the Oman banking sector. This study evaluates data of 500 bank employees across 18 listed banks in the Sultanate of Oman. A theoretical framework is discussed to assess the effects of rewards on employee performance. According to this literature review, it is proven that rewards influence employee performance. Güngör’s (2011) study shows that organizations develop reward strategies to motivate and increase employee performance. Salah (2016) proves that rewards have a strong influence on employee performance, and he further states that incentives encourage employees to work with purpose and increase organizational performance. The outcomes are examined using factor analysis, structural equation modeling, and multivariate analysis of variance. The results of this study provide critical insights into how companies can adopt effective reward management to sustain and compete in the dynamic business landscape and modulate performance management in Omani banks. Overall, a statistically significant association between the rewards system and employee performance in Oman’s listed banks is established in this study. The study further underscores the need to design and evolve employee-centric policies to get optimum performance. It also offers guideposts for managers and policy planners working in the Middle East countries’ banking sector to develop holistic policies to succeed in stiff, cut-throat competition and ensure participatory management for best performance. Herein, extrinsic and intrinsic rewards are studied concerning their impact on the performance matrix. A proper insightful reward management system may lead to optimum performance, better outcomes, and a robust financial plan