Purpose The purpose of this study, in line with Zerbib’s S-CAPM (2022) and and Hens and Trutwin (2023), is to deploy the theoretical implications of the capital asset pricing model (CAPM) and analyse the impact of environmental, social and governance (ESG) preferences on asset returns within a linear and concise framework, suggesting also a mechanical approach to extrapolate (indirectly) the investors’ view on the evolution of the ESG cycle. Design/methodology/approach The authors estimate, for each market sub-index (i.e. leader, intermediate and follower), a cross-sectional regression with Huber–White standard errors to account for heteroskedasticity-consistent standard errors. The authors perform an additional analysis to capture the cyclical extent of the phenomenon. Therefore, the authors run also an ordinary least squares rolling (i.e. constantly changing fixed window) regression for analysing changing relationships among variables overtime. The authors conclude estimating the catch-up process prediction through a logit model. Findings The ESG CAPM model should prove a temporary framework inversely correlated with the maturity of the ESG cycle. The authors show that the phi coefficient (i.e. general transition risk) is not only positive and statistically significant exclusively for the Follower and Intermediate indices, but it is higher for the former. It represents the potential (and likely) extra-return (and risk) arising from the business model “catch-up effect” rather than a mere investor’s preference. So, it is feasible to isolate the “general transition risk” preserving the “systemic risk” to extrapolate information about the investors’ perception on the evolution of the ESG market cycle. Originality/value The findings contribute to the influential literature that aims to explain the expected extra-performance of passively following an ESG-screened index within the risk–return paradigm, suggesting a linear theoretical integration to the classic CAPM to take into account the ESG premium. The authors empirically test it by creating innovative ESG indices proxies.

Purpose This study aims to explore the moderating effect of audit quality on the relationship between integrated reporting quality (IRQ) and corporate tax avoidance practices of European companies. Design/methodology/approach Using the feasible generalized least squares (FGLS), the author examined the joint impact of IRQ and audit quality on corporate tax avoidance practices between 2013 and 2022, with audit quality as a moderating variable. The sample consisted of 348 companies from the STOXX Europe 600 index, with data from the Thomson Reuters database. Robustness analyses included an alternative measure of the dependent variable and controlled for the effect of legal system. Findings The results reveal a significant negative joint impact of IRQ and audit quality on corporate tax avoidance practices. Furthermore, audit quality significantly improves the relationship between IRQ and corporate tax avoidance practices by negatively moderating it. Practical implications This paper contributes to the literature by examining how audit quality moderates the relationship between IRQ and corporate tax avoidance. The findings offer valuable insights for researchers, managers, regulators and policymakers, highlighting how IRQ and audit quality influence corporate tax practices and promote socially responsible engagement. Social implications Findings highlight the role of IR and audit quality in promoting tax transparency, fostering fairer taxation and reinforcing corporate accountability and sustainable development. Originality/value This study fills a gap in the literature by exploring the joint effect of IRQ and audit quality on tax avoidance. Furthermore, methodologically, to the best of the author’s knowledge, it is among the first to measure audit quality using three proxies in identified models.

Purpose This study aims to investigate the potential benefits of blockchain technology in enhancing corporate accountability and reporting transparency to foster a more optimistic view toward its implementation in business practices. Design/methodology/approach Data were gathered from 304 managers, accountants, auditors and board members of small and medium-sized enterprises in Razavi Khorasan Province 2024. A combination of standardized instruments and a custom-developed questionnaire validated by experts was used to measure the variables. The data were analyzed using SmartPLS. In the proposed model, blockchain adoption and reporting transparency are independent variables, while corporate accountability and reporting quality are dependent variables. Findings The analysis reveals that implementing blockchain technology has a strong positive impact on corporate accountability and financial reporting quality. In addition, higher levels of transparency in reporting are associated with improved organizational responsiveness, suggesting that greater openness in information disclosure strengthens companies’ ability to respond to stakeholder demands and regulatory expectations. The results indicate that adopting blockchain can significantly contribute to more reliable, timely and transparent corporate reporting practices. Originality/value This research offers a novel empirical perspective on how blockchain can transform corporate accountability frameworks. It emphasizes the importance of technological trust, transparency and continuous blockchain-based auditing in advancing corporate governance. The study provides practical recommendations for managers, regulators and policymakers to support blockchain implementation through regulatory measures, security protocols and inter-organizational collaboration. Ultimately, these findings reinforce stakeholder trust, regulatory compliance and long-term organizational credibility.

Purpose This paper aims to review the major studies that have examined the relationship between religiosity and managerial decisions, with a focus on behavioural corporate finance. Design/methodology/approach In the field of accounting, corporate governance and corporate finance, the main works related to five areas (religiosity, managerial decisions and ethical behaviour; religiosity and corporate risk-taking; religiosity and corporate cash holding; religiosity and corporate financial decisions; and religiosity and corporate governance), were reviewed to provide a systematic literature review. Findings The results of previous works suggest that religiosity, as a cultural proxy, is an important determining variable in corporate decisions and that it can be a useful tool to improve a firm’s ethics towards its management and towards its stakeholders, and to reduce agency costs, especially in firms operating in weaker institutional contexts (weaker corporate governance, higher debt levels and lower stakeholder protection). Practical implications This study provides two practical contributions. Firstly, it provides a comprehensive literature review that can be used for future research. Secondly, this study provides evidence that a country’s national culture, especially religion, is a key factor in shaping organisational and financial behaviour through two channels: local religiosity and personal religious beliefs. Prior to their appointment, it may be very useful for business owners to know that managers and directors are influenced by their personal culture, including religious beliefs, when making business decisions. In other words, corporate decisions may be driven more by personal beliefs than by “first best” criteria. Originality/value This study adds to the body of literature and provides practical implications. Firstly, to the best of the authors’ knowledge, it is the first study to attempt a systematic review of the literature. Secondly, knowing that religiosity, as a cultural proxy, could be a useful determinant in empirical models certainly limits phenomena related to omitted variable bias. Finally, this study could serve as a stimulus to investigate other areas not yet explored in the literature, namely, financial distress, firm longevity and agency costs, especially in small and medium-sized enterprises.

Purpose This paper aims to provide, based on a systematic review of the literature, a future research agenda for the emerging field of diversity washing in organizations. Design/methodology/approach This paper reports a systematic literature review that identified 15 relevant papers based on a broad literature search across different sources and research types that tackled diversity washing. Findings The authors summarize the findings of the systematic literature review by providing tentative answers to what motivates organizations to adopt diversity washing, their strategies to do so, how stakeholders perceive diversity washing, and the key strategies to prevent or revoke such deceptive practices in organizations. Based on these findings, the authors developed a future research agenda that guides scholars in their research efforts in this field. Research limitations/implications The authors present a future research agenda and put forward three theoretical propositions that predict the likelihood of engaging in diversity washing in organizations. Social implications The results have broad social implications, as diversity-washing practices can cover discriminatory practices in organizations with negative social consequences and implications. Originality/value This paper is the first systematic attempt to integrate the literature on diversity washing to date and opens several directions for future research.

Purpose This study examines the impact of board gender diversity (BGD) on financial performance (FP) and environmental, social and governance (ESG) disclosures, as well as the impact of ESG disclosures on FP. Furthermore, this study investigates the moderating role of ESG disclosures in the relationship between BGD and FP. Design/methodology/approach The sample included data on 60 nonfinancial companies listed on the Abu Dhabi Securities Exchange and the Dubai Financial Market from 2012 to 2021. Data were collected from a Bloomberg Terminal. Dynamic panel data regression was used to study the impact of BGD and ESG on FP. Findings During the voluntary ESG reporting period, the impacts of ENV and GOV on FP were significant, whereas that of ESG was not. BGD improves the FP of listed nonfinancial companies when mandatory ESG disclosure is required. However, this relationship was negatively moderated by ESG during adherence to these requirements. Research limitations/implications It is recommended that nonfinancial companies listed in the United Arab Emirates (UAE) practice a more favorable mechanism to enhance BGD when their ESG scores become weaker. Improving BGD practices for nonfinance companies with strong or increasing ESG scores will not be effective as it may reduce the strength of the existing association between BGD and FP. Practical implications It is recommended that nonfinancial companies listed in the UAE practice a more favorable mechanism to enhance BGD when their ESG scores become weaker. Consequently, such companies can improve FP in terms of an increased market value of shares (Tobin’s Q) when their ESG scores decrease. However, improving BGD practices for nonfinance companies with strong or increasing ESG scores will not be effective because it may reduce the strength of the existing association between BGD and FP. Originality/value To the best of the authors’ knowledge, this is the first study to find a negative moderating role of ESG in the relationship between BGD and FP, particularly during mandatory ESG reporting requirements.

Purpose This paper aims to explore how board gender diversity impacts on circular economy (CE) disclosure by a sample of European listed companies. In addition, the paper investigates the moderating role of environmental, social and governance (ESG) controversies in previous relationship. Design/methodology/approach The study conducted a regression analysis on a sample of 485 companies and 3,761 firm-year observations of European listed companies operating in 19 countries between 2004 and 2021. Findings The results reveal that the presence of female directors on the board favors the release of higher levels of CE disclosures. Moreover, female directors operating in companies characterized by higher levels of ESG controversies tend to release higher CE disclosures. Research limitations/implications First, the paper does not investigate the qualitative dimension of disclosures. Moreover, the research does not examine other elements of differentiation within the boards, such as cultural or religious diversities. Practical implications The analysis shows that diversity has an impact on the dissemination of CE information. This should lead companies and policymakers to orient their actions toward both greater diversity in board composition and the higher CE disclosure in fostering sustainable development. Originality/value This paper offers novel contributions to existing literature suggesting an objective way to measure CE-related disclosure and investigating the moderating role of ESG controversies in the relationship between gender diversity and CE disclosure.

Purpose Pakistan’s economy faces challenges of capital structure (CS), such as high debt levels, economic instability, regulatory changes and industry issues. These issues can be resolved through an effective governance structure. So, the purpose of this study is to investigate the impact of diversity in the board of directors of firms on CS. Design/methodology/approach Board diversity (BD) is measured through the women’s board member ratio, foreign directors’ ratio and board independence, while CS is measured through the total debt ratio. Secondary data is collected from annual reports of 190 listed firms at the Pakistan Stock Exchange from 2019 to 2023. The generalized method of moments is used for analyses, while for robustness, the robust least squares method is used. Findings The study found a significant negative effect of BD on CS. Findings are aligned with agency theory, resource dependency theory and stakeholder theories because this study suggests that BD, through mechanisms such as improved monitoring and reduced agency issues, can lead to more careful financial decisions, including lower dependence on debt. Practical implications This study extends distinct practical implications to stakeholders. It improves the recognition of how BD affects CS in developing economies. Policymakers and business managers, through effective corporate governance (CG) frameworks, lower the risk of default in firms by encouraging more diverse and independent boards. Originality/value It is a pioneer study conducted on the impact of diversity in the board on the CS and based on CG codes 2017 and 2019.