How public values shape financial crime: Evidence on the mediating role of public and corporate governance

This study investigates the moderating role of intellectual capital (IC) in the relationship between corporate governance (CG) and stock returns (SR) within the United Kingdom's financial sector. Using a panel dataset of 65 financial firms listed on the FTSE 100 Index over the period 2019–2023, the analysis employs a moderated regression framework under a random-effects specification, as validated by the Hausman test. CG quality is proxied through board independence (INDCOM) and institutional ownership (INSTOWN), while IC is measured using the Modified Value Added Intellectual Coefficient (MVAIC) model. The empirical findings demonstrate that effective governance mechanisms exert a positive and statistically significant impact on SRs. Both independent directors and institutional investors contribute to improved market performance through enhanced monitoring, transparency, and accountability. More importantly, IC exhibits a significant moderating effect, strengthening the relationship between governance and market outcomes. This indicates that UK firms with higher levels of human, structural, and relational capital are better equipped to translate governance efficiency into superior financial returns. The results contribute to the Resource-Based View (RBV) by confirming that intangible assets complement governance structures in creating sustained competitive advantage. Furthermore, the findings support agency theory by demonstrating how knowledge transparency reduces information asymmetry between managers and shareholders. From a practical perspective, the study highlights the importance of integrating ICmanagement within CG frameworks to enhance firm value, investor trust, and long-term sustainability.

• Financial reporting controls are complementary in mitigating earnings management. • Audit quality constrains accrual earnings management. • Corporate governance deters real earnings management. • Accounting enforcement deters income-increasing accrual earnings management. This study examines the association between the three components of the financial reporting control system (auditors, corporate governance, and enforcement) and both accrual (AEM) and real (REM) earnings management across listed companies in 17 EU countries over the period 2012–2018. Our results show that these controls play complementary roles in constraining earnings manipulations. Auditors constrain AEM, independent directors seem to mitigate REM, and enforcement constrains only income-increasing AEM. These findings have policy implications and extend the earnings management literature by providing new insights into the complex relationship between controls and earnings management. Overall, they emphasize the need to adopt a comprehensive view of the system of financial reporting controls and consider its effectiveness with respect to different forms of earnings manipulation.

Groupthink has long been documented as a recurring feature of boardroom decision making, impairing collective judgment and, in some cases, contributing to major corporate failures throughout history. Artificial intelligence (AI) is increasingly introduced into governance settings, yet its implications for collective decision-making dynamics remain underexplored. Drawing on 20 interviews with Moroccan board directors, this study examines perceptions of AI's role in shaping groupthink tendencies. The findings suggest that AI-enabled decision support may enhance the informational basis of deliberation, encourage dissent through neutral feedback, direct prompting, and anonymized inputs, strengthen individual and collective evaluation processes, and augment collective intelligence in board deliberations. Nonetheless, entrenched cultural norms, hierarchical structures, and enduring human dynamics were perceived to constrain AI's influence. Building on these insights, the study introduces the concept of AI-mediated groupthink, contributing to research on small-group decision making, groupthink, and corporate governance, while informing governance actors about the potential and limits of AI-enabled decision support in boardroom decision making. • AI may mitigate some aspects of groupthink but is unlikely to eliminate it. • AI is perceived to enhance efficiency, objectivity, and board evaluation. • AI may foster dissent via neutral, prompted, and anonymous input channels. • Cultural, hierarchical, and human factors may constrain AI's influence. • AI is valued primarily for its potential to augment collective intelligence.

Peer firm’s ESG pressure, executives’ green perception and sustainable development- An empirical study from Chinese listed companies

This paper identifies the essential characteristics of a civilized corporate governance system within Iran's capital market, using the multi-criteria decision-making (MCDM) method, specifically polar matrix analysis. The goal of this research is to aid policymakers, corporate boards, and regulatory bodies in creating customized governance frameworks. The study emphasizes the significance of understanding and applying governance practices suited for emerging markets like Iran, contrasting these with established models in markets such as the US and Europe. Conducted between 2018-2022, the study uses a meta-composite analysis process to explore governance practices tailored to this emerging market, recognizing significant differences from established markets like the US or Europe. The analysis follows a three-step procedure. First, qualitative analysis identifies six key characteristics essential for an effective governance structure. In the second step, descriptive ranking evaluates the effectiveness of existing systems in Iran's capital market, revealing that among the six identified characteristics, adhocracy demonstrates the highest effectiveness percentage. Finally, quantitative analysis assesses the strengths and weaknesses of Iran's civilized corporate governance systems. This comprehensive approach provides a nuanced understanding of governance practices that align with the unique attributes of Iran's capital market, contributing to the development of localized, robust governance frameworks. • Identifies the key dimensions of civilized corporate governance. • Applies MCDM techniques to evaluate governance structures. • Integrates expert judgment with quantitative decision-making models. • Provides a structured framework for governance assessment.

The role of corporate governance in shaping environmental performance: Exploring industry differences

Related-party transactions (RPTs) occupy a central position in contemporary corporate governance, serving as essential channels for resource allocation among affiliated business entities. The growing complexity of ownership arrangements and globalized operations has made RPT auditing increasingly challenging for financial professionals. Traditional audit methodologies struggle with intricate enterprise relationship networks that often span multiple jurisdictions and involve layered ownership through shell companies, rendering manual inspection approaches both time-consuming and incomplete. Despite advances in computational approaches, significant gaps persist in current research and practice. Existing audit systems inadequately capture the multi-dimensional relationships connecting enterprises, shareholders, executives, and transactions. Most machine learning methods treat transactions as independent observations, thereby ignoring the relational context that distinguishes legitimate RPTs from irregular ones. Furthermore, the dynamic nature of enterprise relationships demands adaptive models capable of tracking temporal evolution, yet static snapshots of relationship networks may produce outdated or misleading risk assessments. Four critical challenges must be addressed for effective RPT audit automation: modeling heterogeneous entity types linked through diverse relationship categories with different audit implications; capturing temporal dynamics as ownership structures change through acquisitions and personnel movements; providing interpretable outputs that support professional judgment and regulatory inspection; and integrating domain knowledge with data-driven learning in a coherent framework. This study develops an intelligent decision support system that bridges knowledge graph technology with graph neural network architectures to address these challenges. The proposed framework constructs a domain-specific knowledge graph capturing multi-dimensional enterprise relationships through entity resolution and temporal modeling. An enhanced graph neural network employs heterogeneous attention mechanisms alongside temporal fusion components to learn relationship-aware representations. Interpretable risk assessment emerges through attention weight visualization and risk propagation path analysis. Experimental evaluation on real-world enterprise data demonstrates substantial improvements over baseline methods, with practical deployment confirming utility for detecting undisclosed relationships and pricing anomalies in accounting firm engagements.

Purpose This study aims to examine the moderating role of product market competition (PMC) in the relationship between corporate governance (CG) and firm value from the perspective of agency theory in Pakistan. Design/methodology/approach This study applied a fixed-effect model, instrumental variable two-stage least squares estimator and the system generalized method of moments to analyze panel data, collected from 369 firms listed on the Pakistan Stock Exchange between 2010 and 2023. Findings The findings indicate that CG increases firm value only in highly competitive industries through a complementary effect, whereas it diminishes firm value in less competitive industries through a substitutive effect. The results further demonstrate that this impact is more pronounced in state-owned enterprises (SOEs) than in non-SOEs. The robustness of the findings is confirmed through consistent results across alternative sample divisions, variable measurements, governance structures and regression estimations. Research limitations/implications Policymakers and regulatory authorities in developing countries like Pakistan should consider diversifying CG structures based on varying levels of competition to improve firm value. Given the strong complementarity between PMC and CG in SOEs, regulatory reforms should prioritize aligning governance practices in SOEs with the best practices observed in non-SOEs to maximize performance outcomes. Originality/value This study grasps critical research gaps in the literature, theory and methodology by investigating how external governance (i.e. PMC) shapes the relationship between internal CG and firm value through the lens of agency theory. Besides, it offers insights into how the CG structures of SOEs and non-SOEs respond to competitive pressures within the unique institutional context of Pakistan. Moreover, the findings support the view that the moderating role of PMC in the nexus of CG with firm value or performance diverges from patterns observed in other institutional settings.

Purpose This research aims to investigate the relationship between family control and leverage, with a focus on how board quality and the presence of women on the board can moderate this relationship. Design/methodology/approach The study examines nonfinancial firms listed on the Indonesia Stock Exchange, covering a sample of 362 companies and 1,810 observations from 2018 to 2022. Quantitative methods were employed to collect and analyze empirical data. Findings The results reveal a significant positive correlation between family control and leverage. Furthermore, board quality moderates the relationship between family control and leverage. The presence of women on corporate boards also serves as a moderating factor in this relationship. Originality/value By integrating agency theory and resource dependence theory, this study provides a deeper understanding of the dynamics between family control and leverage, highlighting the impact of board quality and gender diversity on corporate governance.

Purpose Following milestones such as the Business Roundtable and the Davos Manifesto, corporate purpose moved beyond rhetoric and emerged as a viable business orientation. In this context, corporate governance becomes crucial for guiding and deploying purpose within organizations. Yet the literature lacks an integrated explanation linking both concepts. This paper aims to examine how prior research links corporate purpose and corporate governance, and to propose–drawing on institutional theories–a multilevel framework that explains their relationship. Design/methodology/approach A systematic review of the literature was conducted, following the PRISMA protocol, to select and analyze 34 articles identified in Scopus and Web of Science. Findings The study shows a multilevel relationship between purpose and corporate governance. At the macro level, institutional systems condition the adoption of purpose; at the meso level, organizational attributes filter pressures; and at the micro level, leaders’ agency allows purpose to be incorporated into decisions to manage tensions. Originality/value A multilevel conceptual framework is proposed that integrates purpose and governance from an institutional perspective, offering a common language to connect the institutional context, organizational attributes and individual agency. Likewise, a typology of organizations is developed that, based on the combination of institutional logics at the national, organizational and individual levels, allows for the identification of tensions that emerge in the implementation of purpose.

In Bangladesh, corporate governance and financial transparency has a complicated relationship which is examined in this study. In this study it is also discussed how the mechanisms like inefficient board independence, ineffective audit committees, inadequate financial disclosure practices and lack of regulatory enforcement can be the causes of regulatory failure and financial scandals which can lead to the distrust of the stakeholders and doubt the whole transparency process. With the help of qualitative technique which includes interviews of the stakeholders, document analysis and content analysis, it is found that corporate responsibility is weakening by significant institutional and political issues. Though Corporate Governance Code 2018 and Companies Act 1994 exist, results indicate that implementation of corporate governance is still not up to the mark and in a remarkable state. Increased activism of stakeholders, improved financial disclosure strategies, better audit procedures, greater board independence and stronger regulatory authority etc are some developed approaches that are suggested by the study as well. It also indicates how the rules for openness are changed by CSR reporting and digital financial disclosures. For promoting a moral, responsible and financially transparent business environment that assist Bangladesh’s sustainable economic growth, it is required to address these constructional and organizational limitations.

This study examines how the integration of artificial intelligence (AI) into corporate operations fundamentally reshapes the core doctrines of corporate law and governance. Our analysis establishes that AI represents a structural transformation that necessitates a complete re-evaluation of traditional fiduciary duties, liability frameworks, and supervisory approaches. The ‍research highlights AI’s dual impact on sustainability: its immense potential to advance environmental, social, and governance (ESG) objectives (through enhanced measurement and transparency) is directly counterbalanced by significant risks, including algorithmic discrimination, environmental externalities from high computing intensity, and opaque decision-making. The core finding is that existing corporate governance frameworks inadequately address this dual and contradictory impact. Consequently, the study concludes that a fundamental doctrinal evolution is essential. Specifically, the analysis identifies the ‍imperative to extend fiduciary obligations to encompass technological competence, ethical oversight, and data stewardship—a ‍necessary concept framed here as the “duty of technological prudence”. Furthermore, the research demonstrates how AI exposes firms to amplified liabilities, ranging from privacy claims and cybersecurity failures to complex product liability for autonomous systems. To address the fragmented global regulatory landscape, the paper advances “sustainability-by-design” as a ‍strategic imperative, mandating that ethical and environmental considerations be embedded throughout the entire AI lifecycle. The paper concludes with targeted policy recommendations for legislators and corporate boards to align AI innovation with social progress and human dignity.

The rapid digital transformation of business operations presents a significant challenge for corporate governance, particularly in the complex and opaque domain of tax strategy. This systematic review follows PRISMA guidelines to critically analyze the role of corporate governance mechanisms in developing tax avoidance and tax risk in the context of the current phase of rapid digital transformation. The research problem stems from fragmented evidence on governance-tax relationships as digital technologies fundamentally alter corporate information environments and decision-making processes. The purpose is to synthesize evidence on how governance mechanisms, including board characteristics, ownership structure, executive compensation, and external monitoring, influence tax outcomes in digitally transforming organizations. The methodology employed a systematic search of Scopus and Web of Science, yielding 96 peer-reviewed articles following Tranfield et al.’s (2003) guidelines. Findings reveal that while board independence and expertise moderate tax aggressiveness, governance effectiveness is increasingly mediated by digital technologies. Consistent with Jensen and Meckling’s (1976) agency theory framework, significant theoretical gaps persist regarding digital transformation’s impact. The review concludes that future research must integrate technological factors and alternative theoretical perspectives. This synthesis guides regulators, practitioners, and academics navigating the complex intersection of governance, tax behavior, and digital transformation.

This study examines the effectiveness of the internal audit function (IAF) in promoting good corporate governance through its reciprocal relationships with three key governance actors, namely the University Council and Audit Committee, Executive Management, and External Auditors, within a Ghanaian public university context. The University of Mines and Technology (UMaT) serves as the empirical setting. An explanatory sequential mixed-methods design was employed, combining structured Likert-scale questionnaires administered to 40 purposively selected staff members, achieving a 100% response rate, with semi-structured interviews conducted with 10 key informants. Quantitative data were analyzed using descriptive statistics in Microsoft Excel, while qualitative data underwent reflexive thematic analysis using NVivo. The findings reveal a strong and functional relationship between the IAF and both the University Council and Audit Committee (mean = 4.5) and Executive Management (mean = 4.1), confirming that these relational dimensions significantly contribute to institutional transparency, accountability, and oversight. Both Hypothesis 1 and Hypothesis 2 were accepted. However, a recurring and critical operational gap emerges across both governance relationships: despite strong strategic rapport, resource and logistical adequacy scores are consistently moderate, with mean values of 2.8 and 2.5, respectively, indicating that relational goodwill has not translated into sufficient staffing, budgetary allocation, or capacity-building support. The relationship between the IAF and External Auditors is characterized as moderate overall (mean = 3.1), with critically low scores for joint audit planning (mean = 1.3) and periodic risk-assessment meetings (mean = 1.1), identifying a significant coordination deficit that generates duplication of effort, elevated audit costs, and missed assurance opportunities. Hypothesis 3 was also accepted based on existing interaction, though the quality and depth of that interaction fall short of professional standards. The study offers actionable recommendations for university governance structures in emerging economies, including formalized joint audit planning protocols, increased budgetary commitments to internal audit capacity, and governance reforms that convert strategic support into operational empowerment. The findings contribute to the growing literature on public sector audit governance in sub-Saharan Africa and carry direct implications for the Internal Audit Agency of Ghana and policymakers seeking to strengthen audit-governance synergies in tertiary institutions.

The impact of corporate governance attributes on cash holdings: evidence from quantile regression and fuzzy-set qualitative comparative analysis

This paper explores integration of forensic accounting techniques and big data analytics in detecting and preventing fraud within multinational corporations (MNCs). Through a detailed analysis of ten MNCs, the study demonstrates that advanced big data analytics tools significantly enhance fraud detection capabilities. The findings reveal that companies employing these integrated approaches are more effective in identifying and quantifying fraudulent activities, underscoring the critical role of technology in modern fraud detection strategies. The study discusses the implications for practice, emphasizing the need for investment in technology and continuous training for forensic accountants. It also provides recommendations for policy and practice, advocating for the development of integrated fraud detection systems and the creation of standardized frameworks by policymakers. Suggestions for future research include comparative studies across different industries, exploration of technological innovations like artificial intelligence, longitudinal studies to assess long-term effectiveness, and cross-cultural analysis to identify universal and region-specific strategies. This research contributes to a deeper understanding of how forensic accounting and big data analytics can be leveraged to combat corporate fraud, ultimately enhancing the resilience of corporate governance practices.

This research aims to explore the impact of internal control quality on the market value of real estate companies listed on the Stock Exchange of Thailand using secondary data of 110 companies over a 3-year period from 2021 to 2023. The price-to-sales ratio (P/S) is set as the dependent variable, while internal control quality (CG) is converted into a categorical variable based on the corporate governance score. In addition, the variables of operating profit to revenue (OPM), business size (Log Total Assets), business age, and financial risk (Debt-to-Equity) are controlled. The data are analyzed by using multiple regression.The model test results indicate that the model is appropriate, as shown by a statistically significant F-statistic. Internal control quality exhibits a significantly negative relationship, suggesting that companies with higher governance scores may be undervalued within the Thai real estate industry. Operating profit has a positive influence on the price-to-sales ratio, while both firm size and financial risk also show significant effects positive for firm size and negative for financial risk. The effect of firm age is not statistically significant. An examination of multicollinearity reveals acceptable variance inflation factor values, and the Durbin-Watson statistic confirms the absence of autocorrelation issues. The findings suggest that operating efficiency, capital structure, and firm size remain key drivers of market valuation, whereas internal control quality may exert a short-term negative impact under Thailand's regulatory conditions. These results have implications for executives in shaping governance policies that balance strict oversight with operational flexibility. From a theoretical perspective, the study contributes to the understanding of internal control’s role inthe real estate sector of developing economies and recommends future research to incorporate ESG disclosure variables and long-term dynamic analysis to validate the observed relationships.

Revisiting Corporate Governance in the Digital Age: The Influence of IT-Enabled Services on Decision Quality

This study aims to analyze financial performance, corporate governance, and corporate social responsibility at PT Medco Energi Internasional Tbk during the period 2020–2024. The research uses a descriptive method with quantitative and qualitative approaches based on secondary data obtained from financial statements, annual reports, and sustainability reports. Quantitative analysis includes financial ratios such as ROA, ROE, DAR, DER, TATO, and Inventory Turnover, while qualitative analysis reviews the implementation of corporate governance and corporate social responsibility. The results indicate that financial performance generally improved, corporate governance was implemented effectively, and corporate social responsibility contributed positively to corporate reputation and business sustainability.