Enhance Corporate Performance Research Articles

The Impact of ESG Practices on Corporate Performance in the Context of Digital Transformation: A Case Study of TBEA

In the context of digital transformation, enterprises are facing unprecedented opportunities and challenges, and environmental, social, and governance (ESG) practices have gradually become a focus of attention for enterprises. How to improve their own ESG practices to enhance corporate performance is crucial for the sustainable development of enterprises. This article selects TBEA as a case study enterprise to study its ESG practices from the perspectives of environment, society, and corporate governance in the context of digital transformation. Furthermore, relevant indicators are used to analyze the impact of ESG practices on corporate performance. Research has found that good ESG practices can promote the improvement of a company's financial and non-financial performance, with non-financial performance mainly reflected in the value created by the company for stakeholders.

Corporate environmental responsibility’s influence on risk-taking in Chinese A-share listed companies

Purpose This study aims to investigate the relationship between corporate environmental responsibility (CER) and risk-taking in Chinese A-share listed companies from 2011 to 2020. It seeks to understand the influence of CER on risk-taking behavior and explore potential moderating factors. Design/methodology/approach A quantitative approach is used, using data from Chinese A-share listed companies over the specified period. Regression analysis is used to examine the relationship between CER and risk-taking, while considering moderating variables such as performance aspiration, environmental enrichment and contextual factors. Findings The findings indicate that CER positively influences corporate risk-taking, with significant impacts on information asymmetry and corporate reputation. Moreover, positive performance aspiration strengthens the effect of CER on risk-taking, while negative performance aspiration and environmental enrichment weaken this effect. Cross-sectional analysis shows that the positive association between CER and risk-taking is more prominent for firms located in areas with strict environmental regulation, for nonstate-owned firms, and for firms with higher levels of internal control. Originality/value This research contributes to the literature by providing insights into the dynamics between CER and risk-taking in the Chinese market context. It expands existing knowledge by considering the influence of performance aspiration on this relationship, offering practical implications for firms seeking to enhance corporate performance through strategic management of environmental responsibilities.

The Advent of Generative AI and Financial Industry

Purpose: This paper explores the recent literature on Generative AI applications in the financial industry and delineates its role in the future. Methodology: Our paper follows secondary research analyzing current literature on Generative AI in finance. It is one of the essential tools for understanding background information, identifying research problems, and filling the literature gaps. This paper studies how Generative AI has potential financial benefits and risks, providing unique insights into the financial landscape in the coming years. Findings: The findings unveil that Generative AI can become a strategic tool to redefine financial services and operational effectiveness. It can substantially improve the services by reducing costs, bringing efficiency, and enhancing corporate performance. It has the enormous transformative power to revolutionize client product and service offerings, improving risk management assessments and bringing efficiency to operations. However, our study indicates that the financial service industry can get into practices and decisions that are potentially unethical and financial exclusion due to an embedded bias in its algorithm and design of Generative AI technologies. Since Generative AI continues to evolve, its role and effectiveness in decision-making are expected to shape the financial services landscape significantly. Unique Contribution to Theory, Practice, and Policy: Generative AI can be a game changer for the financial industry, fueling digital transformation across industries. The transformative potential of generative AI can optimize operations, revolutionize customer experiences, and drive innovation seamlessly in finance. Our paper suggests how policymakers can foresee the challenges ahead due to the Generative AI in finance services, which is challenging the existing regulatory landscape. To stay ahead in the competition, financial firms must balance data privacy and algorithmic bias and ensure the responsible use of AI.

The Impact of Corporate Social Responsibility on Employee Job Satisfaction

Corporate Social Responsibility (CSR) has evolved into a pivotal determinant of corporate development within the contemporary business landscape. With globalization advancing and societal expectations escalating, enterprises are increasingly viewing the fulfillment of social responsibilities not merely as a philanthropic endeavor but as a crucial avenue to enhance competitiveness and achieve sustainable growth. CSR encompasses environmental stewardship, safeguarding employee rights, engaging in community outreach, upholding business ethics, and more. Through these initiatives, organizations not only improve relations with external stakeholders but also foster positive internal impacts, notably enhancing employee job satisfaction. Research indicates that when companies prioritize CSR, they bolster employees' sense of pride and belonging, thereby elevating overall job satisfaction and consequently enhancing corporate performance. Hence, delving deeply into the influence of corporate social responsibility on employee job satisfaction is not only of profound theoretical significance but also offers practical guidance for corporate endeavors, promoting a mutually beneficial development for both enterprises and their employees.

The Effects of Equity Incentives on Corporate Performance in China

For modern companies, equity incentives are used as a tool to address agency problems. This study examines the long-term impact of equity incentives on corporate performance using data from A-share listed companies in China from 2010 to 2022. The findings suggest that equity incentives can enhance corporate performance for four years after implementation, with the strongest effect observed in the second year. Additionally, there is no significant difference in the impact of equity incentives on corporate performance between state-owned enterprises (SOEs) and non-state-owned enterprises (NSOEs) in China.

Corporate governance codes: A controversial efficiency?

The pursuit of good governance by companies confronts a fundamental challenge: defining what constitutes “good governance”. Existing corporate governance codes and their implementation documents fall short of offering a clear answer to this crucial question. Despite the establishment of a reference framework years ago, the focus has shifted from defining the objectives of good governance to a consensus on the means of achieving these objectives. Unfortunately, this consensus often absolves stakeholders from providing detailed explanations. Achieving effective good governance necessitates a shift in focus towards the underlying goals of governance structures. Two potential approaches emerge in this context. While many companies rely on codes without explicitly outlining their objectives, there is a compelling case for urging or mandating them to articulate the purposes of the governance methods they employ in their reports. This level of specificity has the potential to enhance the reflective qualities of the transparency process, fostering a more comprehensive understanding of the governance landscape. Beyond merely discussing the objectives of corporate governance, the pursuit of good governance necessitates the implementation of instruments whose efficacy transcends reliance solely on market discipline. The aim is not to undermine the imperatives of transparency and justification. Instead, the intention is to recognize that these elements, while essential, do not independently ensure the effectiveness of soft law instruments, such as governance codes. Nowadays, it is crucial to assess the extent to which traditional corporate governance codes respond to the needs of companies in the era of digitalization and sustainability. Therefore, conducting a critical analysis of the existing corporate governance codes will contribute in shedding light on the gaps of these instruments to come up with recommendations for improvements. Aims and objectives: This article will focus on the following areas: Defining the role and purpose of corporate governance codes in enhancing corporate performance and accountability and discussing the challenges and limitations of corporate governance codes, including compliance issues and enforcement challenges. Presenting empirical evidence on the impact of corporate governance codes on corporate behavior and analyzing, through the principle of comply or explain, whether code adherence leads to improved corporate governance practices and financial performance. Discussing emerging trends in corporate governance and offering recommendations for improving the effectiveness of corporate governance codes.

Enhancing Corporate Performance through Debt Financing: Evidence from Nigerian Consumer Goods Firms

Background: Consumer goods firms play a significant role in any economy, like other businesses, require a mix of financing methods to amplify their performance. Aim: The study examined enhancement of corporate performance of Nigerian Consumer Goods Firms through debt financing for a period of eleven (11) years from 2011 to 2022. Methods: The data obtained were estimated using descriptive statistics and panel regression model of fixed effect. Results: The study found a positive and significant impacts of long-term debt (β=0.469729, P=0.0311) and firms’ size (β=0.154547, P=0.0251) on the performance of Nigerian consumer goods firms’ but negative and significant impacts of loan quality (β=−0.037431, P=0.0241) and short-term debt (−0.023417, P=0.0124) on their performance. Recommendation: The study recommends financing through Long-term debt for businesses in Nigeria.

The Impact of Agency Problems on Corporate Performance in China

This paper delves into the intricate dynamics of the horizontal agency problem within the realm of corporate governance in China, scrutinizing the inherent conflict of interest between controlling and minority shareholders amidst a backdrop of concentrated ownership. Its core objective is to comprehensively grasp the repercussions of this agency dilemma on firm value and corporate performance. Central to this investigation is the identification and analysis of institutional features that fuel the agency predicament, notably the pre-existing split-share structure and the prevalent establishment of pyramid ownership arrangements. In response to these challenges, this study advocates for two primary approaches to mitigate the agency conundrum: an informal approach driven by cultural factors, particularly rooted in Confucian ethics, and a formal strategy entailing robust legal safeguards and regulatory frameworks. The potential efficacy of these proposed measures in ameliorating conflicts of interest, curbing unethical conduct, and fortifying the rights of minority stakeholders, all while reducing agency costs and enhancing corporate performance.

A STUDY OF THE RELATIONSHIP BETWEEN CORPORATE SOCIAL RESPONSIBILITY, CORPORATE REPUTATION AND CORPORATE PERFORMANCE BASED ON INTERNAL EMPLOYEE SURVEY DATA

In the new era, assuming social responsibility has become a necessary consideration for corporate development. Existing studies suggest that fulfilling social responsibilities positively impacts corporate performance, while others argue it increases costs and has negative effects. Therefore, this article delves into the impact of corporate social responsibility (CSR) on corporate performance from the perspective of internal employees and explores the mediating role of corporate reputation between CSR and corporate performance. This theoretical research aims to enhance corporate performance by promoting CSR. The study employed literature analysis and questionnaire surveys to investigate employees within three Chinese smartphone companies: Xiaomi, OPPO, and Vivo. We verified the research hypotheses through correlation and regression analyses. The findings indicate that, firstly, the economic, legal, ethical, and charitable responsibilities of CSR positively influence corporate performance. Secondly, corporate reputation partially mediates the relationship between each dimension of CSR and corporate performance. Consequently, the study suggests that companies should establish a strategic CSR management mindset, considering fulfilling social responsibilities as a mission to drive sustainable development and thereby enhance corporate performance.

Enhancing Corporate Performance Through Transformational Leadership in AI-driven ERP Systems

Organisational traits, technological adoption, and transformative leadership in Chinese enterprises are examined in this study using a dataset 2010–2022. The main goal is to understand how transformative leadership affects business performance and how AI-driven ERP systems, organisational scale, and technology adoption culture modulate this relationship. The paper provides a solid framework for understanding these complex linkages using a big dataset using R and SPSS statistical analysis. Revolutionary leadership consistently boosts business. Organisational size mediates and revolutionary leadership may work better in larger organisations. Technology adoption culture highlights an organization's readiness to accept new technology, regulating the relationship. The study also found that AI-driven ERP systems diminish the correlation, suggesting that higher-tech organisations benefit from transformational leadership. This information can help CEOs adjust their technology and company characteristics strategies. Leadership theories benefit from theoretical implications that highlight contextual aspects that affect leadership dynamics. Understanding how organisational culture affects AI-driven revolutionary leadership may also help. Integrating AI and ethical transformative leadership affects sustainability and trust. Finally, the innovative leadership of AI-driven ERP systems in numerous areas and sizes explains it.

A Study on the Relationship between CEO Succession Based on Big Data Information Processing Technology and Corporate Performance

The recognition of data elements as a crucial production factor in China in 2019 highlights the rising importance of leveraging data assets. The pivotal role of big data information processing technology in economic and financial realms cannot be understated. CEO succession is a pivotal event that heavily influences a company’s performance. However, past research on the correlation between CEO succession and corporate performance has yielded inconclusive results. This study addresses this gap by employing advanced analytical models, namely propensity score matching and difference-in-differences techniques, grounded in the realm of big data information processing technology to explore the intricate relationship between CEO succession and corporate performance. By analyzing data from A-share listed companies spanning from 2014 to 2021, noteworthy insights have emerged. Firstly, a notable negative correlation between CEO succession and corporate performance has been observed, affirming the notion of a “disruptive effect” associated with CEO transitions, leading to a decline in corporate performance. Furthermore, the study sheds light on the multi-faceted nature of factors influencing corporate performance, cautioning against attributing poor performance solely to the CEO. Consequently, enhancing corporate performance demands a nuanced approach that goes beyond mere CEO replacements, emphasizing a holistic strategy encompassing various avenues for improvement.

Impact of Digital Transformation and Green Manufacturing Practices on Firm Performance with Mediating Role of Green Product Innovation: An Empirical Investigation with PLS-SEM Modeling

Purpose: The objective of this research is to determine the impact of green manufacturing practices and digital transformation on firm performance, with a particular focus on the mediating role of green product innovation. Design/Methodology/Approach: The study conducted a survey of 212 employees from various businesses using a questionnaire-based method. The data is analysed using Partial Least Squares Structural Equation Modelling (PLS-SEM) to examine the connections between digital transformation, green manufacturing practices, and company performance. The study also investigated the intermediary function of green product innovation in these connections and offered valuable insights into how sustainable practices might enhance corporate performance. Findings: This research indicates that green product innovation plays a vital role in connecting these practices to improved company success. The results suggests that organisations that have used digital transformation technologies are more inclined to foster innovation in environmental friendly goods, so enhancing sustainability and subsequently improving performance. Implications/Originality/Value: The present research contributes to the existing understanding of the impact of digital transformation and green manufacturing techniques on enhancing company performance with a specific emphasis on sustainability. The importance of digital transformation and environmentally-conscious manufacturing methods in improving the sustainability of enterprises is emphasised.

The Impact of Executive External Pay Disparity on Enterprise Innovation: Evidence from Mixed-Ownership Enterprises in China

ABSTRACT Reasonable compensation contract arrangements have long been an essential means of promoting the hard work of executives and enhancing corporate performance. While internal pay disparity and its incentive effects have garnered widespread attention, few studies have examined the impact of executive external pay disparity on enterprise innovation. Using panel data from Chinese mixed-ownership listed companies spanning from 2013 to 2020, this study explores how executive external pay disparity affects enterprise innovation. Our findings demonstrate that enterprise innovation is positively influenced by the disparity in executive external pay. This facilitating role is further strengthened in enterprises with a high level of board governance. Additionally, the benefits of executive external pay disparity for innovation are particularly evident in general commercial mixed-ownership enterprises. Mechanism tests reveal that executive external pay disparity plays a pivotal role in enhancing enterprise innovation by increasing corporate risk-taking, ultimately leading to improved enterprise value. This study not only enriches our understanding of the influencing factors behind enterprise innovation from a new perspective but also holds significant implications for deepening the reform of mixed ownership and promoting enterprise innovation through the optimization of compensation contract arrangements.

Eco-innovation and financial performance nexus: Does company size matter?

Nowadays, there is an increasing recognition of the value of eco-innovation in both academic and practical spheres. Establishing the connection between eco-innovation and corporate performance is highly important. This paper aimed to analyze the correlation between eco-innovation, corporate performance, and company size. To accomplish this goal, the paper collected unique data from 383 global non-financial companies using the Refinitiv Eikon database from 2013 to 2022. This paper uses fixed effect and (generalized method of moment) GMM techniques to overcome possible endogeneity concerns. The strong empirical results display a positive relationship between eco-innovation and corporate performance. Importantly, this paper discovered that the size of companies significantly magnifies the effect of eco-innovation on corporate performance. Our findings are still robust to endogeneity concerns. The results confirm that prioritizing eco-innovation can benefit larger companies in multiple ways, including boosting productivity, avoiding penalties, expanding into new markets, improving green image, and gaining a competitive edge, all of which ultimately enhance corporate performance. Additionally, the extensive evaluation by stakeholders enables these larger corporations to generate increased profits. This paper aims to contribute the innovation literature by exploring an under-explored topic using extensive panel data and offering practical guidance for non-financial firm stakeholders. The implications of the findings have various impacts on future research and policy development. Furthermore, this paper aims to assist policymakers in establishing impactful mechanisms and guidelines that foster ecologically conscious attitudes. The conclusion assists managers in grasping the importance of context-based eco-innovation.

Sharing the ownership in Peru and Mexico: the case of a French MNE prompting the SDGs achievement

PurposeThis study aims to investigate how a French multinational enterprise (MNE) is developing employee stock ownership (ESO) in its subsidiaries in Peru and Mexico, both Latin American countries with deep social and economic inequalities.Design/methodology/approachThis is a qualitative case study which conducted interviews with representatives of the French MNE and its subsidiaries in Peru and Mexico.FindingsThe employee stock purchase plans offered by the company to its employees support the achievement of the sustainable development goals (SDGs) 1, 8 and 10 in these countries.Social implicationsThe authors argue that MNEs could become flagships in the SDG achievement in emerging economies.Originality/valueBy contributing to better workplace outcomes and enhanced corporate performance, ESO is in line with SDG 8. ESO also fulfills SDGs 1 and 10 by allowing employees to build up savings and wealth, whose lack is the main source of inequality and poverty. Reciprocity and binary economics theories explain these relationships.

Environmental protection investment on performance of heavy-polluting enterprises: evidence from China's A-share listed companies.

Heavy-polluting enterprises' investment in environmental protection will have a "crowding out effect" on their other inputs, affecting enterprise performance. However, if the environmental protection investment of enterprises improves their green technology innovation ability, resulting in the "innovation compensation effect," which can offset the "crowding out effect" of environmental protection inputs, it may have a positive impact on enterprise performance. This can offset the "crowding out effect" of environmental investment and may promote the performance of enterprises. At the same time, equity concentration plays the role of "tunneling effect" and "monitoring and incentive effect" in the process of environmental protection investment affecting the performance of heavy-polluting enterprises. The paper selects the data of A-share listed heavy-polluting enterprises in China from 2010 to 2019 and analyzes the impacts of environmental protection investment and green technology innovation on the performance of heavy-polluting enterprises by using a multidimensional panel fixed-effects model. The results show that environmental protection investment will improve the performance of heavy-polluting enterprises by improving their green technology innovation ability; green technology innovation plays a partly intermediary role in the process of environmental protection investment affecting the performance of enterprises, and the magnitude of this intermediary role is regulated by the concentration of corporate equity. Based on the results of the empirical study, it is recommended that heavy-polluting enterprises should accelerate the pace of green technology research and development and results transformation, optimize the proportion of equity allocation, and achieve the dual goals of fulfilling environmental responsibilities and enhancing corporate performance.

Research on the Impact of Open Innovation on the Business Performance of Aerospace Equipment Manufacturing Enterprises

Amidst the accelerating pace of the digital economy, industries across the spectrum are increasingly embracing open innovation to enhance competitive edge of their products. Open innovation fosters the connection of internal and external resources and facilitates resource integration. However, the central issue that scholars are now focusing on is whether the adoption of open innovation genuinely brings significant changes in corporate performance and what the pathways of influence are. This paper is based on extensive literature review and domestic and data collection. engages in a theoretical analysis of the impact of open innovation actions in aerospace equipment manufacturing companies on operational performance. It puts forth corresponding hypotheses. Subsequently, through meticulous analysis and organization, this study selects 108 publicly listed companies on the Shanghai and Shenzhen stock markets that meet the criteria, covering the years from 2007 to 2022 as the subjects of investigation. It employs the virtual variable “Open Innovation” as an explanatory variable and complements it with one mediating variable and four control variables for empirical research. The following conclusions are drawn: Presently, the adoption of open innovation effectively enhances corporate performance. Open innovation influences corporate operational performance by impacting the company's internal integration capability. This paper presents practical and feasible recommendations from both a national and corporate perspective, facilitating their thriving development in the future.

AI in Decision Making: Transforming Business Strategies

This paper delves into the transformative impact of Artificial Intelligence (AI) on strategic business decision-making, offering a nuanced perspective on how AI is reshaping the corporate world. The primary purpose of this study is to explore the emergence and evolution of AI within the realm of business strategy, examining its role in disrupting traditional decision models and enhancing business agility. This study systematically analyzes academic and industry sources through a meticulous literature review, providing a comprehensive understanding of AI’s multifaceted role in business. The methodology adopted is a systematic literature review, which serves as a robust framework for evaluating source credibility and synthesizing insights. This approach enables a thorough examination of AI’s integration into business management, its influence on corporate performance metrics, and its potential in fostering inclusive business practices. The study also addresses the unique challenges and opportunities presented by AI in the business context. Key findings reveal that AI is not merely a technological tool but a strategic asset that significantly redefines business decision-making. The integration of AI into business strategies demonstrates substantial potential in enhancing corporate performance and promoting sustainable business practices. The study concludes that AI is a cornerstone in business evolution, offering unparalleled opportunities for innovation and efficiency. Recommendations advocate for a balanced approach to AI integration, emphasizing the need for businesses to align AI with their core values and strategic objectives. As AI continues to evolve, its role in business decision-making is expected to shape the corporate landscape significantly.

Leveraging Customer Service Support to Enhance Brand Value and Corporate Performance: Evidence from the Fintech Industry

Objective –This study investigates the role of customer service support (CSS) in co-creating brand value and enhancing corporate performance in the fintech industry. The research focuses on analyzing the impact of CSS on the customer journey from registration to first deposit. Methodology – The study utilizes historical data analysis and A/B testing. Client data from a leading fintech company is analyzed to compare conversion rates between those who used CSS versus those who did not. An A/B test is then conducted using a specialized support team targeting clients who haven’t made a deposit and had less than 2 chats with CSS. Findings –Clients who used CSS before depositing had 5 times higher conversion rates. The A/B test found a 3.1 percentage point (9.3% relative) increase in conversion from using targeted support. Novelty –This study provides new empirical evidence on the impact of CSS as a brand value co-creator in fintech, with a novel methodology to enhance corporate performance. Type of Paper: Empirical JEL Classification: M14, M31. Keywords: Brand value; Brand co-creation; Fintech; Customer service; Performance Reference to this paper should be made as follows: Syropyatov, V.V; Arenkov, I.A; Sajid, S; Mahar, D.H. (2023). Leveraging Customer Service Support to Enhance Brand Value and Corporate Performance: Evidence from the Fintech Industry, J. Fin. Bank. Review, 8(3), 116 – 124. https://doi.org/10.35609/jfbr.2023.8.3(1)

Nonstate ownership, agency costs and corporate performance: evidence from Chinese state-owned enterprises

PurposeThe primary objective of introducing nonstate ownership into state-owned enterprises (SOEs) is to enhance corporate performance. This study explores how nonstate ownership affects corporate performance, emphasizing agency costs as the primary mechanism.Design/methodology/approachUsing data from 2010 to 2019 for listed SOEs, the authors measure nonstate ownership based on shareholding ratios, control rights and shareholding–control matching. The authors also use fixed-effects and mediation-effects models, with agency costs as the primary mechanism.FindingsIncreased nonstate shareholding ratios, stronger control rights and improved shareholding–control matching promote SOE performance. Nonstate shareholding ratios boost performance through resource effects, while control rights and shareholding–control matching promote performance by mitigating agency costs. A heterogeneity analysis indicates stronger effects in local SOEs and highly marketized regions. Moreover, control rights and shareholding–control matching reinforce the positive impact of shareholding ratios on performance.Originality/valueThe mixed-ownership reform of Chinese SOEs aims to optimize shareholding and control structures between state and nonstate shareholders. Therefore, research on the impact of nonstate shareholding ratios, control rights and shareholding–control matching on corporate performance is highly pertinent. However, existing studies have focused on the effects of single factors on performance, without exploration of the economic implications of shareholding–control matching. This study not only prioritizes the optimization of shareholding and control structures but also underscores the importance of granting nonstate shareholders control rights proportionate to their shareholding, providing critical evidence of the value of improving SOEs' ownership structure.