European Companies Research Articles

Empirical Examination of the Relationship between Supply Chain Effectiveness and a Company’s Overall Success

The relationship between the effective management of supply chains and overall organizational success is not fully explained in the literature. The differences in the effectiveness of supply chains as well as the corporate social responsibility (CSR) of supply chain companies in North America, Europe, and Asia Pacific are not broadly studied. This article attempts to bridge that gap in the literature using data from the Gartner Supply Chain Group, Brand Finance, American Consumer Satisfaction Index, and Bloomberg Finance. Pertinent statistical tools including multiple regression, ANOVA, t-tests, and chi-square tests were utilized in the study. SCM top performers were found to have higher customer satisfaction than their industry counterparts; supply chain variables used currently do not have a statistically significant impact on the overall success of those companies; North American companies have experienced significantly higher supply chain effectiveness than their counterparts in Europe and Asia Pacific; and European supply chain companies are significantly ahead of companies in America and Asia in the area of CSR. The findings can help managers in companies to benchmark with their global peers. The main contribution of this research is that it demonstrates the value of supply chain effectiveness while underscoring the need for further research to link supply chain effectiveness with organizational performance. Supply chain managers need to explore operational or internal process metrics that have a more significant impact on overall company success.

A Multivariate Performance Analysis of the Plastics Manufacturers: Comparative Analysis of European Regions

Abstract This study evaluates the economic performance of plastics manufacturers in European regions (e.g., Western, Southern, Central and Eastern Europe, and the Baltic States) between 2017 and 2020 based on data from 3,372 companies using multivariate correspondence analysis (MCA) and Welch’s test. They were analyzed according to the indicators of profitability, sales (or turnover), employment, and total assets. The results of MCA show that Central and Eastern European companies are absolute leaders in terms of profitability. While Southern European companies have the highest total assets, their sales and profitability are lower compared to other regions. We found that Western European companies lead in terms of turnover and that the Baltic region is roughly on par with Central and Eastern European countries in terms of profitability and employment. These differences were also tested using the pairwise Welch’s test, which revealed highly statistically significant differences, especially in turnover and total assets. The results also show that profitability levels are similar regardless of company size, while sales and total assets are significantly different across European regions. These findings on plastics manufacturers in different European regions are crucial to help policymakers and industry leaders make informed decisions to address economic performance, investment and environmental concerns, and to develop sustainable solutions for the plastics industry.

Do investments in phosphorus recovery from dairy processing wastewater pay off?

While phosphorus fertilizers contribute to food security, part of the introduced phosphorus dissipates into water bodies leading to eutrophication. At the same time, conventional mineral phosphorus sources are increasingly scarce. Therefore, closing phosphorus cycles reduces pollution while decreasing trade dependence and increasing food security. A major part of the phosphorus loss occurs during food processing. In this article, we combine a systematic literature review with investment and efficiency analysis to investigate the financial feasibility of recovering phosphorus from dairy processing wastewater. This wastewater is particularly rich in phosphorus, but while recovery technologies are readily available, they are rarely adopted. We calculate the Net Present Value (NPV) of investing in phosphorus recycling technology for a representative European dairy processing company producing 100,000 tonnes of milk per year. We develop sensitivity scenarios and adjust the parameters accordingly. Applying struvite precipitation, the NPV can be positive in two scenarios. First, if the phosphorus price is high (1.51 million EUR) or second if phosphorus recovery is a substitute for mandatory waste disposal (1.48 million EUR). However, for a variety of methodological specifications, the NPV is negative, mainly because of high input costs for chemicals and energy. These trade-offs between off-setting pollution and reducing energy consumption imply, that policy makers and investors should consider the energy source for phosphorus recovery carefully.

Financial Performance (Dis)parity in Post-transition Europe

Decades after the transition processes have spread across Central, Eastern, and South-Eastern Europe (CESEE), the former Soviet Union, and the Baltic, it was interesting to perform the post-transition and non-transition advanced European economies comparison to capture the outcomes of the 'catching-up process' . In this analysis, I tried to reach the results of this ‘catching process’ using the firm-level accounting data, namely, enterprises' annual accounts rather than countries' national accounts. The goal was to evaluate if post-tran- sition countries' enterprises have reached the financial performance of non-transition countries' enterprises across Europe, three decades after the transition processes began. The research captured firm-level financial performance aspects revealing some differentiators, namely, financial report indicators that differed for the enterprises belonging to post-transition countries in comparison with the ones belonging to non-transition countries in Europe. The findings related to the liquidity, solvency, indebtedness, profitability indicators, and labor intensity ratio were derived by logit regression models. The observations for 569 European companies were provided by Orbis Europe for the year 2021 annual accounts. According to the results, enterprises in post-transition countries, characterized by lower total assets and working capital scale, were likely to have lower profit margins, share of employees’ costs in operating turnover, current ratio, and gearing, while higher solvency and liquidity ratio. Mild marginal effects indicated the gap narrowed but with still existing significant disparities, particularly in the field of liquidity.

Environmental, social, governance and gender diversity under the adoption of European Di-rective 2014/95/EU

Research Question: Does Gender Diversity positively or negatively affect the non-financial information on ESG? Motivation: This research explores the connection between ESG and the synthesis of the Board of Directors. More explicitly, we explore if the board's Gender Diversity improves non-financial information on ESG. Also, the effect of board gender diversity on ESG is under investigation as the findings in the current literature about the synthesis of board gender diversity are mixed. Considering this gap, this research tries to understand if Gender Diversity positively or negatively affects the non-financial information on ESG. Idea: This research article aims to study the relationship between gender diversity on board and European companies' environmental, social, and governance (ESG) ratings. It also examines the potential impact of European Directive 2014/95/EU, which re-quires disclosure of non-financial information, on this relationship. Data: The investigation used the dataset of 5,380 observations from 20 European countries from 2013 to 2022. Tools: The association between the ESG ratings and control variables was examined using regression analysis. Findings: The investigation results confirm a statistically significant impact between gender diversity and ESG performance ratings. The findings confirm conclusions drawn in other research studies. The adoption and enforcement of EU Directive 2014/95/EU had a remarkable and positive impact on European firms' ESG policies, as shown by statistical significance in several regression models. Gender diversity on company boards positively impacted all ESG models except the Governance Pillar Score. The investigation shows the importance of board synthesis, gender diversity, and additional variables concerning ESG reporting practices. Contribution: This research explores the connection between ESG and the synthesis of the Board of Directors. More explicitly, we explore if the board's Gender Diversity improves non-financial information on ESG. Also, the effect of board gender diversity on ESG is under investigation as the findings in the current literature about the synthe-sis of board gender diversity are mixed. Considering this gap, this research tries to understand if Gender Diversity positively or negatively affects the non-financial in-formation on ESG.

Prediction of customer demand for perishable products in retail inventory management, using the hybrid prophet-XGBoost model during the post-COVID-19 period

ABSTRACT Retail inventory management (IM) presents challenges in decision-making, especially in determining optimal inventory levels for future customer demand alignment. This study focuses on predicting dairy product demand by a significant European retail company using historical order data. As dairy products are perishable and constitute a relevant portion of retail trade volume, accurate IM is crucial to prevent wastage and meet customer needs. However, external factors like COVID-19 may impact demand volatility and seasonal patterns. Given the absence of scientific studies on predicting post-COVID-19 demand, our research aims to fill this gap by proposing alternatives, such as excluding the pandemic period and developing a historical imputation. The study employs two predictive models, Prophet and XGBoost, known for their superior performance in predicting demand. Moreover, a hybrid approach combining both models is proposed to enhance prediction accuracy by leveraging the capacity of the Prophet model to handle seasonal and holiday-period effects and XGBoost’s regularization to prevent overfitting. The results demonstrate the feasibility of historical imputation and the hybrid model approach, improving significantly individual model performance. The principal application of the study is to propose an approach to predict the shipment of other products in a post-COVID-19 context.

Land grabbing, CSR, and the (de)mobilization of resistance

AbstractAs large-scale agricultural investment has been rising, scholars have much investigated the factors that shape contestations against land grabbing. This literature, however, has hardly focused on the role of investing agricultural companies and their corporate social responsibility (CSR) practices so far. Vice versa, there is extensive research on the CSR-contention nexus for mining and other sectors, albeit with contested findings. To contribute to these debates, I apply the opportunities and threats framework from social movement studies to examine how CSR affects local and transnational contention. This is studied in the comparison of two major European agricultural companies that operate in Cameroon (and beyond). The analysis shows a demobilizing effect of timely and substantial CSR practices.

Profitability of Defense Companies in the US and Europe

ABSTRACT The profitability (ROA) of US and European defense companies are influenced by past profitability, debt policy, company size, and defense specialization. Taking into account the effect of these variables, individual company characteristics and time specificities, the profitability of US defense companies remains higher than that of European companies. Moreover, US defense firms are more profitable when specialized in defense, while European companies are more dependent on the civilian market and its evolution. The position of a company in the SIPRI ranking has a negative impact on American companies’ profitability, while it positively influences European companies’ profitability. These results could be due to excessive fragmentation (of orders and industries) on the European market and high concentration on the US market.

The Benefits of Workforce Well-Being on Profitability in Listed Companies: A Comparative Analysis between Europe and Mexico from an ESG Investor Perspective

This paper evaluates the relationship between investing in workforce well-being and profitability of listed companies in Mexico compared to European companies from an Environmental, Social, and Governance (ESG) investor perspective. In this case, the Refinitiv workforce score or High-Performance Work Policies (HPWP) is used as an indicator of the quality of workforce well-being by including the industry effects (economic and business sectors) and the behavioral (sentiment) factors as control variables. Specifically, this article examines the relationships between HPWP, stock price changes (measured as a percentage), profitability (ROE), and market risk (betas). We used a sample of companies from the Refinitiv Mexico and European stock indices for this purpose. In the Mexican case, the results show that a higher level of well-being promotion relates to better company profits. The opposite happens in European companies. Regarding market prices, European companies show higher prices when they have higher HPWP and Mexican companies confirm the opposite. Regarding market risk, only European basic materials with high HPWP show less risk. Finally, in almost all Mexican business sectors, the relationship between market risk and workforce well-being is negative.

The impact of audit committee attributes on integrated reporting quality: evidence from European companies listed on the STOXX Europe 600 index

PurposeThis paper aims to shed light on the relationship between audit committee attributes and integrated reporting quality (IRQ).Design/methodology/approachData on a sample of 360 European firms selected from the STOXX Europe 600 index between 2010 and 2021 were used to test the model based on multiple regression for panel data to analyze the effect of audit committee attributes on IRQ. This paper considers generalized least squares (GLS) estimation for panel data models.FindingsThe findings of this study confirm expectations concerning the impact of audit committee attributes on the IRQ. Indeed, audit committee independence and meetings have a significant positive impact on IRQ. However, no significant association is found between financial expertise and IRQ.Practical implicationsThe findings of this paper have significant implications for policymakers, who, through proper legislation, should encourage the formation of larger audit committees and ones with a higher percentage of independent members. They should also establish a minimum number of audit committee meetings per year. These regulations, which aim to increase the efficacy of audit committees’ supervisory and monitoring tasks, would promote corporate transparency and improve IRQ.Originality/valueThis study supports the existing literature. First, it expands the scientific debate on IRQ. Second, unlike previous studies, which used more subjective methods to measure the degree of integrated reporting (IR), this study relied on the CGVS variable from the DataStream ASSET 4 Database. Third, the research is novel because it indicates the crucial role of internal assurance mechanisms in wide managerial reporting practices in European companies. The sample consisted of European firms only, whereas previous studies used a global sample. Finally, this study is based on recent data (2010–2021), while other studies covered the period between 2008 and 2013.

Risk and return efficiency of manufacturing firms: Integrating corporate social responsibility performance

AbstractThis paper uses Data Envelopment Analysis to assess the performance of stocks in terms of return on assets, risk and their Environmental‐Social‐Governance score. Next, latent class analysis (LCA) is used to determine groups with similar performances and relates group membership to a set of covariates. The empirical application employs a set of 139 European manufacturing companies from 2016 to 2021 period. The results suggest stocks on average perform 25% below their potential in each of the three dimensions. The LCA suggests five groups and membership of lower performance classes significantly relates with lower size, R&D expenses and Tobin's Q.

From Western India to Eastern Africa—the Rise of the Parsis in the 18th and 19th Centuries

Abstract The present paper examines the socio-economic conditions for the ascendancy of the Zoroastrian community in Western India between the 18th and 19th centuries. This study reinforces the well-established thesis on the role played by the Parsis in the development of capitalism in India. What distinguishes it from other narratives is the periodization of this development and the consideration of Parsi agency in the Western Indian Ocean region and East Africa, especially Mozambique. The cooperation of the Parsis with the European trade companies and private European traders as of the mid-17th century—most notably, their links to the English East India Company, which boosted the Zoroastrian communities of northwestern India—is investigated. I try to show how the Parsis, who had been predominantly peasants, farmers and artisans from the 10th to 17th centuries, increasingly embarked upon trade, moneylending, brokerage and production. Because of their accumulated wealth, their numbers as well as their influence augmented throughout the 18th and 19th centuries.

Endogenous Innovation and Export Performance in Firms

We investigated whether export activity is correlated with innovation in a large sample of European companies. We explicitly considered five types of innovation: a) process innovation; b) product innovation; c) process and product innovation; d) product innovation new to the firm; and e) product innovation new to the market. We considered innovation as endogenous and determined by R&D through a process characterized by the regional technological environment. Our analysis enabled us to propose an integrated model incorporating R&D, innovation, and export in a scheme of simultaneous decisions which considers their mutual correlations.Econometric results showed that product and process innovation positively affect the export intensity of manufacturing firms in Europe. The results also indicated complementarity effects between process and product innovation. The average effect on export intensity from engaging in process innovation is larger than that found for product innovation, except in cases where the product is new to the market. When both types of innovation have been carried out, a larger effect results than that observed for product or process innovation alone. Furthermore, the average marginal effect on export intensity from innovation of any kind is highly positive and significant.

Assessing the Practice of Earnings Management in COVID-19 Era. Landscape of European Companies: An International Comparison

Beginning of 2020, the COVID-19 crisis holds for firms all over the world. Under these circumstances, the purpose of this paper is to evaluate the landscape of the European countries in terms of the earnings manipulation in COVID-19 era. Therefore, we compared companies from 15 European countries. The results show that the deteriorating economic conditions caused by COVID-19 are reflected in the managers’ activity for earnings management in the context of European companies. Moreover, the panorama of earnings management activities in Europe is quite heterogeneous and inconsistent as we observe significant differences between European countries in the practice of earnings management. Additionally, rather than a single incentive or factor, we find a wide range of variables that affected managers’ decisions to engage in earnings manipulation in COVID-19 times. Indeed, the results show that lack of growth opportunity caused by the pandemic, increased amount of debt, volatility of cash flow or sales, even size, age, or book value, were variables that influenced managers’ decisions to manipulate earnings in pandemic. In addition, the industry effect cannot be separated from the impact of COVID-19.  Surprisingly, institutional mechanisms of control, including audit quality or board monitoring, which are widely documented in the literature as limiting earnings management, were ineffective in the COVID-19 period. The presence of mechanisms of control is considered essential variables that limit the practices of earnings management, but even these can occasionally fail, as confirmed our study.

A pattern‐based tool to support companies in sustainability‐oriented business strategies: grounded theory research in agribusiness

AbstractSustainability is an issue that echoes in our daily lives, leading to a new post‐COVID‐19 crisis trend: sustainable business. Sustainability encompasses environmental, social, and economic aspects are reflected in corporate organizational practices and sustainable business models. Despite this, integrating sustainability into business practices presents a challenge. As indicated by the literature review, 90% of the existing sustainable business models are partially capable of covering the three dimensions of sustainability. This study proposes a pattern‐based tool to support companies in the implementation of sustainability‐oriented business strategies emerging from a grounded theory research in agribusiness. The proposed pattern‐based tool maps the current sustainable business models, the material topics, and Global Reporting Initiatives that a company can adopt to implement sustainability strategies. Sustainable business models came from literature review, material topics and GRIs were identified analyzing 107 European agribusiness companies. The proposed pattern‐based tool, can be explored through three patterns designed to implement economic, social, and environmental sustainability strategies. It was applied in a case study to better demonstrate how to use the proposed tool in the practice. Discussions and implications for academia and agribusinesses are provided.

Corporate social responsibility and total factor productivity: the case of European mining industry

The aim of this research is to investigate the effect of corporate social responsibility (CSR) on total factor productivity (TFP) in the European mining industry, considering micro- and macroeconomic indicators of the relationship between CSR and TFP. Employing data from 40 European mining companies from content analysis, CSR Hub, and the World Bank between 2018 and 2021, this paper utilizes a combination of Data Envelopment Analysis (DEA) and panel regression techniques to test the research hypotheses. The findings suggest that the TFP of European mining firms is positively affected by CSR initiatives implemented by the companies. Also, the empirical results depict that the CSR-TFP relationship is mainly established on institutional criteria. The results also indicate that CSR-related factors, namely, transparency and reporting, training, health and safety, and resource management, are the impacting indicators. The study broadens the horizons of this line of research and can be beneficial to CEOs, managers, experts, policymakers, decision-makers, and economists in the field of mining who are willing to promote responsible and sustainable mining.

EU-China Economic Relations in the Early 21st Century

The European Union (EU) and China are two of the most influential and complex economies globally. The current state of their relationship is marked by a growing trade deficit for the EU with China, along with increasing Chinese investments in Europe's energy, technology, and infrastructure sectors. The EU has expressed dissatisfaction with China's treatment of foreign investors, limited market access for European companies, and government subsidization of domestic companies. Additionally, the EU has raised concerns about China's human rights record and its policies in Hong Kong, Taiwan, and mainland China. The partnership is expected to remain a key focus for the EU's economic outlook as both sides balance economic potential with geopolitical and security considerations. This report aims to identify and explain the primary issues, key areas for improvement, and mutual interests between the EU and China, while also proposing potential solutions to enhance their economic and trade relations. Informative articles, relevant papers, textbooks, and other sources support the discussion. Although the analysis is subjective, a quantitative methodology is also employed. The discussion presents a common interface and provides recommendations for enhancing financial relations, increasing exchange, financial and security relations, participating in and benefiting from two-way engagement, and enhancing EU-China relations.

Do you prefer logging in? The relevance of the experience of telework for well-being

PurposeThe swift and unanticipated integration of telework by European companies due to COVID-19 gave rise to distinct features of telework. These attributes underscore the necessity of analysing its impact on employees’ well-being. This paper explores how telework experiences impact well-being by influencing work–life balance and job satisfaction. Additionally, it investigates whether employee preferences for telework are a contributing factor.Design/methodology/approachBased on the data provided by the “living, working and COVID-19” e-survey, structural equation models (SEM) were used to test the hypotheses. Specifically, a multiple-mediation approach and path analyses were applied to measure the relationship between the variables under study. The moderating role of preference for telework was also tested.FindingsKey findings support that telework experience has a positive impact on well-being, both directly and indirectly, particularly via work–life balance. Although preference for telework strengthens the relationship between telework experience and well-being, it does not enhance the predictive power of the mediated model.Practical implicationsThese results have important implications from an applied perspective. Human capital departments as well as managers should design telework programmes to create a positive experience since this will ensure a positive influence on the perception of work–life balance, job satisfaction and well-being.Originality/valueCOVID-19 as a sudden environmental constraint forced the implementation of telework without proper planning and training. Thus, how the employees experience this major change in their working conditions has affected their well-being. The present paper contributes to clarifying how the proposed variables relate under such constraints.

The effect of environmental, social, and governance disclosure and real earning management on the cost of financing

AbstractThis study identifies if sustainable development practices measured through ESG information disclosure are related to stakeholder confidence, leading to a lower cost of debt and equity financing. We also investigate the possible moderating role of real earnings management. We apply a fixed effects panel data analysis to 1659 firm‐year observations of 177 European companies from 2010 to 2019. The results show that investors value ESG disclosure negatively and increase the cost of equity, whereas lenders value it positively and reduce the cost of debt. In addition, when the moderating effect of real earnings management is introduced, the effect of ESG disclosure on the cost of debt decreases, and the effect of ESG disclosure on the cost of equity is reinforced by increasing it. In the presence of real earnings management, investors and lenders seem to think companies use ESG disclosure to legitimise their practices or mislead financing providers.

Familiarization with the features of the enterprise activities through the management report: condition, perspectives of development, risks

Introduction. The modern trends of Ukraine's European integration path determined today's demand for enterprises – the timely publication of the Management Report. The process of preparing the report should be phased. It is reasonable to create a working group, involving representatives of the production unit, the HR department, and marketers. The Law «On Accounting and Financial Reporting in Ukraine» contains clauses with requirements for reporting, therefore, it is observed that it should be compiled by the accounting department, but it provides a lot of information that does not belong to the competence of this service. Considering this, management of the company has to take care of the proper organization of the preparation of the Management Report and the software of information sources for its individual areas. The purpose of the paper is a justification of the optimality of filling the sections of the Management Report according to individual characteristics of the company's activity, based on the experience of European companies, which report on certain issue five years earlier than Ukrainian ones. Results. Each company, depending on the specifics of the business, needs to develop the concept of the Management Report and determine which sections it will consist of. Accordingly, determine sources of information and organize its collection, processing and generalization. It is advisable that this form is not only useful, but also visually attractive, especially with the prospect of attracting new partners. The management report is significantly different from other financial reports. The paper substantiates the optimality of filling the sections of the Management Report according to individual characteristics of the company's activity, based on the practical experience of Ukrainian and European companies. A number of excerpts from relevant reports of various business entities are provided, which visualize their data. Conclusion. It was concluded that the proposed approaches to the informational disclosure of activities and annual results, with an emphasis on non-financial components of the Management Report, contribute to saving time of the performers and the development of a holistic approach to the presentation of data. Perspectives for further research are determined by the accumulation of experience by domestic enterprises on the development of the most optimal structure and content of the Management Report, in order not only to comply with legal requirements, but also to use this creative format to best promote their own achievements and future business opportunities.