Capital Sustainability Research Articles

The Economic Consequences Associated with Integrated Report Quality: Capital Market and Real Effects

We examine whether integrated report quality (IRQ) is associated with stock liquidity, firm value, expected future cash flows, and cost of capital. Our study is motivated by the recent focus on sustainable capitalism and the global interest shown by firms, investors, and regulators in integrated reporting. We use data from South Africa because it is the only country where integrated reporting is mandatory. We use a measure of IRQ based on proprietary data from EY, which rates these reports as part of its Excellence in Integrated Reporting Awards. We find that IRQ is positively associated with stock liquidity, measured using bid-ask spreads, and firm value, measured using Tobin’s Q. Our results are consistent whether we analyze levels or changes. When we decompose the firm value into an expected future cash flows effect and a cost of capital effect, we find that the positive association between IRQ and firm value is attributable mainly to the cash flows effect, which is consistent with investors revising estimates of future cash flows upward as a result of better understanding the firm’s capitals and strategy or future cash flows increasing because of improved internal decision making. We provide evidence on these two explanations and find it is more likely that our results are attributable to improved decision making by managers than to analysts forecasting future cash flows more accurately.

The Fifth Epoch: Socio-Economic Approach to Sustainable Capitalism

The Fifth Epoch: Socio-Economic Approach to Sustainable Capitalism

Environmental Values, Human Nature, and Economic Democracy

Recent social science indicates that the public at large behave more ethically, and favor environmental protection more strongly, than do the wealthiest minority. Yet the latter group exerts predominant control over the economy. This suggests that shifting power away from this minority and onto the majority would yield a better ecology. In this paper I spell out the implications of these considerations for “economic democracy” (ED), a well-developed alternative to capitalism that shifts power from wealthy shareholders onto ordinary citizens and workers. I contrast this rationale for ED with some thinkers’ defense of “sustainable capitalism”, and with others’ ecological arguments for ED based on economic stability and self-interest, rather than ethical behavior per se.

Emerging Markets Decoded: The Four Domains of Development for Growth

The report highlights the complexity of the phenomenon of the emerging markets and analyses separately three groups of them: advanced, intermediary and early stage. Further economic growth is imperative for all three groups, as the solid basis for the social development. The report outlines four areas of development for growth: infrastructure, digital technology, sustainability and human capital. These areas represent huge business potential for both international and local players with the total volume of opportunity being close to USD 10 trillion by 2020.

Towards the Second Sustainable City in the Middle East: Retransforming Ras El Khaimah Costal City with the Estidama First Model of the Abu Dhabi Master Plan 2030

The new Pearl Rating System (PRS) consists of three rating stages—design, construction and, operation—and is the core of the UAE Estidama program that was introduced under the vision of the Abu Dhabi master plan 2030 Towards the 1st Sustainable Capital in the Middle East. By monitoring every stage in a building life cycle, the system will guarantee applying all development aspects in a sustainable manner. As one of the fastest-developing countries in the Middle East, and rushing to be one of the best developed countries in the region, having one city as the first sustainable capital is not enough for conserving the heritage, culture, and the unique virgin environment of the Arabian Gulf western shore. A small city such as Ras El Khaimah, with its few resources and richness with desert-hidden treasures, is a good second candidate for the application of the vision of the Abu Dhabi 2030 Estidama program. This paper will present two detailed analytical studies regarding the Abu Dhabi master plan 2030 and Ras El Khaimah’s current situation in order to investigate the challenges facing the sustainable development in the city under the Estidama program. The aim is to generate a guideline and provide a set of recommendations that can take care of the development process while applying the Pearl Rating System and the UAE Estidama program. With a population somewhere between 250,000 and 300,000 (2010), Ras El Khaimah has maintained its original Emirati character in a unique manner that manages modern architectural style without distracting from the traditional image of the city. This small, coastal city has good potential along with many challenges due to the lack of natural resources and closed community. The UAE federal government system will face a challenge against the application of the Abu Dhabi Estidama model. However, such cases are proof that sustainability is the most efficient solution for developing traditional communities with their own empty hands.

Ecological Political Economy: Towards a Strategic-Relational Approach

ABSTRACTThis article identifies three distinct traditions in what might be described as ‘ecological political economy’. First, a ‘Promethean’ approach posits that capitalism has a relentless drive towards growth and bears responsibility for the wholesale transformation of nature. Second, critics of sustainable capitalism acknowledge the possibility of capitalist futures with a better management of natural resources and carbon emissions. The Strategic Relational Approach, developed by Bob Jessop and Ngai-Ling Sum, points to a unique third type of ecological political economy. Each approach is shown to have distinct views concerning the commodification of nature, the role of the state and ways to understand ecological and social transitions. The Strategic Relational Approach points to the possibility of counter-hegemonic strategies and collective mobilization to transform the state and so redirect, control and contain capitalist relations with nature.

Economic Crisis and Regulation Theory: Review of International Conference of Research & Regulation 2015

On June 9–12, 2015, the International Conference of Research & Regulation 2015 was held in Paris. The theme of this international conference was “the theory of regulation in times of crises,” and around 200 experts and academics from all over the world attended this distinguished conference. Centering on this theme, the hosts selected over 170 papers from those submitted and divided them into 23 topics, among which topics such as reflection and criticism on the economics methodology, labor-management relations and capitalism crisis, financial system and development mode in the post-crisis era, sustainable development and global governance, capitalism diversity and East Asian economy are emphasized and discussed. Many academics who attended the conference also proposed a lot of useful ideas, suggestions for the development of regulation theory, as well as theories and proposals for criticism on neoclassical economics, the emergence system of economic crisis, improvement of global economy, environment and sustainable development, capitalism diversity and development of East Asian economy.

Sustainability of Dairy Based Livelihoods of the Tribes of Jharkhand: A study of Ranchi and Dhanbad

The present study assesses the extent of contribution of Dairy based production system towards the Sustainable Livelihood of the tribes of Jharkhand. Out of 24 districts of Jharkhand, Govindpur and Ormanjhi blocks of Dhanbad and Ranchi districts were randomly selected for the study. From these two blocks, four villages were selected randomly and from each village 30 farmers were again selected randomly, constituting a total number of 120 respondents . The data were collected through participatory rural appraisal and personal interviews during year 2013-14 . The results indicated that the livelihoods of tribal communities in the area have traditionally been dominated by the Dairy Production System (DPS) - C+B+G (C=Cattle, B=Buffalo, G=Goat). Among the sustainable livelihood components human capital was minimum compared to others and use of traditional knowledge (5.98), Farm Energy (5.95), ICT Tools (5.71), Livestock Density (5.97) and Access to natural resources (5.85) had highest influence on Sustainable livelihood of the respondents. The DPS prevalent in the area was found to be substantially contributing for the sustainable livelihood of the respondents and was the integral part of day-to-day livelihood activities, nutritional security and traditional life style for tribal people in the area

Hyperobjects: Philosophy and Ecology after the End of the World by Timothy Morton

<i>Hyperobjects: Philosophy and Ecology after the End of the World</i> by Timothy Morton

Greening of capitalism: how Asia is driving the next great transformation

As China, India, and other industrializing giants grow, they are confronted with an inconvenient truth: They cannot rely on the conventions of capitalism as we know them today. Western industrialism has achieved miracles, promoting unprecedented levels of prosperity and raising hundreds of millions out of poverty. Yet, if allowed to proceed unencumbered, this paradigm will do irreversible harm to the planet.By necessity, a new approach to environmentally conscious development is already emerging in the East, with China leading the way. Positioning its argument against zero-growth advocates and free-market environmentalists, Greening of Capitalism charts this transformation and sketches out a framework for more sustainable capitalism. State-mandated changes in energy use (as opposed to carbon taxes), a circular flow of resources (as opposed to emissions standards), and the introduction of new financial instruments that support green growth are cornerstones of China's framework. John A. Mathews argues that these tenets will be emulated around the world-first in India and Brazil. In light of this emerging shift, Mathews considers core debates over national security, international relations, and economic policy, ultimately addressing the question of whether these measures will be far-reaching or timely enough to prevent further damage.

Human capital, pension information and firm valuation

We demonstrate that the reported pension information in the notes to financial statements captures human capital, in addition to the compensation expense and accounting assets/liabilities information that it is purported to represent. In explaining prices (returns), we document that the service cost for defined benefit pension firms and the pension cost for defined contribution pension firms have consistently positive coefficients that can be attributed to capturing the sustainability (growth) of human capital. This finding confirms the existence of service cost anomaly and extends to pension cost for defined contribution plans. The human capital hypothesis is supported by the finding that the coefficients of service cost (for defined benefit plans) and pension cost (for defined contribution plans) are more (less) positive for firms that are likely to have more (less) sustainable human capital. Further, in a balance–sheet–based analysis where service cost is absent, the valuation of pension assets and liabilities is biased by the omitted human capital variable. Our results are robust to sensitivity tests taking into account multi–collinearity, scale effects, standard errors, outliers, and omitted variables.

The Importance of Age in Development

In terms of the sustainable livelihoods approach (SLA), sustainable livelihoods are achievable by the presence of five specific capital assets including human capital. This article shows that human capital needs to be expanded beyond education, training, skills and health. The research was conducted in one rural area of KwaZulu-Natal, South Africa. Using triangulation as well as target and random sampling methods, the study aimed to: (1) identify the capital assets of the people in that area; (2) identify the barriers that they still faced in taking an active role in the local tourism economy after a few years of democracy, and (3) also identify the economic opportunities that the local people could exploit. During the research it was found that young people had clearer and profound views about their conditions than the rest of the community members in terms of age differences. Based on the interviews with different categories of local community members, the article argues that young people in particular have clearer views about their conditions of poverty and unemployment. The article concludes therefore that age is critically fundamental in the realisation of sustainable human capital. In this regard, biological age should form part of the human capital component of the SLA. DOI: 10.5901/mjss.2014.v5n20p2533

Towards sustainable capitalism in the development of higher education business school curricula and management

Purpose – The purpose of this paper is to account for, and conceptualize, the internal and external forces that influence higher education business schools as they strive to integrate sustainability issues into their curricula in the effort to achieve a more sustainable (yet capitalist) world. Design/methodology/approach – A case study approach is used for the research, which is grounded in the relevant literature, to investigate sustainable development issues in the context of a Swedish business school (university level). The empirical data consists of a review of internal documents plus e-mail surveys and interviews and discussion seminars with university teachers/researchers and key administrators. Findings – Two tentative models are presented that map the various internal and external forces behind business schools’ curriculum change. One important finding describes how supply and demand influences business schools and recruiters of business students. Research limitations/implications – Because this research is based on a single case study, the analysis and the mapping in the paper are somewhat limited in their general applicability. However, the research context of the business school permits drawing conclusions that may apply to a broad class of colleges or departments in higher education. In addition, because the research is supported by significant ideas from the literature, general inferences may be drawn about business school curricula. Originality/value – The two tentative models provide a holistic framework that adds to the understanding of the composition and interrelationship of influential forces on business schools when major changes in curricula and their management are contemplated.

EB-5 as an Instrument of Sustainable Capitalism

This article proposes a targeted application of the EB-5 Immigrant Investor Program to solve a heretofore intractable national problem: “nonpoint source water pollution,” which is the most significant single source of water pollution in the United States (U.S.). With this goal in mind, EB-5 can be cultivated and grown into a program, both ethical and pragmatic, that serves the public good via a mission to reclaim and restore a significant component of our environment.The article provides the historic context, a legal precis, and an introduction to the process that is the EB-5 Program; explores the constitutional, ethical, and administrative dilemmas that plague the program; examines some notable successes; and proposes a systematic evolution of EB-5 for application in Vermont in the service of anticipatory regenerative environmental design, construction, and maintenance of sustainable development.Thus matured, EB-5 becomes a financial “kick-start” for animating the laboratory of democracy that is Vermont, to begin a series of watershed specific research and development projects to conceive, design, and develop regenerative solutions to this perpetual problem.A collateral virtue of this evolved EB-5 Program is that, while distinctly local to each watershed, the underlying concepts and best practices developed are eminently “scalable” — applicable throughout the United States and ultimately the world. Thus, investments made by immigrant investors in the U.S. may well end up serving the very countries from which their personal wealth was derived.

How to Change Attitudes, Beliefs, and Paradigms in Capitalism and Management: Some Structural, Organizational and Personal Case Studies Showing a Humanistic Management Approach

The Humanistic Management Network proposes that companies can merge socio-human value generation with financial sustainability (see von Kimakowitz et.al., 2010). Within this PDW, three consultants — with one being also an academic — present the reality of a balanced capitalism from three perspectives: structural, corporate and personal. The order is organized starting from a capitalistic critique and proposal of change. Second, a real case study of a multinational corporation is presented. Finally, the reflections of personal change and how to propel it are elicited. With this in mind, a workshop is proposed to reflect into these three possible paths towards a more sustainable capitalism. Participants will be able to analyze their personal mindsets around these three domains and share their views with others. Using a TPA methodology the participants will have the time and space to interiorize some of the core ideas presented, and also to be able to use it later in their professional settings.

A study on relationship between empowering employees and social capital depreciation: A case study of treasury department

Article history: Received May 20, 2013 Received in revised format 12 August 2013 Accepted 7 September 2013 Available online September 8 2013 Empowering employee plays essential role in having sustainable social capital. When social capital is depreciated, we may expect some negative consequences on society and working environment. Therefore, we need to investigate different factors influencing depreciation of social capital as well as empowering employees. The proposed model of this paper designs a questionnaire and distributes it among some randomly selected employees who worked for treasury department in Iran. The study uses two regression models, where empowering employees is a function of four independent variables including being effective, having the right to select, competency and being meaningful. The other regression model studies the relationship between depreciation of employee as dependent variable and four independent variables including job involvement, television, living affairs and generation change. The results of both regression analyses indicate that there were some positive and meaningful relationship between empowering employees as well as depreciation of employees as dependent variable and independent variables. © 2013 Growing Science Ltd. All rights reserved.

Ten Strategies for Pension Funds to Better Serve Their Beneficiaries

On December 14, 2011, the Wall Street Journal carried an article titled “A Manifesto for Sustainable Capitalism” by former US Vice President Al Gore and his partner at Generation Investment Management, David Blood. The article signaled the launch of their white paper on sustainable capitalism, which set out five broad recommendations. On June 4, 2013, these five recommendations were debated in a workshop attended by 100 senior executives representing 40 pension organizations from 12 countries. The next day, the attendees were asked to turn the five recommendations into specific action steps they would be prepared to act on. They were asked to think about these action steps both in the micro context of their own organization and in the macro context of collective action. This article describes each of the resulting 10 action steps and reflects on their potential to move the sustainable capitalism yardsticks in the right direction.

Corporate Responsibility Coalitions :The Past, Present, and Future of Alliances for Sustainable Capitalism

Preface Acknowledgments Introduction Part 1. The past: The emergence of new models of collective business leadership 1. The rise of the corporate responsibility movement 2. The definition of business-led corporate responsibility coalitions 3. The evolution of business-led corporate responsibility coalitions 4. Global trends and motivations driving the growth of corporate responsibility coalitions 5. The leadership role of individual champions, companies and foundations in building the coalitions Part 2. The present: Assessing the impact of coalitions today 6. The number and diversity of corporate responsibility coalitions 7. Coalitions as part of a broader ecosystem promoting responsible business 8. The key roles of corporate responsibility coalitions 9. How coalitions organize themselves 10. Networking among the coalitions 11. Assessing the impact of coalitions Part 3. The Future: The leadership challenge for corporate responsibility coalitions 12. The need for greater corporate responsibility and collective action 13. An agenda for action for corporate responsibility coalitions 14. Are corporate responsibility coalitions fit for the future? 15. Recommendations and conclusion Profiles of leading corporate responsibility coalitions and Sui Generis organizations 1. Business for Social Responsibility 2. Business in the Community 3. CSR Europe 4. Instituto Ethos 5. International Business Leaders Forum 6. Maala-Business for Social Responsibility 7. National Business Initiative for Growth, Development and Democracy 8. Philippine Business for Social Progress 9. World Business Council for Sustainable Development 10. World Environment Center 11. United Nations Global Compact 12. World Economic Forum Appendix 1. Corporate responsibility time-line Appendix 2. Research methodology Appendix 3. GlobeScan coalition survey and survey respondents Endnotes Index

Ten Strategies for Pension Funds to Better Serve Their Beneficiaries

On December 14, 2011, the Wall Street Journal carried an article titled “A Manifesto for Sustainable Capitalism” by former US Vice President Al Gore and his partner at Generation Investment Management, David Blood. The article signaled the launch of their white paper on sustainable capitalism, which set out five broad recommendations. On June 4, 2013, these five recommendations were debated in a workshop attended by 100 senior executives representing 40 pension organizations from 12 countries. The next day, the attendees were asked to turn the five recommendations into specific action steps they would be prepared to act on. They were asked to think about these action steps both in the micro context of their own organization and in the macro context of collective action. This article describes each of the resulting 10 action steps and reflects on their potential to move the sustainable capitalism yardsticks in the right direction.

Mary Parker Follett: Informing the Future of Capitalism and Corporate Social Responsibility

Our proposal for an evolved form of corporate social responsibility (CSR) that is compatible with sustainable capitalism is informed by the works of Mary Parker Follett (1868 – 1933). Although Follett’s teaching and writing predate contemporary theories of capitalism and CSR, they have profound relevance to the present turbulence and questioning of these theories. We consider that to answer the challenges presented by the global financial crisis and to survive with credibility, capitalism and CSR must be integral. Therefore, in seeking out a valid model and application for CSR we looked to the writings of Follett, whose credentials in contributing to the tenets of management theory are well documented. Relationships, integration, blossoming and sharing power, are at the heart of Follett’s philosophy. Using Follett’s concepts we drew comparisons with accepted scholarly strands of CSR theory to inform an evolved CSR that is sufficiently valid to of give credence to capitalism. Our proposals call on governments, the community, and corporations to integrate desires and eschew short-term strategies for the common good and sustainability of capitalism.