Types Of Firms Research Articles

Sustainability Committee, Audit Firm Type and Corporate Sustainability Reporting of Non-Financial Firms in Nigeria

In spite of the detrimental consequences, such as pollution and other environmental risks arising from corporate activities, there has been a noticeable lack of transparency in disclosing social, environmental, and economic information. In light of this, the research aims to present empirical evidence regarding the impact of sustainability committees and the type of audit firm on the reporting of corporate sustainability information by companies. The study utilized an Ex-post facto research design, considering a population of one hundred and fifteen (115) listed non-financial firms. Ninety-two (92) companies were selected as the sample. Both descriptive and inferential (Panel Corrected Standard Error) estimation techniques were employed to analyze data collected from the annual reports and accounts of the sampled listed manufacturing companies over a seven-year period (2016-2022). The findings revealed that the presence of a sustainability committee and audit type significantly predict corporate sustainability reporting among listed non-financial firms at a 5% level of significance. In conclusion, the study determined that sustainability committees and audit types play a crucial and meaningful role in shaping corporate sustainability reporting practices among listed non-financial firms in Nigeria. As a result, the study recommends that listed companies should establish sustainability committees to proactively address sustainability issues and enhance disclosure. Additionally, non-Big Four audit firms are encouraged to enhance their services by providing their staff with up-to-date audit skills.

Mitigating Underinvestment through Accounting Conservatism: A Comparative Study of Family and Non-Family Firms in Taiwan

This study examines the role of accounting conservatism in mitigating underinvestment due to internal cash flow volatility in Taiwan-listed and OTC companies from 2013 to 2022, comparing family and non-family firms. Utilizing regression analysis, we assess how accounting conservatism influences investment decisions under varying conditions of cash flow stability. Our findings reveal that accounting conservatism significantly alleviates underinvestment across all sampled firms, particularly in family firms where its impact becomes pronounced under high cash flow volatility conditions. In contrast, conservatism does not significantly affect investment decisions in stable cash flow scenarios. Additionally, the study finds that accounting conservatism can reduce capital costs under high cash flow volatility, thereby promoting investment. These insights provide a new understanding of the function of accounting conservatism across different firm types and offer practical guidance for financial decision-making.

The effect of informal competition on the performance of formal firms: a systematic review of the literature

PurposeThe purpose of this paper is to examine the empirical literature on the effects of informal competition on firm performance and provide directions for future research.Design/methodology/approachWe search the Scopus and Web of Science databases and adopt a specific protocol to perform a systematic review of the literature. We screen 536 documents and apply three inclusion criteria for filtering.FindingsWe identify the impact of informal competition on nine types of formal firms' performance. We assess the findings according to the explanatory and response variables and the data samples of the articles reviewed. We find that five areas of focus are under-researched due to analyses of country or region-specific data, or lack of consensus because of contradicting findings.Originality/valueTo the best of our knowledge, this is the first review of the empirical literature on the effects of informal competition on the performance of formal firms.

Foreign demand shocks and CO2 emission intensity: firm-level evidence from China

ABSTRACT Constrained by data availability and challenges in causality identification, the relationship between trade and the environment remains theoretically ambiguous. This paper constructs a novel Chinese manufacturing firms’ CO2 emission intensity dataset by converting different types of firms’ energy consumption. Using disaggregated transaction data and the Shift-Share design, this paper exploits the effects of foreign demand shocks on firms’ CO2 emission intensity from 2007 to 2014. We document that a 10% increase in foreign demand leads to a 0.28% reduction in firms’ CO2 emission intensity. We find that multi-product exporters can benefit more from foreign demand shocks, and further prove the absence of CO2 leakage due to the EU ETS. This paper demonstrates that firms can be beneficiaries of foreign demand shocks, unmasking the trade-environment nexus by providing micro evidence from the largest developing country.

Impact of business strategy on carbon emissions: Empirical evidence from U.S. firms

AbstractThis study examines the nexus between business strategy and carbon emissions by utilising a dataset of U.S. firms from 2007 to 2020. It focuses on two broad types of firms, that is, prospectors and defenders. Regarding carbon emissions, we consider total emissions (Scope 1 & 2), direct emissions (Scope 1) and indirect emissions (Scope 2). The results reveal a significant association between business strategy and total carbon emissions as well as direct carbon emissions. Notably, the results suggest that prospectors, compared to defenders, display higher levels of total and direct carbon emissions. Our findings contribute to the debate on whether prospectors in developed countries mismanage sustainability issues. The study offers valuable insights into the interplay between business strategy and carbon emissions and provides empirical evidence that business strategy is an important determinant of total and direct carbon emissions.

Human Capital Efficiency and Firm Performance of Quality-Certified Firms from EFQM Excellence Model: A Dynamic Panel Data Study

Abstract Purpose The study’s main purpose is to investigate the impacts of human capital efficiency (HCE) on the firm performance of non-certified and quality-certified firms from the European Foundation for Quality Management (EFQM) Excellence Model. The study also examines the relationship between firm performance and quality-certificates from the European Foundation. Design/methodology/approach By using a sample of 282 non-certified and 22 quality-certified firms from 2017 to 2021, the current study employed a two-step system generalized method of moments (GMM) estimation to analyse the empirical data. The dummy variable is used to examine the relationship between quality-certificates and firm performance. The dummy interaction term is employed to quantify the impacts of HCE on the firm’s performance for quality-certified firms. Findings The results revealed that quality-certificates and firm performance have a positive relationship. Quality-certified firms perform better and earn more profits than non-certified firms. HCE has a positive impact on firm performance for both types of firms. Moreover, the quality-certified firms utilize HCE in an efficient way to earn more profits compared to the non-certified firms. Originality This is the first study to use a comprehensive analysis to emphasize the HCE for non-certified and quality-certified firms separately. The effects of quality-certificates on firm performance in the context of HCE are also being highlighted for the first time in this research. Practical implications The current study’s findings are fruitful for academics, managers, researchers, policymakers, and other firm management. The findings will encourage the management of the firms to implement the total quality management (TQM) approach within their firms.

Firm Type and Unconditional Conservatism: The Indian Experience with IFRS Convergence

This paper investigates how private and public firms vary with respect to unconditional conservatism in financial reporting in the pre and post IFRS worlds. I consider unconditional conservatism (UC) which pre-empts the more commonly studied conditional conservatism, private firms that are differently regulated, IFRS convergence instead of the more uniform IFRS adoption and an emerging market. Using a large Indian sample of 63,000 observations across more than 15,500 firms (~41% are private) over 10 years (2011-2020), I show that private firms are less unconditionally conservative than public firms. Also, contrary to literature, IFRS convergence increases conservatism in India and reduces the conservatism gap between private and public firms. These results hold even after controlling for monitoring, governance, and group-affiliation. This adds significantly to our understanding of how the effect of uniform accounting standards on reporting choices of different firm types varies significantly by and within a context and region.

Trade War Actions, Reporting Strategies, and Stock Market Reactions

Investors’ perceptions of uncertainty have increased since Donald Trump’s inauguration, primarily as a result of trade frictions. In the context of China-US trade frictions, this study investigates the joint effects of the actions of the parties and media tone on the Chinese stock market. The trade friction reports are classified into 12 groups based on two dimensions, that is, the actions of the parties and the tone of the state-controlled media. The result shows that the role played by the state-controlled media depends on the actions taken by both the parties, as well as the type of firms. Specifically, when the US took action, either launched attacks or made concessions, adopting a high tone played some role in boosting returns and curbing fluctuations; adjusting reporting strategies also played some role in elevating the liquidity of both types of firms and influencing domestic southbound investments. Market reactions were more influenced by the actions than the official attitudes when China made concessions or when both sides took action (attacks or concessions).

Guarantee employment or guarantee wage? Firm-level evidence from China

This study investigates how firms respond to the economic shock and discusses policy implication that whether the government should prioritize guaranteeing employment or guaranteeing wage. Using a comprehensive dataset, our research reveals negative effects of lockdown policies on firms' performance. In response, firms opted to reduce employment rather than cut wages. This strategy remained consistent across various types of firms and different lockdown measures. However, reducing employment without cutting wage is superficial. In fact, firms internally reduced the employment of informal workers, so that to stabilize the wages of formal employees. This study sheds light on the phenomenon of increased unemployment and income inequality during the pandemic, and advocates for prioritizing vulnerable groups to ensure their employment.

The asset growth return premium and anchoring on the 52‐week high

AbstractResearch shows that year‐over‐year growth in a firm's assets is associated with a negative stock return premium. A possible explanation for this premium is based on mispricing correction, due in part to investors' overvaluation related to investment. In this article, we argue that a correction of any type is more likely to occur when stock prices are further away from their 52‐week high. To the extent that the 52‐week high acts as a viable anchor, when stocks are closer to this anchor, investors might become less inclined to contribute to the typical downward correction for these types of growth firms. In several tests, we find that stocks that are furthest away exhibit the strongest return premium. The return premium, however, begins to disappear as stocks approach their 52‐week high. These results are robust to various risk factors and cross‐sectional tests that include several firm‐specific characteristics.

Deciphering the Spatial Stickiness, Co-occurrence, and Co-change of Industries at the Scale of City

This paper analyzes the location of industries in two metropolitan cities to investigate how firms are spatially distributed, and identify the prevailing trends in firm location choice. By defining a “Region Index” metric, we show how industries have concentrated in or diffused from the regions-of-interest over time. We apply this metric to the Central Area (CA) of Singapore and the London Region to decipher the relative tendency of industries to locate at CA as well as London. To analyze the spatial co-location of industries, we constructed a community network, which reveals subtle spatial relationships between firms. Extending this approach temporally to create a co-change network, we deduce the occurrences of industries in Singapore and London that move into or out of a spatial region synchronously. Based on this approach, we elucidate firm types that not only co-change but also co-occur in space and remain within a region-of-interest. Overall, we observe certain common and contrasting patterns of industry movements in the context of Singapore and London through the analysis. “Other Activities Auxiliary to Financial Services” is found to have the consistent tendency of diffusing out of CA and London throughout the period of study. Conversely, opposite movement patterns are observed where we see the proclivity of IT and digital service firms to locate in London but relocate out of CA, while the Media, Financial Services, and Life Insurance subsectors tend to diffuse out of London but concentrate in the CA of Singapore.

BIBLIOMETRIC ANALYSIS OF VENTURE TEAMS OF TECHNOLOGY-BASED FIRMS

Purpose: Due to its growing impact on the economic development of countries, research on venture teams in new technology-based firms - TBFs has been increasing in recent years, seeking to identify the success and failure factors of this type of firms, given their high mortality rates. This paper ana-lyzes the changes that have occurred in the intellectual structure of this discipline. Methodology: The bibliometric method was used to analyze the theme of venture teams in the new TBFs. The information collected was extracted from the main collection of the Web of Science (WoS) and SCOPUS databases from 1987 to 2020. The Nvivo and VOSviewer softwares are used to perform the initial analyzesas well as the analysis of citations, co-citations, co-authorship, etc. Findings and Conclusion: The advances associated with the main authors, sources and countries, the general citation structure and the development of this field are presented. The results show a growing publication trend as of 2009, seeing a higher production of articles between 2014 and 2019. USA is the most influential country, followed by China and Italy. The"Research Policy" and " Strategic Entrepreneurship Journal"are the most influential sources. Originality/Value: The main contribution of this work is to show the evolution of this theme, so that researchers can use it in the future in their theoretical and research frameworks.

A comparison of direct listings and IPOs

AbstractIPOs and direct listings (DLs) offer two different mechanisms for firms to go public. In contrast to IPOs, DLs do not employ an underwriter or raise new capital. Using a sample of IPOs and DLs on major stock markets in the European Union, we document that firms that choose to go public via DLs are larger, more profitable, and less levered, on average, than IPO firms. These pre‐listing differences suggest that DL firms should be less risky than IPO firms; however, controlling for this selection effect, we find that DLs have higher aftermarket price volatility than IPOs. This is consistent with some policy‐makers' concerns that, because they lack an underwriter, DLs expose investors to higher risk than IPOs in the immediate post‐listing period. We show that this heightened price volatility persists, on average, for the first 20 trading days after listings, and is larger in industries where listed peer firms provide relatively low‐quality disclosures. Our results provide new evidence regarding the types of firms that choose to list via DLs versus IPOs and the riskiness of IPOs versus DLs in the immediate post‐listing period; additionally, our results are consistent with underwriters improving the quality of information available to investors for IPO firms in the pre‐listing period.

Impacts of firm performance on chief executive officers’ overconfidence

This research investigates the intricate relationship between firm performance and chief executive officer (CEO) overconfidence, drawing on data obtained from a comprehensive analysis of 733 publicly listed U.S. companies from 2015 to 2021. The study employs stock-option data, as inspired by the seminal work of Malmendier and Tate (2005), a robust metric to gauge CEO overconfidence. The empirical findings contribute significantly by establishing a positive correlation between firm performance and the manifestation of CEO overconfidence. This discerned pattern suggests that as firm performance improves, there is an accompanying increase in the likelihood of CEOs exhibiting overconfident behaviors in their decision-making processes. This insight significantly enriches our understanding of the complex interplay between organizational success and the psychological attributes of corporate leadership. Furthermore, the study unveils variations among different firm types, revealing that non-financial firms, particularly those exhibiting strong performance, are more prone to having overconfident CEOs compared to their counterparts in the financial sector. In addition to these insights, the research explores the impact of the COVID-19 pandemic on this dynamic relationship, underscoring an intensified influence of firm performance on CEO overconfidence during this period. This investigation unveils the nuanced dynamics introduced by external disruptions, shedding light on how executive decision-making adapts to unprecedented challenges posed by global events.

Judicial improvement, market integration, and export technical complexity-a quasi-natural experiments based on the creation of circuit courts.

Judicial improvement and trade structure optimization are important elements in achieving a high level of openness. This paper develops a theoretical framework on the impact of local protectionism on market integration and export technical complexity, and then empirically analyses the effect of judicial improvement on the technical complexity of urban product exports and its mechanism of action based on a quasi-natural experiment with the establishment of circuit courts. The study finds that the establishment of circuit courts significantly increases the technical complexity of product exports, and the findings remain valid after a series of robustness tests. Further analysis shows that the technology enhancement effect of the establishment of circuit courts is more pronounced in the group of cities with higher administrative levels, better location advantages, and less advanced rule of law. Mechanism Analysis shows that a superior institutional environment can have a two-sided effect on different types of firms. Overall, however, the productivity-enhancing effect of low-productivity firms exiting the market is lower than the productivity-reducing effect of higher-productivity firms' increased compliance costs, which in turn weakens the positive promotional effect of circuit courts. The above theoretical and empirical findings provide policy implications for maximizing the technology enhancement effect of the establishment of circuit courts on product exports, thereby promoting a high level of openness in China.

Fostering a safety culture in manufacturing through safety behavior: A structural equation modelling approach

Creating a robust safety management system is crucial for fostering a culture of safety in the workplace, particularly in industries like manufacturing where improvements are still needed. This study aimed to assess the impact of safety behavior on safety culture within the manufacturing sector. Employing a quantitative approach, questionnaires were distributed to 342 employees in manufacturing firms during data collection. The collected data underwent analysis using structural equation modeling (SEM) through IBM-SPSS-AMOS 24.0 to test the proposed model. The study findings revealed that components of safety behavior, specifically safety compliance and safety leadership, have a significant influence on safety culture. This implies that prioritizing safety behavior and culture is vital for occupational safety and health, aligning with guidelines set by responsible entities to ensure a secure work environment. The insights gained from this research can be instrumental in highlighting the importance of safety culture, the pivotal role of leadership, the complex nature of safety culture, and the potential for measuring and enhancing it. By understanding these implications, organizations can foster a safety-centric culture that not only protects employees but also enhances overall performance. Additionally, this research contributed to the existing literature by examining an integrated higher-order construct model using the SEM technique, predicting the model by 53 percent. The insights garnered from this study are applicable to various types of firms, emphasizing the integral role of safety culture in any organization.

Governance of Greenwashing Behaviors: A Perspective of Heterogeneous Firm Types

Corporate greenwashing in response to carbon neutrality strategies has received substantial academic attention. Distinct from previous studies, this paper establishes a differential game model incorporating both green and brown enterprise types. The model compares greenness and total profits under two government scenarios: subsidies for green enterprises and the regulation of brown enterprises. It further analyzes the mechanism behind brown enterprise greenwashing formation. The results show that subsidies alone encourage brown enterprises to engage in greenwashing. However, government regulation inhibits such behaviors, with the inhibition effect positively correlated to regulatory intensity. Consumers’ green perception of enterprises also significantly drives brown enterprise greenwashing degrees. Higher green enterprise perception coefficients reduce greenwashing, while higher brown enterprise perception coefficients increase it. Differential game and simulation analyses reveal that greenwashing governance should consider both direct policy effects on brown enterprises and indirect subsidy effects on green enterprises.

The role of local currency pricing in the international transmission effects of a government spending shock in an economy with vertical production linkage and foreign direct investment

By constructing a two-country model with asymmetry in price-setting behavior between home and foreign intermediate goods firms, vertical production and trade, and endogenous entry of three types of final goods firms, this paper examines the effects of a home government spending shock. In particular, it focuses on the role of asymmetry in price-setting behavior between home and foreign intermediate goods firms. A home government spending shock is shown to result in the entry of multinational firms from both countries, an increase in the aggregate outputs of both countries, a deterioration in home welfare, and an improvement in foreign welfare. In addition, with an increase in the ratio of home and/or foreign intermediate goods firms setting their export prices in the local currency, the effects of this shock on the entry of home multinational firms, the increase in aggregate foreign output, the deterioration in home welfare and the improvement in foreign welfare are shown to be weakened, while the effects of this shock on the entry of foreign multinational firms and the increase in aggregate home output are intensified.

Synergistic effects of pollutant control: Evidence from China's sulfur dioxide emission control policy

This study investigates the impact of China's national sulfur dioxide emission control policies on carbon dioxide emissions. Using the difference-in-difference-in-differences (DDD) estimation method, we analyze the synergistic effects of environmental regulations on pollution control and carbon emission reduction. Empirical findings demonstrate that sulfur dioxide emission regulations have a significant effect on reducing firms' carbon dioxide emissions, primarily through energy conservation measures. Furthermore, results reveal variations in the effectiveness of these regulations across different types of firms and regions. Specifically, state-owned and large-scale firms, along with those situated in the eastern and central regions of China, exhibit greater energy-saving and emission-reducing effects in response to the regulations. Notably, these regulations lead to unexpected energy savings and emission reductions without compromising output, highlighting improvements in energy efficiency as a key driver. These findings underscore the importance of recognizing the potential synergies between pollutant control policies and carbon emission reduction goals. To maximize these positive effects, policymakers should prioritize strategies to enhance energy efficiency and tailor environmental regulations to suit the unique characteristics of firms and regions. Overall, this study contributes valuable insights to the development of effective environmental policies in the context of carbon peaking and neutrality objectives of China.

Ontological basis of the creative accounting phenomenon as a financial misstatement

PurposeThis article aims to contribute to the accounting knowledge literature by presenting the framework of creative accounting factors and evaluating their identified factors through an argumentation-based total interpretive structural modeling (TISM) approach.Design/methodology/approachThis study adopted mixed, inductive and deductive approaches to develop an integrated framework, validate its practicability and verify its effectiveness in selected manufacturing firms listed on the Tehran Stock Exchange (TSE), respectively. In developing the framework and implementation procedure, the study employed an exploratory data collection (qualitative) approach to review the phenomenon of creative accounting factors. Then, in this study’s second phase, TISM is used to develop the framework of creative accounting design. This study used two types of theoretical sampling in the qualitative part, including theoretical and snowball sampling. Also, the participants in the TISM process in this study were specialized analysts of the TSE.FindingsBased on the mixed method of this study, the result in the qualitative part provides the creative accounting framework of the existence of three categories. There are 6 components and 35 themes during 12 interviews. In the quantitative section, it was determined that two factors, namely the type of ownership firms and intrinsic objectivity, are the most effective drivers for the formation of creative accounting in TSE firms.Originality/valueSo far, it is rare to find preceding studies that have proposed, validated and practically tested an integrated creative accounting framework within the context of financial markets. Thus, the authors understand that this is the very first research focused on the development of a framework for capital market companies to continuously be competitive and could help financial decision-makers, practitioners and academicians in their perception of knowing more about the financial functions of firms.