- Southampton, England, United Kingdom
- 00442380594285
- Professor of Accounting and Deputy Head (Dean) of School, Southampton Business School, University of Southampton.edit
The aim of the project was to investigate corporate governance practices in UK higher education institutions (HEIs). Specifically, the project sought to examine the role and effectiveness of the audit committee in supporting what was... more
The aim of the project was to investigate corporate governance practices in UK higher education institutions (HEIs). Specifically, the project sought to examine the role and effectiveness of the audit committee in supporting what was initially conceptualised as ‘financial leadership’ in HEIs. What makes a board, and its various committees, an effective mechanism is a key and recurring question, which has been raised in academic, practitioner and policymaking circles and is relevant to companies, public bodies, charities and universities alike. The case of the audit committee is often highlighted in practice and in the literature, since it is a central plank of any corporate governance structure, normally tasked with overseeing the financial, control, auditing and risk management aspects of the organisation. In the light of the rapidly changing and uncertain financial environment faced by UK HEIs, the role of the audit committee is critical in monitoring, advising and shaping the HEI...
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Our study analyses the nature, quality and extent of human resource disclosures (HRDs) of UK Financial Times Stock Exchange (FTSE) 100 firms by relying on a novel disclosure index measuring the depth and breadth of disclosures.... more
Our study analyses the nature, quality and extent of human resource disclosures (HRDs) of UK Financial Times Stock Exchange (FTSE) 100 firms by relying on a novel disclosure index measuring the depth and breadth of disclosures. Contextually, we focus on the 5-year period following the then Labour government’s attempts to encourage firms to formally report on their human resource management practices and to foster deeper employer–employee engagement. First, we evaluate the degree to which companies report comprehensively (or substantively) on a number of HRD items that we classify as “procedural” or “sustainable.” Second, we hypothesise that a company’s employee relation ideology (using a proxy to measure a company’s level of “unitarism”) is positively associated with HRD. Our results indicate that: (i) whilst there has been an increase in the breadth of HRD in terms of procedural and sustainable items being disclosed, the evolution towards a more comprehensive and in-depth form of H...
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The international higher educational institutions (HEIs) environment has experienced rapid changes and/or reforms over the past decades. Specifically, the HE sector has been characterised by increasing student numbers, declining... more
The international higher educational institutions (HEIs) environment has experienced rapid changes and/or reforms over the past decades. Specifically, the HE sector has been characterised by increasing student numbers, declining government funding, but tighter external regulation, increasing competition, and greater accountability through increased ‘managerialism’, ‘commoditisation’, ‘commercialisation’ and ‘corporatisation’ of academics and HEIs. These changes have brought to the core the issue of sound financial management through good internal governance, increased public accountability and transparency, and stronger performance within HEIs. This paper, therefore, investigates why and how HEIs internal governance structures might influence their voluntary public accountability and transparency disclosures (PADs). Using a 2012 cross-sectional sample of 130 UK HEIs, we find that audit committee quality, governing board diversity, independent or lay governors, and the presence of a corporate governance committee impact positively in PADs. By contrast, we do not find any evidence that audit firm size, governing board size, and the frequency of governing board meetings have any significant effect on PADs. The central tenor of our findings remains unchanged across a number of econometric models that sufficiently account for different kinds of endogeneities, as well as alternative internal governance mechanisms and PADs measures. Our results are generally in line with the predictions of our multi-theoretical framework that incorporates insights from agency, institutional, legitimacy, public accountability/stewardship, resources dependence, and stakeholder theories
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We examine the relationships among religious governance, especially Islamic governance quality (IGQ), national governance quality (NGQ), and risk management and disclosure practices (RDPs), and consequently ascertain whether NGQ has a... more
We examine the relationships among religious governance, especially Islamic governance quality (IGQ), national governance quality (NGQ), and risk management and disclosure practices (RDPs), and consequently ascertain whether NGQ has a moderating influence on the IGQ-RDPs nexus. Using one of the largest datasets relating to Islamic banks from 10 Middle East and North Africa (MENA) countries from 2006 to 2013, our findings are three-fold. First, we find that RDPs are higher in banks with higher IGQ. Second, we find that RDPs are higher in banks from countries with higher NGQ. Finally, we find that NGQ has a moderating effect on the IGQ-RDPs nexus. Our findings are robust to alternative RDPs measures and estimation techniques. These results imply that the quality of disclosure depends on the nature of the macro-social level factors, such as religion that have remained largely unexplored in business and society research, and therefore have important implications for policy-makers.
This paper highlights the role of cash flow forecasting process in capital budgeting decisions. To achieve this goal, we examine the influence of contingency variables on the use of forecasting procedures & methods, which in turn reflects... more
This paper highlights the role of cash flow forecasting process in capital budgeting decisions. To achieve this goal, we examine the influence of contingency variables on the use of forecasting procedures & methods, which in turn reflects on the extent of use of capital budgeting techniques (CBT). The descriptive results of this study reported that most manufacturing and oil companies operating in Libya depend on personal estimates for forecasting future cash flow, as well as use the payback period and accounting rate of return to evaluate the investment projects. Statistically, the findings of this research provided robust evidence that the use of forecasting procedures & methods is significantly associated with the extent of CBT usage. In addition, the results of this study proved that the contingency variables have a direct and significant impact on the use of forecasting procedures & methods. In this regard, we found that the influence of the combined contingent variables differ...
Despite experiencing rapid growth in their number and size, existing evidence suggests that African stock markets remain highly fragmented, small, illiquid and technologically weak, severely affecting their informational efficiency.... more
Despite experiencing rapid growth in their number and size, existing evidence suggests that African stock markets remain highly fragmented, small, illiquid and technologically weak, severely affecting their informational efficiency. Therefore, this study attempts to empirically ascertain whether African stock markets can improve their informational efficiency by formally harmonising and integrating their operations. Employing parametric and non-parametric variance-ratios tests on 8 African continent-wide and 8 individual national daily share price indices from 1995 to 2011, we find that irrespective of the test employed, the returns of all the 8 African continent-wide indices investigated appear to have better normal distribution properties compared with the 8 individual national share price indices examined. We also report evidence of statistically significant weak form informational efficiency of the African continent-wide share price indices over the individual national share pri...
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This study aims to determine the extent to which the dynamic programming can be used in the preparation of capital budgeting to rationalize investment decisions under limited resources. Ras Lanuf Oil & gas processing company is chosen as... more
This study aims to determine the extent to which the dynamic programming can be used in the preparation of capital budgeting to rationalize investment decisions under limited resources. Ras Lanuf Oil & gas processing company is chosen as a case study, due to the importance of the company's investment activity and its impact on the future of the company's business. The importance of this paper is that it illustrates how to link the managerial accounting tools and mathematical models to create a new synthesis that can be used in planning and control of investment expenditures. This paper presents a mathematical model that contributes to raising the efficiency of the capital expenditure decisions implemented by Ras Lanuf Company. A Dynamic programming (DP) is one of the important mathematical models which is suggested in order to select the optimal investment alternatives under the available funds. The DP is suitable for problems that require sequential decisions or that can be...
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Sub-Saharan Africa (SSA) has the highest prevalence rate of HIV/AIDS in the world, with negative effects on productivity, profitability, economic growth, and development. The social responsibility role of public companies in contributing... more
Sub-Saharan Africa (SSA) has the highest prevalence rate of HIV/AIDS in the world, with negative effects on productivity, profitability, economic growth, and development. The social responsibility role of public companies in contributing towards reducing the negative effects of HIV/AIDS is priceless. This paper investigates the impact of corporate governance (CG) on social and environmental accounting (SEA) with specific focus on corporate health accounting (CHA) and, consequently, examines whether CG can moderate the link betweenCHA andfirm value (FV), with particular focus onHIV/AIDS disclosures. First, employing one of the most extensive data on CG, CHA, and FV from a sample of listed SSA companies to date, our results suggest that companies that are better-governed tend to engage in increased CHA disclosures. Second, we find that the combined effects of CG and CHA on FV are stronger than CHA alone, meaning that the quality of firm-level CG moderates the link between CHA and FV. ...
This paper investigated the changes in competitive behaviour of banks in sub-Saharan Africa, following the 2007/2008 global financial crisis. Using 481 bank-year observations from an unbalanced panel of 83 banks from six countries over... more
This paper investigated the changes in competitive behaviour of banks in sub-Saharan Africa, following the 2007/2008 global financial crisis. Using 481 bank-year observations from an unbalanced panel of 83 banks from six countries over the period 2008–2013. We employed the Panzar-Rosse model of firm competition, and found that the degree of competition among banks in Sub-Saharan Africa increased. This increase is due to the effect of reform/liberalisation policies, largely initiated in the pre-crisis era. The success that followed via the development of banking systems, nonetheless moderated at the onset of the 2007/2008 financial crisis. System instabilities, which were characteristic of a post-crisis period, exposed deficiencies in regulation and asymmetric incentives for bank management. A significant recalibration of prudential policies followed, as regulators sought to restore system stability, which again had an impact in altering competitive conduct of banks. Policymakers sho...
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Drawing on institutional theory, we examine the impact of corporate governance (CG) on corruption. The interaction effects of national culture and CG on corruption are also examined. By employing a dataset of 149 countries, our baseline... more
Drawing on institutional theory, we examine the impact of corporate governance (CG) on corruption. The interaction effects of national culture and CG on corruption are also examined. By employing a dataset of 149 countries, our baseline findings indicate that the quality of CG practices reduces the level of corruption. Findings also show that three cultural dimensions, namely, power distance, individualism and indulgence moderate the CG-corruption nexus. Our findings indicate that CG and national culture explain the level of corruption among societies, with national culture appearing to matter more than the quality of CG. Our findings remain unchanged after controlling for endogeneities, country-level factors, CG and corruption proxies.
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The last three decades has seen the term “corporate governance” emerged clearly as an independent field of study. Its scope has also witnessed great expansion such that it is now an amalgam of different disciplines, including accounting,... more
The last three decades has seen the term “corporate governance” emerged clearly as an independent field of study. Its scope has also witnessed great expansion such that it is now an amalgam of different disciplines, including accounting, economics, ethics, finance, law, management, organizational behavior, and politics, among others, with no universally accepted definition. As a corollary, there exist a large number of definitions of corporate. Despite the existence of heterogeneous definitions, however, researchers frequently classify the existing corporate governance definitions as either “narrow” or “broad.” As a prelude, the narrow broad dichotomization is based on the extent to which a corporate governance regime essentially focuses on satisfying the parochial interests’ of shareholders or meeting the broader interests of diverse societal stakeholder groups.
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The development of credit information sharing schemes in developing countries has gained significant attention in recent times along with ongoing financial sector reforms. In this paper, we provide first-hand evidence of the effect of... more
The development of credit information sharing schemes in developing countries has gained significant attention in recent times along with ongoing financial sector reforms. In this paper, we provide first-hand evidence of the effect of credit information sharing on credit intermediation cost in these countries, and consequently ascertain the extent to which the credit information sharing–credit intermediation cost nexus may be accentuated by banking market concentration and governance quality. Using a large dataset covering 272 banks from 27 African countries over the 2004-2012 period, we uncover four new findings. First, we find that credit information sharing does reduce credit intermediation cost. Second, we show that the relationship between credit intermediation cost and credit information sharing is conditional on banking market concentration. Third, our findings suggest that governance quality moderates the effect of credit information sharing on credit intermediation cost. Finally, we find that banking market concentration reduces credit intermediation cost, but the effect is moderated by credit information sharing. Overall, our findings suggest that credit information sharing may serve as a useful policy tool for achieving financial sector stability in developing countries.
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This study aims to investigate the impact of corporate governance (CG) mechanisms on financial risk reporting in the UK.,The study uses a panel data of 50 non-financial firms belonging to 10 industrial sectors listed on the London Stock... more
This study aims to investigate the impact of corporate governance (CG) mechanisms on financial risk reporting in the UK.,The study uses a panel data of 50 non-financial firms belonging to 10 industrial sectors listed on the London Stock Exchange in the period 2011-2015. Multivariate regression techniques are used to examine the relationships.,The findings of this study reveal that CG has a significant influence on financial risk disclosure. Specifically, it is found that block ownership and board gender diversity have a positive effect on the level of corporate financial risk disclosure (FRD). While there is no significant relationship between board size and corporate FRD.,This study has significant implications for policy-makers, investors and regulators. Evidence of growing FRD implies that efforts by several stakeholders have had some positive impact on the level of FRD in the firms examined. Examples of such changes include, namely, increasing board size and gender diversity acting as effective firm level advisors and monitors of FRD. As a consequence, regulators and policymakers should continually pursue reforms to encourage firms to follow CG principles that are promoted as good practice.,This study adds to the emerging body of literature on CG–risk disclosure relationships in the UK context using content analysis. The study also highlights that gender diversity enhances FRD.
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This paper provides an up-to-date and comprehensive systematic literature review (SLR) of the existing research on women on corporate boards (WOCBs) and corporate financial and non-financial performance. The aim is to synthesise and... more
This paper provides an up-to-date and comprehensive systematic literature review (SLR) of the existing research on women on corporate boards (WOCBs) and corporate financial and non-financial performance. The aim is to synthesise and extend current understanding of both the existing (i) theoretical (i.e., economic, psychological and social) perspectives and (ii) empirical evidence on the (a) multi-level (i.e., individual-, social-, firm- and country-level) antecedents of WOCBs, and (b) the effects that WOCBs have on a wide range of corporate financial and non-financial performance. We achieve this by adopting a three-step SLR approach to analyse/review one of the largest SLR datasets to be employed to date, consisting of 634 mixed, qualitative, quantitative and theoretical studies conducted in over 100 countries from more than 10 disciplines (e.g., accounting, finance, economics and governance) from 1981 to 2019 and published in 270 top-ranked journals. Our findings are as follows. F...
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Departing from previous studies, this paper investigates the impact of corporate board diversity on corporate performance and executive pay within the context of MENA countries. Our sample includes a balanced panel of 600 firm-year... more
Departing from previous studies, this paper investigates the impact of corporate board diversity on corporate performance and executive pay within the context of MENA countries. Our sample includes a balanced panel of 600 firm-year observations, consisting of 100 individual firms drawn from 5 Middle Eastern countries (Egypt, Jordan, Oman, Saudi Arabia and United Arab of Emirates) over the 2009–2014 period. The findings are three-fold. First, board diversity, as measured by director gender and nationality, has a positive effect on corporate financial performance. Second, the relationship between board diversity and corporate performance is stronger in better-governed firms than their poorly-governed counterparts. Finally, board diversity, as measured by director gender, ethnicity and nationality, enhances the pay-for-performance sensitivity, but not the actual executive pay. Our results suggest that decisions about board diversity are not merely influenced by moral values; they arise because of the cost-benefit considerations of what diversity can bring to the firm. The findings are robust to controlling for different alternatives of board diversity measures, corporate governance proxies, corporate outcomes and types of endogeneities.
Abstract Supreme audit institutions are an important pillar of governance and government resource management, particularly for controlling corruption. Francophone African countries inherited these from their former colonial power, France,... more
Abstract Supreme audit institutions are an important pillar of governance and government resource management, particularly for controlling corruption. Francophone African countries inherited these from their former colonial power, France, but their role and function are limited. This paper argues that this is partly a legacy of their colonial experience. It investigates the Chamber of Accounts in Benin, the country’s supreme audit institution, using the lenses of Ekeh (1975) two publics and legitimacy theory. Nonetheless, Ekeh’s theory needed extending to incorporate changes affecting governance after Benin’s independence. The amorality of political officials, accepted by much of Benin society, rendered the institution largely ineffective in controlling corruption. Nevertheless, civil society organizations, donors, and the World Bank and International Monetary Fund have attempted to redress this. Politicians and government officials responded by engaging in symbolic compliance to meet stakeholders’ expectations. A separate audit institution – the General Inspectorate of State – was established under the sole control of the President to gain external legitimacy and retain donors’ budget support, whilst persistent corruption and rising poverty continue. Benin’s auditing institutions have become empty crates, which sometimes facilitate rather than control corruption.
This study seeks to examine the impact of Block Ownership structure on risk-taking as measured by R&D Intensity in OECD countries. The study uses a panel data of 200 companies from Anglo American and European countries between 2010 and... more
This study seeks to examine the impact of Block Ownership structure on risk-taking as measured by R&D Intensity in OECD countries. The study uses a panel data of 200 companies from Anglo American and European countries between 2010 and 2014. The ordinary least squares regression is used to examine the relationships. Additionally, to alleviate the concern of potential endogeneity, we use fixed effect regression, two-stage least squares using instrumental variables. The results show that there is a negative and significant relationship between block ownership and risk-taking, with a greater significance among Continental European countries than among Anglo American countries. The rationale for this is that Continental European countries are more likely to have block owners who are also the co-founders and owners of their companies. Also, for the block owners in Anglo American companies, there is greater protection afforded minority shareholders because of the particular legal system i...
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This study seeks to examine the impact of Block Ownership structure on Credit Ratings in OECD countries. This research seeks to contribute to the extant literature by exploring the effects of Corporate Governance (CG) mechanisms on... more
This study seeks to examine the impact of Block Ownership structure on Credit Ratings in OECD countries. This research seeks to contribute to the extant literature by exploring the effects of Corporate Governance (CG) mechanisms on corporate credit ratings. The study uses a panel data of 200 companies from Anglo American and European countries between 2010 and 2014. The ordinary least square regression is used to examine the relationships. Additionally, to alleviate the concern of potential endogeneity, we use fixed effect regression, two-stage least squares using instrumental variables. The results show there is a negative and significant relationship between block ownership and credit ratings, with a greater significance among Anglo American countries than among European countries. The rationale for this is that Anglo-American system gives preferential treatment to individual shareholders and its accounting tradition leads to a decline in risk and increase in credit ratings. The r...
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Abstract Going beyond the mere participation of female directors within boardrooms, we investigate which of the two major boards of directors' roles (advisory versus monitoring) is best played by female directors in order to make a... more
Abstract Going beyond the mere participation of female directors within boardrooms, we investigate which of the two major boards of directors' roles (advisory versus monitoring) is best played by female directors in order to make a difference to shareholders. More specifically, we investigate the impact that advisory and monitoring female directors have on managerial opportunism with a specific focus on earnings management. Using sample of US firms, we find evidence suggesting that female directors holding monitoring roles mitigate managerial opportunism, as measured by discretionary accruals. In contrast to the current argument that advisory directors in general are better able to sustain and improve earnings quality, we find no evidence that suggests that advisory female directors are significantly associated with lower managerial opportunism. Overall, the results remain robust after controlling for potential endogeneity problems, corporate governance, and external auditor quality.
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Departing from the existing literature, which associates credit information sharing with improved access to credit in advanced economies, we examine whether credit information sharing can also reduce loan default rate for banks domiciled... more
Departing from the existing literature, which associates credit information sharing with improved access to credit in advanced economies, we examine whether credit information sharing can also reduce loan default rate for banks domiciled in developing countries. Using a large dataset covering 879 unique banks from 87 developing countries from every continent, over a 9-year period (i.e., over 6300 observations), we uncover three new findings. First, we find that credit information sharing reduces loan default rate. Second, we show that the relationship between credit information sharing and loan default rate is conditional on banking market concentration. Third, our findings suggest that governance quality at the country level does not have a strong moderating role on the effect of credit information sharing on loan default rate.
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Abstract Whilst the ongoing banking regulatory reforms towards a comprehensive Basel III framework emphasise disclosure, transparency and a competitive banking market environment, very little is known about the empirical relationship... more
Abstract Whilst the ongoing banking regulatory reforms towards a comprehensive Basel III framework emphasise disclosure, transparency and a competitive banking market environment, very little is known about the empirical relationship between bank opacity and banking competition. We investigate the impact of competition, as measured by the individual bank's pricing power in the banking market, on bank opacity using a large sample of US bank holding companies over the 1986–2015 period. We uncover new evidence, on the competition-bank opacity nexus, which suggests that banks with higher market power and operating in less competitive banking markets have lower analysts' forecast errors and dispersions and may thus be less opaque. This effect is more pronounced for the 2007–09 global financial crisis period. Our evidence is robust to controlling for analysts' characteristics, bank fixed-effects and endogeneity problems.
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Financial strength ratings (FSRs) have become more significant particularly since the recent financial crisis of 2007–2009 where rating agencies failed to forecast defaults and the downgrade of some banks. The aim of this paper is to... more
Financial strength ratings (FSRs) have become more significant particularly since the recent financial crisis of 2007–2009 where rating agencies failed to forecast defaults and the downgrade of some banks. The aim of this paper is to predict Capital Intelligence banks’ financial strength ratings (FSRs) group membership using machine learning and conventional techniques. Here the authors use five different statistical techniques, namely CHAID, CART, multilayer-perceptron neural networks, discriminant analysis and logistic regression. They also use three different evaluation criteria namely average correct classification rate, misclassification cost and gains charts. The data are collected from Bankscope database for the Middle Eastern commercial banks by reference to the first decade of the 21st century. The findings show that when predicting bank FSRs during the period 2007–2009, discriminant analysis is surprisingly superior to all other techniques used in this paper. When only mac...
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This paper investigated the changes in competitive behaviour of banks in sub-Saharan Africa, following the 2007/2008 global financial crisis. Using 481 bank-year observations from an unbalanced panel of 83 banks from six countries over... more
This paper investigated the changes in competitive behaviour of banks in sub-Saharan Africa, following the 2007/2008 global financial crisis. Using 481 bank-year observations from an unbalanced panel of 83 banks from six countries over the period 2008-2013. We employed the Panzar-Rosse model of firm competition, and found that the degree of competition among banks in Sub-Saharan Africa increased. This increase is due to the effect of reform/liberalisation policies, largely initiated in the pre-crisis era. The success that followed via the development of banking systems, nonetheless moderated at the onset of the 2007/2008 financial crisis. System instabilities, which were characteristic of a post-crisis period, exposed deficiencies in regulation and asymmetric incentives for bank management. A significant recalibration of prudential policies followed, as regulators sought to restore system stability, which again had an impact in altering competitive conduct of banks. Policymakers sho...
Purpose The purpose of this paper is to investigate the level of voluntary compliance with, and disclosure of, corporate governance (CG) best practices, and the extent to which board characteristics and shareholding structures can explain... more
Purpose The purpose of this paper is to investigate the level of voluntary compliance with, and disclosure of, corporate governance (CG) best practices, and the extent to which board characteristics and shareholding structures can explain discernible differences in the level of voluntary CG disclosure in a number of emerging Middle Eastern and North African (MENA) economies. Design/methodology/approach The paper uses a number of multivariate regression methods, namely, ordinary least squares, weighted, non-linear, lagged-effects, two-stage least squares and fixed-effects regression techniques to analyse data collected for a sample of listed corporations in emerging MENA economies from 2009 to 2014. Findings First, in general, MENA listed firms have a relatively lower level of voluntary compliance with, and disclosure of, CG practices compared to listed firms in developed countries. Second, the evidence suggests that corporate board characteristics, including board diversity, have a ...
This paper provides evidence on how corporate multinationality from the perspective of acquiring firms relates to M&A returns. Using multivariate regressions and a large dataset of over 6,000 M&As (both cross-border and domestic)... more
This paper provides evidence on how corporate multinationality from the perspective of acquiring firms relates to M&A returns. Using multivariate regressions and a large dataset of over 6,000 M&As (both cross-border and domestic) by UK firms during 1987 to 2014, the paper finds multinationality to be associated with significantly higher short-run announcement returns and long-run operating performance. While the multinationality premium (higher M&A returns for multinationals) persists over time, it seems to be restricted to firms with superior resource/managerial capabilities and minimal agency problems. Finally, the multinationality premium appears to be driven by foreign acquisitions into advanced economies. The results are robust to correcting for sample selection bias and controlling for several firm and deal characteristics, as well as accounting for firm-, industry-, and year-fixed effects. Collectively, the findings imply that multinationality could be a source of value creation for acquiring firms, particularly in foreign acquisitions, which tend to be complex, and thereby, require superior managerial capabilities to succeed.
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ABSTRACT We explore how audit committees (ACs) oversee risk management in UK Higher Education Institutions (HEIs), using semi-structured interviews, attendance at AC meetings and documentary analysis. We find that the AC’s oversight seems... more
ABSTRACT We explore how audit committees (ACs) oversee risk management in UK Higher Education Institutions (HEIs), using semi-structured interviews, attendance at AC meetings and documentary analysis. We find that the AC’s oversight seems constrained by a fixation on the process of risk management, an over-reliance on risk registers, and varying levels of emphasis on operational risks. Theoretically, the AC’s oversight reflects different shades of symbolic and substantive activities designed to maintain the HEI’s legitimacy and that of its governing board, hence providing a symbolic representation. We raise concerns as to the AC’s ability to monitor effectively the HEIs’ risk management practices.
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PurposeThis paper aims to investigate the association among trustee board diversity (TBD), corporate governance (CG), capital structure (CS) and financial performance (FP) by using a sample of UK charities. Specifically, the authors... more
PurposeThis paper aims to investigate the association among trustee board diversity (TBD), corporate governance (CG), capital structure (CS) and financial performance (FP) by using a sample of UK charities. Specifically, the authors investigate the effect of TBD on CS and ascertain whether CG quality moderates the TBD–CS nexus. Additionally, the authors examine the impact of CS on FP and ascertain whether the CS–FP nexus is moderated by TBD and CG quality.Design/methodology/approachThe authors use a number of multivariate regression techniques, including ordinary least squares, fixed-effects, lagged-effects and two-stage least squares, to rigorously analyse the data and test the hypotheses.FindingsFirst, the authors find that trustee board gender diversity has a negative effect on CS, but this relationship holds only up to the point of having three women trustees. The authors find similar, but relatively weak, results for the presence of black, Asian and minority ethnic (BAME) trust...
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Purpose This paper aims to investigate the level of compliance with, and disclosure of, corporate governance best practice recommendations and the firm- and country-level factors that can explain discernible differences in the level of... more
Purpose This paper aims to investigate the level of compliance with, and disclosure of, corporate governance best practice recommendations and the firm- and country-level factors that can explain discernible differences in the level of compliance with, and disclosure of, corporate governance best practice recommendations in a number of Middle Eastern and North African (MENA) countries. Design/methodology/approach The authors use the widely used content analysis technique to examine the level of compliance with, and disclosure of, corporate governance best practice recommendations in a sample of listed corporations in MENA countries. In addition, the authors use the ordinary least square multiple regression analysis technique to examine the firm- and country-level antecedents of the level of compliance with, and disclosure of, corporate governance best practice recommendations. The findings are generally robust to different types of firm- and country-level factors, alternative measur...
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Purpose The purpose of this paper is to investigate the effect of corporate governance (CG) mechanisms (board size, board independence, separation of chairman and chief executive officer (CEO) roles and external auditor type) on... more
Purpose The purpose of this paper is to investigate the effect of corporate governance (CG) mechanisms (board size, board independence, separation of chairman and chief executive officer (CEO) roles and external auditor type) on accounting conservatism in Egypt. Design/methodology/approach Archival data relating to CG and accounting conservatism are collected and analysed using multivariate regression techniques. Findings The findings indicate that board independence is positively associated with accounting conservatism. By contrast, board size and auditor type are negatively associated with accounting conservatism, while separating the chairperson and CEO roles has no significant relationship with accounting conservatism. Originality/value To the best of the author’s knowledge, this is one of the first empirical attempts at providing evidence on the relationship between CG and accounting conservatism in Egypt.
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ABSTRACT We examine the effect of corporate social responsibility (CSR) quality ratings on the financial distress levels of Chinese enterprises by using the previously unexplored new China-specific Altman ‘ZChina Score’ in the context of... more
ABSTRACT We examine the effect of corporate social responsibility (CSR) quality ratings on the financial distress levels of Chinese enterprises by using the previously unexplored new China-specific Altman ‘ZChina Score’ in the context of CSR and data from 749 firms over the 2009–2014 period. First, we find that CSR quality ratings significantly reduce Chinese firms’ distress levels. Second, we find that the ability of CSR to reduce distress levels in non-state-owned Chinese firms is higher than state-owned ones. Finally, we find similar results when we divide the data into high-low CSR ratings and levels of distress. Our results are robust to potential endogeneities.
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Purpose This study aims to examine the impact of internal corporate governance mechanisms on insurance companies’ risk-taking in the UK context. Design/methodology/approach The study uses a panel data of all listed insurance companies on... more
Purpose This study aims to examine the impact of internal corporate governance mechanisms on insurance companies’ risk-taking in the UK context. Design/methodology/approach The study uses a panel data of all listed insurance companies on FTSE 350 over the 2005-2014 period. Multivariate regression techniques are used to estimate the effect of internal corporate governance mechanisms on insurance companies’ risk-taking. Findings The results show that the board size and board meetings are significantly and negatively related to risk-taking. In contrast, the results show that board independence and audit committee size are statistically insignificant but negatively related to risk-taking. The findings are robust to alternative measures and endogeneities. Research limitations/implications The findings have important implications for investors, managers, regulators of financial institutions and effectiveness of corporate governance reforms that have been pursued. Investors may further rel...
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Purpose The purpose of this paper is to investigate the extent of voluntary disclosures in UK higher education institutions’ (HEIs) annual reports and examine whether internal governance structures influence disclosure in the period... more
Purpose The purpose of this paper is to investigate the extent of voluntary disclosures in UK higher education institutions’ (HEIs) annual reports and examine whether internal governance structures influence disclosure in the period following major reform and funding constraints. Design/methodology/approach The authors adopt a modified version of Coy and Dixon’s (2004) public accountability index, referred to in this paper as a public accountability and transparency index (PATI), to measure the extent of voluntary disclosures in 130 UK HEIs’ annual reports. Informed by a multi-theoretical framework drawn from public accountability, legitimacy, resource dependence and stakeholder perspectives, the authors propose that the characteristics of governing and executive structures in UK universities influence the extent of their voluntary disclosures. Findings The authors find a large degree of variability in the level of voluntary disclosures by universities and an overall relatively low ...
South Africa (SA) has pursued corporate governance reforms in the form of the 1994 and 2002 King Reports. This paper examines the association between the presence of independent non-executive directors (INEDs) and market valuation of a... more
South Africa (SA) has pursued corporate governance reforms in the form of the 1994 and 2002 King Reports. This paper examines the association between the presence of independent non-executive directors (INEDs) and market valuation of a sample of 169 firms listed on the Johannesburg Stock Exchange (JSE) in SA from 2002 to 2007. Our results suggest a statistically significant and positive relationship between the presence of INEDs and firm valuation. By contrast, we find no statistically significant association between the presence of non-executive directors (NEDs) and firm valuation. Our findings are robust across a number of econometric models that control for different types of endogeneity problems, non-linear associations and firm valuation proxies. Our findings have important policy and regulatory implications. Whereas our evidence that more independent corporate boards’ impacts positively on firm valuation provides support for the recommendations of the King Reports, it shows th...
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We investigate the association between board size and firm value for a sample of 169 firms from 2002 to 2007 in post Apartheid South Africa (SA). The post Apartheid SA corporate context is interestingly and uniquely characterised by... more
We investigate the association between board size and firm value for a sample of 169 firms from 2002 to 2007 in post Apartheid South Africa (SA). The post Apartheid SA corporate context is interestingly and uniquely characterised by greater urgency to meet affirmative action provisions in board appointments, limited qualified and experienced directors, especially black directors, concentrated ownership, weak enforcement of corporate regulations and greater government ownership. These make SA corporate boards to play weaker agency (advisory, monitoring and disciplining) role than Western European and US boards, but stronger resource (resources, such as business contacts and contracts) dependence role. This suggests that any positive impact of board size on firm value is likely to depend on the effective execution of the resource dependence role than the agency role. Our main conclusion is that board size has a positive association with firm value, as proxied by Tobin’s Q. The findings are robust across a raft of econometric models that control for different types of endogeneity, including simultaneity and firm-level fixed effects, as well as different types of accounting and market-based firm valuation measures. Our findings suggest that the boards of the sampled firms perform the resource dependence role better than the agency role.
Research Interests:
ABSTRACT This paper investigates the association between executive compensation and performance. It uniquely utilises a comprehensive set of corporate governance mechanisms within a three-stage least squares (3SLS) simultaneous equation... more
ABSTRACT This paper investigates the association between executive compensation and performance. It uniquely utilises a comprehensive set of corporate governance mechanisms within a three-stage least squares (3SLS) simultaneous equation framework. Results based on estimating a conventional single equation model indicate that the executive pay and performance sensitivity is relatively weak, whereas those based on estimating a 3SLS model generally suggest improved executive pay and performance sensitivity. Our findings highlight the need for future research to control for possible simultaneous interdependencies when estimating the executive pay and performance link. The findings are generally robust across a raft of econometric models that control for different types of endogeneities, executive pay and performance proxies. Copyright © 2013 John Wiley & Sons, Ltd.
Research Interests:
Research Interests:
ABSTRACT This paper investigates the association between executive compensation and performance. It uniquely utilises a comprehensive set of corporate governance mechanisms within a three-stage least squares (3SLS) simultaneous equation... more
ABSTRACT This paper investigates the association between executive compensation and performance. It uniquely utilises a comprehensive set of corporate governance mechanisms within a three-stage least squares (3SLS) simultaneous equation framework. Results based on estimating a conventional single equation model indicate that the executive pay and performance sensitivity is relatively weak, whereas those based on estimating a 3SLS model generally suggest improved executive pay and performance sensitivity. Our findings highlight the need for future research to control for possible simultaneous interdependencies when estimating the executive pay and performance link. The findings are generally robust across a raft of econometric models that control for different types of endogeneities, executive pay and performance proxies. Copyright © 2013 John Wiley & Sons, Ltd.
Research Interests:
We investigate whether and to what extent publicly listed Saudi corporations voluntarily comply with and disclose recommended good corporate governance (CG) practices, and distinctively, examine whether the observed cross-sectional... more
We investigate whether and to what extent publicly listed Saudi corporations voluntarily comply with and disclose recommended good corporate governance (CG) practices, and distinctively, examine whether the observed cross-sectional differences in such voluntary CG disclosures can be explained by corporate commitment to voluntarily embrace and incorporate Islamic values into business operations, as well as by traditional ownership structure and CG mechanisms. We find that corporations that depict greater commitment towards incorporating Islamic values into their operations through high Islamic values disclosure index score engage in higher CG disclosures than those that are not. Additionally, our results suggest that corporations with larger boards, a big-four auditor, higher government ownership, a CG committee and higher institutional ownership, disclose considerably more than those that are not. By contrast, we find that an increase in block ownership significantly reduces voluntary CG disclosure. Our results are generally robust to a number of econometric models that control for different types of disclosure indices, general firm-specific characteristics, and firm-level fixed-effects. Keywords: Islamic values; Ownership structure; Corporate governance; Disclosure; Saudi Arabia
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This study examines how companies report their involvement and response to a major health crisis, namely HIV/AIDS. In light of the significant impact this epidemic has caused in South Africa over the last two decades, we analyse the... more
This study examines how companies report their involvement and response to a major health crisis, namely HIV/AIDS. In light of the significant impact this epidemic has caused in South Africa over the last two decades, we analyse the corporate disclosure behaviour of a sample of 75 companies listed on the Johannesburg Stock Exchange (JSE). We also study whether a reporting guidance issued by the Global Reporting Initiative (GRI) in 2003 ensured a more consistent and complete reporting of corporate activities aimed at tackling HIV/AIDS in the workplace. Based on a longitudinal analysis of the annual and sustainability reports from 2003 to 2009, we find an increased volume of HIV/AIDS related disclosures post-2003 and a subsequent decline post-2006. We also find a very limited, and sometimes selective, adherence to the disclosure of indicators recommended by the GRI guidance. We conclude that the increase and subsequent decrease in disclosures are primarily motivated by the need to manage stakeholder (employees) and to maintain and gain moral legitimacy.