Search results

This study aims to investigate whether banks’ environmental, social and governance (ESG) activities impact their profitability and stability. The authors also explore whether banking industry competition and the country’s regulatory quality moderate the impact of banks’ ESG on their profitability and stability.

The sample includes data from 46 banks in 11 Organization of Islamic Countries (OIC) from 2010 to 2020. The authors have used the generalized method of moments (GMM) as the primary estimation model, with robustness tests to validate research findings.

The results show that neither ESG nor its components impact bank profitability. Instead, ESG and its social component decrease bank stability. The findings neither support the stakeholder theory nor the risk-management view, which proposes that ESG activities improve financial performance and reduce unnecessary risks. However, an increase in market power (reduced competition) frees resources for banks, such that they focus more on ESG activities, which improves profitability, albeit at reduced stability levels. This finding supports the competition-related differentiation hypothesis. Finally, a country’s regulatory quality change does not influence bank ESG to impact its profitability or stability. This finding does not support the institutions-ESG proposition.

This study has several limitations. First, constrained by data availability, the authors could not examine Islamic banks in OIC countries. Examining the ESG outcomes in Islamic banks would be interesting based on Islamic ethics and corporate social responsibility perspectives. The data set could also be more recent so that the differential impact of COVID-19 on bank ESG and financial performance could be estimated. The coverage of OIC countries was limited in our sample; this could be improved in future research.

Banks should evaluate the focus and scope of their ESG activities, communicate their long-term strategic benefits with stakeholders and align ESG with their strategy and business model to offer innovative ESG-based products. They should also recalibrate ESG in their risk management framework to catalyse stability and stakeholders’ trust. Policymakers should control the level of competition so banks can foster ESG without sacrificing financial performance. Also, banks should be given regulatory incentives so ESG becomes integral to bank growth, direction and stability.

ESG should be part of banks’ strategy and business model, to maximize its benefits for stakeholders, while maintaining competition and providing regulatory incentives.

To the best of the authors’ knowledge, this is the first study to investigate the influence of bank ESG activities on their profitability and stability in OIC countries. The authors also extend the theoretical literature by connecting competition and regulatory quality to ESG-led financial performance.

In an era marked by artificial intelligence (AI), virtual reality (VR) and augmented reality (AR), this study presents a research paradigm centered on nurturing fundamental skills crucial for effective digital leadership in a paradoxical age where leaders are ambitious as well as skeptical for the adoption of such technologies. This study offers a strategic framework to seamlessly integrate diverse technologies into leadership development; the objective is to bridge the divide between theoretical understanding and practical implementation, especially through the lens of paradox theory.

This conceptual study delineates essential attributes that digital leaders must cultivate, drawing insights from the corpus of literature encompassing leadership, technology and organizational advancement. Synthesizing theoretical perspectives, the study proposes a comprehensive research framework that provides a systematic approach to harnessing the potential of AI, VR and AR to enhance leadership competencies. This conceptual study significantly contributes to paradox theory through method of “theory adaptation” as elaborated in the literature.

The study unveils a spectrum of foundational proficiencies, including technological acumen, adaptability, strategic acumen, effective communication, collaborative aptitude and ethical acumen, among others. These competencies underscore the multifaceted skill set required of digital leaders. To adeptly traverse the intricate digital terrain, foster innovation and align technological advancements with organizational objectives, these proficiencies are imperative for digital leaders to possess.

The distinctiveness of this study lies in its all-encompassing approach to digital leadership development by offering a paradoxical perspective and hence making a contribution to the body of knowledge for paradox theory. By amalgamating AI, VR and AR into a cohesive framework, the study enhances the comprehension of how these technologies collaboratively nurture leaders capable of cultivating organizational triumph in the digital age. This proposed paradigm serves as a bridge between cutting-edge digital technology usage and leadership proficiency paradox, furnishing pragmatic insights to benefit both academic researchers and industry practitioners.

This study aims to enhance our understanding of employee emotional competence (EEC) in the context of service failure and recovery. Accordingly, the present study investigates the relationship between perceived EEC and customer emotional attachment (CEA) through the mediating role of service recovery satisfaction (RES). Furthermore, the study examines the moderating impact of service failure severity (SFS) on the relationship between perceived EEC and RES.

A self-administered online survey was carried out to collect data. Using a convenience sampling technique, 195 US consumers were recruited from Prolific Academic. To test the hypotheses, this study employed partial least squares structural equation modeling (PLS-SEM).

According to the analysis, perceived EEC impacts CEA directly and indirectly via RES. Additionally, the study finds that consumers reported feeling more emotionally connected to the restaurant when they were satisfied with service recovery. Finally, the study identified that the connection between perceived EEC and RES increases with service failure severity.

This study emphasizes enhancing EEC through organization-wide training to increase customer satisfaction and emotional attachment to the service organization. Furthermore, it underscores the need for comprehensive employee training to categorize service failure severity and formulate appropriate recovery strategies.

The authors believe this is the first RES study to examine perceived EEC’s effect on CEA. By combining the affect infusion and cognitive appraisal theories to examine recovery satisfaction, this study contributes to the existing body of research on service recovery by shedding light on the relationship between perceived EEC and CEA. Furthermore, the study offers preliminary findings indicating an increase in the impact of perceived EEC on RES during high failure severity (SFS).

Rapid industrialization and construction generate substantial concrete waste, leading to significant environmental issues. Nearly 10 billion metric tonnes of concrete waste are produced globally per year. In addition, concrete also accelerates the consumption of natural resources, leading to the depletion of these natural resources. Therefore, this study uses artificial intelligence (AI) to examine the utilization of recycled concrete aggregate (RCA) in concrete.

An extensive database of 583 data points are collected from the literature for predictive modeling. Four machine learning algorithms, namely artificial neural network (ANN), random forest (RF), ridge regression (RR) and least adjacent shrinkage and selection operator (LASSO) regression (LR), in predicting simultaneously concrete compressive and tensile strength were evaluated. The dataset contains 10 independent variables and two dependent variables. Statistical parameters, including coefficient of determination (R²), mean square error (MSE), mean absolute error (MAE) and root mean square error (RMSE), were employed to assess the accuracy of the algorithms. In addition, K-fold cross-validation was employed to validate the obtained results, and SHapley Additive exPlanations (SHAP) analysis was applied to identify the most sensitive parameters out of the 10 input parameters.

The results indicate that the RF prediction model performance is better and more satisfactory than other algorithms. Furthermore, the ANN algorithm ranks as the second most accurate algorithm. However, RR and LR exhibit poor findings with low accuracy. K-fold cross-validation was successfully applied to validate the obtained results and SHAP analysis indicates that cement content and recycled aggregate percentages are the effective input parameter. Therefore, special attention should be given to sensitive parameters to enhance the concrete performance.

This study uniquely applies AI to optimize the use of RCA in concrete production. By evaluating four machine learning algorithms, ANN, RF, RR and LR on a comprehensive dataset, this study identities the most effective predictive models for concrete compressive and tensile strength. The use of SHAP analysis to determine key input parameters and K-fold cross-validation for result validation adds to the study robustness. The findings highlight the superior performance of the RF model and provide actionable insights into enhancing concrete performance with RCA, contributing to sustainable construction practice.

This study examines direct effect of leader-member exchange (LMEX) and learning orientation (LEOR) on workplace innovation (WPIN) and indirect effect between underline relationships in presence of mediators such as creative self-efficacy (CRSE), thrive at work (THAW), task interdependence (TAIN) work significance (WOSI) and creative performance (CRPE). Moreover, this study investigates the serial mediating effect of CRSE, WOSI, THAW, TAIN and CRPE between LMEX, LEOR and WPIN in entrepreneurial small and medium-sized enterprises (SMEs).

This study collected a total of 286 usable responses from entrepreneurial SMEs in three major business cities in Pakistan. In this cross-sectional study, data were gathered through self-administered surveys using purposive sampling approach and tested hypotheses using structural equation modeling (SEM).

The findings suggested insignificant direct effect of LMEX and LEOR on WPIN in the presence of mediators. Interestingly, CRSE, THAW, TAIN and CRPE were identified as significant mediators between LMEX, LEOR and WPIN. However, WOSI was found to be an insignificant mediator in the observed context. Moreover, the results revealed significant serial mediating effect of CRSE and CRPE with work context elements such as THAW and TAIN between LMEX, LEOR and WPIN, while serial mediating effect of WOSI in underline relationships found insignificant.

The study emphasizes that chief executive officers (CEOs) of entrepreneurial SMEs should prioritize individual, team and organizational factors to improve WPIN for competitiveness. Entrepreneurial management should focus on building strong relationships with employees to foster creativity and create a learning-oriented work environment that improves motivation and collaboration, thereby boosting employees' CRSE and CRPE, leading to enhanced WPIN.

This research offered a novel research framework and identified critical mediators and serial mediators between LMEX, LEOR and WPIN for entrepreneurial SMEs in developing countries, a domain grossly underrepresented in the literature.

This research was initiated by motivation from a real business problem that delves into lean management practices in dairy farm operations. It investigates how lean management practices can be applied as an improvement strategy in the dairy business to evaluate its impact on performance, where profitability is a decisive factor.

Based on the qualitative design, a 5-phase action research methodology was used in this study, where multiple data collection sources were used, including focus group discussions, on-site observation or Gemba walks and process mapping. The impact is evaluated by comparing the key performance measures with the same period before and after research.

The research revealed that lean management practices can significantly improve dairy business performance. It explained vital aspects of lean management practices and their sequence with examples of first-hand applications. It explained, how lean management practices were applied in dairy farm operations. Furthermore, the research resulted in significant benefits, in terms of quality, cost and profitability.

This research was conducted in a real business setting in the field environment, to improve dairy business performance. It was a distinctive application of lean management practices to solve a national problem. This could be used as a road map to bring continuous improvement at the national level to improve the performance of food value chains.

This research is unique because it addresses the methodological, population and empirical gaps in dairy farm operations. It adds value to the existing knowledge base by sharing best practices, developed and implemented for the first time to the best of our knowledge, like high-level process mapping and performance measures at different levels. Furthermore, the solutions can be simulated in related farm operations to bring breakthrough improvements in dairy business performance.

Funding difficulties are particularly compounded for Muslim entrepreneurs in Nigeria, owing to the dominance of interest-based financial institutions prohibited in Islam. Thus, this study aims to explore the role of awareness of Islamic finance principles in ameliorating financial deprivation and financial anxiety to increase access to Islamic financing among Muslim entrepreneurs.

A quantitative survey method of data collection was used to collect data from a total of 208 micro, small and medium enterprises (MSME) owners based on hand-delivered questionnaires. The data was analyzed using a partial least square structural equation model.

The result supports the direct negative impact of relative financial deprivation and the positive impact of awareness of Islamic finance principles on access to Islamic finance. However, awareness of Islamic finance principles could not moderate any of the direct relationship.

This study implies that financial deprivation is detrimental to access to Islamic finance, but financial anxiety has no significant impact. In addition, policymakers and MSME owners could directly foster access to Islamic finance through awareness of Islamic finance principles, though it could not redirect the negative impact of relative financial deprivation on access to Islamic finance.

The valuable finding here is that the substantial positive impact of awareness of Islamic finance principles on access to Islamic finance is not enough to redirect the negative effect of relative financial deprivation on access to Islamic finance.

The rapid evolution of digital innovation has significantly revolutionized the business landscape for entrepreneurs. Embracing digital innovation is crucial for all stakeholders to achieve sustainable development goals (SDGs) and promote sustainability. However, there is little understanding of how entrepreneurial leadership in developing nations has proactively responded to the challenge of digital innovation. Based on Drucker’s productivity theory, this study examines the relationship between entrepreneurial leadership (EL), digital orientation (DO) and digital capability (DC) as predictors of digital innovation (DI). The proposed model aims to establish the causal connections between variables and elucidate the complex interplay between digital innovation and the resulting outcome of sustainable performance (SP).

Two research studies were carried out in the Chinese IT industry to assess the efficacy of the theoretical framework among IT workers. Study 1 utilized a three-week, two-week time-lagged design (N = 299), while Study 2 used a two-week, four-week survey design (N = 341). The study used Smart-PLS 4.0 for data analysis.

The results showed that entrepreneurial leadership significantly impacts employee digital orientation and digital capabilities, fostering digital innovation. Moreover, digital innovation has a significant impact on sustainable performance.

The study’s findings allow authors to contribute to the existing scholarship on employee digital orientation, digital capabilities, digital innovation and sustainable performance in an emerging economy.

The learning outcomes are as follows: to identify and analyze the importance of operations management in a situation demanding minimizing environmental impact and maintaining operational momentum; access the risks faced during project executions and apply project management concepts to facilitate Karachi Steel in implementing indigenous technological solutions; and evaluate the importance of adaptability, continuous improvement and innovation in creating sustainable solutions to address complex challenges.

Javaid Iqbal, CEO of Karachi Steel, was the case’s protagonist. With capacity expansion, Javaid relocated the steel facility from Rawalpindi to Islamabad, Pakistan. The company encountered several difficulties because of the air emissions’ inconvenience to nearby residents and the strict environmental regulations. To push the emissions into the air, the company first installed a locally fabricated chimney. Later, they hired a foreign Pakistani engineering firm to install air filters, but the project proved unsuccessful. To control emissions, the company developed a Wet Particulate Control (WPC) system based on a water-sprinkling mechanism. The endeavor was successful, but it resulted in water pollution. As a result, Karachi Steel signed a contract with a local engineering company that invented and effectively installed an air filtration system. Karachi Steel not only devised solutions for their predicaments but also made significant contributions toward achieving the Sustainable Development Goals (SDGs). However, the emissions reporting and monitoring mechanism continued to cause inconvenience for regulators. In addition, the filtration facility encountered a blocked duct conveying zinc sulfate from smoke, resulting in the periodic suspension of operations. As Karachi Steel seek long-term solutions to current challenges, it is critical to examine the relationship between internal circumstances and external forces and stimulate a holistic approach to resolving issues within the realms of operations management and project management.

The case study is suitable for students pursuing their undergraduate degree programs in business studies or management sciences. This case can be taught in specific subjects in the domain of management sciences, including project management and operations management. Furthermore, undergraduate students pursuing degrees in environmental sciences, specializing in environmental impact assessment and sustainable development, can also learn from this case study. These subjects have the potential to provide students with a detailed understanding of the dynamic relationship between environmental problems caused by business activities, and how to address these challenges using principles of project management and operations management. There is no pre-requisite for this case study, and the level of difficulty is moderate. The recommended teaching pedagogy for this multidisciplinary case study includes role-playing exercises, simulations to replicate real-world situations and the Socratic method, which encourages critical thinking.

Teaching notes are available for educators only.

CSS 7: Management Science.