Augusta Ferreira, João Carvalho and Fátima Pinho
The main purpose of this paper is to evaluate if, motivated by political competition, municipalities engage in earnings management practices through discretionary accruals.
Abstract
Purpose
The main purpose of this paper is to evaluate if, motivated by political competition, municipalities engage in earnings management practices through discretionary accruals.
Design/methodology/approach
Quantitative methodology.
Findings
Results indicate that, in those municipalities where political competition is greatest, there is a greater tendency to report positive net earnings close to zero. This study also indicates that for such purpose, discretionary accruals are used.
Originality/value
The purpose of this paper is to respond to the lack of information in the area of earnings management in the public sector, to be able to evaluate responsibility, performance and efficiency regarding the allocation of public resources and the degree of satisfaction of citizens/voters' needs-accountability.
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The aim of this paper is to investigate whether Mayors in Portugal engage in earnings management close to zero with the motivation of re-election.
Abstract
Purpose
The aim of this paper is to investigate whether Mayors in Portugal engage in earnings management close to zero with the motivation of re-election.
Design/methodology/approach
The data used in this study were annual financial information from Portuguese municipalities from 2005 to 2016, as well as data on elections and Mayor re-elections involving three political cycles. The methodologies employed were quantitative, including graphical and panel data regressions.
Findings
The results indicate that municipalities used discretionary accruals to engage in earnings management to report net earnings close to zero, and re-election seems to be a motivation for earnings management behaviour. Furthermore, the results suggest that municipalities in which the Mayor is re-elected are less likely to report positive net earnings close to zero.
Originality/value
This paper makes a valuable contribution to the literature on earnings management in municipalities. At the theoretical level, it makes it possible to identify whether re-election is a motivation for earnings management and, in this sense, to identify patterns of behaviour by managers. On a practical level, the knowledge of a manager's behaviour patterns will help to anticipate his or her future behaviour and, consequently, may prevent inefficiencies.
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Lucas Lopes Ferreira Souza, Francesca Bassi and Ana Augusta Ferreira de Freitas
Microfinance has become an important way to alleviate poverty. Though four decades have passed since its introduction, its impact is still not entirely clear. What makes it…
Abstract
Purpose
Microfinance has become an important way to alleviate poverty. Though four decades have passed since its introduction, its impact is still not entirely clear. What makes it difficult to ascertain its efficacy is the existence of diverse types of microfinance organizations and client profiles. Microfinance institutions must primarily pay more attention to the client, and to the mechanism through which financial services are delivered. The purpose of this paper is to identify the profiles of microfinance customers and the features of their operations.
Design/methodology/approach
In this paper, multilevel latent class models were estimated to reveal clusters of operations and classes of clients.
Findings
The results show that there are six clusters of operations and four classes of clients in the market, each with distinct profiles and needs. Different strategies are recommended for each cluster and class.
Originality/value
Numerous studies have focused on the importance of getting to know the clients of microfinance programs, but none as yet have used market segmentation as a way to do so. The goal is to generate better strategies to help clients improve their business results. Applying market segmentation to the microfinance market may point to different products for different groups of clients, taking the real needs of each of them into account.
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Pierre Donatella, Marco Bisogno, Sandra Cohen and Odd J. Stalebrink
Bruno Ocelli Ungheri, Carla Augusta Nogueira Lima e Santos, Maria Aparecida Dias Venâncio, Edmur Antônio Stoppa and Hélder Ferreira Isayama
This paper is an excerpt from a countrywide study entitled “Leisure in Brazil: representations and realizations of daily experiences”, which aims to investigate what Brazilians do…
Abstract
Purpose
This paper is an excerpt from a countrywide study entitled “Leisure in Brazil: representations and realizations of daily experiences”, which aims to investigate what Brazilians do in their leisure time, what they would like to do and why they do not do it.
Design/methodology/approach
Specifically, in this paper, the authors analyze data referring to the elderly population from southeastern Brazil. Sampling of the national survey comprised representative quotas of the population, considering region and state, and, in each state, quotas of sex, age, education level and family income, according to data obtained by IBGE in 2010. A total of 2,400 interviews were conducted in total. For the present study, the 91 interviews conducted with elderly subjects from the Southeast region of Brazil were considered.
Findings
The majority of participants understand leisure as a time for resting and fun and have physical/sports interests as their favorite leisure activity during the week. On weekends, social and tourism interests stand out, and idleness stands out in the preference of this public during the holiday period. Lack of time and financial resources are the main barriers to the access to and permanence in the desired leisure practices.
Originality/value
Having knowledge of the relationship between leisure and aging in Brazil is a way to contribute to the potential of this stage of life, based on the quality of life and continued learning provided by the content they enjoy.
Hussain Muhammad, Stefania Migliori and Augusta Consorti
This paper aims to examine the role of technological capability in the relationship between corporate governance and small and medium-sized enterprise (SME) performance.
Abstract
Purpose
This paper aims to examine the role of technological capability in the relationship between corporate governance and small and medium-sized enterprise (SME) performance.
Design/methodology/approach
Using panel data comprising 1,357 European SMEs from 2014 to 2020, this paper examines how technological capability acts as a mediator and moderator within the governance-performance nexus.
Findings
The results show a positive and significant link between corporate governance mechanisms and SME performance, as well as between technological capability and SME performance. In addition, this paper show that technological capability plays a crucial role in moderating and mediating the governance-performance relationship. Specifically, technological capability accentuates the positive effects of board size, the presence of outside directors and concentrated ownership on SME performance. Conversely, it attenuates the positive impacts of CEO duality and board gender diversity on SME performance. These results highlight corporate governance mechanisms and technological capability’s crucial role in significantly influencing SME performance.
Practical implications
The results suggest that SMEs should prioritize not only the implementation of effective corporate governance mechanisms but also the strategic utilization of technological innovations to boost performance. European policymakers are encouraged to enact supportive policies on technological innovation to strengthen the governance-performance dynamic.
Originality/value
This study contributes to the governance-performance literature by offering new insights into the critical role of technological capability, which has been previously explored in partial and fragmented ways.
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Dinesh Hasija, Mirzokhidjon Abdurakhmonov, Lee Warren Brown and Ru-Shiun Liou
To mitigate the impact of legitimacy concerns, firms often depend on strategic partnerships that enable them to navigate both complex political landscapes and regulatory…
Abstract
Purpose
To mitigate the impact of legitimacy concerns, firms often depend on strategic partnerships that enable them to navigate both complex political landscapes and regulatory environments. In this paper, the authors expand research into the dynamics of indirect and collective forms of corporate political activities (CPA), particularly focusing on multinational enterprises (MNEs) originating from countries with low political affinity with the host country and its allies.
Design/methodology/approach
Using a sample consisting of 2,173 friendly acquisitions in the USA made by 1,612 foreign acquirers originating from 66 countries, the authors used Tobit regression analysis to test the direct and moderating hypotheses.
Findings
The empirical evidence shows that acquiring MNEs grappling with heightened legitimacy issues due to low political affinity between the involved countries are more inclined to leverage target firms for effective lobbying resources. This tendency is amplified when the multilateral political affinity between the home and the host country's allies is also considered.
Originality/value
The evolving nature of global politics and the increasing scrutiny of corporate-political interactions necessitate a deeper understanding of indirect CPA strategies. The findings of this research shed light on how bilateral and multilateral political relations affect MNEs’ corporate political activities, specifically in the form of indirect, collective lobbying.
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Ana Augusta Almeida de Souza Santos and Silvia Inês Dallavalle de Pádua
Start-ups can change the direction of a country's economy when they manage to remain in the market, as they are companies that generate innovation, income and employment. However…
Abstract
Purpose
Start-ups can change the direction of a country's economy when they manage to remain in the market, as they are companies that generate innovation, income and employment. However, these are companies that need both favorable external conditions that guarantee their survival, and internal capacities for the development of a management that is able to consider the needs for change in the product or service and consolidate the business as a whole. Therefore, start-ups need to develop dynamic capabilities (DCs), which are achieved through the processes that direct, coordinate and formulate the strategies of the other processes. Therefore, adopting a management approach that enables the development of DCs is essential for the survival of start-ups. The business process management (BPM) approach becomes an appropriate option, since it identifies business processes to adapt organizational management to new market demands. It can be used to interpret the environment, to understand the organization internally and to transform; it is flexible to the needs and characteristics of each organization. Based on this, the objective of the study is to develop a BPM framework that operationalizes the development of DCs in start-ups.
Design/methodology/approach
The method used consisted of two case studies and analysis of documents and seven interviews. Two start-ups that underwent BPM promotion in 2018 and 2020 were selected. The start-ups are Brazilian and from the biotechnology sector. Interviews were conducted with the team that promoted BPM at start-ups and with members of the start-ups that participated in the promotion. The interviews followed a semi-structured script elaborated according to the authors of the literature review. Discourse analysis was used to identify excerpts from the statements that expressed the content of the questions. All interviews were recorded with the prior consent of the participants and later validated with them.
Findings
The BPM promotion framework for start-ups is divided into four steps: “frame BPM,” “understand BPM,” “enable BPM” and “continue BPM”. Nine principles constitute the promotion of BPM: (1) context consideration principle, (2) holistic, (3) simplicity, (4) involvement, (5) empowerment, (6) shared understanding, (7) purpose, (8) technological appropriation and (9) continuity. Promoting BPM in start-ups has developed dynamic entrepreneurial and networking capabilities.
Social implications
As for the contribution to society, scientific studies make it possible to structure tacit knowledge and give direction to human action based on assertive methods; thus, the scientific contribution on DCs and start-ups brings assertiveness to start-up managers and the entire chain they impact with their actions, which makes their performance more beneficial to society.
Originality/value
As for the contribution to the state-of-the-art, visualizing the principles in a practical way, through the application of the BPM promotion project in start-ups, made it possible to understand the BPM cycle in a less rigid and more fluid way. This format proved to be suitable for the start-ups in the case study, as it ensured that they learned both about how the approach works and about the advantages of using it in the management of start-ups, thus contributing to the development of these important organizations for the economy of different countries.
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Ru-Shiun Liou, Lee Warren Brown and Dinesh Hasija
Many multinational corporations that originate from emerging economies (emerging market multinational corporations (EMNCs)) opt for acquiring a target firm in a developed market…
Abstract
Purpose
Many multinational corporations that originate from emerging economies (emerging market multinational corporations (EMNCs)) opt for acquiring a target firm in a developed market to expediently upgrade their strategic capabilities. To successfully achieve their strategic goals in the developed markets, EMNCs may use market actions and nonmarket actions to mitigate the potential risk derived from the national political differences between their home emerging economy and host developed economy. This paper aims to extend the legitimacy-based view of political risk to study the influence of political animosity – defined as misalignment of the host-home countries’ national interests – on the EMNCs’ market and nonmarket strategy in a developed market.
Design/methodology/approach
In this paper, we examine all EMNCs that made cross-border acquisitions of the USA targets from 2005 to 2011. The final sample consists of 252 acquisitions originating from 25 emerging markets. This paper used Tobit regression analysis to test the direct and moderating hypotheses.
Findings
Facing a high level of political animosity between their home country and the host developed economy, EMNCs use a market strategy by acquiring less ownership stake in the developed market, as well as engage in a nonmarket strategy by increasing lobbying activities. In addition, because of the heightened legitimacy concerns of developed market shareholders, cross-listed EMNCs have a greater tendency than non-cross-listed EMNCs to improve their legitimacy through their market and nonmarket strategy.
Originality/value
The current paper sheds light on EMNCs’ international strategy in developed markets by examining both market and nonmarket actions. EMNCs are shown to be strongly motivated to engage in acquisitions in developed markets so they can acquire invaluable strategic resources, such as brands and distribution channels, to compete with the developed market multinationals. A sophisticated ownership strategy and corporate political activities are invaluable for EMNCs to catch up with developed market multinationals.
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J. Ruben Boling, Donna Taylor Mayo and Marilyn M. Helms
Mergers in higher education seem to be more common as academic institutions work to control costs and avoid program duplications in challenging economic times and adopt the more…
Abstract
Purpose
Mergers in higher education seem to be more common as academic institutions work to control costs and avoid program duplications in challenging economic times and adopt the more common cost saving measures often espoused from business mergers. The purpose of this paper is to highlight successes from a complementarity-based merger of two institutions in the University System of Georgia (USG) and present results over time.
Design/methodology/approach
A case study methodology was employed to explain why a particular merger resulted in greater growth compared to other system-wide academic mergers. This research focuses on a single merger of two institutions in Georgia, one of seven such mergers in the USG institutions to date, involving Gainesville State College and North Georgia College and State University to become the University of North Georgia. Observations are made and complimented by secondary data to rank growth among the seven USG consolidations.
Findings
The case findings highlight the success from the complementarity of these institutions. While the two were unique institutions, the success of the merger was linked to the underlying complementarity issues.
Originality/value
Using the strategic issues inherent in mergers from the business literature, the merger of the two institutions is profiled and discussion and recommendations are provided along with areas for future research.