Nur Asni and Dian Agustia
The purpose of this paper is to investigate the mediating role of financial performance (FP) in modelling the relationship between green innovation (GI) and firm value (FV), using…
Abstract
Purpose
The purpose of this paper is to investigate the mediating role of financial performance (FP) in modelling the relationship between green innovation (GI) and firm value (FV), using ASEAN countries as sample with panel analysis.
Design/methodology/approach
A panel data was collected from 374 publicly traded companies in six ASEAN countries, and was analysed using feasible general least squares (FGLS) to control heteroscedasticity and serial correlation.
Findings
The findings suggest that financial performance, namely return on assets (ROA) and return on equity (ROE), has a significant value in mediating the relationship between GI and FV. This illustrates that investors in the ASEAN region's capital market are more interested in the economic motivation for companies implementing GI. Other findings also provide evidence that ROA and ROE have positive and significant effects on FV. This indicates that the profitability resulting from a firm's ability to continuously innovate has a positive impact on the creation of value by manufacturing companies in the ASEAN region.
Research limitations/implications
The number of observations is still relatively limited, from manufacturing companies listed on stock exchanges in the ASEAN countries. The total number of samples used in this study was 374 companies with 22.30% of the total population.
Originality/value
This study combines the different types of secondary data to provide panel evidence on the mediating effect of financial performance using ROA and ROE in the relationship between green innovation and firm value, using ASEAN countries as the sample.
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Beate Klingenberg and Susan M Kochanowski
The purpose of this paper is to investigate how recruiters at a college career fair perceive sustainability and the knowledge business graduates should have about it. It reports…
Abstract
Purpose
The purpose of this paper is to investigate how recruiters at a college career fair perceive sustainability and the knowledge business graduates should have about it. It reports on how recruiters understand sustainability and perceive their organization’s engagement and resulting expectations for new hires. The results indicate that recruiters neither understand sustainability well, nor are suitably informed of their organizations’ needs with respect to this topic. Educators, as a consequence, face a dilemma of how to craft adequate educational experiences, as employer needs are not clearly expressed. The paper concludes with suggestions on how educational institutions can nevertheless proceed with offerings in sustainability education.
Design/methodology/approach
The study was performed by conducting personal, structured interviews at a college career fair.
Findings
While most respondents considered sustainability to be an important topic, there appears to be a lack of thorough understanding of sustainability. Recruiters were not overly informed about their organizations’ position and efforts toward sustainability. They considered it to be important that students learn about sustainability, but preferences for educational tools were not aligned with expected depth of knowledge. This leaves educators in search of guidance on how to align educational offerings with organizational needs.
Research limitations/implications
As a pilot study, the total number of interviewed organizations was low, and therefore, the results should not be over-interpreted. The findings nevertheless point to a clear disconnect between organizations’ expressed needs for adequate trained personal and their ability to define what they are looking for. These results encourage more research to develop a better link between company strategy toward sustainability, recruiter’s know-how of it and concise expectations in new hires that could be mirrored in educational offerings.
Practical implications
Human resources play a critical role in providing organizations with the capabilities to become more sustainable. Organizations need to develop concise recruitment policies that better communicate what they are looking for, as well as educational programs for recruiters to ensure future hiring fulfills critical needs.
Originality/value
This paper closes a gap in the literature as it includes a thus-far ignored stakeholder group, namely recruiters; into the research on how to align organizational needs with the development of adequate educational offerings that generate future leaders and managers well-versed in sustainability.
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Gabriel Sam Ahinful and Venancio Tauringana
The chapter investigates the relationship between environmental management practices (EMPs) and financial performance (FP).
Abstract
Purpose
The chapter investigates the relationship between environmental management practices (EMPs) and financial performance (FP).
Design/Methodology/Approach
The study is based on a sample of 187 SMEs and uses data on six EMPs (energy, water, waste, material, emissions, and biodiversity) collected through a self-administered questionnaire from owner-managers of SMEs. Ordinary least squares regression is employed to model the hypothesized paths.
Findings
The results suggest a positive and significant relationship between EMPs (energy, water, and material) and FP. There is also a significant positive relationship between an aggregate EMP measure and FP. However, other EMPs (waste, emissions, and biodiversity) are not significantly associated with FP. Overall, these results provide empirical support to the mostly normative suggestion that the conflicting results on the environmental management and financial performance relationship are partly due to the EMP measure used.
Research Limitations/Implications
The study is based on cross-sectional data, and therefore, it is impossible to determine any changes over time. Longitudinal studies could help confirm the relationship between EMP and FP over a longer period. From a policy perspective, this results mean that the Ghanaian EPA must monitor more closely for violations of laws and regulations relating to waste, emissions, and biodiversity since SMEs do not have incentives to manage these impacts without commensurate return.
Originality/Value
The study contributes by documenting evidence of the relationship between multiple measures of EMP and FP. This unlike most existing studies has enabled us to report evidence of how each EMP measure affects FP differently and where win–win opportunities are for SMEs. Thus, the win–win opportunities are associated with some EMP measures but not all.
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Rafaela Alfalla-Luque, Darkys E. Luján García and Juan A. Marin-Garcia
The link between supply chain agility (SCA) and performance has been tested in previous research with different samples and results. The present paper quantitatively analyses and…
Abstract
Purpose
The link between supply chain agility (SCA) and performance has been tested in previous research with different samples and results. The present paper quantitatively analyses and summarises the impact of SCA on performance found in previous empirical papers and determines the influence of several identified moderators.
Design/methodology/approach
Using a meta-analysis approach based on a systematic literature review, a total of 63 empirical papers comprising a sample of 14,469 firms were meta-analysed to consider substantive (type of performance and SCA operationalisation) and extrinsic (economic region and industry) moderators.
Findings
Results confirm a significantly large, positive correlation between SCA and performance. None of the analysed moderators has enabled the identification of any significant differences between the SCA and performance correlations by subgroup. However, high heterogeneity in total variance, both in the full sample and the subgroups by moderator, demands further rigorously reported empirical research on this topic with clearly conceptualised variables and frameworks and the use of validated scales.
Research limitations/implications
Several research gaps and best practice recommendations have been indicated to improve future empirical research on this topic.
Practical implications
Practitioners in different economic regions and industries will find consistent evidence of improvements in performance through SCA.
Originality/value
No meta-analysis has been found in previous research to estimate the value of the correlation between SCA and performance and the influence of moderating variables.
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The paper aims to provide an analysis of the principle‐agent relationship between owner (principal) and manager (agent) of investment properties by: developing an optimization…
Abstract
Purpose
The paper aims to provide an analysis of the principle‐agent relationship between owner (principal) and manager (agent) of investment properties by: developing an optimization model for the net profit scenario that any third party manager of properties in multiple locations faces; and describing the principal's (or owner's) problem and likewise developing an income optimization model. The model allows illustrating the misalignment of incentives and compensation arrangements common to the business of managing small investment properties.
Design/methodology/approach
The paper provides an in depth review of literature on the agency problem, both in general as well as in real estate research and compares the qualitative findings with analytical results provided by the model. The latter is developed by applying a transaction cost framework to the context of income structures in investment properties and their management.
Findings
The optimization model shows that profit maximization for the manger (agent) depends on an optimum number of properties to be managed. It is further shown that the compensation methods customary in small real estate management contracts are inappropriate for the manager to control and cover the transaction costs, which result from the fact that more than one location is managed. The result is a kind of impossibility theorem, stating that management of small investment properties based on customary compensation structures is unprofitable as the number of properties and their distance rises.
Practical implications
The analysis shows that industry practice for the compensation of management of small investment properties does not address the inherent principle‐agent problem. Consequently, additional compensation and incentive mechanisms as well as control structures need to be employed by the owner. The paper, therefore, provides a starting point to review and improve industry practice.
Originality/value
The paper expands the existing literature of the agency problem in real estate by providing an optimization model for management of investment properties. The model and findings are of interest to academics for its analytical treatment of agency relationships; as well as to practitioners, as the analysis reveals inefficiencies in industry practice.
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Beate Klingenberg and Roger J. Brown
The purpose of this paper is to show how an optimization model previously published by the authors is employed to study the effects of rent control on income optimization for the…
Abstract
Purpose
The purpose of this paper is to show how an optimization model previously published by the authors is employed to study the effects of rent control on income optimization for the owner and the manager, as well as on the principal‐agent relationship. The model explains effects on management, maintenance and housing quality observed under rent control.
Design/methodology/approach
The optimization model is developed by applying a transaction cost framework to the context of income structures in investment properties and their management. Rent control is introduced into the model as a rent maximum.
Findings
Under rent control, the manager is forced to optimize income solely through cost control, without motivation to provide above minimum services. The owner is unable to optimize income. Income and funds available for management and maintenance are reduced by costs uncontrollable by the owner. Consequently, management and maintenance are reduced, if not eliminated, resulting in deterioration of the housing stock, notwithstanding minimum habitability standards imposed by regulators. This dilemma argues against dropping management entirely and interferes with the owner's quest to find the right incentive structure for the agent.
Research limitations/implications
Rent control is modeled as a cap on rents. Many rent control policies employ a maximum in rent increase instead, with the maximum often linked to inflation. As the results of the model are in line with real‐world observations, this simplification seems to be non‐critical.
Practical implications
Rent control was implemented with the intent to provide affordable housing to the less fortunate in society. Economic and social effects of rent control have since been heatedly discussed, in the public arena and in academia. This paper supports the view that rent control has unintended, negative consequences not only for the property owner, but also for the property manager (who is at the brink of elimination) and for the tenant (as housing quality deteriorates). This paper therefore encourages a renewed discussion and review of rent control policies.
Originality/value
The paper expands existing literature by analyzing the effects of rent control on property management. By using an optimization model, theory‐based results are provided that supplements real‐word observations, which is interesting for both academics and practitioners. Furthermore, the applicability of the previously developed optimization model is strengthened.
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The purpose of this paper is to determine the effect that ownership and management structures have on ability to control operating expenses. For individual investors, intensity of…
Abstract
Purpose
The purpose of this paper is to determine the effect that ownership and management structures have on ability to control operating expenses. For individual investors, intensity of management experience is also explored as a possible explanatory variable for operating expenses. For property management services that are contracted out, the level of the fee is investigated as a possible cause for movements in operating expenses as well. Finally, operating expenses are used as a possible explanatory variable for a property’s lease-up performance during the year.
Design/methodology/approach
The analysis consists of a series of regression models performed on data provided by the 2012 Rental Housing Finance Survey (RHFS) in the USA. The RHFS is a unique data set that covers a wide degree of information on multifamily properties. The RHFS represents 2,260 properties in total, and covers various aspects of the apartment industry, including financing and operational cost measures. Control variables used as independent variables include number of units, year of property acquisition, and age of building.
Findings
Individual ownership and self-management proved to be statistically significant drivers in driving down log operating expenses. Hours spent by individuals performing property management roles on their own properties had a slightly positive association with operating expenses. For professional managers, the fees devoted solely to the manager or management company had a highly significant and positive effect on other operating costs. Finally, when separating out the individual components of operating expenses, only two variables had significant effects on tenant lease-ups: management expenses (positive) and security expenses (negative).
Research limitations/implications
The data set is potentially biased toward those properties with less than 100 units, and thus it would be problematic to assume that these findings are generalizable to the population at large. There are also no geographic coding indicators within the RHFS data set, which eliminates the potential to control for various market factors and rural/urban differences.
Practical implications
The research provides an understanding of some of the basic factors behind increases in operating expenses, which ultimately has implications for performance benchmarks such as net operating income and property market value.
Social implications
The reasonable controlling of operating expenses ultimately has potentially positive implications for low- to moderate-income populations, who would ultimately experience lower rents as a result.
Originality/value
This research represents one of the first known uses of the RHFS database.
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Minelle E. Silva, Michele M.O. Pereira and Albachiara Boffelli
To better understand the supplier's role in promoting supply chain sustainability (SCS), the authors investigated the learning process as it relates to sustainability knowledge…
Abstract
Purpose
To better understand the supplier's role in promoting supply chain sustainability (SCS), the authors investigated the learning process as it relates to sustainability knowledge. Through the lens of the knowledge-based view, they understand the shift of sustainability knowledge from rhetoric to common knowledge existent between suppliers and buyers.
Design/methodology/approach
A case study method was employed to study sustainability knowledge learning between a key global coffee supplier and its geographically dispersed buyers. The research was developed with data collected from 2019 through 2021. Interviews and secondary data were analyzed using both deductive and inductive approaches.
Findings
Results were organized to demonstrate how the supplier developed and transferred its own sustainability knowledge within supplier–buyer dyads. The authors uncovered that buyer selection was a vital strategy used to appropriate the value created to ensure SCS learning. Four learning stages were analyzed, and while the results indicated that all buyers acquired knowledge, they also showed that only four distributed it. Moreover, different levels of interpretation were identified, two of which were associated with a low level of understanding of the meaning of sustainability knowledge. In addition, the data provided little evidence of organizational memory. All links were guided by common sustainability knowledge learned through multiple learning loops between the supplier's knowledge management and buyers' SCS learning, thus boosting sustainability in the coffee supply chain.
Practical implications
A greater understanding of how sustainability knowledge is learned in supply chains helps managers develop better SCS strategies.
Originality/value
Unlike previous research, this paper illustrates that common sustainability knowledge is key to SCS implementation, which is made possible by carefully selecting buyers and by facilitating sustainability knowledge learning through two-way interactions.
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Alessandro Ancarani, Carmela Di Mauro and Simone Gitto
The study investigates the profitability of manufacturing firms backshoring (BS) to Europe. In particular, the article analyses the relation between BS drivers and post-relocation…
Abstract
Purpose
The study investigates the profitability of manufacturing firms backshoring (BS) to Europe. In particular, the article analyses the relation between BS drivers and post-relocation profitability and tests whether this relation is moderated by innovation policies that firms adopt in conjunction with BS.
Design/methodology/approach
The empirical model links the post-relocation profitability to BS drivers, firms’ involvement in product innovation and/or adoption of new manufacturing technologies. Data concerning BS initiatives to Europe between 2012 and 2018 extracted from secondary sources have been matched to firms’ balance sheet data.
Findings
Results show that responsiveness-driven BS is associated with higher profitability when the relocation is coupled with product innovation. A second key finding is that the adoption of new manufacturing technologies has a positive impact on post-BS profitability.
Research limitations/implications
The restriction of the dataset to firms for which information on post- and pre-BS financial performance was available has led to a small sample size. Availability of longer time series of profitability data will allow estimating long-term impact, especially for innovation.
Practical implications
The study provides first evidence on the impact of BS on financial performance and throws light on the relevance of innovation as a lever supporting manufacturing relocation to high-cost countries.
Originality/value
The study advances empirical research on BS by offering evidence of its impact on profitability and by linking it to previous research on BS drivers. Further, the study throws light on the role of different drivers as “success factors” of BS and on how they interact with innovation efforts. The study also offers insights to business leaders who are evaluating the potential benefits on company profitability of a return to a high cost-environment and provides useful indications on the conditions under which BS pays off.
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Kevin Watson, Beate Klingenberg, Tony Polito and Tom G. Geurts
Environmental management systems (EMS) seek to make companies simultaneously more competitive and environmentally responsible. Improved environmental performance can be sought…
Abstract
Environmental management systems (EMS) seek to make companies simultaneously more competitive and environmentally responsible. Improved environmental performance can be sought from the adaptation of techniques that emphasize reduction of waste and process/product redesign in the quest of reducing environmental impact. However, EMS lacks a framework to quantify improvements and much of the evidence of EMS's impact on financial performance is anecdotal. This lack of theoretical development has served to diminish corporate support, thus reducing the likelihood of EMS implementation due to a perceived cost disadvantage. This paper proposes, and tests, a framework to quantify EMS improvements to determine the impact of EMS strategies on financial performance. Our findings suggest that implementation of an EMS strategy does not negatively impact a firm's financial performance.