Pablo Gomez-Carrasco, Encarna Guillamon-Saorin and Beatriz Garcia Osma
The purpose of this paper is to contribute to the development of the theoretical framework for corporate social responsibility (CSR) and to provide a number of conceptual…
Abstract
Purpose
The purpose of this paper is to contribute to the development of the theoretical framework for corporate social responsibility (CSR) and to provide a number of conceptual considerations which can be considered in the design of measures for corporate social performance (CSP).
Design/methodology/approach
This study develops a theoretical framework of CSR and provides conceptual considerations to improve the measurement of CSP. The example of Spanish savings banks is used to illustrate the complexity of the concept of CSR, which includes different dimensions and relationships.
Findings
CSP evaluation can be affected by the illusion of CSR, which may result in invalid conclusions on the relationship with financial performance. This risk mainly affects those studies whose CSP measure is based on charity or philanthropic activities, as most of the time they are disconnected from core business. These activities enjoy great visibility and, in some cases, such as Spanish savings banks, they become a thick veil that can be used to hide serious deficiencies in other key aspects of CSP.
Research limitations/implications
This study has implications for the literature on the conceptual and theoretical framework of CSR and the research on the link between CSP and financial performance. This paper highlights the importance of seeking comprehensive measures that cannot be misleading because of the relationships between the components of CSR.
Originality/value
The paper provides a novel conceptual framework for CSR, which connects the conceptual debate around “Strategic CSR” with the theoretical framework designed by Carroll’s (1991) Pyramid of CSR and emphasizes the importance of a meticulous examination of the CSP construct before studying its relationship with financial performance.
Details
Keywords
Jacobo Gomez-Conde, Rogerio Joao Lunkes and Fabricia Silva Rosa
The purpose of this paper is to analyze the effect of management accounting and control systems (MACS) on environmental innovation practices and operational performance…
Abstract
Purpose
The purpose of this paper is to analyze the effect of management accounting and control systems (MACS) on environmental innovation practices and operational performance. Specifically, this study relies on Simons’ levers of control (LOC) framework to investigate how managers implement environmental innovation practices. This paper hypothesizes that a forward-looking use of MACS (i.e. interactive use) triggers the implementation of environmental innovation practices, resulting in higher operational performance. Furthermore, the authors argue that the monitoring role of MACS (i.e. diagnostic use) combined with environmental training improves the effect of environmental innovation practices on operational performance.
Design/methodology/approach
Hypotheses are examined through a questionnaire survey. The analyses are based on responses in an empirical study from 89 Brazilian hotels.
Findings
Empirical findings from a hierarchical moderated regression analysis support the hypothesized links.
Originality/value
This study contributes to the environmental management and management control literature by providing novel evidence on the roles MACS play in the field of sustainable development. Based on the LOC framework, the authors shed light on the understanding of how managers introduce and monitor environmental innovation practices, as well as also outlining the key effects of environmental training in enabling the novel abilities of managers and employees to better understand environmental data and identify novel potential environmentally friendly solutions in the case of deviations. This paper also adds to Wijethilake et al. (2017), providing new empirical evidence on how firms design, implement and use MACS that capture institutional pressures for sustainability from multiple stakeholders.
Details
Keywords
The study aims to show how the public interest has been argued to justify the political interference in the accounting of financial entities as a tool to face a critical financial…
Abstract
Purpose
The study aims to show how the public interest has been argued to justify the political interference in the accounting of financial entities as a tool to face a critical financial situation in a country. And to offer a different perspective of the publicness notion that focuses on the field of financial accounting for private entities.
Design/methodology/approach
The paper draws on legal and political arguments referred to the public interest that consider the balancing approach, and so goes beyond the traditional agency framework, to explain politicians' influence on financial reporting. The behavior of the newly elected Spanish government, which issued accounting impairment rules for banks is described, and the accounting practices of a highly politically connected financial entity—Bankia—are used to illustrate the consequences of that intervention.
Findings
The paper evidences that the government intervention, which implied non-compliance with IFRS, was in line with its economic goals, led to the financial sector bailout and avoided the rescue of the country. This is what we call “breaking rules to achieve the public interest”, which is also consistent with a big-bath behavior to justify the bailout and legitimate the decision to breach IFRS. The silence of enforcers is consistent with the balancing approach that suggests compliance costs from a breach of rules are perceived less relevant after a high-level decision.
Research limitations/implications
This is a country-specific study based on a single case study that limits the generalizability of the findings.
Originality/value
This research provides a new angle to consider the political motivations to intervene in accounting in the private sector, as well as the enforcers' motivations to allow it. From an interdisciplinary perspective, it shows how politicians have argued the “public interest” to use (and abuse) to intervene in accounting rules, as well as to influence the accounting practice of a highly politically connected bank. It also highlights the potential long-term unintended consequences of these actions.
Details
Keywords
Taha Almarayeh, Beatriz Aibar-Guzman and Óscar Suárez-Fernández
In light of the key role attributed to the board of directors as a monitoring tool to constrain earnings management practices, this study aims to examine the effect of some board…
Abstract
Purpose
In light of the key role attributed to the board of directors as a monitoring tool to constrain earnings management practices, this study aims to examine the effect of some board attributes on accrual-based earnings management and real earnings management in the Middle Eastern and North African (MENA) context, whose institutional, economic and legal environment is markedly different from that of most organization for economic cooperation and development countries.
Design/methodology/approach
The authors selected a sample of 161 nonfinancial companies from nine MENA countries between 2014 and 2021 (corresponding to an unbalanced data panel of 486 observations). The authors used the generalized least squares regression test to examine the relationship between board attributes and earnings management.
Findings
The authors found that three board attributes (size, independence and gender diversity) have no effect on both types of earnings management practices, while CEO duality has no effect on accrual-based earnings management but has a significant and negative effect on real earnings management. Overall, the results suggest that most board attributes do not play a crucial role in reducing earnings management.
Research limitations/implications
The results provide valuable insights into the universal role of corporate governance mechanisms and raise questions about the role of the board of directors in improving reporting quality in the MENA context.
Practical implications
Regulators should adapt corporate governance mechanisms to the characteristics of the institutional context in which they are inserted.
Originality/value
To the best of the authors’ knowledge, this study is the first to examine the effect of various board characteristics on both types of earnings management practices in the MENA context. It also provides the first empirical evidence of the relationship between board gender diversity and earnings management in the MENA region.
Details
Keywords
Ricardo Malagueño, Jacobo Gomez-Conde, Yannick de Harlez and Olaf Hoffmann
The authors examine the extent to which a controller's involvement in project functions (namely definition and scope, organization, constraints management and risk management…
Abstract
Purpose
The authors examine the extent to which a controller's involvement in project functions (namely definition and scope, organization, constraints management and risk management) cascades down to project performance.
Design/methodology/approach
The authors test the study’s framework using survey data from a sample of project leaders in German and Swiss firms. Responses were analyzed using the partial least squares (PLS) technique.
Findings
The authors find that controllers contribute to project success via the previously described project functions. Further, the study reveals the crucial role of controllers in managing uncertainty and project risks.
Research limitations/implications
Although the arguments used in this research were not country specific and suggest that the findings of this study also apply to the controller professional in general, this study clearly acknowledges that further research is needed to address the effects of this role in different jurisdictions given the specific characteristics of controllers acting in German-speaking countries.
Practical implications
The authors provide insights on the role of controllers at an operational level, like project management, highlighting the need for controllers to support an effective project governance.
Originality/value
The authors add to the literature by examining the role of controllers in highly knowledge-intensive, highly pressured, task-driven, interdependent and dynamic operational settings, thus contributing to a better understanding of how controllers function at an operational level. The authors also strengthen a broader role of controllers in project management that goes beyond their historical controlling activities to include more modern functions, extending previous studies analyzing their professional identity.
Details
Keywords
Isabel Abínzano, Lucía Garcés-Galdeano and Beatriz Martínez
This paper investigates the impact of board gender diversity on the readability of the annual reports of family-controlled public companies.
Abstract
Purpose
This paper investigates the impact of board gender diversity on the readability of the annual reports of family-controlled public companies.
Design/methodology/approach
Grounded in the premises of the restricted and extended views of the socioemotional wealth (SEW) approach and executive power theory, this paper explores the ways in which family-affiliated female directors influence report readability in a sample of 133 publicly traded US companies listed in the Fortune 1,000. We use the system GMM estimator, which deals with two key sources of endogeneity by controlling first for reverse causality, using the lags of the endogenous variables as instruments, and then for omitted variables, capturing the individual effect.
Findings
Our analysis confirms that the significant enhancement in annual report readability is associated with the presence of female family directors, particularly those who are insiders within the company. In contrast, non-family female directors and family outsider directors appear to have a negative impact on annual report readability.
Originality/value
While scholars have increasingly focused on variations in annual report readability among family firms, the contribution of female directors to this phenomenon has received minimal attention. In our study, we integrate the theories of restricted and extended SEW perspectives with the theory of women’s executive power within the board. This integration is essential for considering two critical factors: firstly, the primacy of their SEW objectives, and, secondly, their legitimacy within the board.