Irfan Butt, Bhasker Mukerji and Md Hamid Uddin
This paper aims to examine the issue of corporate social responsibility (CSR) in Pakistan, where religiosity is very strongly prevalent. Based on literature, it is conceptualized…
Abstract
Purpose
This paper aims to examine the issue of corporate social responsibility (CSR) in Pakistan, where religiosity is very strongly prevalent. Based on literature, it is conceptualized that the consumers’ perception and awareness about the CSR activities influence their purchase intentions, but the effect from consumers’ CSR perception is to be mediated by their trust in the company and their religious beliefs.
Design/methodology/approach
Both qualitative and quantitative methods are applied to investigate the research issue. The qualitative method is applied in the initial phase and conducted in two steps. First, focus groups discussions are conducted to understand the consumers’ knowledge on CSR and other factors influencing their purchase intention. Next, a number of descriptive and interpretive approaches are applied to examine the contents of focus group discussions. A total of three focus groups discussions are conducted in the city of Lahore, Pakistan. Each of the focus group includes 10 individuals from different social classes. Based on the focus group discussion outcomes, a survey is designed to conduct the quantitative study in the next phase. A set of 310 was randomly selected as a convenience sample from the university student population. This non-probability random sampling method ensures data availability for the study, but also risks that the sample might not represent the whole population of the society, and it might be biased by the volunteers.
Findings
Based on 230 respondents’ data, it is found that the CSR perception and awareness do influence the purchase intention of consumers, which provides corroborating evidence to confirm that CSR is important for business development in different environments. However, religiosity in society does not play a significant role in determining the effect of CSR perception; but the consumers’ trust in the CSR activities of companies is found to be an important factor. Therefore, it is concluded that CSR has a business value if the consumers have a good perception of CSR which is determined by their trust in the company, but not by the religious orientations. Hence, companies need not overemphasize religious aspects in CSR campaigns, instead working on the building of consumers’ trust is more important.
Originality/value
Corporate social responsibility (CSR) is a widely studied issue because of increasing pressure from global society to ensure ethical corporate behavior. However, there is a trend to dress up CSR within the broader business framework because CSR initiatives eventually pay off through expanding business as result of more engagement with the customers and society. Because the social structure widely varies across the world, it is important to understand how the different social dynamics influence CSR initiatives and their impact on the customers’ buying decisions. This paper examined the issue in Pakistan, where religiosity is very strongly prevalent. Based on literature, it is conceptualized that the consumers’ perception and awareness about the CSR activities influence their purchase intention, but the effect from consumers’ CSR perception is to be mediated by their trust in the company and their religious beliefs. The survey study using 230 respondents’ data confirm that CSR perception and awareness positively influence consumers’ purchase intention. This corroborating evidence generally suggests that CSR initiatives may add value for the companies in different environments.
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Sabri Boubaker, Md Hamid Uddin, Sarkar Humayun Kabir and Sabur Mollah
This paper aims to investigate a fundamental research question of whether the Islamic banking business model makes corporate earnings more uncertain. This question arises because…
Abstract
Purpose
This paper aims to investigate a fundamental research question of whether the Islamic banking business model makes corporate earnings more uncertain. This question arises because prior research shows that Islamic banks do well in loan performance but incur more operational costs than conventional banks, indicating the systemic limitation of Islamic banks in business risk management.
Design/methodology/approach
The study used a sample of banks to conduct the panel regression analysis with 15 years of data for 532 banks (129 Islamic and 403 conventional) from 23 Muslim countries across the world. The authors estimate earnings uncertainty in two ways: the spread and standard deviation of the country-adjusted return over the sample period and applied the difference-in-difference approach interacting cost to income ratio with the Islamic bank dummy, checking if Islamic bank’s high operational costs contribute to more earning uncertainty.
Findings
Islamic banks’ returns on assets are significantly more uncertain than conventional banks due to higher operational costs. Consistent with earlier evidence, the study also finds that Islamic banks generally have fewer nonperforming loans than conventional banks. The authors conclude that Islamic banks trade-off between reducing credit risk and escalating business risk.
Originality/value
This study documents that the Islamic banking model helps build a safer asset portfolio but gives rise to the uncertainty of corporate earnings. Therefore, the choice between Islamic and conventional banking models involves a trade-off between credit and business risks. It is a new finding that we add to the literature body on Islamic finance.
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Shabiha Akter, Md Hamid Uddin and Ahmad Hakimi Tajuddin
Performance assessment of microfinance institutions (MFIs) has long been a question of considerable research interest. The dual goals – financial performance and social…
Abstract
Purpose
Performance assessment of microfinance institutions (MFIs) has long been a question of considerable research interest. The dual goals – financial performance and social performance of MFIs widely studied yet remain unsolved in the existing literature. To assess the knowledge structure of research in this area and to aid future research, we review the literature with bibliometric analysis.
Design/methodology/approach
Our study has used bibliographic data of 1,252 scientific documents indexed in the Scopus database from 1995 to 2020 (June 05). We have used the “bibliometrix” package in R language to analyze the data and illustrate the findings.
Findings
We find that there has been an increasing trend in publications, especially from 2006 onwards. Various bibliometric indicators allow us to follow the progression of knowledge along with identifying the most contributing and impactful authors, publication sources, institutions and countries. We illustrate the major research themes and identify that “poverty alleviations”, “group lending” and “credit scoring” are the major emerging and specialized themes besides the basic research evolved around “microfinance” or “microcredit”. Our further analysis of thematic evolution over different time frames reveals that “financial performance” aspect is getting more attention in recent times in evaluating the performance of MFIs.
Originality/value
The insights of knowledge accumulated from our bibliometric review and thematic analysis provide researchers with an efficient comprehension of the advancement of the research on microfinance performance and offer avenues for future scientific endeavors.
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Negative relationship between the return of a stock and its liquidity suggests that the illiquid stocks are riskier than liquid stocks. Thus, researchers tend to include the stock…
Abstract
Purpose
Negative relationship between the return of a stock and its liquidity suggests that the illiquid stocks are riskier than liquid stocks. Thus, researchers tend to include the stock liquidity as a variable in asset pricing models, where the stock and market liquidities are usually considered as independent. The purpose of this paper is to reexamine the relationship between the return of a stock and its liquidity by using a relative measure that links the individual stock liquidity with market‐wide liquidity.
Design/methodology/approach
Multivariate regressions are employed to examine the effect of relative market liquidity on the stock return while controlling the effects of other factors.
Findings
Negative relationship between the stock return and liquidity is confirmed, but the relationship is not linear. It is found that the relative measure of liquidity is not a substitute, but complement to other liquidity measures used in prior studies. It is also found that fluctuation in relative stock liquidity does not positively affect the return.
Research limitations/implications
The study is conducted on New York Stock Exchange and American Stock Exchange exchanges using monthly data. The robustness tests using the daily or weekly data are not conducted.
Practical implications
Findings may suggest that investors do not seriously concern about the fluctuations of individual stock liquidity, provided that the stock liquidity is higher than the average market liquidity.
Originality/value
For the first time, the liquidity risk is tested using a relative measure instead of an absolute measure. Since fluctuation in stock liquidity does not positively affect the return, a new question arises whether the variability in liquidity can reflect the liquidity risk.
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Hung Son Tran, Thanh Dat Nguyen and Thanh Liem Nguyen
The purpose of this study is to carry out an empirical investigation about how the level of market concentration or competitiveness of the banking system and institutional quality…
Abstract
Purpose
The purpose of this study is to carry out an empirical investigation about how the level of market concentration or competitiveness of the banking system and institutional quality are associated with bank’s financial stability.
Design/methodology/approach
This study uses dynamic panel data techniques on the sample of 133 developing and emerging countries over the years 2002–2020.
Findings
The authors document several significant findings. First, there is evidence that bank stability is positively associated with the level of market concentration. The result is in line with the concentration–stability view that banks operating in a more concentrated market tend to be more stable than those in a less concentrated market. Second, the results confirm that the quality of the institutional environment plays a critical role in improving the stability of banks in developing and emerging countries. Third, the authors find that institutional development can moderate the effect of market concentration (or competitiveness of the banking system) on bank stability. Specifically, the results show that better institutional quality enhances the positive influence of bank concentration on the bank’s financial stability in developing and emerging countries. These results are robust to different specifications with the alternative measures of bank stability and market concentration.
Originality/value
This study provides further understanding regarding the effects of the level of market concentration or competitiveness of the banking system and institutional quality on bank stability in 133 developing and emerging countries over the years 2002–2020.
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Mohammad Jashim Uddin, Md. Tofael Hossain Majumder, Aklima Akter and Rabaya Zaman
This paper aims to explore the effects of bank diversification (i.e. diversification of income and diversification of assets) on Bangladeshi banks’ profitability.
Abstract
Purpose
This paper aims to explore the effects of bank diversification (i.e. diversification of income and diversification of assets) on Bangladeshi banks’ profitability.
Design/methodology/approach
Using a dynamic panel data model with system generalized methods of moments, the authors examine an unbalanced panel data from 32 banks spanning 318 bank-year observations from 2007 to 2016.
Findings
The findings indicate a significant positive association of income diversification and asset diversification on bank profitability. Therefore, the results show that banks can generate profit from diversification of income and diversification of assets.
Originality/value
One of the rare attempts to investigate the relationship between diversification and profitability in Bangladesh’s banking sector is this report. The authors anticipate the results to have major consequences for Bangladeshi bank regulators and other related economies.
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The objective of this chapter is to discuss how different techniques in Regional Science and Peace Science and the emerging techniques in Management Science can be used in…
Abstract
The objective of this chapter is to discuss how different techniques in Regional Science and Peace Science and the emerging techniques in Management Science can be used in analysing Disaster Management and Global pandemic with special reference to developing countries. It is necessary for me to first discuss the subjects of Disaster Management, Regional Science, Peace Science and Management Science. The objective of this chapter is to emphasise that the studies of Disaster Management should be more integrated with socioeconomic and geographical factors. The greatest disaster facing the world is the possibility of war, particularly nuclear war, and the preparation of the means of destruction through military spending.
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Md Tarikul Islam, Mia Mahmudur Rahim and Sanjaya Chinthana Kuruppu
This paper examines the link between the failure of public accountability and stakeholder disengagement brought about by a New Public Management (NPM) style “smart solution”…
Abstract
Purpose
This paper examines the link between the failure of public accountability and stakeholder disengagement brought about by a New Public Management (NPM) style “smart solution” introduced to reduce public urination in Dhaka city. It shows how New Public Governance (NPG), Islamic and dialogic approaches can improve decision-making and solutions.
Design/methodology/approach
Drawing on the concepts of public accountability, NPM, NPG and dialogic accountability, this study highlights how narrow conceptions of accountability and poor stakeholder engagement impacted the effectiveness of the “smart solution” based on data collected through observation and unstructured in-depth interviews.
Findings
Evidence suggests that narrow conceptions of accountability driven by monologic NPM perspectives led to poor stakeholder engagement, which impacted the effectiveness of the “smart solution”. The solution that consists of changing anti-urination signage from Bengali to Arabic script has not solved Dhaka's public urination problem. In many instances, the solution has disenchanted certain stakeholders who view it as an offence against Islam and a confusing de-privileging of the Bengali language which has significant national and cultural value in Bangladesh.
Originality/value
The findings of the study contribute to policymaking discussions on how to effectively engage with stakeholders and extend the literature on accountability within the context of conflicting public versus private demands related to a public nuisance. The study outlines important issues related to stakeholder engagement and introduces a framework that conceptualises how to increase the effectiveness of public policy decisions using NPG, Islamic and dialogic accountability approaches, especially on matters that require significant public/external stakeholder support. It also provides a conceptual integration of these various approaches, including nuanced insights into accountability challenges within “non-Western” contexts.
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Md. Kausar Alam, Md. Mizanur Rahman, Fakir Tajul Islam, Babatunji Samuel Adedeji, Md. Abdul Mannan and Mohammad Sahabuddin
The purpose of this study is to explore the practices of Shariah governance (SG) systems in terms of their guidelines, current operational procedures, internbal policies and…
Abstract
Purpose
The purpose of this study is to explore the practices of Shariah governance (SG) systems in terms of their guidelines, current operational procedures, internbal policies and structures and regulatory framework of Islamic banks in Bangladesh from the viewpoints of Shariah, Tawhidic approach/ontological approach and Shuratic process of Islamic corporate governance and institutional theory.
Design/methodology/approach
A semi-structured interview tactic has been applied to attain the objective. Overall, data has been collected from the regulators, Shariah supervisory board members, Shariah department executives and experts from the central bank and Islamic banks of Bangladesh.
Findings
The study finds that Islamic banks do not follow complete Shariah principles in all aspects of SG nor violate them fully in their overall functions due to less accountability, which contradicts the concept of the Tawhidi epistemological process of Islamic corporate governance. Islamic banks announce that they are following Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI) guidelines, but in practice, they do not follow the instructions accurately because all of the standards and policies of AAOIFI and the Islamic Financial Services Board are not applicable in Bangladesh due to its cultural, legal and regulatory structures. It is found that Islamic banks in Bangladesh have a lower practice of maqasid as-Shariah and Tawhidic approach and Shuratic process.
Research limitations/implications
The study significantly contributed to the central bank of Bangladesh and Islamic banks by exploring the SG systems for their further enhancement. The research provides some suggestions for improving existing SG systems and enhancing more application of SG guidelines and Shariah principles in the overall operations of the Islamic banks in Bangladesh.
Originality/value
This research extends the literature regarding the Islamic banks’ SG practices in Bangladesh. The study also contributes to Shariah, Tawhidic approach/ontological approach and Shuratic process of Islamic corporate governance and institutional theory by exploring the Islamic banks’ existing SG practices in Bangladesh.