The aim of this paper is to investigate the association of earnings quality with corporate performance of publicly listed firms of China and tries to provide a new explanation…
Abstract
Purpose
The aim of this paper is to investigate the association of earnings quality with corporate performance of publicly listed firms of China and tries to provide a new explanation. Poor earnings quality is normally characterized by unhealthy profitability and/or untrue financial information, which leads to a misallocation of capital and low corporate performance. The largest emerging economy of China has experienced a fast and fluctuant growth, while the companies have been thought of low earnings quality.
Design/methodology/approach
Initial univariate and multivariate analyses are conducted using four earnings quality measures and either accounting-based corporate performance or market-based corporate performance. Further analyses apply unmanaged earnings, earnings-increase management and financially distressed firms.
Findings
The authors find that low earnings quality is associated with high corporate performance for the Chinese publicly listed firm in their sample period. Further evidence shows that earnings management is only a contributor to the negative relationship, not its main driver. They argue that the negative association of earnings quality with corporate performance is a phenomenon of a new emerging market within an economy booming period, particularly in China.
Research limitations/implications
The results and argument of this paper may not totally follow the traditional literature. But they provide a new research question that requires further studies.
Originality/value
In theoretical discussion, this paper partitions earnings quality into two components: One results from reporting accuracy and the other results from firm’s operating outcome. In empirical analyses, this paper examines both accounting-based performance and market-based performance, and both managed earnings and unmanaged earnings.
Details
Keywords
Diyan Lestari, Shiguang Ma and Aelee Jun
The financial sector's resilience is associated with greater prosperity and a better average income. Banks have evolved their business model and diversified their sources of…
Abstract
Purpose
The financial sector's resilience is associated with greater prosperity and a better average income. Banks have evolved their business model and diversified their sources of income, and bank digitalization has become one of the prominent strategies. The purpose of this study is to examine how bank service expansion represented by revenue diversification activities and digital strategy will enhance bank stability in ASEAN countries from 2010 to 2021.
Design/methodology/approach
This study uses information from the Datastream database and banks’ annual reports to measure bank stability, diversification and market power, which also provide information for bank digital strategy. This study uses the two-step system generalized method of moments to investigate the effect of diversification and digitalization on bank stability in ASEAN.
Findings
The results of this study show that bank revenue diversification has no effect on bank stability, and the presence of the chief digital officer and digital disclosure improves banks’ stability. However, alliance strategy with financial technology companies does not significantly impact bank stability and might increase bank risk.
Practical implications
The findings of this study provide relevant policy implications: the regulation should support bank business to diversify the source of income; regulators and policymakers should regulate and enhance the Information and Communication Technology infrastructure; and banks should design their strategy comprehensively.
Originality/value
This study provides new evidence of the essential role of digital strategy in enhancing bank stability in ASEAN. In addition, this study also shows how banks diversify their business in a competitive environment.
Details
Keywords
Siwen Song, Adrian (Wai Kong) Cheung, Aelee Jun and Shiguang Ma
This paper aims to empirically examine the impact of mandatory CSR disclosure on the CEO pay performance sensitivity.
Abstract
Purpose
This paper aims to empirically examine the impact of mandatory CSR disclosure on the CEO pay performance sensitivity.
Design/methodology/approach
Using the mandatory requirement of CSR disclosure as an exogenous shock, the authors compare the changes in CEO pay performance sensitivity for treatment firms with control firms through a difference-in-difference (DiD) approach.
Findings
The authors find that mandatory CSR disclosure enhances CEO pay performance sensitivity. The results also show that monitoring CEO power is a conduit through which mandatory CSR disclosure affects CEO pay performance sensitivity. The positive impact is more profound in firms with a powerful CEO, i.e. one who is politically well-connected, holds dual roles as both CEO and Chairman, and/or has had a long tenure. Furthermore, the increased CEO pay performance sensitivity after the mandate is prominent among state-owned enterprises (SOEs) only.
Practical implications
The findings of this paper have implications for other economies with similar institutional backgrounds as China. Although the mandatory CSR disclosure does not require firms to spend on CSR investment, the mandatory CSR disclosure alters firm behaviour, and mitigates agency problems.
Originality/value
This paper contributes to the studies on the impact of CSR disclosure on firms' behaviour. To the authors' knowledge, this is the first study to examine the effects of mandatory CSR disclosure on CEO pay performance sensitivity using the quasi-natural experiment settings.
Details
Keywords
Wenjuan Ruan, Grant Cullen, Shiguang Ma and Erwei Xiang
The authors examine the debt maturity structure of Chinese listed companies during the period when bond market was under-developed and the majority of commercial banks were owned…
Abstract
Purpose
The authors examine the debt maturity structure of Chinese listed companies during the period when bond market was under-developed and the majority of commercial banks were owned by the state. The purpose of this paper is to answer why and how the different ownership control types impact the firms’ preference and accessibility to either long- or short-term debts.
Design/methodology/approach
The univariate analysis was used to test the differences of debt maturity choices for firms grouped by ownership control types, profitability and institutional development. Then, logit regression and ordinary least squares regression were applied to examine the determinants of ownership control types in debt maturity structures.
Findings
Compared to privately controlled firms, state-owned enterprises had greater access to long-term debt and used less short-term debt during the sample period. Evidences also indicate that the on-going financial reform has increased the motivation of banks to consider company profitability in their lending decisions. However, state-owned banks still discriminate private firms in allocation of financial resources, particular in less-developed regions.
Research limitations/implications
Due to the research scope and data limitations, the authors cannot take some factors into consideration, such as collateral, guarantee, credit ranking, financing agreement and leasing obligation.
Originality/value
This study extends the existing literature in three ways. First, the authors investigate the bank discrimination problem into the loan term structure. Second, the authors recognise the effect of financial reform on alleviation in bank discrimination problem. Finally, the authors take the consideration of institutional development of firms’ location areas in their analyses.
Details
Keywords
Yinjia Jiao, Yujie Zhao and Shiguang Wen
Trajectory planning is a core aspect of manipulator operation, directly influencing its performance. This paper aims to introduce a chaotic improved sparrow search algorithm…
Abstract
Purpose
Trajectory planning is a core aspect of manipulator operation, directly influencing its performance. This paper aims to introduce a chaotic improved sparrow search algorithm (CISSA) to optimize hybrid polynomial-interpolated trajectories, enhancing the efficiency and precision of manipulator trajectory planning.
Design/methodology/approach
The proposed approach leverages 3-5-3 polynomial interpolation to construct the motion trajectory of a 6R manipulator. To optimize the trajectory over time, the sparrow search algorithm is enhanced with chaotic mapping, a discoverer dispersion strategy, positional limiting mechanisms and Brownian motion. These enhancements collectively reduce the manipulator’s runtime while meeting operational requirements.
Findings
The proposed method was applied to the AUBO-i5 robot to evaluate its performance. Simulation results demonstrate that CISSA effectively avoids local optima and achieves more accurate solutions compared to similar algorithms. By integrating CISSA into trajectory planning, the robot’s movement time was reduced by 13.99% compared to the original SSA, and the number of algorithm iterations was significantly decreased, ensuring smoother and more efficient task execution in real production.
Originality/value
A CISSA is proposed and applied to the optimal time trajectory planning of the manipulator, verifying the effectiveness and superiority of the algorithm. Experimental results show that CISSA outperforms comparable algorithms by several orders of magnitude in solving manipulator inverse kinematics, significantly enhancing planning efficiency and reducing trajectory planning time.
Details
Keywords
Shiguang Qiu, Yunfei Yang, Xiumin Fan and Qichang He
– The paper aims to propose a systematic approach for human factors (HFs) automatic evaluation for entire maintenance processes in virtual environment.
Abstract
Purpose
The paper aims to propose a systematic approach for human factors (HFs) automatic evaluation for entire maintenance processes in virtual environment.
Design/methodology/approach
First, a maintenance process information model is constructed to map real maintenance processes into computer environment. Next, based on this information model, the automatic evaluation methods for visibility, operation comfort and reachability are presented. All evaluation results are weighted and added up to establish a comprehensive HFs evaluation model. Then, the methods mentioned above are realized as an HFs evaluation module, which is integrated into virtual maintenance simulation platform, software developed by our lab.
Findings
An application in HFs evaluation of repairing hydraulic motor on container spreader is implemented, and an on-site survey is carried out. The comparison between the result from the survey and the result we get using the presented methods shows that our solution can support HFs fast assessment accurately and effectively.
Practical implications
Through evaluating maintenance operation processes, engineers can better analyze and validate the maintainability design of complex equipment, and some potential ergonomic issues can be found and dealt earlier.
Originality/value
The paper contributes to present a systematic approach to achieve HFs fast and accurate evaluation for entire maintenance processes, rather than for a few maintenance postures.
Details
Keywords
Ali Ziaee Bigdeli, Tim Baines, Oscar F. Bustinza and Victor Guang Shi
The need for a holistic framework for studying organisational transformation towards Servitization is implicit. This is particularly relevant as Servitization demands…
Abstract
Purpose
The need for a holistic framework for studying organisational transformation towards Servitization is implicit. This is particularly relevant as Servitization demands consideration of both business model and organisational change. The purpose of this paper is, therefore, to provide an integrative framework that systematically captures and evaluate existing literature on Servitization.
Design/methodology/approach
The aim of the paper has been achieved through three main objectives; comprehensively examine the literature in organisational change management that would assist with the selection of the most effective evaluation framework, classify previous studies against the proposed framework through a systematic literature review methodology and analyse the selected papers and propose research questions/propositions based on the identified gaps.
Findings
Results indicate that there are two somewhat macro opportunities for the Servitization community, namely, stronger infusion of generic theory into the Servitization debate and exploring Servitization in action through the lens of the theoretical framework.
Practical implications
The findings of the paper demonstrate the gaps in the Servitization literature, which indeed require further theoretical/empirical research.
Originality/value
It is discussed the usefulness and practicality of viewing research contributions that are setting out to be either “descriptive” or “prescriptive”. Consequently, the authors have proposed several avenues for future research based on these two viewpoints.
Details
Keywords
This study aims to investigate the relationship between earnings quality and corporate voluntary disclosure among Malaysian listed companies. Moreover, it examines the moderating…
Abstract
Purpose
This study aims to investigate the relationship between earnings quality and corporate voluntary disclosure among Malaysian listed companies. Moreover, it examines the moderating effect of the ownership structure on the relationship between earnings quality and corporate voluntary disclosure.
Design/methodology/approach
This study covers 300 companies listed on Bursa Malaysia. It has used strategic, financial and non-financial information to measure voluntary disclosure; earnings management, persistence and smoothness to measure earnings quality; and institutional and managerial shareholders to measure ownership structure. Hierarchical regression analysis was used to investigate if ownership structure moderates the relationship between earnings quality and corporate voluntary disclosure.
Findings
The results in this work imply that companies with high earnings quality are more likely to disclose voluntary information to help stakeholders. Furthermore, this study provides original evidence that institutional ownership and managerial ownership play a main role as moderating variables that influence management motives toward practices of voluntary disclosure and earnings quality.
Originality/value
Because of the limited number of empirical studies on the relationship between voluntary disclosure and earnings quality, this study fills a gap in the literature by investigating the relationship between them. In addition, a lack of research exists on the effects of ownership structure on the relationship between voluntary disclosure and the earnings quality. Therefore, this study makes an original contribution to the literature by using institutional and managerial ownership as moderating variables to investigate the effects of the ownership structure on the relationship between voluntary disclosure and earnings quality in Malaysian companies.
Details
Keywords
Arif Billah Dar, Aasif Shah, Niyati Bhanja and Amaresh Samantaraya
The purpose of this paper is to estimate the relationship between stock prices and exchange rates of eight Asian countries. The analysis is based on methodologies that possess the…
Abstract
Purpose
The purpose of this paper is to estimate the relationship between stock prices and exchange rates of eight Asian countries. The analysis is based on methodologies that possess the ability to provide a complete representation of data series from both time and frequency perspectives simultaneously. In addition, instead of limiting the analysis to focus on the conditional mean of the response variable y in the regression equation, the authors investigate the extremes of distribution to reveal a range of hidden relationships between these variables.
Design/methodology/approach
Given the limitations of classical methodology of Pearson correlation and least-squares regression, this study estimates the relationship between stock prices and exchange rates through wavelet correlation and cross-correlation to serve as a protocol for different traders who view the market with different time resolutions. In addition, quantile regression technique robust to heteroscedasticity, skewness and leptokurtosis is used to understand the relationship between stock prices and a specified quantile of the exchange rates.
Findings
In accordance with the portfolio balance effect, it is observed that stock prices and exchange rates are negatively correlated at all frequencies. In particular, the negative correlation grows with higher time scales (lower frequency intervals). The findings from quantile regression also suggest that the coefficients are more inclined to be negative when exchange rates are extremely high.
Originality value
The paper contributes to the literature by focussing on the multi-scale relationship between stock prices and exchange rates. In addition, it also analyzes the relationship between stock prices and a specified quantile of the exchange rates.