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Corporate Finance and Business Administration in Sustainability

A special issue of Sustainability (ISSN 2071-1050). This special issue belongs to the section "Economic and Business Aspects of Sustainability".

Deadline for manuscript submissions: 20 April 2024 | Viewed by 5503

Special Issue Editor

Department of Finance, Western University, London, ON, Canada
Interests: empirical corporate finance; corporate governance; executive compensation; CSR
Special Issues, Collections and Topics in MDPI journals

Special Issue Information

Dear Colleagues,

Corporate finance is becoming central to business administration in sustainability. The corporate finance functions support every aspect of business policies, practices and decisions regarding sustainability and corporate social responsibility. An awareness and understanding of corporate finance and business administration in sustainability is essential to succeed as an executive. This Special Issue will focus on corporate finance, which either helps businesses succeed or fail.

In this Special Issue, original research articles and reviews on all areas of corporate finance are welcome. Research areas may include, but are not limited to, the following: financial structure, governance, compensation and incentive, payout, innovation, risk management, financial contracting, green finance and international finance.

I look forward to receiving your contributions.

Dr. Frank Li
Guest Editor

Manuscript Submission Information

Manuscripts should be submitted online at www.mdpi.com by registering and logging in to this website. Once you are registered, click here to go to the submission form. Manuscripts can be submitted until the deadline. All submissions that pass pre-check are peer-reviewed. Accepted papers will be published continuously in the journal (as soon as accepted) and will be listed together on the special issue website. Research articles, review articles as well as short communications are invited. For planned papers, a title and short abstract (about 100 words) can be sent to the Editorial Office for announcement on this website.

Submitted manuscripts should not have been published previously, nor be under consideration for publication elsewhere (except conference proceedings papers). All manuscripts are thoroughly refereed through a single-blind peer-review process. A guide for authors and other relevant information for submission of manuscripts is available on the Instructions for Authors page. Sustainability is an international peer-reviewed open access semimonthly journal published by MDPI.

Please visit the Instructions for Authors page before submitting a manuscript. The Article Processing Charge (APC) for publication in this open access journal is 2400 CHF (Swiss Francs). Submitted papers should be well formatted and use good English. Authors may use MDPI's English editing service prior to publication or during author revisions.

Keywords

  • corporate finance
  • business administration
  • capital structure
  • corporate governance
  • executive compensation
  • compensation incentives
  • risk management
  • green finance
  • CSR
  • ESG

Published Papers (5 papers)

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Research

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13 pages, 285 KiB  
Article
Determinants of the Capital Structure of the Oil and Gas Industry in Malaysia: The Moderating Role of Earnings Volatility
Sustainability 2023, 15(24), 16568; https://doi.org/10.3390/su152416568 - 05 Dec 2023
Viewed by 653
Abstract
This paper examines the relationship between firm-specific factors and the capital structure of the oil and gas (O&G) industry in Malaysia.. In addition, this paper adds to the literature by investigating the moderating effect of earnings volatility on the relationship between firm-specific factors [...] Read more.
This paper examines the relationship between firm-specific factors and the capital structure of the oil and gas (O&G) industry in Malaysia.. In addition, this paper adds to the literature by investigating the moderating effect of earnings volatility on the relationship between firm-specific factors and capital structure. Random effect models with cluster-robust standard errors were used to analyze this relationship. Using the secondary data from 30 O&G firms listed on the main market of Bursa Malaysia collected between 2010 and 2019 (10 years), the results show that profitability, asset tangibility, liquidity, and firm size significantly impact the capital structure of the O&G industry in Malaysia. However, growth opportunities, non-debt tax shields, and firm age had no significant impact. In addition to this, earnings volatility significantly moderated the relationship between asset tangibility and leverage. In short, when earnings volatility acts as a moderating variable, the relationship between asset tangibility, which is otherwise positive without moderation, turns negative. This study is useful for policymakers in the O&G industry in Malaysia and will help their managers to decide on capital structure for sustainable growth. Full article
(This article belongs to the Special Issue Corporate Finance and Business Administration in Sustainability)
16 pages, 690 KiB  
Article
Examining the Sustainability of Contributions of Competing Core Organizational Capabilities in Response to Systemic Economic Crises
Sustainability 2023, 15(5), 4526; https://doi.org/10.3390/su15054526 - 03 Mar 2023
Cited by 1 | Viewed by 928
Abstract
A dynamic capability view is used in this study to explain how organizational capabilities operate effectively and efficiently in stable environments and respond dynamically to changing conditions in their operating environments. Such capabilities enable organizations to both create and sustain their performance. When [...] Read more.
A dynamic capability view is used in this study to explain how organizational capabilities operate effectively and efficiently in stable environments and respond dynamically to changing conditions in their operating environments. Such capabilities enable organizations to both create and sustain their performance. When faced with a systemic change in the environment, such as a global economic crisis, organizational capabilities may no longer contribute effectively to sustain organizational performance or their survival. In this study, we examine the effectiveness and sustainability of organizational capabilities in response to a systemic economic crisis. We do so through examining these issues in a broad multiyear sample of U.S. credit unions through the global financial crisis. In this context, organizations utilized two types of competing capabilities: explorative capabilities to increase revenues and/or exploitative capabilities to reduce expenses. The effectiveness of these capabilities and the sustainability of the resulting performance implications of their combined deployment remains under-theorized and insufficiently examined, particularly under conditions of high economic uncertainty. We examine these issues using a sample of 1127 large U.S. credit unions collecting comparative data during a period of economic stability from 2001 to 2004 and during a period of economic instability from 2006 to 2009, before and after the 2008 global financial crisis. We perform multiple regression analysis to examine the contributions and sustainability of organizational capabilities to relative performance. Interestingly, we find that in stable times, the explorative capability to increase revenues appears to contribute more to performance, while in the crisis period, the exploitative capability to reduce expenses appears to contribute more to performance. Further, the combined effect of deploying both “competing” capabilities simultaneously is related to performance only when the environment is stable and can be detrimental during a crisis. The results suggest that using expense decreasing capabilities (but not revenue increasing capabilities or both combined) is better when facing an economic crisis. Full article
(This article belongs to the Special Issue Corporate Finance and Business Administration in Sustainability)
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19 pages, 622 KiB  
Article
Managing Information Sensitivity: The Relationship between the Interbank Offered Rate and the Characteristics of Bank-Issued Wealth Management Products in China
Sustainability 2023, 15(2), 1392; https://doi.org/10.3390/su15021392 - 11 Jan 2023
Viewed by 1189
Abstract
Unlike previous studies that focused on measures and changes in debts’ information sensitivity, this paper examines how banks in China manage the information sensitivity of wealth management products (WMPs), one of the most important assets in Chinese shadow banking. Employing the interbank offered [...] Read more.
Unlike previous studies that focused on measures and changes in debts’ information sensitivity, this paper examines how banks in China manage the information sensitivity of wealth management products (WMPs), one of the most important assets in Chinese shadow banking. Employing the interbank offered rate to proxy investors’ incentives for private information production, we find when the interbank offered rate rises for newly issued WMPs, banks shorten their maturity, provide them with more guarantees, and reduce the risk of their underlying assets. Moreover, these effects are more pronounced in small and medium-sized banks (SMBs) relative to the largest five state-owned (Big5) banks. Furthermore, we also find that banks reduce the number of WMPs issued to institutional investors when the interbank offered rate rises, and this effect exists in both Big5 banks and SMBs. Our findings suggest that banks adjust the characteristics of WMPs to maintain WMPs’ information insensitivity when investors’ incentives to produce private information increase. These results also indicate that there is less need for Big5 banks to adjust WMPs’ characteristics since individual investors consider WMPs issued by Big5 to be safer and thus to have less incentive to produce private information. However, institutional investors understand WMPs’ risks better and, therefore, all banks reduce the number of issues to them when the interbank rate rises. Full article
(This article belongs to the Special Issue Corporate Finance and Business Administration in Sustainability)
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21 pages, 403 KiB  
Article
Human Resources, Investor Composition and Performance of Venture Funds: Focused on the Stakeholders of Venture Funds
Sustainability 2022, 14(24), 16773; https://doi.org/10.3390/su142416773 - 14 Dec 2022
Viewed by 921
Abstract
This study aims to understand the effect of the human resources and investor composition of venture funds on fund performances in Korea. It was conducted on 235 venture funds and revealed that the fund manager retention period, retention rate and investors’ number affected [...] Read more.
This study aims to understand the effect of the human resources and investor composition of venture funds on fund performances in Korea. It was conducted on 235 venture funds and revealed that the fund manager retention period, retention rate and investors’ number affected fund performance. Blind funds showed the same results with overall funds, whereas project funds, performance was affected only by the fund manager retention period. Funds operated by general partners, which manpower is not major shareholders, showed the same result as the overall ones. This study provides the basis for government planning venture policies and investors establishing funds’ evaluation criteria. Full article
(This article belongs to the Special Issue Corporate Finance and Business Administration in Sustainability)
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Review

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44 pages, 1350 KiB  
Review
Understanding the Relevance of Sustainability in Mergers and Acquisitions—A Systematic Literature Review on Sustainability and Its Implications throughout Deal Stages
Sustainability 2024, 16(2), 613; https://doi.org/10.3390/su16020613 - 10 Jan 2024
Viewed by 885
Abstract
The importance of transforming business models and activities toward a sustainable economy is more urgent than ever and manifests in the adoption of international agreements and regulatory initiatives. Company transactions, including mergers and acquisitions (M&A), need to pay attention to sustainability concepts and [...] Read more.
The importance of transforming business models and activities toward a sustainable economy is more urgent than ever and manifests in the adoption of international agreements and regulatory initiatives. Company transactions, including mergers and acquisitions (M&A), need to pay attention to sustainability concepts and their implications. Consequently, the current and traditional literature on M&A processes acknowledges the role of sustainability as a prerequisite for success in M&A operations. However, reviews of the relationship between sustainability and M&A from an integrative perspective that highlight the pre- and post-deal stages are limited. To bring further transparency to this context, we perform a systematic review of the academic literature on the relevance and implications of sustainability in M&A, focusing on archival studies. We present an overview of major sustainability influences at different stages of the M&A process, using the perspective of the acquirer as well as the target of sustainability. We observe that in all analyzed pre- and post-deal stages, sustainability is identified as having an impact or being impacted by M&A activities. Accordingly, practitioners’ strategic consideration of sustainability for deal origination and performance is required. Furthermore, we highlight several understudied factors and create a research agenda, as research findings are, to some extent, heterogeneous and limited. Full article
(This article belongs to the Special Issue Corporate Finance and Business Administration in Sustainability)
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