Research

25 pages, 1595 KiB

Open AccessArticle

Political Connection and Environmental Protection Investment: A Study Based on Ownership Difference

by Yunfei Qi, Chengzhi Niu and Hong He

Sustainability 2023, 15(22), 15982; https://doi.org/10.3390/su152215982 - 15 Nov 2023

Cited by 1 | Viewed by 720

Using data from listed firms in the pollution-intensive industries in China from 2009 to 2019 and taking into account ownership differences, our study examines the causal effect of political connections on environmental protection investment behavior. To deal with the potential endogeneity concern, we [...] Read more.

Using data from listed firms in the pollution-intensive industries in China from 2009 to 2019 and taking into account ownership differences, our study examines the causal effect of political connections on environmental protection investment behavior. To deal with the potential endogeneity concern, we created a quasi-natural experiment based on an anti-corruption campaign in China that prohibited officials from holding business positions. Our results indicate that political connections increase environmental protection investment in state-owned firms, primarily when the politically connected director (is affiliated) participates in the firm’s daily operations. However, in non-state-owned firms, political connections hinder environmental protection investment, and, furthermore, investment decreases as the administration level of the politically connected directors increases. Additionally, we also found that local regulatory intensity strengthens the impact of political connections on environmental protection investment. While the study uses China’s firms as the sample, the findings may also apply to other emerging economies. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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17 pages, 657 KiB

Open AccessArticle

The Impact of Economic Policy Uncertainty on Investment in Real Estate Corporations Based on Sustainable Development: The Mediating Role of House Prices

by Yuanyuan Qu and Aza Azlina Md Kassim

Sustainability 2023, 15(21), 15318; https://doi.org/10.3390/su152115318 - 26 Oct 2023

Viewed by 1304

Abstract

Since the COVID-19 outbreak, the global economy has undergone profound changes, and China’s real estate market has experienced dramatic turbulence. In order to stabilise the national economy during the epidemic, China’s macro-controls on the real estate industry have become more frequent. These regulatory [...] Read more.

Since the COVID-19 outbreak, the global economy has undergone profound changes, and China’s real estate market has experienced dramatic turbulence. In order to stabilise the national economy during the epidemic, China’s macro-controls on the real estate industry have become more frequent. These regulatory policies have kept the uncertainty in China’s economic policies at a high level for almost two years. Therefore, in order to further regulate the real estate market and thus establish a sustainable macro-control mechanism, the purpose of this study is to provide the necessary practical research and policy basis for the real estate market by exploring how economic policy uncertainty and house prices affect the level of corporate investment in real estate development. Based on the theory of real options, financial friction theory and real estate characteristics theory, this paper studies the relationship between economic policy uncertainty and the investment level of real estate developers and further explores the mediating role of house prices. This paper selects the panel data of Shanghai and Shenzhen A-share real estate listed companies in the CSMR database from the first quarter of 2012 to the fourth quarter of 2022 and uses the fixed-effects regression method to identify the following conclusions. Firstly, stronger economic policy uncertainty promotes the investment level of real estate corporations; secondly, the fluctuation of house prices plays a mediating role in the positive effect of economic policy uncertainty on the investment of real estate corporations. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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17 pages, 456 KiB

Open AccessArticle

The Impact of Chief Sustainability Officers on Environmental Performance of Korean Listed Companies: The Mediating Role of Corporate Sustainability Practices

by Nebedum Ekene Ebele, Seong Mi Bae and Jong Dae Kim

Sustainability 2023, 15(20), 14819; https://doi.org/10.3390/su152014819 - 12 Oct 2023

Viewed by 1040

Abstract

Chief sustainability officers and sustainability consultants have become increasingly common today as many organizations have become more aware of their impact on the environment and society at large. With the growing importance of integrating sustainability into business, many firms are appointing chief sustainability [...] Read more.

Chief sustainability officers and sustainability consultants have become increasingly common today as many organizations have become more aware of their impact on the environment and society at large. With the growing importance of integrating sustainability into business, many firms are appointing chief sustainability officers to manage and oversee the sustainability affairs of their firms at various levels. However, very little is known about the chief sustainability officer and the sustainability management team. This study investigates the potential importance of the chief sustainability officer (CSO) and the sustainability management team toward the firm’s environmental performance. Using a sample of Korean-listed companies for the year 2017–2020, this study aims to investigate the relationship between appointment of the chief sustainability officer and a firm’s environmental performance. It also explores the possible mediating role of corporate sustainability practices (CSP) in this relationship, utilizing Baron and Kenny’s method to analyze the mediating role. First, the regression analysis was conducted to assess the impact of the presence and role of CSO on the firm’s environmental performance. Subsequently, the firm’s CSP was then introduced into the regression analysis as a mediator, to evaluate its influence on the relationship between the chief sustainability officer and the firm’s environmental performance. We found that CSP completely mediated the relationship between CSO and environmental performance. This study contributes empirically to the growing literature on the relevance of sustainability management officials and their impacts on the firm’s environmental performance. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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22 pages, 3199 KiB

Open AccessArticle

Industry Volatility and Employment Extreme Risk Transmission: Evidence from China

by Ling Lin, Qiumei Li, Jin Li, Zuominyang Zhang and Xuan Zhong

Sustainability 2023, 15(17), 12916; https://doi.org/10.3390/su151712916 - 26 Aug 2023

Viewed by 895

Abstract

China’s socio-economic growth path aims to achieve full and sustainable employment, which requires an in-depth understanding of the linkages between employment and different industrial sectors within the economic system. The objective of this study is to examine the heterogeneous transmission effects of industry [...] Read more.

China’s socio-economic growth path aims to achieve full and sustainable employment, which requires an in-depth understanding of the linkages between employment and different industrial sectors within the economic system. The objective of this study is to examine the heterogeneous transmission effects of industry fluctuations on the distribution of employment, with special attention to the transmission effects of industry fluctuations on employment under extreme conditions. The research methodology of this paper is to systematically examine the risk spillover effects between industry sectors and employment distribution using the quantile risk spillover model. The results show that industry volatility significantly affects employment volatility in China. The impact of industry volatility is stronger under extreme conditions, both more adverse and favorable than that of under normative conditions. Among labor-intensive industries, the employment impact of skilled labor-intensive and integrated labor-intensive industries is relatively small compared to that of the relatively large impact of manual labor-intensive industries. The results suggest that traditional indicators of the spillover effect, such as the mean-based indicator, cannot accurately capture the source and real effect of risk transmission, leading to unemployment fluctuations, underscoring the need to focus on the heterogeneity of the distribution of employment fluctuations. The findings also present the evolution of the risk transmission structure of employment in China, which provides implications for policymaking on full and sustainable employment. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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17 pages, 606 KiB

Open AccessArticle

Do ESG Ratings of Chinese Firms Converge or Diverge? A Comparative Analysis Based on Multiple Domestic and International Ratings

by Yunfu Zhu, Haoling Yang and Ma Zhong

Sustainability 2023, 15(16), 12573; https://doi.org/10.3390/su151612573 - 18 Aug 2023

Cited by 1 | Viewed by 1727

Abstract

Since the Chinese economy has transitioned to a sustainable model, the Chinese socially responsible investment (SRI) market has expanded rapidly, which has deeply stimulated the development of environmental, social, and governance (ESG) ratings for Chinese firms. Domestic agencies, such as SynTao, Rankins (RKS), [...] Read more.

Since the Chinese economy has transitioned to a sustainable model, the Chinese socially responsible investment (SRI) market has expanded rapidly, which has deeply stimulated the development of environmental, social, and governance (ESG) ratings for Chinese firms. Domestic agencies, such as SynTao, Rankins (RKS), Sino-Securities (SSII), and China Alliance of Social Value Investment (CASVI), and international agencies, such as Bloomberg, FTSE Russell (FTSE), and Morgan Stanley Capital International (MSCI), have launched their own ESG rating systems. These emerging ratings may provide users of information with more diverse references; however, if their results are too divergent, they may also confuse users. To what extent do these ESG rating results in the Chinese market converge or diverge? Aiming to answer this question, we used Hushen 300 index firms in 2019 as the initial sample, and selected 195 firms covered by the above seven ratings for the analysis. Firstly, by comparing the overlap in the top 100 lists of these sample firms, we found that the list overlap rate between each pair of ratings was between 66.36% and 82.35%; however, only 35% of the firms were listed in the top 100 of all seven ratings. Furthermore, the Pearson correlation analysis showed that the correlation coefficients between each pair of ratings ranged from 0.057 to 0.736, and the average was only 0.411. These results suggest a wide divergence in the ESG rating results for Chinese firms. We suggest that information users need to consider a more diverse and comprehensive perspective when utilizing these ratings. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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23 pages, 329 KiB

Open AccessArticle

Industrial Agglomeration and Corporate ESG Performance: Empirical Evidence from Manufacturing and Producer Services

by Xuemeng Guo, Ke Guo and Lingpeng Kong

Sustainability 2023, 15(16), 12445; https://doi.org/10.3390/su151612445 - 16 Aug 2023

Viewed by 1111

Abstract

Global climate change has emerged as a persistent global crisis. Under the dual pressures of industrial structure upgrading and ecological environment improvement, enhancing enterprise ESG (Environmental, Social, and Governance) performance can contribute to achieving sustainable development of the global economy. Selected a sample [...] Read more.

Global climate change has emerged as a persistent global crisis. Under the dual pressures of industrial structure upgrading and ecological environment improvement, enhancing enterprise ESG (Environmental, Social, and Governance) performance can contribute to achieving sustainable development of the global economy. Selected a sample of 285 prefecture-level cities in China from 2005 to 2020 and panel data of listed companies to empirically examine the impact of industrial agglomeration on corporate ESG performance and its heterogeneity effects. We found that industrial agglomeration generally positively affects corporate ESG performance, with the significant promotion of ESG performance in manufacturing and a “U”-shaped relationship between producer services. Influence channel analysis found that industrial agglomeration acts on corporate ESG performance through the micro-transmission mechanisms of financing constraints, investment levels, market competitiveness, and internal control. Heterogeneity research found that the impact of manufacturing agglomeration on corporate ESG performance is more significant in capital-intensive and high-end technology industries, while producer service agglomeration has a more significant effect on ESG performance for knowledge-intensive industries. This study contributes to a better understanding of the microeconomic consequences of industrial agglomeration and expands the research perspective on the internal mechanisms and external incentives of corporate ESG performance. It provides a basis for local governments to analyze the different characteristics and microeconomic consequences of industrial agglomeration and provide empirical evidence for listed companies to adjust their ESG performance structure dynamically. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

20 pages, 488 KiB

Open AccessArticle

Does Enterprise Internal Control Improve Environmental Performance—Empirical Evidence from China

by Lijuan Tao, Xiaoju Wei and Wenjing Wang

Sustainability 2023, 15(13), 10199; https://doi.org/10.3390/su151310199 - 27 Jun 2023

Cited by 1 | Viewed by 1478

Abstract

Enterprises are key actors in green governance. Many studies have analyzed the factors that affect corporate environmental performance, but the impact of internal control on environmental performance has not been investigated yet. China’s innovative internal control policies make this issue more meaningful for [...] Read more.

Enterprises are key actors in green governance. Many studies have analyzed the factors that affect corporate environmental performance, but the impact of internal control on environmental performance has not been investigated yet. China’s innovative internal control policies make this issue more meaningful for research. Unlike the general practices of developed market economy countries or regions which require enterprises to evaluate and disclose the effectiveness of internal control over financial reporting, China’s policy focuses on multi-objective internal control. Using the instrumental variables regression method, this paper employs a moderated mediation model to study the relationship between internal control and environmental performance. This paper takes listed companies on the Shanghai and Shenzhen Stock Exchanges from 2013 to 2021 as the sample. Empirical results show that high-quality internal control is conducive to enhancing environmental performance, while the level of enterprise digitalization plays a mediating role in the relationship between the two, and ownership type moderates the effects of internal control on environmental performance. The conclusion indicates that China’s internal control policy is of great significance for the green development of enterprises. Our study contributes to the literature on both the factors affecting environmental performance and the economic consequences of internal control. The study findings can be beneficial for managers in corporations, internal control policymakers and environmental regulators. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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26 pages, 9908 KiB

Open AccessArticle

Mapping the Themes Underlying the Literature on Cross-Listing of Shares—A Contemporary Corporate Strategy of Sustainable Growth

by Qiuyuan Lei, Muhammad Umer Quddoos Attari, Mustansar Hayat, Muhammad Munir Ahmad, Abdul Haseeb and Amir Rafique

Sustainability 2023, 15(12), 9316; https://doi.org/10.3390/su15129316 - 09 Jun 2023

Cited by 1 | Viewed by 1161

Abstract

In the current era of globalization, cross-listing literature has been growing as a tool to achieve sustainable growth and provide policy implications for multinationals, international investors, and regulators. This research explores the three themes—influential aspects, intellectual structure, and conceptual structure—that underpin the growing [...] Read more.

In the current era of globalization, cross-listing literature has been growing as a tool to achieve sustainable growth and provide policy implications for multinationals, international investors, and regulators. This research explores the three themes—influential aspects, intellectual structure, and conceptual structure—that underpin the growing cross-listing-based literature published in the Web of Sciences until July 2020. This study used bibliometric coupling to segregate the research front of cross-listing and then studied each theme’s conceptual structure and influential aspects separately. The analysis revealed that the cross-listing literature could be divided into three clusters: (1) price discrepancies and stock returns related to asymmetric information and market efficiencies, (2) earnings quality, earnings management, and the adoption of accounting standards, and (3) cross-listing benefits covering the growth, informativeness, and liquidity. For instance, our analysis identifies the impact of cross-listing on local market developments regarding trading volume and liquidity, secondly the benefits of financial market liberalization for cross-listing, particularly regarding the cost of capital, and thirdly the variation in abnormal returns after cross-listing with changing risk exposure, shareholding base, and amount of money raised. This research also proposes a future research agenda for the advancement of each cluster of cross-listing identified. The outcomes of this literature review will provide valuable information to practitioners and researchers and help them to further understand the broad perspective and prospects of cross-listing. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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22 pages, 1076 KiB

Open AccessArticle

Non-Financial Disclosure: Isomorphism Effect in the Face of New Regulation

by Igor Álvarez-Etxeberria, Miguel Marco-Fondevila and Constancio Zamora-Ramírez

Sustainability 2023, 15(11), 8493; https://doi.org/10.3390/su15118493 - 23 May 2023

Viewed by 1369

Abstract

The purpose of this paper is to study the mimetic isomorphism process among firms in a context of expectations of further non-financial disclosure regulation. From the new institutionalism theory approach, we study the effect that the 2014/95/EU Directive transposition into the Spanish law [...] Read more.

The purpose of this paper is to study the mimetic isomorphism process among firms in a context of expectations of further non-financial disclosure regulation. From the new institutionalism theory approach, we study the effect that the 2014/95/EU Directive transposition into the Spanish law had on 120 companies over an eight-year period and the isomorphism determined by their activity and leadership in reporting before (expectations period) and after the law enactment. Before the law, a trend to increase disclosure was observed, especially among environmentally sensible sectors and low-level reporting firms, while afterwards, the trend was reversed except for leading companies, highlighting the prevalence of the mimetic and normative isomorphism. This work deepens understanding of the adoption processes of coercive norms based on mimetic behaviors and coercive isomorphisms and helps in predicting the effect of a given norm after its announcement and approval, supporting more efficient designs for future legislation. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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20 pages, 993 KiB

Open AccessArticle

Local Digital Economy and Corporate Social Responsibility

by Yong Hu and Qian Liu

Sustainability 2023, 15(11), 8487; https://doi.org/10.3390/su15118487 - 23 May 2023

Cited by 3 | Viewed by 1651

Abstract

Utilizing the entropy evaluation approach to construct a local digital economy index, this paper investigates the influence of digital economy development on corporate social responsibility (CSR) using a sample of Chinese listed firms from 2011 to 2020. Our findings indicate that the development [...] Read more.

Utilizing the entropy evaluation approach to construct a local digital economy index, this paper investigates the influence of digital economy development on corporate social responsibility (CSR) using a sample of Chinese listed firms from 2011 to 2020. Our findings indicate that the development of the digital economy can facilitate enterprise digital transformation, enhance agency efficiency, and increase online media attention, thereby significantly promoting CSR performance for local firms. Further analysis shows that the local digital economy has varying impacts on distinct dimensions of CSR, with more pronounced effects observed among state-owned enterprises, firms in secondary industries, large-scale and non-digital firms. Overall, these findings suggest that the development of the digital economy fosters the willingness of firms to engage in CSR, resulting in a favorable interaction between firms and stakeholders. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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15 pages, 742 KiB

Open AccessArticle

Driving Change towards Sustainability in Public Bodies and Civil Society Organisations: Expert Interviews with UK Practitioners

by Nicola Andreij Rieg, Birgitta Gatersleben and Ian Christie

Sustainability 2023, 15(10), 8292; https://doi.org/10.3390/su15108292 - 19 May 2023

Cited by 1 | Viewed by 1061

Abstract

While public bodies and civil society organisations play an important role in the transition towards a more sustainable society, there has been very limited research on how to make these institutions more sustainable. Therefore, the purpose of this study is to generate insights [...] Read more.

While public bodies and civil society organisations play an important role in the transition towards a more sustainable society, there has been very limited research on how to make these institutions more sustainable. Therefore, the purpose of this study is to generate insights on processes and patterns of change towards sustainability, and to identify effective practices that might be transferred and adapted to different institutional contexts. The research followed an organisational change framework and a qualitative exploratory design. Six semi-structured interviews were conducted with experienced sustainability practitioners working at leading organisations in the UK. Thematic analysis of the data revealed three overarching themes: knowledge and reflection, support and engagement, and driving and enabling change. From this, a framework for effective practice was developed, highlighting the importance of (i) explicitly linking organisational understanding to working practices through frequent and deliberate reflection; (ii) developing a support base that provides expertise and legitimacy; and (iii) using context-specific strategies for implementing planned changes, as well as supporting emergent change throughout organisational sub-systems. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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27 pages, 1005 KiB

Open AccessArticle

The Impact of Carbon Emission Trading Policy on Enterprise ESG Performance: Evidence from China

by Yadu Zhang, Yiteng Zhang and Zuoren Sun

Sustainability 2023, 15(10), 8279; https://doi.org/10.3390/su15108279 - 19 May 2023

Cited by 4 | Viewed by 3022

Abstract

The carbon emission trading system profoundly impacts enterprises’ sustainable development as an important market incentive environmental regulation tool. Through data collected from Chinese A-share listed enterprises in Shanghai and Shenzhen from 2011 to 2019 and Bloomberg ESG score data, this paper empirically analyses [...] Read more.

The carbon emission trading system profoundly impacts enterprises’ sustainable development as an important market incentive environmental regulation tool. Through data collected from Chinese A-share listed enterprises in Shanghai and Shenzhen from 2011 to 2019 and Bloomberg ESG score data, this paper empirically analyses the impact of carbon emission trading policy on enterprise ESG performance and its channel mechanism using the difference-in-difference (DID) method. Results of this study indicate that carbon emission trading policy improves enterprise ESG performance significantly, and robustness tests confirm these findings. Carbon emission trading policy can encourage enterprises to enhance their R&D investments and promote internal controls, ultimately enhancing their ESG performance. Additionally, carbon emission trading policy positively impacts ESG performance in low-carbon enterprises, enterprises where the CEO is separated from the company, enterprises with a high degree of digital transformation, and enterprises receiving high government subsidies. This paper extends our research into the economic implications of carbon emission trading policy, enriching the literature on market-based environmental regulation policies’ impact on enterprise ESG performance. With respect to governments’ use of carbon emission trading to regulate enterprises environmentally, this paper provides theoretical guidance. It has significant practical implications for improving enterprise ESG performance and sustainability. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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16 pages, 298 KiB

Open AccessArticle

Association between Earnings Announcement Behaviors and ESG Performances

by Joonhyun Kim and Yunkyeong Lee

Sustainability 2023, 15(9), 7733; https://doi.org/10.3390/su15097733 - 08 May 2023

Viewed by 1573

Abstract

Despite the rapidly growing interest in ESG business management, it is not easily attainable for stakeholders to accurately assess the quality of the ESG activities of a firm due to several problems, including the exaggeration or greenwashing of the real ESG performance. This [...] Read more.

Despite the rapidly growing interest in ESG business management, it is not easily attainable for stakeholders to accurately assess the quality of the ESG activities of a firm due to several problems, including the exaggeration or greenwashing of the real ESG performance. This study investigates whether managerial opportunism, as revealed by earnings announcement behaviors, can be utilized as a hallmark to forecast the quality of ESG performance. Based on the tests using Korean firms, the empirical results show that opportunistic behaviors for earnings announcement announcements, such as the announcement on Friday, after market closing, and omitting preliminary earnings disclosure, are all negatively associated with the ESG performance score on an individual and also collective basis. Further analysis shows that firms with opportunistic strategies for earnings announcement tend to miss the disclosure on ESG activities as well. In sum, this study contributes to future research and policy-making by suggesting a new practical approach to analyzing the earnings announcement behaviors as a quick test to verify the corporate ESG performance. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

16 pages, 457 KiB

Open AccessArticle

The Moderating Role of Digital Environmental Management Accounting in the Relationship between Eco-Efficiency and Corporate Sustainability

by Abeer M. Abdelhalim, Nahla Ibrahim and Mohammed Alomair

Sustainability 2023, 15(9), 7052; https://doi.org/10.3390/su15097052 - 23 Apr 2023

Cited by 6 | Viewed by 1793

Abstract

In response to concerns about environmental issues and the role of manufacturing corporations in maintaining eco-efficiency, this study aimed to investigate the moderating role of digitally supported environmental management accounting (EMA) in the relationship between eco-efficiency and corporate sustainability performance. A quantitative approach [...] Read more.

In response to concerns about environmental issues and the role of manufacturing corporations in maintaining eco-efficiency, this study aimed to investigate the moderating role of digitally supported environmental management accounting (EMA) in the relationship between eco-efficiency and corporate sustainability performance. A quantitative approach was applied by using a survey distributed to a sample consisting of 77 individuals from senior and executive financial and operational positions in large Saudi manufacturing corporations. The findings of the linear regression analysis revealed that there is an insignificant direct relationship between eco-efficiency and corporate sustainability performance, while there is a significant moderating impact of EMA on the linkage between eco-efficiency and corporate environmental sustainability, and this significant moderating impact also applied to the linkage between digital applications and corporate environmental sustainability. This study provides good insights into the domain of environmental sustainability performance on the business scale in the Saudi context as an emerging economy, as it could be considered an innovative contribution to theoretical and practical aspects in the recent green issue adoption context; theoretically, it provides additional evidence of the role of digital EMA in improving environmental sustainability performance, and practically, the study findings can be beneficial for strategy and policymakers in corporations and regulators of environmental sustainability performance. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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19 pages, 711 KiB

Open AccessArticle

Can Digital Inclusive Finance Help Small- and Medium-Sized Enterprises Deleverage in China?

by Debao Dai, Mingzhu Fu, Liang Ye and Wei Shao

Sustainability 2023, 15(8), 6625; https://doi.org/10.3390/su15086625 - 13 Apr 2023

Cited by 4 | Viewed by 1803

Abstract

Digital technology has energized the development of inclusive finance in China and is beneficial in lowering the threshold and transaction costs of financial services and expanding financial coverage. However, it is a key issue whether digital inclusive finance can help SMEs overcome financing [...] Read more.

Digital technology has energized the development of inclusive finance in China and is beneficial in lowering the threshold and transaction costs of financial services and expanding financial coverage. However, it is a key issue whether digital inclusive finance can help SMEs overcome financing difficulties, obtain liquidity, reduce corporate leverage, and thus achieve sustainable development. By using the data from China’s small- and medium-sized listed companies and an aggregate development index of digital inclusive finance at the county level in China from 2015–2019, this empirical analysis finds that the development of digital inclusive finance can significantly reduce the leverage ratio of SMEs; specifically, the development of digital inclusive finance can cut down the leverage ratio of enterprises through easing financing constraints and reducing finance costs. Heterogeneity analysis shows that digital inclusive finance is more effective in reducing leverage for those low- and medium-leverage and non-private enterprises. Accordingly, it is suggested that the government continue to promote the development of digital inclusive finance, deepen the financial supply-side structural reform, and improve the efficiency of financial recycling. SMEs should speed up digital transformation to enable digital finance to provide precise financing services and achieve high-quality sustainable development. Digital financial institutions should improve the digital inclusive financial system as soon as possible, realize scientific supervision and risk prevention, and promote the sustainable development of digital finance. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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23 pages, 419 KiB

Open AccessArticle

FinTech and Green Credit Development—Evidence from China

by Qian Liu and Yiheng You

Sustainability 2023, 15(7), 5903; https://doi.org/10.3390/su15075903 - 28 Mar 2023

Cited by 4 | Viewed by 3327

Abstract

The existing literature on FinTech and green finance has primarily focused on exploring sustainable economic and environmental benefits. However, empirical research examining the effect of FinTech on green finance remains underexplored. In light of the advantageous position of green credit in the development [...] Read more.

The existing literature on FinTech and green finance has primarily focused on exploring sustainable economic and environmental benefits. However, empirical research examining the effect of FinTech on green finance remains underexplored. In light of the advantageous position of green credit in the development of green finance in China, this study analyzes the impact of FinTech on green credit development using polluting listed firms in 2012–2021. The results show that FinTech significantly improves the development of green credit, affecting it through two crucial mechanisms: information asymmetry and green credit allocation efficiency. Additionally, heterogeneity analysis reveals that FinTech has a more significant impact on regions with higher government environmental objectives, small-to-medium enterprises with low carbon emissions, and firms with high external ESG (Environment, Social, and Governance) scores. Overall, our findings indicate that financial institutions should be committed to leveraging FinTech for the pre-loan investigation of green credit, and policymakers should encourage the development of FinTech in order to perfect environmental information disclosure policies to establish environmental information-sharing platforms. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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17 pages, 289 KiB

Open AccessArticle

The Role of Long-Term Institutional Ownership in Sustainability Report Assurance: Global Evidence

by Abdulaziz A. Alomran and Kholod F. Alsahali

Sustainability 2023, 15(4), 3492; https://doi.org/10.3390/su15043492 - 14 Feb 2023

Viewed by 1469

Abstract

Focusing on the role of the institutional investment horizon as a monitoring mechanism that enhances companies’ sustainability reporting reliability, this study investigates the association between long-term ownership and companies’ decisions to assure their sustainability report. Further, the study examines the moderating effect of [...] Read more.

Focusing on the role of the institutional investment horizon as a monitoring mechanism that enhances companies’ sustainability reporting reliability, this study investigates the association between long-term ownership and companies’ decisions to assure their sustainability report. Further, the study examines the moderating effect of the quality of governance on this association. Consistent with the critical mass theory, the study argues that long-term ownership should reach a certain threshold to have an influence on companies’ assurance decisions. The study’s results support the argument and find that long-term ownership is positively and significantly associated with companies’ assurance decisions, and the association is positive and significant only for a high level of long-term ownership in comparison to low- and medium-level long-term ownership. Moreover, the study finds that the association between long-term ownership and assurance is negatively moderated by the quality of governance at both the company and country levels. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

17 pages, 304 KiB

Open AccessArticle

Influence of Financial Shared Services on the Corporate Debt Cost under Digitalization

by Dongshu Jiang, ZhiXing Ni, Yuxiu Chen, Xue Chen and Chaohong Na

Sustainability 2023, 15(1), 428; https://doi.org/10.3390/su15010428 - 27 Dec 2022

Cited by 2 | Viewed by 2188

Abstract

Information technologies such as big data and artificial intelligence promote the development of the digital economy, accelerate the digital transformation of enterprises, and continuously facilitate the reform of enterprise production, organization, and management. This study takes Chinese A-share listed companies on the Shanghai [...] Read more.

Information technologies such as big data and artificial intelligence promote the development of the digital economy, accelerate the digital transformation of enterprises, and continuously facilitate the reform of enterprise production, organization, and management. This study takes Chinese A-share listed companies on the Shanghai and Shenzhen stock exchanges as a sample to examine the influence of financial shared services on the corporate debt cost under the digitalization background based on the perspectives of stakeholders such as creditors, shareholders, and society. This study found that financial sharing can reduce the corporate debt cost. The path mechanism test finds that financial sharing reduces the corporate debt cost mainly by improving the quality of corporate accounting information and decreasing financial risk. The result shows that the effect of financial sharing on reducing the corporate debt cost is positively moderated by enterprise digitalization. Further analysis based on the stakeholder perspective shows that the effect of financial shared services on reducing the corporate debt cost is enhanced by the equity balance and social responsibility fulfillment. The findings provide insights and evidence on how to use financial shared services to improve debt management and enhance creditor protection in the digital context. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

24 pages, 1395 KiB

Open AccessArticle

Green Bond Issuance and Peer Firms’ Green Innovation

by Xia Wu, Danlu Bu, Jun Lian and Yanping Bao

Sustainability 2022, 14(24), 17035; https://doi.org/10.3390/su142417035 - 19 Dec 2022

Cited by 5 | Viewed by 2566

Abstract

Based on the realistic background of the rapid development of China’s green bond market, this paper uses the data of China’s non-financial listed companies from 2010 to 2020 to examine the impact of green bond issuance on peer firms’ green innovation. The results [...] Read more.

Based on the realistic background of the rapid development of China’s green bond market, this paper uses the data of China’s non-financial listed companies from 2010 to 2020 to examine the impact of green bond issuance on peer firms’ green innovation. The results show that the issuance of corporate green bonds can significantly promote the quantity and quality of peer firms’ green innovation, and this promotion effect is sustainable. The heterogeneity test shows that when the issuer of green bonds is an industry leader or the issuer is highly concerned by the media, the green innovation promotion effect of peer firms is more significant. Similarly, when the issuer and the peer firm are close competitors or in the same board network, the peer firm has a higher level of green innovation. It is further found that the green innovation behavior adopted by peer firms can significantly improve their environmental performance. The article indicates that the issuance of corporate green bonds can produce a good spillover effect of green innovation in the industry, which is conducive to China’s strategic goal of “carbon neutrality, carbon emission peak”. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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17 pages, 866 KiB

Open AccessArticle

Judicial Independence and Domestic Supply Chain: Evidence from a Quasi-Natural Experiment

by Yuqiang Cao, Weiming Liang, Guocheng Yang and Jun Yin

Sustainability 2022, 14(24), 16965; https://doi.org/10.3390/su142416965 - 18 Dec 2022

Viewed by 1546

Abstract

How to effectively break down market segmentation and build a sustainable and unified domestic market has become critical to achieving high-quality development in the Chinese economy nowadays. This study examines the effects and mechanisms of improved judicial independence on the development of larger [...] Read more.

How to effectively break down market segmentation and build a sustainable and unified domestic market has become critical to achieving high-quality development in the Chinese economy nowadays. This study examines the effects and mechanisms of improved judicial independence on the development of larger and more sustainable domestic supply chains, using a sample of Chinese enterprises from 2011 to 2016 and a quasi-natural experiment of local judicial reforms. We find that, after the establishment of local circuit courts, the distribution distance of a firm’s supply chain increases significantly. The mechanism analysis suggests that the increase in distribution distance in the domestic supply chain is due to the breakdown of market segmentation resulting from the reduction in local judicial protectionism and the improvement in the quality of local justice after the establishment of circuit courts. Further tests show that the impact of improved judicial independence on the domestic supply chain is most pronounced among small and manufacturing non-state-owned enterprises and those from less competitive industries. Overall, the findings of this paper provide important insights into developing large and sustainable supply chains via breaking down market segmentation, thereby promoting long-term economic growth. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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21 pages, 320 KiB

Open AccessArticle

Does Fintech Development Enhance Corporate ESG Performance? Evidence from an Emerging Market

by Deli Wang, Ke Peng, Kaiye Tang and Yewei Wu

Sustainability 2022, 14(24), 16597; https://doi.org/10.3390/su142416597 - 11 Dec 2022

Cited by 17 | Viewed by 4180

Abstract

The effectiveness of environmental, social, and governance (ESG) has been widely discussed and is often linked to corporate sustainability strategies. However, corporate ESG performance cannot be achieved without the support of financial development and the underlying mechanisms through which fintech development affects corporate [...] Read more.

The effectiveness of environmental, social, and governance (ESG) has been widely discussed and is often linked to corporate sustainability strategies. However, corporate ESG performance cannot be achieved without the support of financial development and the underlying mechanisms through which fintech development affects corporate ESG performance in emerging markets remain unexplored. Firms that are less financially constrained exhibit higher ESG performance in cities with better developed fintech. Moreover, the results remain robust after addressing the endogeneity between fintech development and ESG performance and using different city-level fintech indexes. Additionally, the results remain robust after addressing the endogeneity between fintech development and ESG performance and using different model specifications and variable measurement. Heterogeneity analysis suggests that the effect of fintech development on ESG performance is stronger for firms that are small, operate in technology industries, and have financial executives. These findings provide new insights into the role of fintech development in promoting sustainable social and economic development. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

23 pages, 2085 KiB

Open AccessArticle

Environmental Accounting Information Disclosure Driving Factors: The Case of Listed Firms in China

by Maoli Ji, Yuguang Ji and Shulan Dong

Sustainability 2022, 14(23), 15797; https://doi.org/10.3390/su142315797 - 28 Nov 2022

Cited by 1 | Viewed by 3111

Abstract

This study explores factors that drive environmental accounting information disclosure (EAID) among corporations in China. Using a sample of 200 A-shared listed firms, we apply a structural equation model (SEM) and multiple linear regressions to examine how, and to what extent, external pressure, [...] Read more.

This study explores factors that drive environmental accounting information disclosure (EAID) among corporations in China. Using a sample of 200 A-shared listed firms, we apply a structural equation model (SEM) and multiple linear regressions to examine how, and to what extent, external pressure, corporate performance and corporate governance affects the EAID of corporations. The results show that external pressure and corporate performance can significantly and positively affect corporate EAID. Regarding external pressure, government regulations, media pressure and loans are the most important driving factors, whereas profitability and sales ability are the most important ones among corporate performance factors. However, we found that governance factors have no significant impact on EAID. This paper enriches research on environmental accounting information disclosure and provides important insights for Chinese regulators into effective ways of fostering disclosures of environmental accounting information and raising corporate awareness of CSR fulfillment to ensure sustainable development. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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19 pages, 1459 KiB

Open AccessArticle

Can Green Bonds Stimulate Green Innovation in Enterprises? Evidence from China

by Huacheng Rao, Dongxu Chen, Feichao Shen and Yangyang Shen

Sustainability 2022, 14(23), 15631; https://doi.org/10.3390/su142315631 - 24 Nov 2022

Cited by 9 | Viewed by 1985

Abstract

Green innovation is the main driving force to improve green productivity and achieve green circular economy development. The existing literature has demonstrated extensively that government policies can promote green innovation in enterprises. However, there is much less literature exploring whether green finance policies [...] Read more.

Green innovation is the main driving force to improve green productivity and achieve green circular economy development. The existing literature has demonstrated extensively that government policies can promote green innovation in enterprises. However, there is much less literature exploring whether green finance policies can promote green innovation in enterprises. In this paper, we investigate the impact of corporate green bond issuance on green innovation in China’s listed companies. The findings indicate that the issue of green bonds by enterprises has had a positive and significant effect on the output of green patents. The effect is stronger for state-owned, large, and low-pollution enterprises. Furthermore, this positive effect is achieved by easing the financing constraints of the enterprise and has a dynamic and continuous impact. These results suggest green bonds stimulate green innovation by easing financing constraints, thereby promoting green transformation in a rapidly industrializing economy. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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24 pages, 2584 KiB

Open AccessArticle

Sustaining Investigative Audit Quality through Auditor Competency and Digital Forensic Support: A Consensus Study

by Hendra Susanto, Sri Mulyani, Citra Sukmadilaga and Erlane K. Ghani

Sustainability 2022, 14(22), 15141; https://doi.org/10.3390/su142215141 - 15 Nov 2022

Cited by 1 | Viewed by 1553

Abstract

The increased public awareness of the impact of fraudulent activities has put pressure on corporations to practise better corporate behaviour. As a result, their stakeholders demanded that corporations increase the level of transparency that pertains to their corporate behaviour and provide them with [...] Read more.

The increased public awareness of the impact of fraudulent activities has put pressure on corporations to practise better corporate behaviour. As a result, their stakeholders demanded that corporations increase the level of transparency that pertains to their corporate behaviour and provide them with sustainable assurance. One of the ways that they can improve the way they conduct business is by ensuring that their investigative audits are of a high quality. In this study, we investigate the factors that influence the quality of investigative audits. In particular, two factors are chosen, namely, auditor competency and digital forensic support. Using a questionnaire survey as the research instrument, the questionnaires were distributed to 150 investigative auditors who worked for the Indonesian Audit Investigative Board (BPK). This study shows that both factors significantly and positively influence investigative audit quality. The findings of this study can help related parties to better understanding the factors that contribute to investigative auditing and, as a consequence, suggest ways to improve the investigative audit quality. For BPK, which has the authority to conduct audits of the management and accountability of state finances, the findings serve as a fundamental insight into sustaining work integrity and professionalism. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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21 pages, 307 KiB

Open AccessArticle

Litigation Risk and Corporate Social Responsibility—Evidence from a Poverty Alleviation Campaign in China

by Jielin Jing, Jianling Wang and Qingjun Wu

Sustainability 2022, 14(22), 14849; https://doi.org/10.3390/su142214849 - 10 Nov 2022

Cited by 5 | Viewed by 1063

Abstract

This paper investigates the impact of an external uncertain factor, litigation risk, on corporate participation in Targeted Poverty Alleviation (TPA) activities. It proposes and explores three possible mechanisms, namely, restore legitimacy, send positive signals, and maintain corporate reputation, for corporations to manage their [...] Read more.

This paper investigates the impact of an external uncertain factor, litigation risk, on corporate participation in Targeted Poverty Alleviation (TPA) activities. It proposes and explores three possible mechanisms, namely, restore legitimacy, send positive signals, and maintain corporate reputation, for corporations to manage their litigation risk via the participation in TPA. Using a sample of Chinese listed firms from 2016 to 2020, it shows that for corporations with high legitimacy pressure, high stakeholder concern, and strong reputation protection motive, litigation risk increases corporate investment in TPA. After litigation cases arise, corporations can manage their litigation risk through participation in TPA, thereby restoring legitimacy, sending positive signals, and maintaining corporate reputation. Furthermore, participation in TPA can also moderate the negative impact of litigation risk on enterprise value. The results remain significant after robustness tests on endogeneity, variable and measurement errors, and firm fixed effects. This paper is insightful for future studies relating to the economic consequences of litigation risk. Concurrently, by exploring the role of China’s legal environment in promoting the effect of corporate participation in TPA, this paper not only expands the scope of factors influencing corporate TPA inputs, but also provides policy implications for the formulation of China’s upcoming Rural Revitalization Strategy. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

23 pages, 2262 KiB

Open AccessArticle

Too Much of a Good Thing? The Impact of Government Subsidies on Incubator Services: Empirical Evidence from China

by Jing Li, Bingqing Liang and Zhenjun Yan

Sustainability 2022, 14(21), 14387; https://doi.org/10.3390/su142114387 - 03 Nov 2022

Cited by 1 | Viewed by 1284

Abstract

In this paper, we investigate the impact of government subsidies on incubation services in incubators. Based on the use of the Generalized Propensity Score Matching (GPSM) method to effectively overcome the endogeneity problem, we find that there is an inverted U-shaped relationship between [...] Read more.

In this paper, we investigate the impact of government subsidies on incubation services in incubators. Based on the use of the Generalized Propensity Score Matching (GPSM) method to effectively overcome the endogeneity problem, we find that there is an inverted U-shaped relationship between government subsidies and incubation services, and thus there is an optimal intensity of government subsidies. The inflection point of the inverted U shape for basic services is much smaller than that for value-added services and investment services. With a wider range of government subsidies, incubators will tend to provide better value-added and investment services rather than basic services. The inverted U-shaped relationship remains robust over time, and the range of appropriate subsidies to promote incubation services is tightening. The conclusions of this paper provide empirical evidence on the effectiveness of government subsidies in incubators, which is conducive to developing more effective industrial policies for future governments. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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21 pages, 684 KiB

Open AccessArticle

Managerial Risk-Taking Incentives and Bank Earnings Management: Evidence from FAS 123R

by Gang Bai, Qiurong Yang and Elyas Elyasiani

Sustainability 2022, 14(21), 13721; https://doi.org/10.3390/su142113721 - 22 Oct 2022

Cited by 1 | Viewed by 1598

Abstract

We study the effect of CEOs’ risk-taking incentives (vega), derived from their stock options, on earnings management (EMGT) by banks. Prior research finds an inconsistent relationship between vega and EMGT in non-financial firms. In the banking industry, the effect of vega on EMGT [...] Read more.

We study the effect of CEOs’ risk-taking incentives (vega), derived from their stock options, on earnings management (EMGT) by banks. Prior research finds an inconsistent relationship between vega and EMGT in non-financial firms. In the banking industry, the effect of vega on EMGT is further complicated by the strict regulatory environment. To establish causality, we exploit the exogenous reduction in vega resulting from Financial Accounting Standard (FAS) 123R in 2005 that mandates a fair-value-based method to expense stock options and increases costs of granting option compensation. Using the difference-in-differences approach, we find that banks with a larger drop in CEO vega due to FAS 123R significantly reduce EMGT. The findings suggest that CEO vega has a positive and causal effect on bank EMGT. Our results are robust enough to employ in different research designs and specifications. Furthermore, we find that the negative effect of FAS 123R on EMGT is weaker in banks subject to a higher possibility of regulatory intervention. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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20 pages, 1654 KiB

Open AccessArticle

Green Loans and Green Innovations: Evidence from China’s Equator Principles Banks

by Xijia Huang, Yiting Guo, Yuming Lin, Liping Liu and Kai Yan

Sustainability 2022, 14(20), 13674; https://doi.org/10.3390/su142013674 - 21 Oct 2022

Cited by 3 | Viewed by 2176

Abstract

Green innovation is critical for promoting environmental protection but largely relies on the support of bank financing. How the participation of banks facilitates green innovation remains largely unexplored. Using a sample of A-share listed firms in China, this study examines the impact of [...] Read more.

Green innovation is critical for promoting environmental protection but largely relies on the support of bank financing. How the participation of banks facilitates green innovation remains largely unexplored. Using a sample of A-share listed firms in China, this study examines the impact of new loans from Equator Principles banks on green innovations. Consistent with the framework of the stakeholder theory, we find that new loans from Equator Principles banks significantly foster green innovations of borrowing firms. Several robustness tests are conducted, and the conclusion remains valid. Further analysis shows that the relief of financial constraints of borrowing firms and the scrutiny of corporate financing projects by Equator Principles banks jointly contribute to the promotion of corporate green innovation. Heterogeneity tests indicate that new loans from Equator Principles banks are more effective in heavily polluting and more competitive industries and among firms with higher levels of executive education. Overall, our findings suggest that stakeholder engagement in environmental governance is an important means of improving corporate green innovations in emerging markets. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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18 pages, 885 KiB

Open AccessArticle

Air Pollution and Employee Protection: The Moderating Effect of Public Attention and Environmental Regulations

by Rui Zhao, Dawei Liang, Yukun Pan and Qianqian Du

Sustainability 2022, 14(18), 11529; https://doi.org/10.3390/su141811529 - 14 Sep 2022

Viewed by 1304

Abstract

Air pollution is imposing substantial health and economic burdens on billions of people around the world. Although the impacts of air pollution on human health and economic growth have long been recognized, empirical evidence on whether and how air pollution affects firms’ employee [...] Read more.

Air pollution is imposing substantial health and economic burdens on billions of people around the world. Although the impacts of air pollution on human health and economic growth have long been recognized, empirical evidence on whether and how air pollution affects firms’ employee protection remains unclear. Using a sample of publicly listed Chinese firms from 2010 to 2019, we show that air pollution can significantly increase firms’ employee protection. The results indicate that employee protection is an effective substitute for poor air quality in firm headquarters. Further analyses suggest that public pressure enhances the influence of air pollution on firms’ labor protection, while environmental regulation lessens the positive relationship between air pollution and employee treatment. Overall, we emphasize that air pollution is a significant non-economic determinant affecting firms’ human capital stock and employee treatment strategy. This study would be of particular interest to economists, managers, and regulators who are concerned about designing optimal environmental and welfare policies. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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20 pages, 316 KiB

Open AccessArticle

Effect of Environmental, Social, and Governance Performance on Corporate Financialization: Evidence from China

by Shuxia Zhang, Xiangyang Yin, Liping Xu, Ziyu Li and Deyue Kong

Sustainability 2022, 14(17), 10712; https://doi.org/10.3390/su141710712 - 28 Aug 2022

Cited by 5 | Viewed by 2522

Abstract

Many nonfinancial firms in China invest increasingly in financial assets. To understand the driving factors behind this phenomenon, this paper examines the effect of environmental, social, and governance (ESG) performance on corporate financialization. The empirical results show that ESG performance has a positive [...] Read more.

Many nonfinancial firms in China invest increasingly in financial assets. To understand the driving factors behind this phenomenon, this paper examines the effect of environmental, social, and governance (ESG) performance on corporate financialization. The empirical results show that ESG performance has a positive effect on corporate financialization, suggesting that ESG activities are a tool for firms to seek financial arbitrage. Further examination confirms that corporate financialization of Chinese nonfinancial listed firms is motivated mainly by maximizing short-term financial returns, rather than reserving funds for long-term development. Heterogeneity analysis shows that the positive effect is more significant in non-state-owned firms and in firms located in regions with a low degree of marketization. This study enriches the existing literature on the economic consequences of ESG performance and the influential factors of corporate financialization and provides practical guidance for government regulators to strengthen stricter regulation on ESG activities and financial asset investment to ensure sustainable and healthy economic development. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

31 pages, 358 KiB

Open AccessArticle

The Value Relevance of Corporate Sustainability Performance (CSP)

by Akhtar Ali and Imran Abbas Jadoon

Sustainability 2022, 14(15), 9098; https://doi.org/10.3390/su14159098 - 25 Jul 2022

Viewed by 1910

Abstract

There are two opposite views about corporate sustainability in the existing literature. Sustainability activities are considered as a source of long-term value creation for the shareholders’ interest whereas they also occupy scarce corporate resources and become an extra burden at the expense of [...] Read more.

There are two opposite views about corporate sustainability in the existing literature. Sustainability activities are considered as a source of long-term value creation for the shareholders’ interest whereas they also occupy scarce corporate resources and become an extra burden at the expense of shareholders. To examine these contradictory views, this study investigated the value relevance of CSP using a sample of 113 firms belonging to twelve (12) highly sustainable economies as ranked by the Global Sustainability Competiveness Index for the period 2015–2020. The CSP was measured through a Sustainability Index (SI) developed in this study using the GRI framework which takes into account all the three dimensions of sustainability, i.e., economic, environmental, and social. The results of the study showed that CSP significantly explains the variation in stock market prices and hence is value relevant in supporting the shareholders’ value-enhancing role of corporate sustainability. The results are useful for practitioners and policy makers in the field of corporate sustainability. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

17 pages, 293 KiB

Open AccessArticle

Do Inquiry Letters Curb Corporate Catering Motives of High Sustainable R&D Investment? Empirical Evidence from China

by Yan Yu and Yi-Tsung Lee

Sustainability 2022, 14(12), 7476; https://doi.org/10.3390/su14127476 - 19 Jun 2022

Cited by 2 | Viewed by 1443

Abstract

Sustainable R&D investment is an important issue for enterprises to obtain core competitiveness in modern society. Government supervision can play a guiding role in the process of developing a competitive advantage in innovation in developing countries. This paper analyzes the impact of the [...] Read more.

Sustainable R&D investment is an important issue for enterprises to obtain core competitiveness in modern society. Government supervision can play a guiding role in the process of developing a competitive advantage in innovation in developing countries. This paper analyzes the impact of the government’s proactive regulatory model, represented by the R&D expense inquiry letters (hereafter, RDILs), on the corporate catering motives of high sustainable R&D investment. The results show that the RDILs have a regulatory effect on the listed companies’ catering motives of high sustainable R&D investment, but this effect is weakened by higher stock price crash risk, lower stock liquidity, and greater market short-selling pressure. Further analysis shows that the regulatory effect of RDILs is achieved by reducing the subsequent level of strategic R&D classification manipulation by the company. Overall, our study finds a monitoring role for inquiry letter supervision on the sustainability of corporate R&D investments. Exchanges in other countries should consider their use. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

18 pages, 516 KiB

Open AccessArticle

The Influence of Relational Capital on the Sustainability Risk: Findings from Chinese Non-State-Owned Manufacturing Enterprises

by Dongsheng Zhang, Hongwei Wang and Wenfu Wang

Sustainability 2022, 14(11), 6904; https://doi.org/10.3390/su14116904 - 06 Jun 2022

Cited by 6 | Viewed by 1659

Abstract

During the COVID-19 pandemic, the global economy fluctuated while the Chinese economy remained relatively stable—a distinction that has aroused people’s curiosity about the unique operation of Chinese enterprises. Compared with the regularity and competitiveness of traditional market strategy theory, Chinese business management pays [...] Read more.

During the COVID-19 pandemic, the global economy fluctuated while the Chinese economy remained relatively stable—a distinction that has aroused people’s curiosity about the unique operation of Chinese enterprises. Compared with the regularity and competitiveness of traditional market strategy theory, Chinese business management pays more attention to informal institutions and relational capital, which is one of the key features that distinguishes Chinese firms from their Western counterparts. Yet, theoretical research on relational capital against the Chinese cultural background remains scarce, and the particularity laws of the socialist market economy are still unclear. Based on the social capital theory, this paper redefines the concept of relational capital in the context of China and uses factor analysis to construct a relational capital measurement index. On this basis, non-state-owned manufacturing enterprises are then used as a sample to explore the interactive relationship between relational capital and sustainability risk. The empirical results show that relational capital can effectively reduce sustainability risk and ensure sustainable operation. In addition, enterprise growth, enterprise development, and marketization can strengthen the role of relational capital and positively regulate the relationship between relational capital and sustainability risk. This paper innovatively constructs the concept and index system of relational capital in the Chinese context, which is the perfection of relational capital theory. At the same time, it verifies the impact of relational capital on business sustainability, revises the correct cognition of relational capital, and supplements the deficiencies of the extant social socialist market economy research. Supported by both theoretical research and empirical conclusions, corresponding management suggestions are put forward for enterprises, governments, and managers to scientifically guide management practice and provide new ideas for future Chinese-style economic research. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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18 pages, 456 KiB

Open AccessArticle

Element Matching and Configuration Path of Corporate Social Responsibility Performance

by Dongsheng Zhang, Hongwei Wang and Xiangshan Jin

Sustainability 2022, 14(11), 6614; https://doi.org/10.3390/su14116614 - 28 May 2022

Cited by 3 | Viewed by 1582

Abstract

With rapid progress in the corporate social responsibility (CSR) theories and the up-gradation of the global market information disclosure system, enterprises have increased their attention toward relevant stakeholders and social responsibility. CSR exerts a substantial impact on the sustainable development of enterprises and [...] Read more.

With rapid progress in the corporate social responsibility (CSR) theories and the up-gradation of the global market information disclosure system, enterprises have increased their attention toward relevant stakeholders and social responsibility. CSR exerts a substantial impact on the sustainable development of enterprises and markets in the economic and social fields. On the one hand, the increasingly perfect supporting facilities promote the financial growth of the entire society. While on the other hand, the profit-seeking trend of capital is also on the rise. The incongruity between the rapid progress of enterprises and the lack of social responsibility limits the benign development of the market. This study discusses the antecedents of CSR from the variable combination perspective using the fuzzy-set qualitative comparative analysis. It also investigates which combination of characteristics has better CSR performance. After the configuration analysis, it is identified that four paths lead to high CSR performance. These include the market-developed type, political link type, financial performance type, and state-owned enterprise subsidy type, and the level of each type is explained in-depth. Finally, this study provides management inspiration for the government and enterprises to formulate a sound social responsibility strategy and improve CSR performance by optimizing the matching of CSR activities and business objectives. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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32 pages, 408 KiB

Open AccessArticle

Effect of Managerial Compensation and Ability on the Relationship between Business Strategy and Firm Value: For Small and Medium-Sized Enterprises (SMEs)

by Won Park and Chung-gyu Byun

Sustainability 2022, 14(8), 4689; https://doi.org/10.3390/su14084689 - 14 Apr 2022

Viewed by 2562

Abstract

This study examines the effect of managerial ability and compensation on the relationship between business strategy and firm value for small and medium-sized enterprises (SMEs). Managers determine, plan, implement, and maintain a firm’s business strategy. Therefore, the characteristics of a manager are an [...] Read more.

This study examines the effect of managerial ability and compensation on the relationship between business strategy and firm value for small and medium-sized enterprises (SMEs). Managers determine, plan, implement, and maintain a firm’s business strategy. Therefore, the characteristics of a manager are an important factor in the selection and success of a business strategy. We believe that managerial abilities are important factors in determining that success. If the managerial ability is good, the manager is more likely to implement a strategy suitable for the firm, significantly affecting the firm’s value. Managers are also more motivated to work harder if their compensation level is high. Therefore, the manager will make efforts to successfully lead the firm’s business strategy. In small and medium-sized enterprises (SMEs), the role of managers is important for carrying out strategies due to the lack of internal resources and difficulties in external funding. Therefore, we examine whether managerial ability and compensation affect the relationship between business strategy and firm value for SMEs. The analysis period is from 2011 to 2017, and the analysis was based on 1615 (firm/year), due to some of the listed SMEs being non-financial businesses with a December settlement of accounts. As a result of the analysis, managerial compensation and ability demonstrated different effects depending on the type of strategy, in terms of the relationship between business strategy and firm value. We suggest that managerial ability and compensation affect the value of a firm and moderate the relationship between business strategy and firm value. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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26 pages, 1825 KiB

Open AccessReview

Navigating the Future: Blockchain’s Impact on Accounting and Auditing Practices

by Sundarasen Sheela, Ahnaf Ali Alsmady, K. Tanaraj and Ibrahim Izani

Sustainability 2023, 15(24), 16887; https://doi.org/10.3390/su152416887 - 15 Dec 2023

Cited by 1 | Viewed by 3885

Abstract

This study seeks to meticulously analyze the scholarly discussion on the integration of blockchain technology into accounting and auditing. Based on a total of 67 articles from the Web of Science (WoS) database, this study adopts a bibliometrics and content analysis approach which [...] Read more.

This study seeks to meticulously analyze the scholarly discussion on the integration of blockchain technology into accounting and auditing. Based on a total of 67 articles from the Web of Science (WoS) database, this study adopts a bibliometrics and content analysis approach which uses both numerical and visualization techniques to examine the extant literature. It spans the timeframe between 2016 and 2022. Bibliometrix R-package (Biblioshiny, version 4 is employed to analyze the descriptive analysis, which includes publication trends, the most trustworthy sources of scientific publications, prominent scientific authors, prominent documents, and country collaborations. VOSviewer software Version 1.6.20, is used for a network visualization of keywords and bibliographic coupling. Leveraging the content analysis, this research reveals three fundamental themes: first, the use of blockchain technology to strengthen financial reporting systems; second, blockchain technology and the future of auditing; and third, the valuation of cryptocurrencies. Research gaps in the current literature include a lack of comprehensive studies on blockchain’s regulatory and governance aspects in accounting, insufficient exploration of risks and challenges in adopting new technologies in auditing, and a limited understanding of tax consequences, disclosure requirements, and regulatory frameworks for cryptocurrencies, necessitating future research endeavors. Thus, this study extends existing theoretical insights by exploring blockchain’s role in financial reporting, its transformative impact on auditing, and the possible adaptation or development of new valuation methods for cryptocurrencies. It further identifies and discusses future research directions, contributing to potential novel frameworks for addressing regulatory, governance, and socio-economic dimensions of blockchain integration into accounting and auditing practices. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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30 pages, 3333 KiB

Open AccessReview

Association between Internal Control and Sustainability: A Literature Review Based on the SOX Act Framework

by Wunhong Su, Liuzhen Zhang, Chao Ge and Shuai Chen

Sustainability 2022, 14(15), 9706; https://doi.org/10.3390/su14159706 - 06 Aug 2022

Cited by 3 | Viewed by 3221

Abstract

With the integration of sustainable development into all aspects of the economy, politics, society, culture, and ecology, the effectiveness and innovation of enterprises in sustainability have become global research issues. Internal control affects the current operation and management as the main means for [...] Read more.

With the integration of sustainable development into all aspects of the economy, politics, society, culture, and ecology, the effectiveness and innovation of enterprises in sustainability have become global research issues. Internal control affects the current operation and management as the main means for enterprises to maintain normal production and operation and prevent risks. Therefore, it is closely related to the future development of enterprises. This study uses 84 papers from Web of Science to systematically trace the determinants of enterprise sustainability using Vosviewer software and the Sarbanes–Oxley Act (SOX) as a manifestation of internal control to analyze the role and controversies of internal control in the process of enterprise sustainable strategic planning. The results show that internal control has, on the one hand, positive effects on enterprise sustainability by improving the quality of financial information, derived effects, and spillover effects. However, on the other hand, internal control can be detrimental to enterprise sustainability by increasing compliance costs and legal liabilities. This study points out opportunities and directions for improving enterprise internal control regulation and empirical research in response to such results. Finally, this study provides implications for enterprises seeking to achieve a sustainable level of development regarding the proper implementation of internal controls, as well as avenues for further research. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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Other

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32 pages, 2592 KiB

Open AccessSystematic Review

Accounting for ‘ESG’ under Disruptions: A Systematic Literature Network Analysis

by Maurizio Comoli, Patrizia Tettamanzi and Michael Murgolo

Sustainability 2023, 15(8), 6633; https://doi.org/10.3390/su15086633 - 13 Apr 2023

Cited by 11 | Viewed by 3149

Abstract

Corporations and small/medium enterprises (SMEs) are subject to a variety of external and internal pressures that often lead to changes in their corporate governance structures and accounting/reporting systems. The environment in which these organizations are collocated has undergone a deep process of change, [...] Read more.

Corporations and small/medium enterprises (SMEs) are subject to a variety of external and internal pressures that often lead to changes in their corporate governance structures and accounting/reporting systems. The environment in which these organizations are collocated has undergone a deep process of change, due to the COVID-19 pandemic, climate change, the blockchain, and the energy industry crisis. Business activities represent a critical and a vital component of human existence across the globe—one that is not restricted to a financial standpoint—and their impact on societal, environmental and animal conditions is now undisputed. However, these activities are frequently coupled with allegations of their being the actual causes of those disruptions and collapses that persist in escaping the scrutiny of international governments. For the effective delivery of sustainable business activities, the concepts of governance and accountability are crucial, and the future of the inhabitants of planet Earth is arguably dependent on the ability of corporations (through their entire value chain) to govern themselves well and to demonstrate accountability to their many stakeholders. This should be achieved through the adoption of good governance standards which are well accepted, and that are globally harmonised with ‘Environmental, Social and Governance’ (ESG) reporting tools that are able to strategically assess and evaluate risk exposure and provide forward-looking information. In this critical context, few studies have actually examined these issues thoroughly, and, because the findings of those studies have been contradictory, there is still no definitive understanding of the causes of weak accounting and reporting tools for ESG dynamics under conditions of disruption. A systematic literature network analysis (SLNA) is used in this study to examine the evolution of the ESG reporting research domain based on existing relationships (e.g., aggregation, cross-citations and isolation) among authors contributing to the field. The findings demonstrate the current state of the art, disclosing interesting and timely future research directions. Furthermore, this study employs a novel approach known as SLNA to conduct the analyses, confirming its efficacy as a tool for dynamic analysis also within the field of sustainability accounting research. Full article

(This article belongs to the Special Issue Accounting, Corporate Policies and Sustainability)

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Accounting, Corporate Policies and Sustainability

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