Stakeholder Existential Authenticity and Corporate Social Responsibility

Posted on by

Abstract

Corporate social responsibility (CSR) research has been slow to address the impacts of CSR on stakeholders, especially in terms of the mechanisms explaining how CSR translates into positive stakeholder outcomes. We introduce a new mechanism into this literature – stakeholder existential authenticity (SEA) – that helps explain how stakeholder participation in CSR can enhance stakeholder wellbeing through the experience of being authentic. We develop an original conceptualization of SEA and integrate this into a model explaining the relationships between CSR participation, SEA, eudaimonic happiness, and subjective wellbeing, as well as the moderating effects of individual stakeholder attributes and CSR activity design. We explain our contributions to the literature on society-centric CSR, authenticity in CSR, CSR implementation, and authenticity in management more broadly, before suggesting directions for future research and outlining the practical implications of our study.

Robust Financial Inclusion Framework by Examining Literacy Aspects in Oman

Posted on by
Business Perspectives and Research, Ahead of Print.
This research examines how Internet finance and challenges (IFC) affect Oman’s banking sector’s financial inclusion (FIN). This research also examines the mediating function of digital literacy (DL) and financial literacy (FL). The conceptual model hypothesis was tested using a questionnaire with study construct items. Financial services and customers at selected Oman banks were sampled using purposive sampling. To test model fitness and derive hypothesis outcomes, AMOS was used to analyze these data using PLS-SEM. The IFC and FIN of financial services users were positively and significantly associated, and DL and FL mediated this connection. This research highlighted DL and FL as the mediating mechanism, adding to the literature on IFC and FIN. FIN must address Internet finance issues, and the government must create regulations to improve financial service consumers’ DL and FL to boost FIN in Oman. This research is innovative and distinctive since it emphasizes the necessity of technological literacy to make it easier for banks and other financial institutions to deliver financial services to the Sultanate of Oman.

Stock liquidity and tone of press releases

Posted on by

Abstract

This paper presents evidence that higher stock liquidity makes firms increase tone of press releases. I find that firms with higher stock liquidity have higher tone in press releases, relative to the tone of news initiated by media, than firms with lower stock liquidity. This relation is stronger for firms with greater short-term pressure, that is, with greater transient institutional ownership, greater sensitivity of manager's wealth to stock price, and more analyst coverage. This finding suggests that stock liquidity, by producing short-term pressure on firms, leads firms to boost press release tone.

How Do Innovation Ecosystems Emerge? The Case of Nanotechnology in Israel

Posted on by

Abstract

Research on innovation ecosystems has identified their evolution phases but neglected their emergence, which we know little about. We offer inductive theory to explain the emergence of the nanotechnology ecosystem in Israel. Our theory suggests that ineffective bureaucracy, resource constraints, and the conflicting agendas of the government and universities create organizational bottlenecks that impede the ecosystem's emergence. Only once these actors establish related dedicated units that are immune to these deficiencies and transition to simultaneous competition and cooperation does the innovation ecosystem begin to emerge. We further reveal how enabling and governing mechanisms legitimize the innovation ecosystem, facilitate its emergence, and direct its evolution trajectory. Hence, we extend research that has centered on subsequent phases of evolution and explain how actors interact to facilitate the emergence of the ecosystem following technological discovery. Our study contributes to strategy research on interfirm coopetition by applying this concept to government and university actors, and by alluding to its multiple facets: identity, direction, administration, and resources. We also complement innovation research on the post-formation dynamics of ecosystems by providing insights into the missing link between technological discovery and the creation of an innovation ecosystem that brings together stakeholders to commercialize that technology.

Covenant violation and operational efficiency

Posted on by

Abstract

We examine the impact of covenant violation on corporate operational efficiency. Using an aggregate measure of operational efficiency developed by Demerjian et al. (Management Science, 58, 2012, 1229–1248), we provide strong empirical evidence that covenant violations hinder firms from achieving operational efficiency. Our finding is robust to alternative definitions of operational efficiency and various model specifications to address potential endogeneity issues. Further analyses show that lower operational efficiency is attributable to covenant-violating firms' under-investments in capital and labour. In addition, the negative effect of covenant violation on operational efficiency is not universally the same, and is less evident in violating firms with greater agency problems.

Stock market liquidity during crisis periods: Australian evidence

Posted on by

Abstract

Liquidity is an important characteristic of financial markets, affecting portfolio decisions and priced risk. During periods of market turmoil, such as occurs during financial crisis, investors have an elevated need for cash and so understanding how liquidity differs during those periods is important. We examine how stock market liquidity was impacted by two crises with distinct origins, the global financial crisis (GFC) and the COVID-pandemic. Our sample includes the S&P/ASX200 constituents for the period January 2005–December 2020. We find that the Australian stock market is less liquid during both crisis periods; spreads are wider, depth is lower, and price impact is larger (stock prices move a lot in response to small amounts of volume). Although the magnitude of the liquidity change is greater at the onset of COVID, the duration of the impact is longer during the GFC, resulting in a larger average effect. While trading volume declines during the GFC, it increases during COVID. Our results are robust to alternate liquidity proxies, methodologies and crisis period identification, and generally applicable across stock sectors.