Review of Accounting and Finance最新文献

{"title":"Climate change and the European banking sector: the effect of green technology adaptation and human capital","authors":"Ayesha Afzal, Jamila Abaidi Hasnaoui, Saba Firdousi, Ramsha Noor","doi":"10.1108/raf-10-2023-0341","DOIUrl":"https://doi.org/10.1108/raf-10-2023-0341","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>Climate change poses effect on banking sector’s risks and profitability through adaptation of green technology. This study aims to incorporates green technology adaptation in three sectors: green banking, green entrepreneurial innovation (EI) and green human resource (HR), in a model of bank’s performance. And determines the impact of climate change on bank risk and profitability.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>An assessment of profitability and risk profile of commercial banks is done for 27 European countries for 2013–2022, employing a two-step difference system-generalized method of moments estimation technique with a moderate effect of climate change by including interaction between climate change and green technology adaptation.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>The results indicate that green banking increases profitability, reduces credit risk and increases liquidity risk. The results also show that green human resource increases profitability and becomes a source of credit and liquidity risks for the banks. Green EI increases credit risk and liquidity risk, while the effects of green EI on profitability vary with the use of two proxies: Green patents increase profitability and environment, social and corporate governance (ESG) scores decrease profitability.</p><!--/ Abstract__block -->\u0000<h3>Practical implications</h3>\u0000<p>Supportive government initiatives, including subsidies and tax rebates to green borrowers, may take the burden of green transition off the banking sector.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This paper observes the impact of green technology adaptation in three sectors: banks, EI and HR, moderated by climate change, adding substantially to the existing literature in conceptual framework and methodology.</p><!--/ Abstract__block -->","PeriodicalId":21152,"journal":{"name":"Review of Accounting and Finance","volume":"241 1","pages":""},"PeriodicalIF":2.4,"publicationDate":"2024-03-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140153141","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"From performance to horizon: managements’ horizon and firms’ investment efficiency","authors":"Abongeh A. Tunyi, Geofry Areneke, Tanveer Hussain, Jacob Agyemang","doi":"10.1108/raf-11-2022-0319","DOIUrl":"https://doi.org/10.1108/raf-11-2022-0319","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>This study proposes a novel measure for management’s horizon (short-termism or myopia vs long-termism or hyperopia) derived from easily obtainable firm-level accounting and stock market performance data. The authors use the measure to explore the impact of managements’ horizon on firms’ investment efficiency.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>The authors rely on two commonly used but uncorrelated measures of management performance: accounting performance (return on capital employed, ROCE) and stock market performance (average abnormal return, AAR). The authors combine these measures to develop a multidimensional framework for performance, which classifies firms into four groups: efficient (high accounting and high market performance), poor (low accounting and low market performance), myopic (high accounting and low market performance) and hyperopic (low accounting and high market performance). The authors validate this framework and deploy it to explore the relationship between horizon and firms’ investment efficiency.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>In validation tests, the authors show that management myopia (hyperopia) explains firms’ decision to cut (grow) research and development investments. Further, as expected, myopic (hyperopic) firms are associated with significantly more (less) accrual and real earnings management. The empirical tests on the link between horizon and investment efficiency suggest that myopic managers cut new investments while their hyperopic counterparts grow the same. Ultimately, the authors find that myopia (hyperopia) exacerbates(mitigates) the over-investment of free cash flow problem.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>The authors introduce a framework for assessing management’s horizon using easily obtainable measures of performance. The framework explains inconsistencies in prior empirical research using different measures of performance (accounting versus market). The authors demonstrate its utility by showing that the measure explains decisions around research and development investment, earnings management and firm investments.</p><!--/ Abstract__block -->","PeriodicalId":21152,"journal":{"name":"Review of Accounting and Finance","volume":"37 1","pages":""},"PeriodicalIF":2.4,"publicationDate":"2024-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"140006189","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Corporate social responsibility and credit rating: evidence from French companies","authors":"Sourour Ben Saad, Mhamed Laouiti, Aymen Ajina","doi":"10.1108/raf-03-2023-0106","DOIUrl":"https://doi.org/10.1108/raf-03-2023-0106","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>This study aims to provide further insights into the connection between corporate social responsibility (CSR) and companies’ credit ratings, while also exploring the role of corporate governance as a moderating factor. The hypotheses for this relationship are rooted in both legitimacy and stakeholder theories.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>Using a sample of French non-financial listed firms from 2007 to 2020, this paper uses the ordered probit model introduced by Greene (2000). The issue of endogeneity has also been addressed.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>The study reveals that CSR practices positively impact companies’ credit ratings by enhancing solvency and financial performance. Specifically, firms that prioritize CSR, particularly in the social and environmental dimensions (such as community relations, diversity, employee relations, environmental performance and product characteristics), tend to have higher credit ratings and a reduced risk of default. This suggests that credit rating agencies likely incorporate CSR performance when assigning credit ratings. Furthermore, the quality of corporate governance acts as a moderator, strengthening the relationship between CSR and credit ratings. The findings remain robust even after accounting for key firm attributes and addressing potential endogeneity between CSR and credit ratings.</p><!--/ Abstract__block -->\u0000<h3>Practical implications</h3>\u0000<p>This research provides valuable guidance for policymakers, corporate managers, investors and other stakeholders, as it offers insights into the influence of CSR activities on risk premiums and financing costs. For financial institutions, expanding credit decisions to encompass non-financial factors such as CSR can result in more accurate predictions of firm credit quality compared to relying solely on financial indicators.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>To the best of the authors’ knowledge, this study stands out as the first to systematically examine the relationship between CSR and credit ratings within the French context. Moreover, it distinguishes itself by investigating the moderating influence of corporate governance on this relationship, setting it apart from prior research.</p><!--/ Abstract__block -->","PeriodicalId":21152,"journal":{"name":"Review of Accounting and Finance","volume":"30 1 1","pages":""},"PeriodicalIF":2.4,"publicationDate":"2024-02-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139678255","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"The relationship between soft skills, stress and reduced audit quality practices","authors":"Antonio Samagaio, Paulo Morais Francisco, Teresa Felício","doi":"10.1108/raf-06-2023-0186","DOIUrl":"https://doi.org/10.1108/raf-06-2023-0186","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>This study aims to identify the effect of soft skills as a driver of audit quality and their moderating role in the relationship between stress and the propensity for auditors to engage in reduced audit quality practices (RAQP).</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>This study uses a sample of 130 auditors, whose data were collected through an electronic questionnaire. The results were derived from the partial least squares-structural equation modelling method.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>The findings show that the propensity to incur RAQP increases when auditors are under job stressors but decreases when individuals have resilience and time management skills. Moreover, the results suggest that the moderating effect of these two soft skills can effectively reduce the auditors’ propensity to engage in dysfunctional actions and judgments in auditing. Emotional intelligence and self-efficacy skills are shown not to affect RAQP.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This study adds to previous research on auditors’ drivers for supplying audit quality, by providing evidence of auditor characteristics as a critical input to audit quality. The results emphasize the importance of researchers including in models the moderating effect of soft skills on the relationship between audit quality and determinants associated with audit firms, clients or the regulatory framework.</p><!--/ Abstract__block -->","PeriodicalId":21152,"journal":{"name":"Review of Accounting and Finance","volume":"24 6 1","pages":""},"PeriodicalIF":2.4,"publicationDate":"2024-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139649157","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Corporate governance and green innovation: international evidence","authors":"Marcellin Makpotche, Kais Bouslah, Bouchra M’Zali","doi":"10.1108/raf-04-2023-0137","DOIUrl":"https://doi.org/10.1108/raf-04-2023-0137","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>This study aims to exploit Tobin’s Q model of investment to examine the relationship between corporate governance and green innovation.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>The study is based on a sample of 3,896 firms from 2002 to 2021, covering 45 countries worldwide. The authors adopt Tobin’s Q model to conceptualize the relationship between corporate governance and investment in green research and development (R&amp;D). The authors argue that agency costs and financial market frictions affect corporate investment and are fundamental factors in R&amp;D activities. By limiting agency conflicts, effective governance favors efficiency, facilitates access to external financing and encourages green innovation. The authors analyzed the causal effect by using the system-generalized method of moments (system-GMM).</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>The results reveal that the better the corporate governance, the more the firm invests in green R&amp;D. A 1%-point increase in the corporate governance ratings leads to an increase in green R&amp;D expenses to the total asset ratio of about 0.77 percentage points. In addition, an increase in the score of each dimension (strategy, management and shareholder) of corporate governance results in an increase in the probability of green product innovation. Finally, green innovation is positively related to firm environmental performance, including emission reduction and resource use efficiency.</p><!--/ Abstract__block -->\u0000<h3>Practical implications</h3>\u0000<p>The findings provide implications to support managers and policymakers on how to improve sustainability through corporate governance. Governance mechanisms will help resolve agency problems and, in turn, encourage green innovation.</p><!--/ Abstract__block -->\u0000<h3>Social implications</h3>\u0000<p>Understanding the impact of corporate governance on green innovation may help firms combat climate change, a crucial societal concern. The present study helps achieve one of the precious UN’s sustainable development goals: Goal 13 on climate action.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This study goes beyond previous research by adopting Tobin’s Q model to examine the relationship between corporate governance and green R&amp;D investment. Overall, the results suggest that effective corporate governance is necessary for environmental efficiency.</p><!--/ Abstract__block -->","PeriodicalId":21152,"journal":{"name":"Review of Accounting and Finance","volume":"118 1","pages":""},"PeriodicalIF":2.4,"publicationDate":"2024-01-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139375291","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Association between executives’ foreign background and audit fees","authors":"Wunhong Su, Chen Yin","doi":"10.1108/raf-12-2022-0330","DOIUrl":"https://doi.org/10.1108/raf-12-2022-0330","url":null,"abstract":"\u0000Purpose\u0000This study aims to investigate the association between executives with foreign backgrounds and the audit fees paid by the Chinese-listed firms over the period from 2010 to 2020.\u0000\u0000\u0000Design/methodology/approach\u0000To examine the association between executives’ foreign experience and audit fees, this study constructs the following empirical model: Lnfeei,t = β0 + β1Foreign backgroundi,t + ∑βj Controli,t + YearFE + IndFE + εi,t (1).\u0000\u0000\u0000Findings\u0000This study finds that auditors charge higher fees for firms hiring more executives with foreign backgrounds. The results are robust to a battery of robustness checks, including fixed effects, alternative measures of independent variable, controlling for other characteristics of executives and auditors and entropy balancing method.\u0000\u0000\u0000Originality/value\u0000This study sheds light on how executives’ foreign backgrounds affect audit fees, enriching the literature on executive heterogeneity and audit fees and providing important implications for audit practitioners.\u0000","PeriodicalId":21152,"journal":{"name":"Review of Accounting and Finance","volume":"71 14","pages":""},"PeriodicalIF":2.4,"publicationDate":"2023-12-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138956708","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Another look at the asymmetric relationship between stock returns and trading volume: evidence from the Markov-switching model","authors":"Mondher Bouattour, Anthony Miloudi","doi":"10.1108/raf-02-2023-0045","DOIUrl":"https://doi.org/10.1108/raf-02-2023-0045","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>The purpose of this paper is to bridge the gap between the existing theoretical and empirical studies by examining the asymmetric return–volume relationship. Indeed, the authors aim to shed light on the return–volume linkages for French-listed small and medium-sized enterprises (SMEs) compared to blue chips across different market regimes.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>This study includes both large capitalizations included in the CAC 40 index and listed SMEs included in the Euronext Growth All Share index. The Markov-switching (MS) approach is applied to understand the asymmetric relationship between trading volume and stock returns. The study investigates also the causal impact between stock returns and trading volume using regime-dependent Granger causality tests.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>Asymmetric contemporaneous and lagged relationships between stock returns and trading volume are found for both large capitalizations and listed SMEs. However, the causality investigation reveals some differences between large capitalizations and SMEs. Indeed, causal relationships depend on market conditions and the size of the market.</p><!--/ Abstract__block -->\u0000<h3>Research limitations/implications</h3>\u0000<p>This paper explains the asymmetric return–volume relationship for both large capitalizations and listed SMEs by incorporating several psychological biases, such as the disposition effect, investor overconfidence and self-attribution bias. Future research needs to deepen the analysis especially for SMEs as most of the literature focuses on large capitalizations.</p><!--/ Abstract__block -->\u0000<h3>Practical implications</h3>\u0000<p>This empirical study has fundamental implications for portfolio management. The findings provide a deeper understanding of how trading activity impact current returns and vice versa. The authors’ results constitute an important input to build and control trading strategies.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>This paper fills the literature gap on the asymmetric return–volume relationship across different regimes. To the best of the authors’ knowledge, the present study is the first empirical attempt to test the asymmetric return–volume relationship for listed SMEs by using an accurate MS framework.</p><!--/ Abstract__block -->","PeriodicalId":21152,"journal":{"name":"Review of Accounting and Finance","volume":"33 1","pages":""},"PeriodicalIF":2.4,"publicationDate":"2023-12-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138631842","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Do ESG ratings and COVID-19 severity score predict stock behavior and market perception? Evidence from emerging markets","authors":"Mai T. Said, Mona A. ElBannan","doi":"10.1108/raf-03-2023-0083","DOIUrl":"https://doi.org/10.1108/raf-03-2023-0083","url":null,"abstract":"&lt;h3&gt;Purpose&lt;/h3&gt;\u0000&lt;p&gt;The purpose of this study is to examine the impact of firm environmental, social and governance (ESG) rating scores on market perception and stock behavior from 2017 to 2021 while controlling for COVID-19 severity score.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Design/methodology/approach&lt;/h3&gt;\u0000&lt;p&gt;The authors used panel regression models with robust standard errors based on cross-country and cross-industry sample of 1,324 ESG firms from 25 emerging countries across four regions. Four separate regression analyses are used. Hausman test is used to determine whether fixed-effect (FE) or random-effect approaches should be used in regression models. Lagrange multiplier test is used to test for time FEs, and F-test for individual effects to choose between pooled ordinary least squares model and FE. Two-unit root tests are conducted to check stationarity. Heteroskedasticity and serial correlation were controlled through a robust covariance matrix estimation.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Findings&lt;/h3&gt;\u0000&lt;p&gt;The authors provide evidence that the stakeholder theory persists in emerging countries. Overall, the results suggest that firms’ stock behavior is positively associated with the level of environmental and social performance in the region. However, the results do not provide empirical evidence to support the link between ESG performance and stock market perception proxied by the price-to-sales ratio. The results suggest that Refinitiv and Bloomberg ESG rating scores have a positive impact on stock performance in emerging markets, albeit the Bloomberg rating score is insignificant.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Practical implications&lt;/h3&gt;\u0000&lt;p&gt;Favorable impact of environmental and social performance on stock performance suggests that policymakers should take initiatives to raise awareness toward investments in ESG projects. Evidence shows that ESG stock performance in emerging markets does not insulate firms from the COVID-19 severity. Furthermore, this study highlights the inconsistency in calculating the ESG ratings, therefore, a more standardized approach is recommended to support investors seeking sustainable investments.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Social implications&lt;/h3&gt;\u0000&lt;p&gt;The findings have social implications for investors with proenvironmental preferences and nonpecuniary motives for ethical investments. Asset fund managers should develop ESG investment strategies to promote investor preferences that are linked to the proenvironmental and prosocial attitudes by increasing their investments in stocks of firms that behave ethically and support the environment. Furthermore, the findings show that investors pay a price for ethical and socially responsible investments as they are evaluating the environmental and social activities, hence, the firm ESG profile influences equity valuation and risk assessment.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Originality/value&lt;/h3&gt;\u0000&lt;p&gt;The study extends the literature and provides evidence from the un","PeriodicalId":21152,"journal":{"name":"Review of Accounting and Finance","volume":"45 1","pages":""},"PeriodicalIF":2.4,"publicationDate":"2023-12-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138515802","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Corporate investment sensitivity to equity market misvaluation","authors":"Senda Mrad, Taher Hamza, Riadh Manita","doi":"10.1108/raf-01-2023-0027","DOIUrl":"https://doi.org/10.1108/raf-01-2023-0027","url":null,"abstract":"&lt;h3&gt;Purpose&lt;/h3&gt;\u0000&lt;p&gt;The purpose of this paper is to investigate the effect of equity market misvaluation on manager behavior. Using a sample of 535 French-listed over 2000–2018, the authors analyze whether corporate investment decision is sensitive to equity market overvaluation.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Design/methodology/approach&lt;/h3&gt;\u0000&lt;p&gt;The study adopts market-to-book (M/B) decomposition developed by Rhodes-Kropf and Viswanathan (2004, RKV) that proxies for market misvaluation at the firm and industry levels. The authors conducted a long-term performance analysis via a portfolio sorting procedure and a Carhart (1997) four-factor pricing model. The authors tested the relationship between equity misvaluation, corporate investment decisions and equity issuance. The authors ran several robustness tests.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Findings&lt;/h3&gt;\u0000&lt;p&gt;The empirical results show that equity market misvaluation affects corporate investment positively as the stock price deviates further away from its fundamental. Based on market timing theory, the authors find that corporate investment occurs in periods of high valuation motivated by equity issuance to benefit from the low cost of capital. This effect is more prominent for financially constrained firms. Consistent with the catering channel, the authors find that the misvaluation-investment nexus is more pronounced in firms with short-horizon investors. By examining the stocks’ long-term performance of misvalued firms, via a sorting portfolio procedure, the authors find that undervalued firms outperform and generate higher abnormal returns (Jensen’s alpha) than overvalued firms, suggesting that mispricing-driven investment appear to be short-lived and lead to lower return in the long term.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Practical implications&lt;/h3&gt;\u0000&lt;p&gt;Corporate decision-makers and governance structures should pay attention to the rationality of the corporate investment decision in the context of equity market misvaluation. Managers who focus on maximizing the stock market value in the short-run at the expense of its long-term performance must give preference to value-creating investment, not driven by an external mechanism such as equity market mispricing. More generally, investors and portfolio managers must take into account the market mispricing process in decision-making. Nonetheless, from the portfolio sorting perspective, decision-makers must act in terms of high governance quality to mitigate suboptimal investment due to stock market mispricing (Jensen, 2005). Finally, equity market overvaluation, leading managers to invest via equity financing in particular, should be a signal to attract investors’ attention to seize the window of opportunity and embark on a short-term portfolio strategy. Such a strategy promises high returns in the short term.&lt;/p&gt;&lt;!--/ Abstract__block --&gt;\u0000&lt;h3&gt;Originality/value&lt;/h3&gt;\u0000&lt;p&gt;This paper investigates jointly two theoretical channels: equity market timing and","PeriodicalId":21152,"journal":{"name":"Review of Accounting and Finance","volume":"2 1","pages":""},"PeriodicalIF":2.4,"publicationDate":"2023-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138515813","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}

{"title":"Early adopters of institutional creativity in integrated reporting","authors":"Ruchi Agarwal, Muhammad Atif","doi":"10.1108/raf-07-2023-0209","DOIUrl":"https://doi.org/10.1108/raf-07-2023-0209","url":null,"abstract":"<h3>Purpose</h3>\u0000<p>In the last two decades, risk reporting has followed a normative and calculative culture rather than the “materiality” of data. Although integrated reporting (IR) has become flooded with extra information, it does not adequately disseminate material information to stakeholders. In addition, the poor tone from the top diminishes creativity. This study aims to investigate how companies creatively address issues of the materiality of risk information in IR and how IR can be aligned with enterprise risk management.</p><!--/ Abstract__block -->\u0000<h3>Design/methodology/approach</h3>\u0000<p>Qualitative research was conducted via interviews with 50 chief risk officers and senior management executives in the Indian and UK insurance markets.</p><!--/ Abstract__block -->\u0000<h3>Findings</h3>\u0000<p>Overall, five institutions were observed to exhibit elements of being early adopters of institutional creativity. This confirmed the present study’s theoretical contribution of five divergent types of early adopters. The motivations for creativity are reflected in the resources available to these institutions.</p><!--/ Abstract__block -->\u0000<h3>Originality/value</h3>\u0000<p>To the best of the authors’ knowledge, this study provides a new insight into IR from internal mechanisms to deal with issue of materiality.</p><!--/ Abstract__block -->","PeriodicalId":21152,"journal":{"name":"Review of Accounting and Finance","volume":"12 1","pages":""},"PeriodicalIF":2.4,"publicationDate":"2023-11-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"138515808","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}