Corporate environmental performance (CEP) is widely acknowledged as a multidimensional construct. The researchers in the field of ecology, environmental management, and sustainability studies have ...long faced the dilemma of how exactly to measure CEP, given the vast array of instruments available and the lack of an operational definition. Our aim was to propose a new conceptualization of CEP based on a comprehensive and critical review of three decades of dedicated research. First, in order to provide an operationalization of the multidimensional construct of CEP, several academic and industry-based CEP reporting inventories are reassembled into a large set of 140 indicators grouped into 14 functional categories, identified using the grounded theory approach. Second, the critical review proposes a classification and discussion of empirical contributions according to their data sources, based on the content analysis of 172 empirical papers (published between 1980 and 2017), using the variable “corporate environmental performance”. Third, we discuss the pros and cons of using certain types of CEP measures and we suggest relevant guidelines for researchers on how to choose the adequate instruments which maximize both the reliability of data sources and the construct validity of CEP measures. Fourth, a new definition of CEP highlights the pivotal concept of environmental impact and the corporate goal of reducing and preventing environmental harm. Finally, we discuss the future of CEP research, given the opportunity and necessity for a more relevant and dimensional approach to measurement.
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•A critical review of 172 papers containing the variable environmental performance.•A discussion of reliability and validity of instruments used in the literature.•Recommendations for researchers on how to choose the adequate instruments.•A new definition of corporate environmental performance.•A call for a functional approach to environmental performance measurement.
The European body of research on corporate environmental performance has not yet reached maturity. That is mainly due to the limited access researchers have to raw environmental performance data, in ...conjunction with an often sterile approach to developing proxies and indicators for this type of corporate performance. Moreover, annual sustainability reports are often neglected in spite of their capacity to produce a compelling longitudinal research perspective. The present article offers a critical reading of the last decade's sustainability reports from the top five largest European oil and gas companies. On account of their significant contribution to global warming, the sample companies (i.e. BP, Total, Shell, BG Group and Eni) have been scrutinized for their ability to provide high-quality environmental disclosures at group-level. Given the sophistication of emissions data collection and estimation tools such as the Greenhouse Gas (GHG) Protocol, it comes as a surprise that these five industry leaders have issued reports containing unexplained figures and methodological inconsistencies. Finally, the reader is persuaded that empirical research in the field of corporate environmental performance should mostly be about creating a context for discussing a firm's commitment to sustainability, rather than modelling irrelevant cross-sectional data to find similarities between incomparable cases.
The article entitled "Decarbonization of the Romanian Economy: An ARDL and KRLS Approach of Ecological Footprint" uses the Environmental Kuznets Curve (EKC) paradigm to study the causal relationship ...between the ecological footprint, as an indicator of sustainable development and several variables (i.e., gross domestic product per capita, the KOF globalization index, fossil fuel energy consumption, and carbon dioxide emissions). The results indicate the existence of a relationship between these variables, in the long-term and in the short-term. ...there is the need to set up instruments aimed at climate neutrality, according to the objectives assumed by Romania through the Green Deal of the European Union. The analyzed companies were classified into four homogeneous groups: leading companies, rising companies, companies that make sacrifices and companies that stagnate. ...a two-way relationship between the environmental and financial performance of companies was identified. ...environmental, social or governance controversies are a factor that negatively affects the likelihood of a higher credit rating in the future. ...European banks should pay particular attention to avoiding such controversies as a source of reputational risk, so that their credit ratings are not affected.
The aim of the present study is to assess the impact of structural capital intensity and utilization on firm profitability in an international setting: the European Union countries, plus Norway, ...Switzerland and the United Kingdom. The indicators are calculated based on financial data downloaded from the Refinitiv Eikon database. Two financial ratios are used as proxies for the intensity and utilization of structural capital. The balanced panel consists of 625 companies from 25 countries, over the period from 2013 to 2022. The panel includes financial information on two industries that are considered innovation-oriented, namely technology and healthcare. Alternative model specifications are proposed to test the robustness of the basic model, including dynamic models (with lagged dependent variables). The present study indicates that a higher proportion of structural capital (intangible assets, excluding goodwill) is a negative factor for company profitability in the technology and healthcare sectors. There is no indication that a more intense use of intangible assets and more investments in R&D positively contribute to company profitability in the respective industries, for a large sample of listed companies. A higher proportion of intangible assets, as reported in financial statements, is possibly related to inefficiencies in the management of structural capital. The inverse relationship between profitability and investments in intangible assets is likely due to failures in cost accounting. Limitations and future research propositions are provided in the conclusions.
The United Nations Sustainable Development Goals (UN SDGs) were introduced in 2015 to advance the 2030 Agenda of sustainable development in all supporting countries. The SDGs are applicable to ...countries, non-governmental organizations, industries, and companies. In this article, we focus on the contribution of listed companies headquartered in the European Union (EU) to the SDGs. The EU intends to be the front-runner in the race for sustainable development and has adopted comprehensive strategies that mirror the UN SDGs. For this reason, we collected relevant data points from the Refinitiv Eikon database for 1156 companies headquartered in EU countries for the financial year 2022. The data collected refer to contributions to each SDG and the adoption of corporate sustainability policies. Data were statistically analyzed per country and sector to generate a comprehensive image of industry contributions to the SDGs in the EU. By applying a comparative analysis of country-level achievements and policies, the results point to four EU countries that are significant contributors to the SDGs through their economic activities. At the same time, other EU countries are still facing significant challenges in this domain. The socioeconomic considerations for these cases are laid out in the Discussion section. The present article offers a snapshot of corporate contributions to the SDGs as climate and geopolitical challenges become more prominent.
The purpose of this study is to investigate the differences between developed countries in terms of corporate governance outcomes at aggregate and granular levels. The population of companies was ...collected from the database curated by Refinitiv. The sample was selected according to two criteria: the existence of governance scores for the financial year 2021 and the registration of a company in any of the G20 countries or the European Union. The results are presented by ranking the G20 countries based on four aggregate indicators and four granular indicators of corporate governance quality. While the differences regarding the aggregate indicators are not statistically strong, the intercountry differences on board independence, board gender diversity, board skills, and auditor tenure are especially relevant. The present article opens an avenue of research on international corporate governance linked to cultural dimensions, comparative legal systems, national approach to corporate social responsibility, and corporate governance principles.
Using a model of inputs-environment-process-outcomes, our focus is the students' point of view on writing the master's thesis in accounting. We analyze the factors that influence the complexity of a ...thesis and the satisfaction of students with it. We used the answers received on two matched questionnaires distributed during the second semester of the academic year 2021-2022. The results of the path analysis show that planning and involvement in research and university support can increase the effectiveness of students' time management and improve satisfaction with the research outcome. Resource use increases the thesis complexity, too. The paper comprises a couple of implications: first, the quality of the thesis depends to a great extent on the initial planning phase, indicating that university support is crucial during preliminary work; second, university management must ensure the existence of necessary resources, which are a complex mix of supervision, collaboration, guidelines, and scientific sources.
This paper is based on the theory of hybrid organizations and we investigate the context, factors, mediators, and outcome of a public scandal involving a Romanian state-owned company in the civil ...aviation sector. This retrospective case study is part of a research design that alternates between inductive and deductive procedures devised to test relevant hypotheses, integrate several theories, and construct the causal mechanism of the corporate scandal. Four theories have been selected to address multiple aspects of the case: the hybrid organization theory, the agency theory, the fraud triangle theory, and the legitimacy theory. Several hypotheses have been proposed at the confluence of these frameworks, and the data collection process was conducted to ensure the credibility, dependability, and transferability of results. In addition to the themes and categories that have emerged from the thematic analysis, the paper also uses the process-tracing method to propose a causal graph and an event-history map in support of the hypotheses. The paper puts forward a series of recommendations on how to improve the corporate governance of state-owned enterprises, and to prevent potential scandals. The authors suggest that the separation of ownership and control is beneficial for strategy implementation in state-owned enterprises and can alleviate an entity’s financial difficulties.
PurposeThe relationships between integrated reporting quality (IRQ) and corporate governance characteristics have been studied extensively, but the results are still inconclusive and, sometimes, ...contradictory. The purpose of this paper is to systematize the results of previously published studies on the relationship between corporate governance and IRQ.Design/methodology/approachThis paper uses several complementary theoretical perspectives (agency, stakeholder and signaling theory). The relevant aspects of the corporate governance system are the attributes and composition of the board, the existence of a social responsibility committee, the quality of the audit committee, integrated report assurance and ownership structures. The sample consisted of 61 papers published in top journals between 2015 and 2021. Meta-analytic procedures were applied on bivariate and partial correlations between IRQ and the identified corporate governance characteristics.FindingsThe results confirm that director independence, the existence of a social responsibility committee, institutional ownership and the hiring of a Big 4 auditor are significantly correlated with IRQ. On the other hand, board gender diversity, audit committee independence and dedicated assurance have a positive but nonsignificant impact on IRQ. Chairperson-chief executive officer duality does not seem to impact report quality, while ownership concentration has a negative but nonsignificant impact on IRQ.Research limitations/implicationsFuture research can improve the measurement of focal indicators by using a common set of variables for comparability, favoring disaggregate measures of corporate governance and updating the measurement of some indicators. Future research could also propose new indicators in the area of corporate governance and expand the theoretical domain of IRQ research.Originality/valueThe findings emphasize the need to explicitly consider the role of corporate governance structures and arrangements in improving IRQ. Through meta-analysis, the paper aims to provide a comprehensive and generalizable set of findings, suggesting that corporate governance indicators cannot be overlooked as predictors of integrated reporting.
There is a growing interest in identifying the benefits that companies may have once they disclose financial and sustainability information in integrated reports. The aim of this study is to analyze ...the relationship between integrated thinking and reporting (ITR) and financial risk in nonfinancial companies worldwide. Data were collected mainly from the Refinitiv Eikon database for 7111 companies from 85 countries over the period 2017–2021. The focal industries are basic materials, consumer discretionary, consumer staples, energy, healthcare, industrials, real estate, technology, telecommunications, and utilities. Panel regression was used as a statistical procedure and random effects models are preferred. Hypotheses related to signaling theory are confirmed, as companies are interested in high-quality disclosures in integrated reports, reflecting a positive outlook and reduced financial risk. Our results show a negative relationship between ITR and the weighted average cost of capital, and a positive association between the main predictor and liquidity measured by the cash ratio. In addition, designing a compensation system linked to sustainability performance leads to a reduced cost of financing through debt and equity. Robustness tests were applied to the relationship between ITR and the weighted average cost of capital; the results show that stricter board oversight and holistic stakeholder management can decrease the average cost of capital and the financial risk for the company. This research is important for stakeholders looking to improve their knowledge about integrated reports and for practitioners seeking to enhance the quality of integrated reports and reduce the financial risk of companies.
