Contextualizing comprehensive board diversity and firm financial performance: Integrating market, management and shareholder’s perspective

Commitment to sustainability in large European banks and its relationship with board gender diversity: a 2030 Agenda perspective

Ensuring a sustainable future by meeting the Sustainable Development Goals (SDGs) cannot be achieved without women's empowerment and gender equality. This study aims to determine whether there are differences between European banks in terms of their commitment to SDGs and the intensity of this commitment depending on their board gender diversity. A sample of the 50 largest European banks from 2016 to 2020 was used to perform hypothesis testing for differences in means. The results provide robust support for the assertion that banks with greater female representation on the board of directors have a greater commitment to the 2030 Agenda. The originality of this research lies in the use of indicators of commitment to SDGs corresponding to each of the five SDG pillars. This study thus provides the first evidence of the importance of distinguishing between these pillars when examining the relationship between commitment to SDGs and board gender diversity. This evidence advances the scant literature on this relationship.

Diversity and Governance: Is There Really Progress?

The purpose of the study was to determine if the diversity of gender, nationality, and age has a positive and significant effect on adopting corporate governance practices. The study considered 1106 corporate social responsibility and corporate governance reports from 2015 to 2020. The research was of the descriptive–correlational type, with a longitudinal temporality, considering in the first instance an analysis of the disaggregated descriptive statistics to later determine if the diversity of gender, nationality, and age of the board affects the adoption of corporate governance practices. The results show a low degree of diversity and stagnation in the analyzed period. Regarding the adoption of corporate governance practices, these are in an incipient stage, and the most liquid companies in the Chilean stock market are the ones that have advanced the most during the period. It is concluded that gender diversity has a positive and significant impact on the degree of adoption of corporate governance practices, operation, and composition of the board of directors, and protection of shareholders, while the diversity of nationality has a positive and significant impact on the adoption of related practices to risk management. Finally, the study confirms the heterogeneity of results by linking board diversity variables versus non-financial variables.

Diversity of the Board of Directors and Financial Performance of the Firms

The diversity of the board of directors continues to be a matter of concern for investors, regulators, and the general public. In this sense, the purpose of the research presented was to identify whether there is a positive and significant impact between the diverse variables of the board of directors and the financial performance of the firms. In this context, the study’s objective was to determine if the diversity in the composition of the boards of directors has a positive and significant impact on the financial performance of the companies listed in the Chilean stock market. The study considered a sample of 1106 reports on social responsibility and sustainable development between the 2015–2020 period and their respective returns. The research was descriptive-correlational, which determined the incidence of gender, nationality, and age diversity in the financial performance of the firms. The results show, in general, a low degree of gender and nationality diversity in Chilean boards. However, a positive and significant impact is observed in the commercial sector, nationality diversity, and the construction and gender diversity axis. In this regard, the study allows confirming the heterogeneity of results by linking the variables of diversity and financial performance and the importance of conducting sufficiently disaggregated studies to understand the relationship between both types of variables. Finally, this study updates the diversity levels of the board of directors for the Chilean stock market and establishes challenges for the regulator in terms of gender quotas and good corporate governance practices.

Good corporate governance and corporate sustainability performance in Indonesia: A triple bottom line approach

This study aims to investigate the effect of good corporate governance (GCG) on corporate sustainability performance (CSP) using the Triple Bottom Line (TBL) approach in a two-tier GCG system. GCG is measured by the size and education background of board of commissioners (BoC) and top management team (TMT). CSP consists of economic, social, and environment sustainability performance. As many as 117 sample data were collected from the financial statements, annual reports and sustainability reports of non-financial companies listed on the Indonesia Stock Exchange (IDX) for the period of 2013–2017. Multiple regression analysis was employed to test the hypotheses studied with the following results. First, BoC education has a negative effect on economic and environmental sustainability performance and no effect on social sustainability performance. Second, BoC size has a positive effect on economic sustainability performance, a negative effect on social sustainability performance and no effect on environmental sustainability performance. Third, CEO's education has a negative effect on economic sustainability performance, and no effect on environmental and social sustainability performance. Fourth, TMT size has a negative effect on economic and environmental sustainability performance and no effect on social sustainability performance. Contributions, limitations and implications of the study are also discussed.

Sustainable Business Practices and Firm’s Financial Performance in Islamic Banking: Under the Moderating Role of Islamic Corporate Governance

This paper examines the moderating role of Islamic corporate governance on the link between sustainable business practices and the firm’s financial performance. A post-crisis period sustainability data for the decade of 2008–2017 was collected by the study. For data collection, this study used the weighted content method. The Generalized Method of Moments (GMM) statistical test was used for empirical testing. The results of the study found that the link between sustainable business practices with the firm’s financial performance measured from the shareholders’ and the management’s perspective is positive, while the subjected link measured from the market perspective was found to be insignificant. This implies that the market stakeholders of the Islamic banks are reluctant for their bank’s spending on sustainable business practices. Interestingly, the insignificant link between sustainable business practices and market performance became significant with the moderating role of Shariah governance and managerial ownership. It shows that the moderating role of Shariah governance and managerial ownership is giving confidence to market stakeholders of Islamic banks for receiving a higher financial return through sustainable business practices initiatives. These results may provide insights for several policymakers of the Islamic banking industry about integrating vital sustainability practices in their business models and about the balanced moderating role of Islamic corporate governance in the link between sustainable business practice and the firm’s financial performance. It provides a roadmap to the Islamic banking industry for efficient management of sustainability practices from an Islamic perspective and subsequently improvement of financial performance through it.

Entrepreneurial engagement in a depleted small town: Legitimacy and embeddedness

Our study of entrepreneurial engagement within a depleted New Zealand community contributes to understanding the role of place and legitimacy in entrepreneurial practice. General decline characterised Stanton until a newcomer entrepreneur started several businesses that rejuvenated the town. She became a local economic hero to many stakeholders; but others deployed social narratives of place that drew on different values. Our analysis of interactions shows how perceptions of place legitimise or vilify and we demonstrate how place intercedes upon economically generated legitimacy of entrepreneurial practice. Social constructions of place and notions of embeddedness influenced this entrepreneurial enactment. Conceptually, we challenge ideas about universal legitimacy ensuing from economic entrepreneurial benefits. Our theoretical contribution offers socio-spatial propositions for understanding entrepreneurial legitimacy through place.