The economic consequences of financial reporting on Twitter

This thesis examines stock market reaction following financial reporting information on Twitter. The results indicate that larger companies and companies closer to technology are more likely to adopt Twitter for financial reporting. Smaller companies receive greater benefits (reduction of information asymmetry) from this practice, as well as disclosing multiple financial reporting tweets. This study encourages frequent use of Twitter and other new Information Technology, to increase the visibility of small companies. This study provides new evidences to inform regulatory policy and promote ‘best practice’ guidelines for financial reporting on social media

When Insider Trading and Market Manipulation Cross Jurisdictions. What Are the Challenges For Securities Regulators and How Can They Best Preserve the Integrity of Markets?

Over the last few decades world securities markets have become significantly more sophisticated in terms of how securities are traded as well as the variety of securities traded. My hypothesis is that the ability of securities regulators to take enforcement action against market abuse has not kept pace with the level of sophistication of the markets and, in particular, the way in which trading can take place across borders and the manner in which market related information can spread rapidly across the world. I argue that that regulators need to do more to protect the integrity of the markets by improving their efforts to initiate action against market abuse. Furthermore, given the global nature of the problem I argue that the International Organization of Securities Commissions (IOSCO) should be more proactive in coordinating the activities of securities regulators in this regard. I commence with an analysis of why the integrity of securities markets is critical to the economy of a country and why it is necessary for regulators to enforce laws prohibiting market abuse in order to protect market integrity. I then move on to identify the changes to securities markets, the regulatory responses to these changes, trends in the types of market abuse which is taking place across borders and how those responsible for taking enforcement action against such market abuse have responded. Finally I consider IOSCO, its history, how its role has evolved, its impact to date and how IOSCO could build upon its success in terms of improving the enforcement outcomes of securities regulators in relation to market abuse. I conclude that the transformation of the markets have presented opportunities to engage in market abuse across borders and that, while some positive steps have been taken to address this issue, more could be achieved. Finally I discuss and make recommendations about what might be done to improve the ability of securities regulators to take successful enforcement action

Commentary - Much ado about something else. Donald Trump, the US stock market, and the public interest ethics of social media communication

Trump’s use of social media during both his presidential campaign and term questions the principle that institutional responsibility in the digital realm implies treating the infosphere as a commons. We discuss the implications for the functioning of the stock market and the emerging public interest ethical issues related to the breakdown of this principle

Responsible Investing: Access Denied

Retail investors are increasingly demanding responsible investments. Retail investors also require the services of an advisor. Many responsible funds may not be responsible. This is due to many factors, including incomplete disclosures, and lack of financialization of risks. The thesis shows that traditional mutual funds, while structurally able to provide responsible investments, have not provided responsible holdings to mass affluent clientele. Institutional investors, and wealthy retail investors, have options to avail themselves of responsible investments; mass affluent investors have less choice to invest responsibly. The thesis recommends enhanced material disclosures and financial valuation models to better identify responsible investments. Advisors and investors do not have access to the majority of responsible investments, nor are advisors properly trained or compensated to provide advice on these products. Regulatory changes to advisor licensing and advisor training are recommended to address these problems, to provide mass affluent investors with better access to responsible investments

Internationalisation: Global Issues

There is much to be done to help Australian SMEs raise their game in the international marketplace. Evidence shows a weak international performance by SMEs, but also grounds for optimism. In terms of government policy interventions, we recommend: A targeted approach, aimed at those SMEs that seek to internationalise but have not yet done so, and those that are already exporting and seek to expand their international reach into new markets A higher priority on facilitating SME exports in the six most internationally active industries, including ‘mining’, ‘agriculture’, ‘manufacturing’, ‘wholesale’, ‘information media’, and ‘professional’ Greater emphasis on encouraging small and self-employed firms to participate in foreign markets by providing targeted export incentives, support for network and international collaboration, business matching opportunities, and facilitating access to finance Increased support for growth and innovation to boost the number of exporters and accelerate their international activities More support for SMEs in terms of detailed information provision, such as tailored advice and a mentoring program for firms internationalising in different geographical markets, in-depth discussion forums and network events

How European Human Rights Law Will Reshape U.S. Business

In recent years several European states have enacted human rights due diligence laws, culminating in the imminent EU-wide Corporate Sustainability Due Diligence Directive. This article provides a comprehensive analysis of these laws and explores their potential impact on U.S. businesses. Human rights due diligence emerges from the United Nations Guiding Principles on Business and Human Rights (2011) and was originally conceived as a voluntary means by which corporations could demonstrate that they proactively monitor and manage potential human rights abuses within their corporate group and supply chains. Since 2017, European states have begun enacting binding human rights due diligence laws. These laws are innately extraterritorial in nature, designed to ensure that corporations that operate in the European market comply with human rights standards throughout their value chain, including through their suppliers and business partners. The emergence of European due diligence laws will thus impact U.S. businesses and industries: an estimated 10,000 U.S. businesses will be directly affected, and far more will have to comply as a result of supplying or partnering with EU-based firms. The effect on U.S. business could be dramatic, particularly with major divergences between the EU and United States in relation to labor law and other legal regimes. The article analyzes how U.S. businesses will be affected, what businesses may need to do, and how divergent legal regimes may be addressed. It further discusses options for the U.S. Government to take a proactive approach to the European incursion on U.S. law and business in the interest of protecting rights while providing business certainty

CEO remuneration: Australian evidence of the influence of reputation, performance and governance

The purpose of this research is threefold. Firstly, to establish that CEO professional reputation is a determinant of CEO remuneration. Secondly, to determine whether company financial performance, in particular cash flow, has any influence on CEO remuneration. Or, is there an alternative measure of company performance that is productivity, which influences CEO remuneration? Thirdly, to obtain further empirical evidence on whether there is a crisis in the current Anglo-American corporate governance structure by researching the influence, if any, that the remuneration committee and substantial shareholders have on CEO remuneration. The methodology adopted in this research is a panel data analysis of companies in the ASX Top 200 over a three-year period from 2007 to 2009 covering the Global Financial Crisis (GFC). Data are obtained from secondary sources, in particular companies’ annual reports. There are a number of findings from this research. CEO professional reputation has a significantly positive effect on CEO fixed remuneration. In addition, there is a significant relationship between operating cash flow as a measure of company financial performance and CEO remuneration. Also, company productivity as an alternative measure of company performance has been shown to have a significant relationship with CEO remuneration. However, corporate governance factors of remuneration committee independence and diligence, as well as the monitoring effect of substantial shareholders, in general do not have any significant relationship with CEO remuneration. This research makes several contributions to the existing literature. It introduces a determinant of CEO remuneration which has not been researched in the past that is CEO professional reputation. In addition, it illustrates how a reputation index is constructed. Furthermore, this study identifies cash flow as a company financial performance measure which affects CEO remuneration particularly during a period of financial crisis. Last but not least, empirical evidence shows that company productivity as an alternative measure of company performance, has an influence on CEO remuneration

Perspectives from mainland China, Hong Kong and the UK on the development of China’s auditing firms: implications and a research agenda

Based on gaining privileged access to interview senior representatives of audit firms, regulatory bodies, financial institutions, universities and other organisations in mainland China, Hong Kong and the UK, this exploratory study presents a range of informed views about the rapid development of China’s auditing profession over the last 25 years. It explores the emerging roles of the firms in the 2nd-tier international networks and among the larger stand-alone firms as challengers to the Big 4, nationally and internationally. It identifies national and international institutional interactions that have shaped and are being shaped by this rapid growth, with particular reference to the overarching role of the State’s shifting strategies to create a domestic profession in China that can compete internationally. The potential consequences, given China’s unequalled size and its expanding global influence, could change the nature and structure of the global profession. A significant contribution of this exploratory empirical study has been to deconstruct the continuing conventional political and academic rhetoric that dichotomises firms into ‘foreign vs local’ and ‘Big 4 vs other’. It contributes new voices and alternative perspectives to the emerging literature on the glocalization of large professional services firms and suggests new opportunities for future auditing research

Measuring knowledge sharing processes through social network analysis within construction organisations

The construction industry is a knowledge intensive and information dependent industry. Organisations risk losing valuable knowledge, when the employees leave them. Therefore, construction organisations need to nurture opportunities to disseminate knowledge through strengthening knowledge-sharing networks. This study aimed at evaluating the formal and informal knowledge sharing methods in social networks within Australian construction organisations and identifying how knowledge sharing could be improved. Data were collected from two estimating teams in two case studies. The collected data through semi-structured interviews were analysed using UCINET, a Social Network Analysis (SNA) tool, and SNA measures. The findings revealed that one case study consisted of influencers, while the other demonstrated an optimal knowledge sharing structure in both formal and informal knowledge sharing methods. Social networks could vary based on the organisation as well as the individuals’ behaviour. Identifying networks with specific issues and taking steps to strengthen networks will enable to achieve optimum knowledge sharing processes. This research offers knowledge sharing good practices for construction organisations to optimise their knowledge sharing processes