34 research outputs found

    A comparative study between the UK and the USA house price indicators before and during the financial crisis of 2007-2009

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    Purpose: The study aims to examine the relationship between key economic fundamentals and average house price movements before and during the financial crisis of 2007 to 2009 in the UK and the USA. Design/methodology/approach: Multiple regression analysis is applied in assessing the correlation between average house prices and a set of selected economic fundamentals. Findings: The study results show that earnings and to less extent interest rate have the highest correlation with the average house price (AHP) and among the different types of interest rate used variable interest rate has the strongest correlation with AHP. The results also reveal that most indicators behave in the same way both before and during the financial crisis, but with better explanatory power for the pre-crisis period. Another key finding is that the directions of relationship for some of the parameters have changed when the market is in crisis, especially in the case of loans extended to house purchase for the UK market and number of households for the USA market. Practical implications: The study findings provide insights to financial policy makers and bank managers on how different types of mortgage rates and other key economic fundamentals affect house price movements during the financial crisis and ultimately use this as a basis for their decision making in adjusting or altering these parameters to improve housing market stability. Originality/value: The originality of the paper stems in using a wide range and thoroughly selected economic fundamentals to explain the movement in house prices and to observe the effect of financial crisis on the correlation between each economic factor and house price movements. The study is also unique in comparing the UK and the USA housing markets for the time frame under consideration as well as for the economic parameters used

    A Comparative Study of Islamic and Conventional Banks Risk Management Practices: Empirical Evidence from Pakistan

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    While conventional bank risk management practices is well documented in the literature there is limited research devoted at comparing the risk management practices of Islamic and conventional banks and how the recent financial crisis affected the approach taken in each banking model to manage the risks. In this paper we use self-administered questionnaire to collect data from 150 bank senior managers and risk specialists from Pakistani conventional and Islamic banks to identify the main contributing factors to their risk management practices after the 2007-2008 financial crisis. The study results reveal that risk identification, risk assessment and analysis, credit risk analysis and risk governance are the most efficient and influential variables in explaining the risk management practices of Islamic banks. Whilst understanding risk management, credit risk analysis, and risk governance are the most significant and contributing variables in the risk management practices of conventional banks. Differences are also observed between Islamic and conventional banks in their liquidity risk analysis and risk governance. The results presented in this study are likely to benefit bank managers, investors, regulators, and policymakers as they will serve them as guide when developing, reformulating and overseeing the bank(s) existing risk management practices

    Money and Audit Practice in the UK Public Sector

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    This paper uses both role theory and audit expectations gap theory to critically evaluate the ability of Value for Money (VfM) audit procedures to improve performance in UK public sector organisations. Our paper reports on an empirical study of seventeen auditors and twenty two representatives of VfM client organisations. The results show that although the VfM audit plays a part in enhancing the institutional performance of the public sector, much of the audit‟s practices have not been institutionalised in the audited bodies as had previously been assumed. Questions were raised about the relevance of the auditors‟ experience and knowledge of the audited body‟s activities. Our results also indicate significant role conflicts in the VfM process. Three types of conflict could be identified; (a) conflict between the VfM auditors‟ roles and their own professional values and standards (person-role conflict); (b) conflict between the VfM auditors‟ capabilities and their role requirements (role overload), and (c) conflict between the auditors and the auditees (inter-sender conflict)

    Stimulating learning about social entrepreneurship through income generation projects

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    Purpose – This empirical paper examines the use of income generation projects as a pedagogic method to assess students’ learning about social enterprises. We are interested in how and why this innovative approach might improve students’ understanding of the different aspects and attributes of social entrepreneurship. Design/methodology/approach – our study used thematic analysis of qualitative data comprising the reflective logs of 87 students on an undergraduate entrepreneurship module in a university business programme. The major attributes of social entrepreneurship were identified from a review of literature, and we used the logs to judge whether students had learnt about these attributes. Findings – results show that students developed an understanding concerning social enterprises’ diverse stakeholder environment, market needs, social enterprises’ ideological foundations, resource mobilisation processes and performance measurement – both social and financial. In addition, they developed skills in reflection and self-awareness, communication, empathy and the generation of new ideas. Research limitations/implications – our study is limited in that it focused on only one cohort of students, undergraduates. We cannot claim that our findings are generalisable to other students or contexts. Practical implications – students are better able to understand the needs and values of social enterprises. However, this is a resource intensive process for educators with implications for curriculum design and management. Social Implications - This study sheds new light on how experiential learning helps to raise students’ awareness of social enterprises. Originality/value – this study sheds new light on how experiential learning in the form of income generation projects helps to raise students’ awareness of social enterprises. Its value lies in helping to develop a novel and effective pedagogy for entrepreneurial learnin

    Sharia boards, managerial strategies and governance practices in Islamic banks: Critical insights using Goffman’s lens

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    Purpose – The study applies Erving Goffman’s (1974) “frame analysis” principles to examine how Sharia governance is practiced in Islamic banks and explores the interaction and strategies adopted by bank managers to influence the decisions of Sharia scholars. The study also aims to identify inherent flaws in the Sharia compliance review system. Design/methodology/approach – The study employs the principles of Goffman as a lens to critically analyse a rich dataset obtained through interviews undertaken with 46 key players operating in the governance framework of the Malaysian Islamic banking industry due to its progressive Islamic governance framework. Findings – The study demonstrates that managers of Islamic banks may engage in “passing” and “covering” strategies while interacting within the governance structure. Concurrently, Sharia boards (SBs) implement “protective practices” during their interactions, adding complexity to their responsibilities within the banks. Consequently, SBs cannot merely be viewed as instruments for legitimising banking operations. This raises questions about the “impression management,” “concealment” and “competence” strategies employed by managers and SB members, as suggested by Goffman’s framework. These findings indicate that there is room for further enhancement in the governance practices of Islamic banks. Research limitations/implications – Future research could explore aspects related to the governance of Islamic banks, such as investigating the independence and effectiveness of internal Sharia officers. Examining the strategies employed during their interactions with external Sharia boards and other stakeholders could provide further valuable insights. Practical implications – By highlighting shortcomings in the governance and compliance review process, the findings could serve as a valuable resource for policymakers. The insights derived could inform the development of regulations aimed at reducing opportunistic behaviour and promoting accountability in the Islamic banking sector. Originality/value – This study uniquely employs Goffman’s concepts of “frontstage” and “backstage” strategies to offer insights into the interactions between Islamic bank managers and SBs and the impact of these interactions on Sharia compliance. The study contributes to the understanding of the dynamics between key players in the governance of Islamic banks and the factors influencing their adherence to Sharia principles

    An Empirical Investigation of the Regulatory and Non-Regulatory Challenges of the UK Islamic Retail Banking

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    The paper examines the regulatory and non-regulatory challenges facing the growth of Islamic retail banking in the UK. Our analyses reveal that policy-makers and regulators in the UK have taken many actions to encourage the growth of Islamic finance. However, despite the suitable regulatory environment, UK Islamic retail banks have so far failed to convince consumers of the credibility of their services due to the questionable structure of their products. Intriguingly, the current system of Shar ̄ı‘ah assurance is perceived to have several weaknesses which could perhaps lead to ambiguity, confusion and loss of credibility in the eyes of consumers. Our findings also reveal several key religio-ethical considerations. In particular, we highlight that the future of UK Islamic retail banking is bleak unless these issues are urgently tackled by creating a more transparent Islamic banking system and improving the current structure of Shar ̄ı‘ah-compliant products to preserve the expected ethical and societal legitimacy of Islamic banks

    Dynamic Capability and Strategic Corporate Social Responsibility Adoption: Evidence from China

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    An increasing number of studies have proposed that corporate social responsibility (CSR) performance depends on how firms apply their resources and capabilities to implement CSR. A firm’s ability to integrate, build, and reconfigure internal and external competencies to respond to environmental changes is its dynamic capability. Implementation of CSR at the strategic level, i.e., strategic CSR (SCSR) that requires alignment between activities and organizational configuration and structure will contribute to a firm’s sustainability. However, the research on how dynamic capabilities contribute to such alignment and SCSR adoption is incipient. This study investigates how dynamic capability influences the performance of SCSR in China. By analyzing 134 Chinese listed firms in the period 2017–2019, in this study, we found that firms with dynamic capabilities at a non-average-industrial level, i.e., higher or lower level than the average industrial level, were less likely to adopt SCSR practices, and had a low SCSR adoption performance. These results can help firms better understand dynamic capabilities and how dynamic capabilities contribute to SCSR adoption and firms’ sustainable development and operations. The policy implications of the study are also discussed

    The Effects of Mergers and Acquisitions on Acquiring Banks’ Contribution to Systemic Risk

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    This paper is the first to examine the effects of international bank mergers and acquisitions on acquirers' contribution to systemic risk covering the period from 1998 to 2015. Our sample consists of 608 international bank mergers, involved domestic and cross-border deals as well as conglomerate and non-conglomerate mergers. Using the Marginal Expected Shortfall (as in Acharya et al., 2017) as well as Conditional Value-at-Risk (as in Adrian and Brunnermeier, 2016) as systemic risk measurements, we find that on average, mergers do not impact on the acquiring banks’ contribution to systemic risk regardless of the increased potential for risk diversification exhibited by cross-border and cross-industry bank mergers. Determinants that contributes to the decrease in acquirers’ systemic risk include product diversifying deals, deals conducted in a more concentrated banking system and a stable political environment. Whereas, for deals financed by cash only and much smaller compared to acquirers as well as involved private targets, acquirers' contribution to systemic risk increase after the merger

    The Effect of Block Ownership on Future Firm Value and Performance

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    This paper examines the performance of the investment decisions of block owners. The block ownership data is obtained from Dlugosz, Fahlenbrach, Gompers, and Metrick (2006). We find that firm valuation (measured by Tobin's Q), operating performance (measured by changes in return on assets) and stock performance (measured by excess buy and hold returns) are positively and significantly related to the previous years' level of block ownership both in terms of the size of the ownership and the number of blockholders. Our results are robust to endogeneity concerns. Regarding whether a specific blockholder is an “insider” or an “outsider” to the firm, we find that the ownership of “outside” blockholders is a key determinant in explaining future firm performance. Note though that this category makes up about two-thirds of the aggregate amount of blockholding in Dlugosz et al. (2006) database, and also includes all blockholders not classified in other categories. In general, we attribute the superior performance to the presence of more blockholders. We also find an inverse association between the volatility in blockownership and the ex-post firm performance measures

    Are retailers “bagging” the carrier bag levy in England? An exploratory enquiry

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    This paper examines the business impact of the legislation in England requiring retailers to charge consumers for single-use carrier bags. The legislation impacts three key stakeholders – Government, retailers, and consumers. The primary focus of this study is, however, from the perspective of retailers and how this group of stakeholders may have benefitted from the charge. Retailers are using the collected revenues to promote their image in the marketplace and presenting themselves as corporate social responsible entities. For retailers, the charge provides an avenue for bolstering their carbon footprint as consumers are expected to reuse their plastic bags – i.e. the “bag for life” as they now have to pay for them. At the same time, the proceeds are helping some retailers to top up their coffers which to some extent implies that there is some misuse or abuse of the policy by retailers
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