Properties that influence business process management maturity and its effect on organizational performance

Abstract BPM maturity is a measure to evaluate how professionally an organization manages its business processes. Previous research provides evidence that higher BPM maturity leads to better performance of processes and of the organization as a whole. It also claims that different organizations should strive for different levels of maturity, depending on their properties. This paper presents an empirical investigation of these claims, based on a sample of 120 organizations and looking at a selection of organizational properties. Our results reveal that higher BPM maturity contributes to better performance, but only up to a point. Interestingly, it contradicts the popular belief that higher innovativeness is associated with lower BPM maturity, rather showing that higher innovativeness is associated with higher BPM maturity. In addition, the paper shows that companies in different regions have a different level of BPM maturity. These findings can be used as a benchmark and a motivation for organizations to increase their BPM maturity

Financial and corporate social performance in the UK listed firms: the relevance of non-linearity and lag effects

Using environmental, social and governance scores compiled by Reuters Datastream for each company’s corporate social performance (CSP), we examine the relationship between CSP and corporate financial performance (CFP) of 314 UK listed companies over the period 2002–2015. We further evaluate the relationship between prior and subsequent CFP and prior and subsequent CSP. Based on the system-GMM estimation method, we provide direct evidence that suggests that while CFP and CSP can be linked linearly; however, when we examine the impact of CSP on CFP, the association is more non-linear (cubic) than linear. Our results suggest that firms periodically adjust their level of commitment to society, in order to meet their target CSP. The primary contributions of this paper are testing (1) the non-monotonous relationship between CSP and CFP, (2) the lagged relationship between the two and the optimality of CSP levels, and (3) the presence of a virtuous circle. Our results further suggest that CSP contributes to CFP better during post-crisis years. Our findings are robust to year-on-year changes in CFP and CSP, financial versus non-financial firms, and the intensity of corporate social responsibility (CSR) engagement across industries

Options

This chapter provides an overview of option markets and contracts as well as the basic valuation of options. Its primary purpose is to examine the behavior of the competitive firm that faces not only output price uncertainty but also a multiplicative revenue shock. The firm can trade fairly priced commodity futures and option contracts for hedging purposes. This chapter shows that neither the separation theorem nor the full-hedging theorem holds when the revenue shock prevails. The correlation between the random output price and the revenue shock plays a pivotal role in determining the firm’s optimal production and hedging decisions. If the correlation is non-positive, the firm optimally produces less than the benchmark level in the absence of the revenue shock. Furthermore, the firm’s optimal hedge position includes both the commodity futures and option contracts. However, if the correlation is sufficiently positive, a canonical example is constructed under which the firm optimally produces more, not less, than the benchmark level. The firm as such uses operational and financial hedging as complements to better cope with the multiple sources of uncertainty

Mutual funds: Management styles, social responsibility, performance and efficiency

The mutual fund industry represents a substantial part of global financial markets with approximately 20 percent invested in mutual funds. Mutual funds offer a simple and easy-to-understand way to invest either into stocks or fixed income products, both for retail and institutional investors. This chapter provides an overview of the literature on the performance of actively and passively managed mutual funds with special emphasis on socially responsible funds. First, the chapter offers insights into the mutual fund industry worldwide and discusses the characteristics of active and passive management. Then the chapter discusses a prominent management style—SRI. The final sections review the efficiency of the mutual fund industry, performance measurements, and sources of returns and outperformance