Financial Performance - Organizational Sustainability Relationship. Literature Review

Organizational sustainability efforts focus on three main areas: people, profit, and the environment (Elkington, 1998). With an increasing emphasis on sustainable development, economic entities are concerned with achieving long-term performance, the capacity to create value and to meet the needs of interest groups (investors, employees, customers, communities, local development), but also on the development, promotion and implementation of concrete actions for environmental protection. This study aims to identify the current stage of the relationship between sustainable development and financial performance, in order to identify key elements, trends and research gaps. Based on these considerations, we performed a quantitative analysis of a sample of 62 articles from 3 databases (ScienceDirect, Scopus and Web of Science), which we subsequently studied qualitatively

Taxation: is flat rate better than progressive rate?

Our research aims to analyze the evolution in time and space of taxation rates and the impact of legislative changes on the microeconomic and macroeconomic environments, as well as the impact of legislative changes, the analysis of different models of tax systems based on the flat tax rate, used in Romania, or progressive tax rates, preferred in countries like France, Belgium and Luxembourg. Attempts at comparing personal income taxes are relatively rare and difficult to achieve precisely because of the tax legislation that is significantly different from one country to another in terms of tax base, tax rates or method of calculation of the various taxes and fees. Identifying the best taxation approach is the main goal of our paper. Our research is aimed at identifying the best taxation system, at determining the correlation between tax burden and tax income, thus analyzing the distributive effects of flat rates or progressive rates, and the effects of preferring one to the other, in other words determining whether they encouraged the formation of a middle class or on the contrary, they have deepened the inequity among the population, the effects that these systems have had on the social, economic and political environments in Romania and in the French-speaking countries included in our research: France, Belgium and Luxembourg

THE INFLUENCE OF THE CONNECTIONS OF ROMANIAN NON-LISTED FIRMS TO TAX HAVENS ON THEIR PROFITABILITY

The offshore entities have become one of the most efficient solutions for tax avoidance and are used by taxpayers almost all around the world. This paper investigates the influence of the connections (via subsidiaries or shareholders) of Romanian non-listed firms to tax havens on their profitability and effective tax rate. In this regard, we used a sample of 7,167 Romanian firms (3,370 with connections to tax havens and 3,797 without tax havens connections). For statistical analysis, we used the simple and multiple linear regression methods with dummy variables. Results have shown that the presence of Romanian non-listed firms in tax havens significantly influences their profitability and effective tax rate. The firms with connections to tax havens have a return on equity ratio higher, a return on assets ratio lower, a gross profit margin ratio lower, a total assets turnover ratio higher and an effective tax rate lower than companies without connections to such jurisdictions

Is Sustainability Reporting a Business Strategy for Firm’s Growth? Empirical Study on the Romanian Capital Market

This study analyzed the impact of sustainability reporting on firms’ growth as a result of adopting an environmentally and socially responsible behavior. The information published by companies listed on the main section of the Bucharest Stock Exchange during a period spanning six financial years (2012⁻2017) was used to assess the influence exerted by the conduct of activities related to sustainability; the integrated reporting of economic, social and environmental protection information; and the quality of published reports on certain indicators relevant to appreciating a firm’s growth (price-to-book ratio, sales growth and cost of capital). The results obtained indicate a low influence of sustainable reporting on a firm’s growth indicators. Current and potential investors, lenders and business partners interpret sustainability reporting as insufficiently documented and as having a low capacity for integration within the decision-making process. However, significant dependency relationships were identified, and particularized on various connections without following a correlation pattern between a firm’s growth directions and the indicators of sustainability reporting. The results remain robust even after the introduction of certain control variables, such as sustainability sensitive industry sectors, company size and age, or increase of investments. Our paper sets out to contribute to expanding the specialty literature by highlighting the involvement of sustainable reporting as a factor in optimizing firms’ growth strategies and, at a methodological level, by using a quantile regression