JOURNAL OF ECONOMICS AND BUSINESS最新文献

The primary objective of this research is to examine the impact of the EU Non-Financial Reporting Directive on the significance of specific board characteristics in promoting higher ESG scores among 835 European companies listed from 2002 to 2020. Empirical results indicate that gender diversity, cultural diversity, a higher number of independent directors on the board, and the presence of a CSR committee all significantly contribute to achieving higher ESG scores. Furthermore, the Non-Financial Reporting Directive 95/2014, which requires large EU firms to report on various environmental, social, and governance issues, not only drives EU firms to attain higher ESG scores but also significantly reduces the ESG gap between companies with and without a CSR committee. Meanwhile, other board characteristics have maintained their relevance to a substantial extent.

This paper examines the link between bank competition measures and risk indicators using quarterly interbank exposures data for all banks in Mexico during 2008Q1–2019Q1. The classical literature focuses on disentangling the link between competition and individual bank solvency risk. In this paper, we take one step forward in analyzing the relationship between competition and systemic risk. We use counterfactual bank-level contagion risk indicators as a proxy of systemic risk to assess their relationship with traditional competition measures. Our main finding indicates a negative relationship between the bank-level Lerner index and systemic risk. This means that an increase in competition is associated with an increase in systemic risk. Additionally, we find that the implementation of regulatory reform during the period studied does not affect this relationship.

This paper examines the factors contributing to the rapid collapse of Silicon Valley Bank, once regarded as one of the best banks. We show that the bank invested heavily in debt securities during a period of low interest rates, and the subsequent surge in interest rates in 2022 resulted in significant unrealized losses. Additionally, the bank's deposits were heavily concentrated among a small group of venture capitalists, which increased the likelihood of a bank run. Furthermore, the bank held less equity capital and had an inefficient risk management system, exacerbating the impact of the risk. Overall, the mismanagement of assets and liabilities led to the bank’s failure.

Research and development (R&D) activities are essential for firm growth and profitability. However, R&D activities also exacerbate information complexity in the financial markets. Therefore, the accuracy of earnings forecasts suffers when R&D expenses are high. This study aims to examine whether board independence can mitigate the adverse effect of high R&D expenditure on analysts' forecasts. Using a sample of 11,645 annual observations from 1997 to 2016, we find that board independence improves analysts' forecast accuracy for R&D-intensive firms. The improvement is more pronounced in firms with low analyst coverage and powerful CEOs. These results are robust with an alternative measure of information asymmetry, a dynamic generalized method of moments (GMM) model and a quasi-natural experiment based on the Sarbanes-Oxley Act of 2002 to address endogeneity concerns.

This paper extends the literature on the bank lending channel by assessing the interplay between monetary policy and funding liquidity in affecting undisbursed loans. Using a sample of Indonesian banks, our empirical findings highlight that a higher monetary policy interest rate increases undisbursed loan growth, suggesting that the bank lending channel affects borrower decisions. Furthermore, we find that banks with higher funding liquidity exhibit lower undisbursed loan growth in response to contractionary monetary policy. However, the role of funding liquidity in reducing undisbursed loans due to a higher monetary policy interest rate is more pronounced for weakly capitalized banks and small banks. On one hand, this paper emphasizes the role of funding liquidity, particularly for weakly capitalized banks and small banks, in maintaining financial intermediation during the implementation of contractionary monetary policy. On the other hand, we also emphasize that the effectiveness of the bank lending channel is mainly driven by highly capitalized banks and large banks.