The rise of MNCs, the expansion of the EU and several M&As have exposed German boards to a variety of cultures. But does diversity in the boardrooms improve performance? Based on an empirical study on German publicly listed companies, this unique research into cultural diversity answers the question if the level of cultural variety and cultural distance on boards of directors have an influence on firm performance in Germany. The results, which show a negative, linear influence of both cultural variety and cultural distance on operating performance measures, show empirical support for the importance of contextual factors in the relationship between diversity and performance. The authors ask for careful consideration before implementing regulations on board diversity.
Purpose This paper aims to examine a case to illustrate the linguistic perception of corporate responsibility disclosures.
Design/methodology/approach In this study, a content analysis framework based on fuzzy linguistic variables is proposed to measure the level of sustainable and responsible practices perceived by the stakeholders. A case is examined to illustrate the linguistic perception of corporate responsibility disclosures.
Findings The results demonstrated a significant difference between Perception of Disclosure, using linguistic variables and most common sustainability indicators, and a Boolean analysis based on sustainability reporting indicators. The approach helps companies in developing a more robust stakeholder management program and to better respond to stakeholders' demands.
Research limitations/implications Future studies can evaluate corporate responsibility and sustainability performance using linguistic variables.
Practical implications The approach helps companies to better respond to stakeholders' demands.
Social implications The approach helps companies in developing a more robust stakeholder management program and to better respond to stakeholders' demands.
Originality/value Most of the studies on corporate responsibility disclosure analysis have focused on a binary response to the level of disclosure of a certain economic, social, environmental or governance issue; however, how a disclosed item is being perceived by the user has not been taken into consideration.
PurposeDrawing upon social exchange theory and psychological contract (PC) research, this study aims to examine the impact of supervisors' fulfillment/non-fulfillment of transactional psychological contract (TPC) and relational psychological contract (RPC) promises on employees' reactions (e.g. feelings of violation, trust in the supervisor and organizational commitment) in a non-Western context, namely, the United Arab Emirates (UAE).Design/methodology/approachAn experimental field design was used with a sample of employees (N = 234) from a wide range of nationalities and work backgrounds. Four conditions were developed by manipulating the fulfillment of three TPC promises (e.g. competitive salary) and three RPC promises (e.g. sufficient power and responsibility). Participants were randomly assigned to the four conditions and asked to complete the study materials as if they were experiencing a real employment situation with a real organization. Hypotheses were tested using multivariate analysis of covariance and follow-up univariate analysis with Bonferronipost hoccomparisons.FindingsThis study demonstrated that a supervisor's failure to fulfill promises pertinent to both TPC and RPC, or one of them, generated negative reactions among participants. Based on a comparison of means analysis, this study also established that breach of TPC promises produced a higher negative impact than breach of RPC promises on perceptions of breach, feelings of violation, trust in the supervisor, organizational perceptions, organizational commitment and recommendation intentions. Furthermore, these findings revealed that a supervisor's breach of RPC promises has no significant incremental (additive) effect above a supervisor's breach of TPC promises. On the other hand, a supervisor's breach of TPC promises has a significant incremental (additive) effect above a supervisor's breach of RPC promises.Originality/valueThis study is one of the very few studies that examined and established, under a controlled setting, the differential effects of fulfillment/non-fulfillment of both TPC and RPC promises on employees' breach perceptions, emotions, attitudes and behavioral intentions.
PurposeThe purpose of this study is to evaluate the comprehensiveness of sustainability reporting in higher education institutions.Design/methodology/approachThis study adopts a university sustainability rating framework and uses it to evaluate the comprehensiveness of sustainability reporting in higher education institutions.FindingsThe results of the study demonstrate that notwithstanding growing concerns over sustainability issues; higher education institutions have been slow to adopt sustainability reporting practices including publishing consistent and periodic reports, receiving third-party assurance and integrating sustainability reporting into university's sustainability management systems.Research limitations/implicationsThe results of the study suggest that the quality of sustainability reporting varies quite significantly, and important dimensions such as education and outreach programs are ill-treated in universities' sustainability reports. The quality presents a tremendous challenge for sustainability reporting as more organizations are joining the sustainability reporting process, the quality would become a differentiator and competitive advantage, the study concludes. Two main limitations were identified. First, the number of reports examined were limited and are not representative of all higher education institutions. Second, data from other sources, like websites, were not factored in the analysis, as the study focuses on evaluating the comprehensiveness of sustainability reporting in higher education institutions.Practical implicationsThe results provide useful insights into comprehensiveness (one aspect of quality of sustainability reporting) in higher education institutions and help to better navigate the future trends in sustainability reporting practices of universities.Originality/valueSustainability reporting is well established in the corporate environment; however, the extent to which it has been adopted and its quality in universities remains relatively unexamined. The study attempts to fill the research gap in the quality of sustainability reporting (comprehensiveness) in higher education institutions to better navigate the future trends in sustainability reporting practices of universities.
Despite the opening of the market and partial privatization of state‐owned companies in China, the state still represents the controlling shareholder in larger companies. By analyzing the weaknesses of Chinese corporate governance we illustrate the framework for harmful corruption. China is characterized by a weak legal system and strong influences of traditions such as guanxi. In this article we analyze the influence of guanxi on the Chinese corporate governance system. We find that guanxi is in general a double‐edged sword, but business‐to‐government guanxi in particular can harm the weak Chinese corporate governance system and hamper its further economic development and growth.
PurposeThis paper seeks to illustrate the development of corporate governance issues in the transition economies of Central and Eastern Europe (CEE) and to analyze if codes based on directives or standards are better for these economies.Design/methodology/approachA chapter about corporate governance codes and the respective (dis)advantages of directives and standards starts the paper. Then common European and specific transition economies' corporate governance problems followed by a discussion of directives versus standards for CEE countries are described.FindingsThe paper finds that historical development of the transition economies in CEE leads to specific corporate governance problems such as high court delays, corruption and immature institutional investors. The introduction of corporate governance codes for these economies seems useful but should not rely on broad standards but on legally enforced binding rules accounting for the discussion of directives versus standards.Research limitations/implicationsResearch on the weaknesses of legal systems in transition economies is mainly verbally argued and needs more empirical backing. The discussion of directives versus standards is limited as we live in a world of flux – standards are becoming directives over time.Practical implicationsThe paper argues against the blindfold implementation of corporate governance codes of other countries and argues for country specific solutions keeping in minds the different effects of directives and standards.Originality/valueThe paper opposes the mainstream thinking that corporate governance codes are the ultimate ratio for transition economies in countries of CEE.
