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The issue of our journal Corporate Governance and Organizational Behavior Review, which is focused on corporate governance and accounting quality, and sustainability management.

Purpose
Over the past decades, corporate social responsibility (CSR) has been considered as a significant corporate strategy and also has been documented as a main information dissemination mechanism of corporations to shareholders, creditors and other external stakeholders. This fact makes the CSR activities and CSR performance interconnected with the quality of firms' financial reporting. The purpose of this paper is to study the impact of CSR performance on the earnings management (EM) behaviour using a sample from 24 European Union (EU) countries summing up to 121,154 firm-year observations over the period 2003–2018.


Design/methodology/approach
The study uses a multi-country data set with various dimensions of CSR performance including indexes regarding workforce, community relations, product responsibility and human rights protection. The empirical analysis is conducted with panel data regressions.


Findings
Evidence supports the negative association between CSR and EM indicating that high CSR performing firms are associated with less income smoothing and discretionary accruals, thus with higher financial reporting quality.


Practical implications
Regulatory agencies in the EU could use the findings of the study for the improvement of the accounting framework via enhancing the use and publications of social and environmental responsibility information and reports.


Social implications
Also, the current paper could be of interest not only to academic researchers but also to potential and existing investors in European corporations. The negative association between CSR performance and EM could be used by investors in assessing the risk of firms and the quality and reliability of their financial information.


Originality/value
This is the first study within the EU, which considers the multi-facet characteristics of CSR on the quality of accounting earnings and offers useful policy implications for regulators and investors.

"Corporate social responsibility (CSR) has been developed into a crucial corporate and organizational issue around the world. It has been incorporated within various sectors, countries and includes many types of activities and dimensions. It is common ground that organizations are more inclined today to broader their performance focus form short-term oriented goals towards a long-term social, environmental and value-added perspectives. Under the framework of corporate governance, organizations and companies are motivated to promote fairness, transparency, ethics and accountability in their transactions, while concurrently maintaining enhanced standards of governance. This means that organizations and corporations must align their activities with community aspirations which is an issue falling within the sphere of CSR. Increased attention has been exerted on the organizations regarding their approach towards the needs of various stakeholders. However, a crucial issue that this book attempts to address is the association, intersection and the inter-relationship between governance and CSR within the EU region, not adequately established in the existing literature. The book will show that governance and CSR are highly connected. With the purpose to study the association of CSR with legal, managerial and empirical aspects of governance in corporations and not-for-profit organizations, through various sectors of the economy, the book also intends to provide useful policy implications as well as to offer constructive directions for future research. It will be of value to researchers, academics, practitioners, policymakers, and students in the fields of corporate social responsibility and governance, organizational theory, marketing management, business ethics and human resource management"--

PurposeThe main purpose of this paper is to examine the relationship between human capital investments and financial performance in the professional football industry. The authors examine this association by controlling for internal (club-level) mechanisms of governance. Specifically, as they deal with a context of highly concentrated ownership and familial control of football clubs, they posit that the degree of family board representation and a dual leadership structure exert a moderating effect on the decision to spend on playing talent.Design/methodology/approachThe empirical analysis employs a fixed-effect econometric model on a panel data set of 16 Italian football clubs that spans a nine-year time period ending up with 144 firm-year observations.FindingsThe main novel finding of this investigation is that clubs with CEO duality and a high degree of family board representation manage to profit from investments in player contracts as opposed to clubs which lack these governance mechanisms.Research limitations/implicationsA clear implication is that the presence of corporate governance mechanisms at club level may be value-enhancing. In terms of policy direction, the finding makes the case that regulatory bodies should consider the imposition of governance mechanisms at club level as a means to promote actual financial discipline and a further ally to current regulations that are restricted to monitoring processes tied to accounting data.Originality/valueThis study attempts to explain the financial outcomes of player investments by combining insights from the mainstream governance and family business literature. Prior works in the field are restricted to testing the direct relation between player investments and performance, but fail to consider the potential moderators of this association.

Purpose
This paper aims to analyse the relationship between ownership structure and financial performance in the five major European football leagues from 2007-2008 to 2012-2013 and examine the impact of the financial fair play (FFP) regulation.


Design/methodology/approach
The sample used comprises 94 teams that participated in the major European competitions: German Bundesliga, Ligue 1 of France, Spanish Liga, English Premier League and the Italian Serie A. The estimation technique used is panel-corrected standard errors.


Findings
The results confirm an inverted U-shaped curve relationship between ownership structure and financial performance as a consequence of both monitoring and expropriation effects. Moreover, the results show that after FFP regulation, the monitoring effect disappears and only the expropriation effect remains.


Research limitations/implications
The lack of transparency of the information provided by some teams has limited the sample size.


Practical implications
One of the main issues that the various regulating bodies of the industry should address is the introduction of a code of good practice, not only for aspects related to the transparency of financial information but also to require greater transparency in the information concerning corporate governance.


Social implications
Regulating bodies could also consider other additional control instruments based on corporate governance, such as for example, corporate governance practices, corporate governance codes, greater transparency, control of the boards of directors, etc.


Originality/value
This study tries to provide direct evidence of the impact of large majority investors in the clubs and FFP regulation on the financial performance of football clubs.

AbstractManuscript TypeEmpiricalResearch Question/IssueIn this paper, we empirically investigate whether US listed commercial banks with effective corporate governance structures engage in higher levels of conservative financial accounting and reporting.Research Findings/InsightsUsing both market‐ and accrual‐based measures of conservatism and both composite and disaggregated governance indices, we document convincing evidence that well‐governed banks engage in significantly higher levels of conditional conservatism in their financial reporting practices. For example, we find that banks with effective governance structures, particularly those with effective board and audit governance structures, recognize loan loss provisions that are larger relative to changes in nonperforming loans compared to their counterparts with ineffective governance structures.Theoretical/Academic ImplicationsWe contribute to the extant literature on the relationship between corporate governance and quality of accounting information by providing evidence that banks with effective governance structures practice higher levels of accounting conservatism.Practitioner/Policy ImplicationsThe findings of this study would be useful to US bank regulators/supervisors in improving the existing regulatory framework by focusing on accounting conservatism as a complement to corporate governance in mitigating the opaqueness and intense information asymmetry that plague banks.

PurposeThe purpose of this paper is to investigate whether bank managers of countries within the European Union (EU) engage in signalling, especially after implementation of international financial reporting standards (IFRS) commencing 2005.Design/methodology/approach"Signaling" is the use of loan loss provisions (LLPs) to convey signals of fiscal prudence and future profitability to investors. The authors use data from 18 countries across the EU covering the pre and post IFRS regimes and apply univariate and multivariate tests in order to test signaling behavior under both accounting regimes.FindingsThe findings indicate insufficient evidence that financially healthy banks engage in signaling behavior. However, banks facing financial distress appear to engage in aggressive signaling relative to healthy banks. Finally, the propensity to engage in signaling behavior is more pronounced for financially distressed banks in the post IFRS regime. While IFRS, under IAS 39 sort to mitigate the discretionary component of LLPs, our finding may be attributable to lax enforcement of IFRS.Practical implicationsThe findings have implications for both investors and regulators. Investors should be aware that troubled banks engage in signaling to convey positive information about their future prospects. Regulators should be aware that financially stressed banks have a greater propensity to engage in signaling and need to ensure that the provisions of IFRS (which attempts to limit discretion in estimating LLPs) are enforced more stringently.Originality/valueThe paper contributes to the growing literature on bank signaling in a number of ways. First, the authors use a sample from 18 countries within the EU which has not been done before. Second, unlike prior studies which only examined healthy banks, the authors also include financially distressed banks in the sample. Third, the authors examine signaling behavior in the pre and post IFRS regimes to understand the influence of IFRS on the propensity to engage in signaling by bank managers.