Issue #2 (Volume 22 2025)

Economic policy uncertainty has a profound impact on firms’ investment decisions, mainly in terms of increased risk and uncertainty for firms when planning future investments. This study aims to explore the impact of corporate economic policy uncertainty on corporate investment, as well as how corporate social responsibility disclosure moderates the relationship between economic policy uncertainty (EPU) and corporate investment. The analysis uses a sample of Chinese listed companies from 2010 to 2022, including 33,791 observations. The study uses ordinary least squares (OLS) regression with clustered standard errors. The basic and robust regression empirical results show that economic policy uncertainty has a negative impact on corporate investment. However, corporate social responsibility plays an important moderating role between them. The two-stage least squares method (2SLS) is used to solve the endogeneity problem of reverse causation. The heterogeneity results show that economic policy uncertainty significantly dampens business investment, while corporate social responsibility (CSR) is effective in mitigating this negative effect, especially among non-state-owned and low-cash-flow firms, where this moderating effect is more pronounced. The study concludes that as corporate social responsibility disclosure enhances information transparency and investor confidence, companies should prioritize CSR programs that ultimately help companies remain competitive and attractive to investors in volatile markets. Meanwhile, this also highlights the strategic importance of CSR in mitigating external risks, such as those presented through volatile economic policies.

Financial well-being refers to how individuals perceive their financial security and ability to meet short-term and long-term financial goals. It involves feeling financially stable, having control over one’s finances, being satisfied with one’s financial situation, and handling unexpected events without excessive stress. This study examines the impact of financial literacy, financial behavior, financial stress, and religiosity on financial well-being, with gender as a moderating factor. A quantitative research approach was used, with the participants in this study consisting of permanent lecturers at a prestigious private university in North Sumatra, Indonesia, who are male with more than 1 (one) year of service. Due to the lack of available data regarding the exact number of faculty members, the sample size was calculated using Lemeshow’s formula, which is appropriate for use when the population is unknown. This resulted in a sample size of 385 permanent lecturers. The sampling method was accidental, and the data were analyzed using the SEM-PLS approach with SmartPLS software. The results show that religiosity, financial behavior, and financial literacy positively and statistically significantly affect financial well-being (p < 0.05). In contrast, financial stress, though negative, does not have a significant impact (p > 0.05). Additionally, gender does not moderate the relationship between religiosity, financial behavior, and financial stress on financial well-being (p > 0.05), but gender moderates the effect of financial literacy on financial well-being (p < 0.05).

Acknowledgment
They financed this study under the Fundamental Research - Regular (PF-R) area. Thank you, Ministry of Education, Culture, Research and Technology of the Republic of Indonesia 2024. This is also possible thanks to the Institute for Research and Community Service (LPPM) and the Faculty of Economics and Business Leadership at Universitas Muhammadiyah Sumatera Utara.

Cryptocurrencies have attracted significant attention due to their high risk, extreme volatility, regulatory controversies, and scandals. Investors and policymakers are drawn to them for their potential to enhance diversification and deliver high returns. This study examines the impact of incorporating cryptocurrencies into investment portfolios, focusing on their ability to improve risk-adjusted returns and diversification. A rolling asset allocation strategy employing the maximum Sharpe Ratio within a Markowitz framework was applied to weekly data from 2018 to April 2024. The analysis compares two unconstrained portfolios and two constrained portfolios, which impose a concentration limit on cryptocurrency investments. Results reveal that in 70% of the rolling periods examined, portfolios with cryptocurrency allocations outperformed non-cryptocurrency portfolios in terms of Sharpe Ratios. However, the heightened volatility of cryptocurrencies significantly increased portfolio risk, with annualized weekly standard deviations ranging from 18% to 25%, compared to 12% to 15% for portfolios without cryptocurrency exposure. These findings illustrate the dual nature of cryptocurrencies: they can act as both a source of instability and an opportunity for diversification. The study underscores the necessity of a cautious and strategic approach to incorporating cryptocurrencies into investment plans, given their inherent risks and unpredictable behavior.

The utilization of business intelligence has become increasingly crucial for small and medium-sized enterprises (SMEs) to remain competitive amid rapid advancements in information technology and heightened business uncertainty. This study analyzes the influence of business intelligence on the financial performance of SMEs, focusing on the mediating role of financial ambidexterity. Additionally, it examines how financial access, financial availability, and financial information quality enable effective business intelligence adoption. Data were collected from a survey of 233 SME managers in Central Java, Indonesia, conducted between December 2023 and February 2024. Smart PLS 3 was used to analyze the data and test the proposed hypotheses. The findings revealed that business intelligence significantly affects financial performance (β = 0.655, p = 0.044). Furthermore, the indirect effect analysis confirmed that financial ambidexterity plays a crucial role in mediating the relationship between business intelligence and financial performance (β = 0.531, p = 0.018). Additionally, the results confirmed that financial resources positively influence business intelligence implementation, with financial availability (β = 0.243, p = 0.000), financial information quality (β = 0.335, p = 0.016), and financial access (β = 0.768, p = 0.025) all showing significant effects. This study highlights the critical role of business intelligence and financial ambidexterity in enhancing financial performance and underscores the importance of financial resources for successful business intelligence implementation in SMEs.

This paper investigates the determinants of working capital management in the Indian hotel sector, focusing on factors influencing financial efficiency and sustainability. Using a dynamic panel model, the study analyzes data from 67 publicly listed Indian hotels over ten years from 2013 to 2022. The data were obtained from the Refinitiv database, the World Bank, and the Sustainable Development Index. The system generalized method of moments estimator was applied to ensure the robustness of results. The study results indicate that firm-specific factors, including return on assets, leverage, asset tangibility, and board structure, significantly impact working capital needs. Additionally, macroeconomic elements such as GDP play a crucial role in shaping working capital management. A notable positive relationship was identified between return on assets and working capital requirements. Conversely, leverage exhibited a strong negative association with working capital needs. These results emphasize the importance of both internal financial characteristics and broader economic conditions in effective working capital management. The study highlights the importance of integrating governance and economic conditions into working capital management strategies.

Sharia financial literacy pertains to individuals’ capacity to manage their finances, partake in Sharia-compliant agreements, and make investments based on Islamic tenets for long-term prosperity. This study explores the relationship between Sharia financial literacy, financial stress, financial behavior, and financial well-being among Islamic university students in Medan, Indonesia. Three hundred seventy-eight (378) students from various regions of Medan, Indonesia, were used as the research sample. The questionnaires were disseminated using social media chat functions or messaging applications (e.g., WhatsApp, Telegram) in which the Google Forms link is shared. The Likert scale measures indicators in responses to statements and questions. The analysis was conducted using SEM with PLS 3.0 software. The findings show a significant positive effect of Islamic financial literacy on financial behavior and well-being (p < 0.05). However, financial stress does not significantly impact financial behavior and financial well-being (p > 0.05). In addition, financial behavior positively affects financial well-being among university students (p < 0.05). This study also demonstrates that Islamic financial literacy indirectly improves financial well-being through its influence on financial behavior (p < 0.05). However, financial stress does not indirectly affect financial well-being through financial behavior (p > 0.05).

Acknowledgment
This research was funded in 2024 by the Ministry of Education, Culture, Research and Technology of the Republic of Indonesia under the Basic Research – Regular (PF-R) category. Thanks also go out to the different tiers of administration at Universitas Muhammadiyah Sumatera Utara, such as the administration of the School of Economics and Business and the staff at the Institute for Research and Community Service (LPPM).

By leveraging supply chain finance (SCF), businesses can optimize their cash flow and strengthen their supply chain relationships, improving overall performance. By effectively harnessing this strategy, companies can dramatically enhance cash flow, strengthen supplier relationships, and propel overall efficiency and growth across their supply chains. The study considered 34 years, from 1990-91 to 2023-24, for India's personal and home care product industry companies, which is a part of the consumer goods industry and contributes as the fourth largest sector in the country's GDP. The study emphasizes the development of an empirical model on the impact of SCF on financial performance parameters like net profit margin (NPM), return on equity (ROE), return on capital employed (ROCE), and return on assets (ROA). The study applied an ordinary least square regression method to establish the relationship. Four empirical models were developed where Model 1 and Model 2 indicate that the accounts receivable turnover ratio (ART) emerged as a key SCF parameter with a statistically significant correlation to firm performance, particularly influencing NPM and ROE. The results of Models 3 and 4 reflect that ATR does not significantly impact the ROCE and ROA of firms. The study results also show that the SIZE variable positively influences financial performance, while LEV (Leverage) has a negative influence. This study compellingly illustrates the connection between SCF and a firm’s economic success, providing actionable insights for stakeholders eager to sharpen their strategic approaches. By prioritizing SCF, industries can unlock significant competitive advantages and drive sustainable growth.

Corporate social responsibility (CSR) disclosure plays a pivotal role in expanding investment opportunities, enhancing operational efficiency, and strengthening transparency and accountability to meet stakeholder demands. This study investigates the determinants influencing CSR disclosure’s extent and quality, aiming to provide a comprehensive understanding of how organizational, institutional, and stakeholder-driven factors shape transparent reporting practices. Using time-series data spanning six years (2017–2022) collected from 200 Vietnamese-listed enterprises annually, this research employs the ordinary least squares (OLS) method for quantitative analysis. The findings reveal that board independence, awards, company size, and financial performance significantly and positively influence both the extent and quality of CSR disclosure. Conversely, industry sensitivity negatively impacts CSR disclosure, while financial leverage exhibits mixed effects – positively affecting the extent but negatively influencing the quality of disclosures. Notably, company size emerges as the strongest determinant of CSR disclosure, underscoring the critical role of larger firms in driving transparent reporting practices. In contrast, industry sensitivity demonstrates the weakest effect on the extent of CSR reporting, suggesting that internal firm characteristics may outweigh industry-specific pressures. Based on these findings, the study recommends that Vietnamese regulatory bodies prioritize company size over industry type when designing CSR disclosure policies. This study provides valuable insights into the evolving dynamics of CSR disclosure in emerging markets like Vietnam, highlighting the need for context-specific strategies to enhance corporate accountability and sustainable development.

Acknowledgment
The author thanks everyone who helped make this study possible.

Common market anomalies tested in developed markets have been considered adequate to explain behavior there. However, the different characteristics in emerging markets such as Indonesia make traditional asset pricing models inadequate. Furthermore, this study highlights the importance of integrating company fundamentals and investor sentiment. This study enriches the asset pricing method in Indonesia and supports the theory of market signals and anomalies. This study analyzes the moderating role of investor sentiment on the relationship between profitability premium, investment premium, and stock returns in one of the emerging markets, Indonesia. The study uses panel data from 93 companies in Indonesia from 2013 to 2023. Portfolio construction with the five-factor model is used. The analysis method used is moderated regression analysis or interaction testing. The study results show that profitability premium and excess return interact significantly with investor sentiment at the 1% level, so investment premium and excess return interact significantly with investor sentiment at the 1% level. This study shows that investor sentiment plays a role in strengthening the premiums for profitability and investment. The findings of this study indicate that considering a company’s financial condition and sentiment level is essential for investors and investment managers in implementing long-term stock investment analysis strategies in emerging markets such as Indonesia. This study can support market stability policies, such as tighter supervision, when negative sentiment has the potential to cause a decline in stock prices that is disproportionate to fundamentals.

Acknowledgments
The authors would like to thank the Indonesian Capital Market for providing data supporting this study’s results. Thanks also to the promoter, co-promoter, and reviewer for their suggestions and input, which were very helpful in preparing this article. In addition, the family has provided prayers and patience in supporting the author in carrying out this research. This research was supported by funding from Universitas Syiah Kuala.

The financial literacy and culture of small and medium-sized enterprises (SMEs) significantly influence their financial stability, decision-making processes, and long-term sustainability. This study analyzes the relationship between financial literacy, company size, and their impact on access to financing and loan repayment performance among Hungarian SMEs from 2019 to 2023, an emerging market economy characterized by continuous economic challenges. Using a partial linear regression model and mediation analysis on a representative dataset of approximately 2,500 SMEs evenly distributed across size categories over five years, the study finds that financial management has a statistically significant effect on access to funding (β = 0.217, p < 0.001 in 2023). Financial planning also plays a crucial role in financial decisions, with a positive correlation strengthening over time (β = 0.181, p < 0.001). The mediating role of company size is confirmed across all models, with Sobel test results indicating a significant indirect effect (z = 5.093, p < 0.001 for financial management impact on funding access). By 2023, medium and larger SMEs demonstrated improved financial decision-making and increased financing opportunities, whereas smaller enterprises continued to struggle, emphasizing the need to enhance their financial strategies. The findings highlight the importance of financial literacy development to ensure SME sustainability, improve access to external financial resources, and support broader economic growth.

Acknowledgment
“Project no. TKP2021-NKTA-51 has been implemented with the support provided by the Ministry of Culture and Innovation of Hungary from the National Research, Development and Innovation Fund, financed under the TKP2021-NKTA funding scheme.” Made in Széll Kálmán Public Finance Lab of Ludovika University of Public Service, Budapest.

This study examines the relationship between CEO overconfidence and discretionary deferred tax assets (DTAs) using a method that separates DTAs into discretionary and non-discretionary components. Based on data from publicly listed companies in South Korea between 2017 and 2021, the study analyzes how overconfident CEOs influence the recognition of DTAs. Under K-IFRS 1012, DTAs should be recognized only when there is sufficient future taxable income with a high probability; however, the lack of explicit guidelines on what constitutes “high probability” leaves room for subjective interpretation by management. Overconfident CEOs, driven by excessive optimism and upward-biased forecasts of future cash flows, may over-recognize DTAs. The main analysis, incorporating industry and year-fixed effects, reveals a positive relationship between CEO overconfidence and discretionary DTAs (coef = 0.003, p-value < 0.05). This tendency is more pronounced in firms with higher marginal tax rates compared to those with lower rates (coef = 0.004, p-value < 0.005) and in firms with lower levels of outside directors (coef = 0.002, p-value < 0.1). Additionally, analyses using alternative variables for CEO overconfidence and discretionary DTAs, as well as propensity score matching (PSM) models, yield consistent results. Overall, this study underscores the critical role of managerial characteristics in shaping accounting judgments and decisions. By providing empirical evidence on the impact of cognitive biases such as overconfidence on financial reporting quality, the findings contribute to the broader discourse on corporate governance and offer practical implications for policymakers, investors, and regulators.

The adoption of digital financial tools improves financial efficiency, transparency, and governance. However, family-owned businesses in Jordan adopt these tools at a lower rate than non-family businesses, potentially limiting their competitiveness. This study examines the extent of digital adoption, its impact on financial management, and the role of generational involvement.
A survey of 366 businesses (262 family-owned and 104 non-family) across six industries was analyzed using multi-group analysis. Family-owned businesses reported a 31.2% improvement in financial management after adoption, compared to 19.6% in non-family businesses (p = 0.039). Generational involvement increased adoption by 26.5% in family-owned businesses versus 10.8% in non-family businesses (p = 0.015). Cultural resistance hindered adoption in family-owned businesses by 4.5% more than in non-family businesses (p = 0.028). Business size influenced adoption similarly (10.2% vs. 10.1%, p = 0.460). Financial management improvements were slightly lower in family-owned businesses (76.6%) than in non-family businesses (78.2%, p = 0.532). Adoption rates in family-owned businesses were 11.7% lower (p = 0.039). The interaction of business type and generational involvement contributed to a 22.0% increase in adoption (p < 0.01).
These results underscore the importance of phased adoption, digital literacy programs, and intergenerational collaboration in accelerating financial digitalization within family-owned businesses. Addressing cultural resistance is essential for ensuring long-term financial sustainability and competitiveness in Jordan’s evolving economy.

Capital inflow into local bond markets helps countries with infrastructure financing, funding fiscal deficit, enhancing bond market liquidity, and diversifying investment portfolios globally. This study aims to assess the impact of institutional quality and capital account openness on capital inflow into Asian local bond markets for the period 2002–2023. For reflecting Asian bond markets, seven countries, namely, China, Malaysia, South Korea, Japan, the Philippines, Indonesia, and Thailand, have been considered. The rule of law, regulatory quality, control of corruption, voice & accountability, political stability, and government effectiveness indices are the various proxies considered in this study to measure the different aspects of institutional quality. Further, the Chinn-Ito index is employed to measure capital account openness. Fixed effect, random effect, and pooled data ordinary least squares are employed as different forms of panel data estimation methods in this study. Moreover, Breusch-Pagan LM and Hausman tests are performed to select the most efficient estimation method. This study reveals that the rule of law, regulatory quality, and control of corruption have a positive influence on capital inflow at a 5% significance level and political stability at a 1% significance level. In contrast, capital account openness has a negative impact at a 1% significance level. However, neither voice & accountability nor government effectiveness have a significant influence over capital inflow. These findings suggest improving the rule of law and regulatory quality, creating policies for political stability, stringent acts against corruption, and controlling capital account openness to encourage capital inflow into local bond markets.

Mandatory and voluntary segment disclosure is crucial for shareholders to assess a firm’s financial health and make informed investment decisions. Given the importance of disclosure to investors, this study investigates the extent of voluntary and mandatory segment disclosure of listed companies in Nigeria from 2015 to 2022. Using descriptive analysis, specifically a recursive transition matrix approach, this study tracked yearly changes in mandatory and voluntary segment disclosure for 85 companies listed on the Nigerian Exchange Group. The findings revealed that mandatory segment disclosure has a mean score of 11.3, which is notably higher than the mean score of 6.86 for voluntary segment disclosure. Also, the recursive transition matrix revealed a notable increase in companies transitioning from lower to higher levels of mandatory segment disclosures. For instance, 87.5% of companies were at Level 1 (Low-level disclosure) in 2016, but this dropped to 35.4% by 2022, showing a shift to higher levels. Levels L2, L3, and L4 remained relatively stable, indicating sustained improvements. This trend reflects the impact of regulatory changes on the increased transparency of companies in Nigeria. For voluntary segment disclosures, in 2016, 72.5% of companies were at L1, 25% moved to L2, and 2.5% advanced to L3. By 2022, the percentages were 41.1% at L1, 34% at L2, and 24.9% at L3. Although some companies have progressed, many continue to maintain low levels of voluntary segment disclosure. The study concluded that listed companies in Nigeria need to improve their voluntary segment disclosures to enhance transparency and address investors’ concerns about inadequate segment disclosure practices among firms.

Agricultural enterprises play a crucial role in China’s rural revitalization strategy, but persistent financing constraints hinder their innovation potential. This study examines the impact of digital inclusive finance on agricultural enterprise innovation, with a particular focus on the mediating role of financing constraints. Using panel data from agricultural enterprises listed on the Shanghai and Shenzhen Stock Exchanges (2014–2023), this study employs fixed-effect regression models and mediation analysis to explore these relationships. The empirical findings reveal that digital financial inclusion significantly enhances innovation levels in agricultural enterprises (β = 0.5127, p < 0.01). Additionally, digital financial inclusion reduces financing constraints (β = –0.0385, p < 0.01), confirming that improved access to digital financial services lowers borrowing costs and increases credit availability. Mediation analysis demonstrates a partial mediation effect, as the coefficient of digital financial inclusion on innovation decreases when financing constraints are included in the model (β = 0.5057). Subgroup analyses show that SMEs, state-owned enterprises, and non-coastal firms benefit the most from digital financial inclusion in China. These findings have important policy and managerial implications. Policymakers should strengthen digital financial infrastructure in rural areas and promote financial inclusion policies to support agribusinesses. Financial institutions should expand digital financial services, such as fintech-driven credit assessments and online lending platforms, to enhance agricultural innovation. Additionally, agricultural enterprises should leverage digital financial tools to overcome financing constraints and boost competitiveness.

This study examines how internal governance mechanisms influence tax aggressiveness among listed companies in Morocco. Using a quantitative approach, the study applies linear regression analysis to panel data from 2018 to 2022. The analysis assesses the impact of key governance factors, such as ownership concentration, board size, board independence, CEO duality, firm performance, and firm age, on tax aggressiveness.
The findings indicate significant relationships between governance mechanisms and tax behavior. Ownership concentration is negatively associated with the effective tax rate, implying that firms with a dominant shareholder are less likely to engage in aggressive tax planning. Conversely, financial performance is positively linked to effective tax rate, suggesting that more profitable firms tend to comply with tax obligations. In the current effective tax rate model, board size, board independence, CEO duality, and financial performance are positively related to tax aggressiveness, while firm age has a negative effect. The book-tax difference model reveals that board independence and CEO duality reduce tax aggressiveness, whereas ownership concentration and financial performance increase it.
These results highlight the significant role of corporate governance in shaping tax strategies. Strengthening governance structures – especially by reinforcing board independence and limiting CEO duality – could help curb aggressive tax practices and promote greater fiscal transparency in Morocco’s financial market.

Precise risk management is crucial in options trading, especially in strategies with limited risk and capped profit potential. The Short Iron Condor is a widely adopted strategy due to its structured risk-reward profile. It provides traders with controlled exposure in low-volatility markets while maintaining defined profit and loss parameters. This paper deals with developing an optimization framework using a mixed-integer programming model to evaluate key factors influencing return efficiency, including maximum loss limits, price confidence intervals, and holding periods. Using 2023 options data for 14 U.S. equities and 9 ETFs, filtered and selected using Out of the Money Strategy (OTM), 324 option contracts from as many snapshots as possible, the study analyzes 324 trading scenarios with maturities ranging from 5 to 20 days. Results indicate that increasing the maximum loss limit raises total return but reduces return efficiency. A $100 loss limit generates an average return of $30 with a 40.7% return on investment, while a $900 limit increases returns to $131 but lowers return on investment to 18.8%. These findings demonstrate that higher risk exposure does not always enhance return efficiency in capped-risk strategies. The proposed framework provides actionable insights for traders aiming to refine strategy selection within well-defined risk constraints. Risk managers can utilize these findings to sustain stable investment portfolios, while algorithmic trading systems may integrate this optimization model for automated strategy refinements and real-time adjustments. This study enhances decision-making in options trading, portfolio risk management, and financial strategy development.

The Indian economy, often described as cost-sensitive, has seen significant growth in investments in mutual funds and witnessed an increase in the number of investors and total assets under management from 2010 to 2023. This study aims to evaluate the effectiveness of mutual funds in India by identifying those that outperform benchmark indices, assessing the stock selection skills of fund managers, and examining their market timing abilities.
The study further investigates the function of market efficiency by looking into two major areas of fund management – market timing and stock selection. Stock selection measures a portfolio manager’s skill in selecting stocks, and market timing measures a portfolio’s ability to increase exposure to the portfolio in expectation of better movements during a defined period. The study uses the Sharpe ratio, Information Ratio, and Treynor-Mazuy model to analyze mutual fund data. The results indicate that over 80 percent of mutual funds are market independent, with high stock picking ability. Nonetheless, 8% of the funds that showed a market timing ability had little else in terms of active trading, indicating a long-term outlook of investments as opposed to short-term trade strategies. The study concludes that Indian mutual funds have exhibited market timing capabilities and generated positive alpha, signifying risk-adjusted outperformance relative to the market.

Informational efficiency is a fundamental pillar of well-functioning financial markets, as it underlies informed investment decisions, effective risk management, and broader economic stability, particularly in emerging African markets, where inefficiencies are more likely to persist. This study assesses the weak-form informational efficiency of six major African stock markets – Johannesburg, Casablanca, Botswana, Nigeria, Egypt, and the Regional Stock Exchange – through the lens of long-memory behavior in returns and volatility. This is achieved by employing four advanced models: ARFIMA-FIGARCH, ARFIMA-FIEGARCH, ARFIMA-FIAPARCH, and ARFIMA-HYGARCH. Each of these models is specifically designed to capture long memory in both the conditional mean and variance. The empirical results demonstrate that the ARFIMA-FIGARCH framework, across all four model variants, consistently outperformed alternative specifications in fitting the return and volatility dynamics of all six African stock market indices. The estimated fractional differencing parameters in both the mean (dARFIMA) and variance (dFIGARCH) equations were highly statistically significant at the 1% level for each market, confirming the presence of persistent long-memory behavior. This strong evidence of long-range dependence implies that past return information is not fully reflected in current prices, thereby violating the assumptions of weak-form market efficiency. Consequently, these findings provide compelling and systematic evidence against the weak-form Efficient Market Hypothesis (EMH) for the markets studied, highlighting a common structural inefficiency across the African financial landscape.

This study investigates the direct and moderating effects of financial development (FD) and human capital development (HCD) on foreign direct investment (FDI) and identifies the human capital development threshold that triggers a significant impact on FDI in sixteen emerging economies from 2010 to 2023. Panel threshold and panel-corrected standard error regression methods are employed to explore these factors’ direct and conditional effects on FDI. The findings indicate that, initially, FD and HCD negatively affect FDI. This can be attributed to short-term costs associated with structural adjustments and economic instability periods for the selected emerging economies. However, when these variables were interacted, their impact on FDI became positive with a total effect of 1.404, revealing the complementary effect of FD and HCD on FDI. Furthermore, a critical threshold was identified for HCD (0.7919), beyond which its impact on FDI becomes positive, facilitating long-term economic gains. Similarly, FD shifts from a negative to a positive effect as financial systems achieve greater stability and efficiency. The study emphasizes the importance of strategic investment in human capital and efforts to enhance financial sector stability to attract and sustain FDI in emerging markets. It reveals that this approach increases FDI inflows and ensures sustainable economic development over time. The study offers critical insights for policymakers to prioritize structural reforms in education, workforce skills, and financial governance to create an enabling environment for FDI. Furthermore, it highlights the relevance of understanding threshold dynamics to design targeted policies that maximize economic returns from foreign investment in emerging economies.

Environmental, Social, and Governance (ESG) factors are important in evaluating a company’s performance while aligning investment with governance, ethical, environmental, social commitment, and sustainability goals. Recent years have seen an increasing focus on ESG factors, leading to a corresponding evolution in financial markets. ESG is emerging as a key factor among other non-financial performance indicators that impact market dynamics, price, and investment strategies. This study investigates the price discovery process at the firm level in reference to ESG in the Indian stock market. The data were analyzed for 11 key sectors using the daily closing prices in the spot market and futures market prices of selected firms, along with their respective ESG scores. The study used the stationarity test and order of integration test, followed by applying the Johansen cointegration test to analyze long-run co-integrating relationships among futures and spot market prices. Finally, the vector error correction mechanism (VECM) test was applied to detect long-term causality. Findings reveal that the price discovery process takes place in the Indian stock market and is significantly affected by the ESG factor. In the case of a high ESG score, the spot market leads the futures market, while for stocks with low ESG scores, the futures market price leads the spot price. Cement, oil, gas, and pharmaceutical sectors have shown a negative association between the price discovery process and ESG scores, while in the case of the service sector, the positive association is witnessed between ESG scores and the price discovery process between futures and spot prices.

The relationship between exchange rates and key economic factors is crucial and may vary across countries depending on the economic context. This paper analyzes cointegration relationships among exchange rate, balance of payments, interest rate, inflation, and trade openness using the Johansen Cointegration Test in the context of the Indian economy. The study uses annual time-series data from 2008 to 2024. Stationarity of the variables is first tested using the Augmented Dickey-Fuller test. The Johansen Cointegration Test is then applied to identify long-run equilibrium relationships, while a Vector Error Correction Model captures short-term dynamics and adjustments towards equilibrium. The exchange rate makes modest adjustments across cointegrating relationships, sometimes restoring equilibrium, other times diverging from it. The balance of payments shows large coefficients, primarily amplifying deviations. The interest rate has minimal adjustment, showing little response to disequilibrium. Inflation and trade openness have small, negative coefficients, indicating weak correction toward equilibrium. Overall, the balance of payments amplifies deviations, while other variables show varying degrees of error-correcting behavior. The model explains 67.4% of the variation in exchange rate changes (R-squared = 0.674), with an adjusted R-squared of 0.5, accounting for predictors. The F-statistic (3.87, p = 0.0115) shows the model is statistically significant. Short-run changes in the exchange rate are influenced by past exchange rates, balance of payments, inflation, and trade openness, while interest rates play a minimal role.

This study investigates how board-level corporate governance affects corporate social responsibility (CSR) performance in European firms. A panel dataset of 5,760 firm-year observations from the STOXX Europe 600 index, covering 21 countries between 2010 and 2022, was analyzed using multivariate regression models. The data, sourced from Refinitiv Eikon, include firms across 22 industries, with capital goods and materials among the largest sectors, and represent major economies such as the United Kingdom, Germany, and France.
The analysis focused on board composition, CEO characteristics, and the presence of governance, audit, and CSR committees. It was found that independent and diverse boards with high attendance are associated with stronger CSR performance. Companies with active CSR committees demonstrate particularly enhanced ESG outcomes. Interestingly, CEO duality is linked to weaker CSR performance, while the presence of a former CEO as chairman improves sustainability efforts.
The study provides quantitative evidence on how governance structures shape corporate sustainability and offers practical insights for corporate leaders, policymakers, and investors seeking to improve CSR strategies across diverse European contexts.

Acknowledgment
This paper is co-funded by the European Union through the European Education and Culture Executive Agency (EACEA) within the project “Embracing EU corporate social responsibility: challenges and opportunities of business-society bonds transformation in Ukraine” – 101094100 – EECORE – ERASMUS-JMO-2022-HEI-TCH-RSCH-UA-IBA / ERASMUS-JMO-2022-HEI-TCHRSCH https://eecore.snau.edu.ua/
Oleh PASKO expresses sincere gratitude for the support from the Kirkland Research Program, generously provided by the Leaders of Change Foundation established by the Polish-American Freedom Foundation.

The Original Article was published on June 2, 2017

Correction:
In the section INTRODUCTION in this article, the following adjustments were made:
In paragraph 4, the text was corrected to include a link to the citation source. The sentences now read like this: “Based on the viewpoint of financial management, the company’s goal is to maximize stockholders’ prosperity. The increase in stockholders’ prosperity can be achieved through the increase in the company’s value (Gitman, 2003). Based on Ross (2005), the goal of financial management is to maximize the current value per share of the existing stock.”
In paragraph 6, the text was corrected to include a link to the citation source. The sentences now read: “In addition, the risk has negative relationship with the corporate value (Wasnieski, 2008; Muslimin , 2006). Moreover, contrasting findings from Sudarma (2004) and Mas’ud (2008) indicate no significant effect of risk on corporate value.”
In paragraph 7, the text was corrected to include a link to the citation source. The sentences now read: “Funding decision can increase the corporate value (Hendro, 2008)”.
In the LITERATURE REVIEW section of this article, the year was corrected from 2005 to 2004. The sentences now read: “Hanafi (2004) explains that the purpose of financing decisions is to obtain funds with the cheapest cost. Financing includes short-term and long-term financing, in which short-term financing is defined as less than one year of financing, while the long-term financing is over a period of business.”
In the REFERENCES list in this article, the source #4 was changed to: “Hanafi, M. Mamduh.2014. Manajemen Keuangan. Yogyakarta: BPFE.”

The current study examines the association between Corporate Cash Holdings and Firm Value and explores whether the interaction effect of Cash Holdings and financial expertise supports fair value. The study used data on 175 non-financial firms from 2015 to 2023 and employed pooled OLS regression. The fair value variable denoted by Tobin’s Q shows an average (median) of 3.01, while the mean (median) of cash holdings and Audit Committee financial expertise was 18% (13%) and 45% (33%). This study finds a positive coefficient of 0.63, which is significant at less than a 1 percent level, revealing that cash holding increases the value of companies, promoting transaction and precautionary incentives for maintaining cash reserves. Interestingly, the study also finds the positive influence of cash holdings on fair value, which is enhanced by the financial expertise of the audit committee (positive coefficient of 0.04, significant at less than a 1 percent significance level). Moreover, the interaction of cash holdings with audit committee financial expertise found a positive coefficient of 1.84, which is significant at less than a 1 percent significance level. This study presents the importance of the Audit Committee mechanism, particularly with the presence of financial and accounting expertise, in supporting the market value of a company. The outcomes of this study benefit policymakers, managers, and investors regarding effective corporate liquidity management and its effect on fair value.

Acknowledgment
The author acknowledges that the current project under research project number PSAU/2023/02/25900 was funded by Prince Sattam Bin Abdulaziz University.

The increasing role of digitalization in the banking sector necessitates an in-depth analysis of the impact of information technology (IT) investments on bank profitability. The paper analyzes the influence of IT investments on the profitability of Vietnamese commercial banks. The data were collected from 27 commercial banks in Vietnam between 2010 and 2022. The methodology used in this paper is the Feasible Generalised Least Squares (FGLS) regression. The key results indicate that investment in IT has improved the overall performance of banks, as evidenced by an average increase of 1.8% in Return on Assets (ROA) and 15.3% in Return on Equity (ROE). In addition, the Equity-to-Asset ratio exerts a favorable influence on bank performance, increasing ROA by 15.7% and ROE by 40.9%. Furthermore, bank size also demonstrates a positive correlation with both ROA and ROE, raising it by 0.3% and 2.3%, respectively. Based on these findings, more efficient investment in digital transformation, collaboration with Fintech firms, IT competence enhancement for staff, and communication promotion for Vietnamese commercial banks are recommended. Enabling environments for bank digital transformation should be provided by the Government in building a centralized database and electronic systems, introducing fintech regulations, establishing digital ecosystems, and implementing security solutions.

Acknowlegment
This paper is funded by the National Economics University, Hanoi, Vietnam.
The authors would like to express their gratitude to the comments from chairs, scholars, and audiences at the 19th International Conference on Humanities & Social Sciences 2024 – Applying Humanities & Social Sciences for a sustainable future, Khonkhaen University, Thailand (ICHUSO-011). This paper has been revised significantly after presenting at the IC-HUSO 2024 Conference.

Demand for ethical and Sharia-compliant investment instruments has driven substantial academic interest in Sukuk, a key component of Islamic finance offering alternatives to conventional bonds. The paper aims to analyze research trends in the field of Sukuk through a comprehensive bibliometric and content analysis of publications indexed in Scopus and Web of Science from 1990 to 2024. Relationships between authorship patterns, institutional affiliations, geographical distribution, applied methodologies, and key findings are examined to identify emerging research trajectories in the field of Sukuk. The analysis covers the evolution of research topics over 33 years, assessing annual achievements, influential articles, keyword dynamics, and topical changes. The paper uses a hybrid method, including bibliometric and content analysis and a systematic literature review (SLR) using the PRISMA methodology, which ensures a high degree of scientific validity. The findings marked growth in Sukuk-related research in the past decade, with growing attention to sustainable finance (Environmental, Social, and Governance Sukuk), green Sukuk, and digitalization. Thematic mapping identifies five major research clusters in Scopus and six in Web of Science, emphasizing investment efficiency, regulatory challenges, Sharia compliance, and market integration. Additionally, the crucial impact of Sukuk on risk management and resilience was revealed during crises while uncovering ongoing gaps such as low secondary market liquidity, insufficient standardization, and limited cross-border compatibility.

Acknowledgments
The study was funded by the Committee Science of the Ministry of Science and Higher Education of the Republic of Kazakhstan “Investigating the impact of macroeconomic, political, and digital processes on financial sustainability of Kazakhstan” No. AP19674948.

This study examines whether paying audit committee members a higher proportion of cash, rather than equity, improves the quality of financial oversight. Using 7,159 firm-year observations from publicly listed non-financial U.S. companies between 2005 and 2023, this paper focuses on firms with standardized financial disclosures and comparable audit committee structures. The sample begins in 2005 to reflect the regulatory environment following the implementation of Section 404 of the Sarbanes-Oxley Act, which requires companies to assess and disclose the effectiveness of internal controls. The results show that a higher proportion of cash compensation is significantly associated with lower discretionary accruals, indicating stronger earnings quality. This relationship holds across alternative model specifications and accrual quality measures. The findings suggest that cash-based pay may enhance audit committee independence by reducing incentives tied to stock performance. For companies and regulators, the study underscores the importance of compensation design – favoring cash over equity may help strengthen financial reporting oversight and reduce earnings management, particularly in complex or high-risk firms.

The development of regional socio-economic systems relies on investments as a key factor for expanded reproduction, creating a cyclical process in which investments drive development, generating resources for further investments. This paper aims to empirically investigate the nexus and causal link between investments and the socio-economic development of a region in Ukraine (Lviv region as a case study). The research methods include VAR modeling (to assess the elasticity of investment processes to environmental factors), Forward Stepwise (to examine the impact of investment on socio-economic development), and extrema (to determine optimal investment resource points). The data for the Lviv region of Ukraine from 2005 to 2023 serve as the information and analytical basis of the study. The article identifies key economic factors, such as employment growth (elasticity: 2.65%) and the number of large and medium-sized enterprises (1.39%), and financial factors influencing investment processes. Financial factors include the growth of personal income tax revenues (4.78%), economic activity expenditures (0.81%), and subsidies (0.49%) in the short term, while tax independence (1.35%), local taxes and fees (2.47%), and economic activity expenditures (0.94%) are significant in the long term. It is estimated that a 1% increase in capital or foreign direct investment boosts socio-economic development by 0.12% and 0.5%, respectively, with foreign direct and capital investments ensuring socio-economic development at 0.45%. The use of constructed models for forecasting and planning investments in the Ukrainian regions allows for optimizing resource allocation, avoiding excessive costs, and ensuring economic stability in the face of global shocks and crises.

Against the rapid developments in cross-border investment that shed light on portfolio diversification opportunities, this study investigates the relationship between Indonesia’s sustainable ethical stocks and global sustainable financial assets. Amid market uncertainty, the need for safe havens and diversification of investment portfolios is imperative. Given the remarkable performance of Indonesia’s Islamic stocks, which are considered ethical stock, and the importance of sustainable stocks, this study examines how global financial assets such as Green Bonds, Artificial Intelligence (AI) stocks, and clean cryptocurrencies are interconnected. Employing a Dynamic Conditional Correlation – Generalized Autoregressive Heteroskedasticity (DCC-GARCH) model within the Structural Vector Autoregression (SVAR) framework, this study examined daily data spanning January 2, 2020, to August 6, 2023. This study finds strong evidence of dynamic relationships across assets, implying limited diversification benefits in the market. The results show that Cardano, as a clean cryptocurrency, can serve as a short-term safe haven, while the Green Bond potential is a long-term safe haven against Indonesia’s Islamic stocks. However, green bonds, Cardano, and AI stocks are suggested as potential diversifiers for sustainable stocks. Understanding these dynamics offers valuable insights into asset selection and diversification strategies, particularly for investors focusing on sustainable ethical assets.

Globalization and financial instability are interconnected phenomena influencing the modern economic and financial environment. Thus, this study analyzes the global antecedents of the current financial problems and looks at the effects of globalized markets on the previous financial crisis of 2007–2008. It quantitatively examines the impact of globalization on financial stability across 15 chosen countries of different continents between 2001 and 2022, focusing on four variables: trade openness, foreign direct investment and net inflows (FDI), inflation and consumer prices, and official exchange rates. Using a comparative analysis approach, the study evaluated these factors to find their influence on one another for the selected developed and developing economies. The findings reveal the varying impacts of globalization on financial stability across nations. Developed economies such as Austria, Australia, and Belgium show a strong positive correlation between financial instability and trade openness, FDI inflows, stable inflation rates, and consistent exchange rates. In contrast, developing countries such as Angola, Argentina, Benin, and Burundi face financial instability associated with volatile FDI flows, major trade fluctuations, high inflation rates, and currency volatility. This highlights that international effects from globalization show different patterns since countries have varying institutional capacities and regulatory systems. Hence, understanding the relationship between globalization and financial instability provides valuable insights and guidance for policymakers to implement stabilization measures through regulatory frameworks and monetary policies and balance economic and financial integration.

This study examines whether institutional investors in the UK substitute the board in firm monitoring and investigates the impact of this substitutive role on audit quality. The methodology comprised a cross-sectional generalized least squares (GLS) random effects model, and a robustness test used the generalized linear model (GLM). The sample included 1,128 firm-year observations and spanned the period 2012–2022. The results suggest a positive relationship between institutional ownership, board size, and audit quality. The interacting variables detect the possibly substitutive role of institutional investors, and the negative coefficient of the interaction term suggests that there are only a few institutional investors on the board. Board independence does not seem to influence audit quality or to be affected by institutional ownership. This finding is attributed to the strictly advisory role of independent board members in the UK market. Overall, the empirical results support the influential role of institutional investors, who replace the board in monitoring and positively influence audit quality.

This study examines the determinants influencing the attractiveness of foreign direct investment (FDI) in Morocco during the period 2000–2023. The data utilized in this study are sourced from the World Bank and the International Monetary Fund, encompassing economic, institutional, and infrastructural dimensions. The model includes variables representing economic growth, economic openness, inflation, infrastructure quality, political and macroeconomic stability, institutional quality, and fiscal policy. A Ridge regression was adopted to address multicollinearity issues detected in the data. Econometric diagnostics, including stationarity tests, residual normality tests, autocorrelation tests, and heteroskedasticity tests, confirm the robustness of the model.The results show that economic openness has a positive and significant effect on FDI inflows, highlighting the importance of trade and international integration. Political and macroeconomic stability also exerts a positive and significant impact, confirming that foreign investors value a stable environment. Conversely, economic growth exhibits a negative and non-significant effect, suggesting that Morocco’s growth has not been sufficient to create favorable conditions for FDI attractiveness. Infrastructure quality and institutional quality show significant negative impacts, which may reflect perceived shortcomings in these areas despite ongoing efforts. Inflation has no statistically significant effect on FDI, while fiscal policy has a significant negative impact, indicating that tax policies have a dissuasive effect on international investors.

Bridging the gap between stock market literacy and active participation is the ultimate objective for institutions and policymakers globally, due to its ability to promote inclusive economic growth. In light of this, the study intended to assess the impact of intrinsic and extrinsic motivation on stock market literacy leading to participation. Further, an attempt was made to analyze the intervening role of investment decision and the moderating role of Tri-Layer Market Analysis. With the descriptive design, a survey questionnaire was used to gather data for this investigation, collecting responses from 376 commerce and management students across government, private, and deemed universities between June and July 2024 from the region of Karnataka, India. Following the data collection, statistical techniques, such as regression analysis, one-way Analysis of Variance, and structural equation modelling, were applied to evaluate intrinsic and extrinsic motivation’s direct and indirect impacts on students’ stock market participation. As per the results, the Intrinsic (β =.361, t = 8.416, p = 0.000) and External Motivations (β =.422, t = 9.816, p = 0.000) substantially impact stock market literacy that ultimately impacts investment decision making (β = .450, t = 9.761, p = 0.000) and stock market participation (β =.207, t = 4.495, p = 0.000). The results also validate the intervening role of investment decision in the relationship between stock market literacy and stock market participation (indirect effect: .131).

This study aims to empirically investigate the impact of Enterprise Risk Management (ERM) practices on the quality of financial reporting (QFR) among U.S. industrial firms. It focuses on key ERM practice indicators such as board-level risk oversight, cash flow volatility, and value-at-risk (VaR). A static panel data approach was employed using data from 18 industrial firms registered on the New York Stock Exchange, covering the period from 2014 to 2022. The finding revealed that ERM significantly enhances the quality of financial reporting. Particularly, the board of risk management committees and VaR have a positive and significant influence on the quality of financial reporting. However, volatility in cash flows has an unfavorable and significant influence, thereby reducing the reliability of financial information disclosed by U.S industrial companies. The study’s empirical evidence can deepen prospective research by stimulating in-depth examination into the implementation of ERM, which enriches transparency and alleviates the risk related to financial reporting. It is recommended that regulatory bodies of the United States should rigorously follow the protocols of a corporate setting, COSO context, and all other legislation regarding risk management, thus preventing the dissemination of misleading accounting information and enhancing the reliability and credibility of the financial statements.

This study examines the impact of financial inclusion, specifically the dimensions of access and usage, on income inequality and economic growth in 70 developing countries using data from 2014, 2017, and 2021. Drawing from multiple international databases, the study employs Partial Least Squares Structural Equation Modeling (PLS-SEM) to assess formative constructs of financial inclusion and to test the hypothesized relationships. Results show that financial access significantly reduces income inequality (β = –0.124, p < 0.05) and promotes economic growth (β = 0.261, p < 0.01). Similarly, financial usage has a negative effect on inequality (β = –0.223, p < 0.01) and a positive effect on growth (β = 0.412, p < 0.01). Among control variables, trade openness is associated with lower inequality, while population growth and corruption increase it; population growth also weakly hinders economic growth. The model explains 30.2% of the variance in income inequality and 45.6% in economic growth. The analysis distinguishes between upper-middle-income and lower-income groups, revealing that financial access is more impactful in wealthier developing countries, while usage is more influential in lower-income ones. These results underscore the need for income-specific policy design. To address concerns of generalization, additional descriptive country-level analysis was conducted for six selected countries, highlighting national-level variation in financial inclusion dynamics. Overall, the findings offer valuable insights for policymakers and international agencies seeking to design inclusive financial systems that support equitable growth and reduced inequality.