Quality of data, information and knowledge in regional foresight processes

A central subcategory of futures research is technology foresight. There is a concern that today's technology foresight processes do not serve technology-political decision-making and strategy processes of companies well enough. The regional level needs to be emphasized, too, and the inclusion of a wide variety of actors and organizations. There is a danger that results of foresight processes are not absorbed into regional strategy-making processes, leading to a “black hole of interpretation and implementation of foresight knowledge”. Particularly knowledge, but also data and information are crucial concepts in foresight processes. An important issue is how to transform foresight information into future-oriented innovation knowledge. Concrete tools and institutional settings to enhance data, information and knowledge quality in foresight processes and strategy work are needed. This article investigates limitations of established foresight processes and planning approaches, limitations in practical utilization of results of foresight processes, and quality of data, information and knowledge as concrete tools and as a systematic response to limitations. The article is partly based on empirical results from a technology foresight survey undertaken in Finland in 2005. The research responds to societal and academic interest by combining the fields of (i) futures research and (ii) data, information and knowledge quality. Future-oriented considerations are not routine tasks, which makes it especially challenging and important to ensure that these processes benefit from data, information and knowledge of good quality.     

Performance and governance in microfinance institutions

We examine the relationship between firm performance and corporate governance in microfinance institutions (MFI) using a self-constructed global dataset on MFIs collected from third-party rating agencies. Using random effects panel data estimations, we study the effects of board and CEO characteristics, firm ownership type, customer-firm relationship, and competition and regulation on an MFI’s financial performance and outreach to poor clients. We find that financial performance improves with local rather than international directors, an internal board auditor, and a female CEO. The number of credit clients increase with CEO/chairman duality. Outreach is lower in the case of lending to individuals than in the case of group lending. We find no difference between non-profit organisations and shareholder firms in financial performance and outreach, and we find that bank regulation has no effect. The results underline the need for an industry specific approach to MFI governance.     

Mobilizing grassroots’ technological innovations and traditional knowledge, values and institutions: articulating social and ethical capital

The Honey Bee Network has helped provide a sort of loose platform to converge creative, but uncoordinated individuals across not only Indian states having varying cultural, linguistic and social ethos, but also in 75 other countries around the world. What the Network is trying to do in a rather quiet manner may transform the way the resources—in which poor people are rich—are used in the future. These resources are their knowledge, innovations and sustainable practices.I first argue that the classical concept of social capital does not distinguish between the trust in society created for social good versus social ‘bad’. For instance, the trust among members of the mafia and other socially undesirable networks does not constitute social capital. I am also trying to emphasize that part of social trust which is guided by higher ethical values which may not have become social norms as yet. This is being characterized as ethical capital. Finally, I conclude that the Honey Bee Network has tried to articulate the social and the ethical capital of society at the grassroots to demonstrate how local individuals and communities are trying to solve local problems without any outside help.     

Incorporating futures research into regional knowledge creation and management

This article focuses on future-oriented knowledge within regional innovation networks. Concrete regional tools and institutional settings aiming to enhance knowledge creation and management in such networks are needed. To enable planning for the future, there is a need for regional visionary capability. Resource-based futures research may make an important contribution in reducing the insecurity that regions face in the turbulent environment. When foresight processes are not absorbed into the regional strategy making processes, ‘black holes of regional strategy making’ come into existence, and future scenarios are built without taking into consideration the path-dependency of a region.This article attempts to reduce the gap between futures research, on the one hand, and regional knowledge and innovation management, on the other hand. It highlights the concept of self-transcending knowledge—the ability to sense the presence of potential. It then introduces a new, systemic model for knowledge creation and management in regional innovation networks. Utilising methods from futures research in creating self-transcending knowledge in a regional knowledge management system is proposed as a fruitful way of enhancing regional visionary capability. The article thus advocates combining approaches and methodologies from futures research with those of knowledge management in a novel way.     

The reflective futures practitioner: Balancing salience,credibility and legitimacy in generating foresight knowledge with stakeholders

This paper explores how foresight researchers involved in environmental, nature and planning issues attempt to balance salience, credibility and legitimacy while generating knowledge in interaction with policy-makers and other social actors. Engaging stakeholders in foresight processes can increase the robustness of foresight knowledge, broaden the spectrum of issues addressed, and create ‘ownership’ of the process. While in foresight practices stakeholder participation becomes more and more popular to resort to as enabling factor for generating salient, legitimate and credible foresight knowledge, participation can also compromise these qualities. We analysed two foresight projects conducted at the PBL Netherlands Environmental Assessment Agency, one that developed future visions for Dutch nature policy and another that focused on future pathways for Dutch urban sustainable development policy. We illustrate that the dynamics of the research setting – changes in the socio-political context and the internal dynamics of the participatory efforts – complicated the balancing process. We conclude that one of the main challenges for futures practitioners is, therefore, to work within the dynamics of the research setting, and to position themselves strategically in this setting; by acting as ‘reflective futures practitioners’.     

Fear of foresight: Knowledge and ignorance in organizational foresight

We discuss the changes occurring in the field of organizational foresight. The analysis results from viewing foresight from two different perspectives: as centered on the future or on the present; as macroscopic analysis or microscopic practice. The combination of these factors results in four different modes of organizational foresight: strategic planning, visioning, scenario thinking and planned emergence. These different perspectives are examined. We contribute to the literature by presenting foresight as a complex process, amenable to different understandings. Foresight is often portrayed as a technical and analytic process. We discuss it as a human process permeated by a dialectic between the need to know and the fear of knowing.     

Developing urban and regional foresight: exploring capacities and identifying needs in the North West

Recent changes in the context for English governance are creating new opportunities for futures thinking at urban and regional level. Drawing on a study of key stakeholders concerned with urban and regional development, this paper presents an analysis of current approaches to future thinking amongst policy-makers in England’s North West region. The study offered an opportunity to explore attitudes to foresight and existing capacities amongst public, private and voluntary organisations, to find out best practices in different sectors, and to investigate potential gaps, constraints and needs in terms of futures thinking. The paper describes the main results from the North West study and concludes by exploring ways of enhancing the capacity for territorial foresight at urban and regional levels.     

Corporate foresight and innovation management: A portfolio-approach in evaluating organizational development

The transition from a traditional industry-driven economy to a knowledge-based economy requires new concepts and methods for companies to sustain competitive advantage. Here, academia has identified corporate foresight and innovation as key success factors. While, content-wise, the contribution of futures research methods to the innovation process has already been researched, this study strives to explore the status quo of organizational development stages of both concepts. To do so, we developed a portfolio-approach, the so-called ‘Future-Fitness-Portfolio’, which enables companies to qualitatively compare amongst others and identify organizational improvement potential. In addition, we conducted expert interviews to explore future organizational development trends in corporate foresight and innovation management. As our research revealed, five strategic clusters can be identified within the portfolio. Consequently, we propose specific strategies for each individual cluster. We conclude that there will be two main organizational development trends for corporate foresight and innovation management in the future: in traditional industries with conventional business models and long product-life-cycles, companies will follow a different development path than companies in dynamic industries with innovative business models and short product-life-cycles.     

Internal governance,legal institutions and bank loan contracting around the world

Using a sample of non-U.S. firms from 22 countries during 2003–2007, we examine the effect of firm-level governance on various features of loan contracting in the international loan market. We find that banks charge lower loan rates, offer larger and longer-maturity loans, and impose fewer restrictive covenants to better-governed firms. We also find that the favorable effect of firm-level governance on some loan contracting terms is stronger in countries with strong legal institutions than in countries with weak legal institutions. Our results suggest that banks view a borrower's internal governance as a factor that mitigates agency and information risk, and that country-level legal institutions and firm-level governance mechanisms complement each other in influencing loan contracting terms.     

Earnings management,corporate governance and expense stickiness

Cost and expense stickiness is an important issue in accounting and economics research, and the literature has shown that cost stickiness cannot be separated fr...     

Corporate governance,SFAS 157 and cost of equity capital: evidence from US financial institutions

This study examines the association between fair value measurements and the cost of equity capital under different fair value valuation methods, and assesses the impact of corporate governance on this relationship for US financial firms. We find that firms’ cost of equity capital is negatively associated with more verifiable fair value assets and positively related to less verifiable fair value assets. Furthermore, the positive association between less verifiable fair value assets and the cost of equity capital is mitigated under better corporate governance. The differential impact between more and less verifiable assets becomes smaller for firms with stronger governance. Our findings contribute to the ongoing debate on fair value regulation by investigating the economic consequences of adopting Statement of Financial Accounting Standards No. 157, Fair Value Measurements (SFAS 157) and the importance of audit committee financial expertise on fair value reporting. We also provide evidence on the importance of board independence, internal control strength, auditor industry specialists, and audit committee financial experts in fair value reporting.     

Internal corporate governance,CEO turnover,and earnings management

The likelihood and speed of forced CEO turnover – but not voluntary turnover – are positively related to a firm's earnings management. These patterns persist in tests that consider the effects of earnings restatements, regulatory enforcement actions, and the possible endogeneity of CEO turnover and earnings management. The relation between earnings management and forced turnover occurs both in firms with good and bad performance, and when the accruals work to inflate or deflate reported earnings. These results indicate that boards tend to act proactively to discipline managers who manage earnings aggressively, before the manipulations lead to costly external consequences.     

银行公司治理与风险管理

公司治理和风险管理之间存在着密切内在的联系,公司治理结构是风险管理的一个基础平台,公司治理机制是风险管理最基本的机制,风险管理是公司治理的重要内容和目的。银行公司治理的核心,主要是提高风险掌控能力,研究银行的公司治理,必须要研究银行风险管理战略和目标。     

Risk management,corporate governance,and bank performance in the financial crisis

The recent financial crisis has raised several questions with respect to the corporate governance of financial institutions. This paper investigates whether risk management-related corporate governance mechanisms, such as for example the presence of a chief risk officer (CRO) in a bank’s executive board and whether the CRO reports to the CEO or directly to the board of directors, are associated with a better bank performance during the financial crisis of 2007/2008. We measure bank performance by buy-and-hold returns and ROE and we control for standard corporate governance variables such as CEO ownership, board size, and board independence. Most importantly, our results indicate that banks, in which the CRO directly reports to the board of directors and not to the CEO (or other corporate entities), exhibit significantly higher (i.e., less negative) stock returns and ROE during the crisis. In contrast, standard corporate governance variables are mostly insignificantly or even negatively related to the banks’ performance during the crisis.     

Corporate governance and pay-for-performance: The impact of earnings management

We ask whether the apparent impact of governance structure and incentive-based compensation on firm performance stands up when measured performance is adjusted for the effects of earnings management. Institutional ownership of shares, institutional investor representation on the board of directors, and the presence of independent outside directors on the board all reduce the use of discretionary accruals. These factors largely offset the impact of option compensation, which strongly encourages earnings management. Adjusting for the impact of earnings management substantially increases the measured importance of governance variables and dramatically decreases the impact of incentive-based compensation on corporate performance.     

Corporate governance,earnings management,and IFRS: Empirical evidence from Chinese domestically listed companies

This research used 1,329 Chinese publicly listed companies’ data from 1998 to 2009 to investigate how IFRS, state ownership, and board of directors (BOD) influence earnings management. We conclude that state-ownership to an extent discourages earnings management in the current environment of China. However, IFRS implementation does not seem to deter earnings management. When state-ownership is not the case, increasing the number of independent BOD seems to be a good practice to discourage earnings management, although non-independent BOD does not make any difference.     

Corporate governance and impression management in annual results press releases

We study the association between corporate governance and impression management in annual results press releases (ARPRs). Press releases constitute a timely vehicle to communicate firm performance to third parties but they can be manipulated to distort readers’ perceptions of corporate achievements. We predict that governance mechanisms actively monitor managerial disclosures, improving firm transparency and thus reducing impression management in ARPRs. The results confirm that strong governance limits impression management, consistent with governance monitoring effectively reducing self-serving disclosures by management. Our evidence suggests that management disclosure practices respond, at least partly, to informative motivations. We also show that strong governance firms are more likely to release an ARPR.     

Asset write-offs discretion and accruals management in Taiwan: the role of corporate governance

Using a sample of Taiwan’s public firms, this paper examines whether managers use discretionary write-offs and abnormal accruals jointly to reach earnings targets and how corporate governance mechanisms react to such opportunistic behavior. We develop a set of simultaneous equations that capture executives’ incentives to manage earnings through write-offs and accrual management. These incentives include the existence and tightness of accounting-based covenants, “big bath,” income smoothing, and changes in senior management. The empirical results show that firms with larger discretionary write-offs also have lower discretionary accruals. In addition, we find that these earnings management tools are endogenous, suggesting that discretionary write-offs and discretionary accruals are partial complements for earnings manipulation and that their magnitudes are determined jointly. These findings contrast sharply with the tenor of discussion in the U.S. literature concerning the potential for using asset write-offs and discretionary accruals to manipulate earnings, which documents that managers use their discretion over accruals to signal economic realities rather than to obfuscate. Moreover, the results reveal that the empirical association between discretionary write-offs and abnormal accruals is more pronounced in weakly governed firms, suggesting that a strong governance setting is likely to constrain management’s discretionary behavior. The above implications are robust to a number of alternative specifications and variables definitions.