Corporate accountability in Australia: Managing the information environment for corporate accountability

Accountability is a significant factor in the soundness of the organisational environment in Australia, for both the public and private sectors. The accountability process rests on the quality and accessibility of organisational records, the information environment. While the Australian liberal democratic open society and free market system relies on accountability, paradoxically accountability is constrained by the needs of the open society and the market. Setting appropriate mechanisms for accountability while preserving civil liberty and innovative free markets is a difficult task, and is one that falls to government. Governments have a ubiquitous role in implementing accountability in both the public and the private sectors, and the Australian federal system further complicates governments' difficult role. The 1990s will bring further corporate pathologies, similar to those of the 1980's. However the public and private sectors can reduce the impact of corporate pathologies in the 1990's by learning the lessons of the 1980's, through placing a priority on inculcating ethical and moral behavior, emphasising democratic values, and raising the organisational status of records.Lance McMahon is a lecturer specialising in government in the School of Management and Marketing, Curtin Business School. He has previously worked as a senior policy adviser in the Western Australian State Government.     

Charity Retailing in the United Kingdom: A Managerial Capabilities Perspective

Nonprofit organizations are venturing into commercial activities due to the intense competition for the limited government funds and declining availability of donor funds for third‐sector organizations that address social problems. Charity retailing, a popular choice of commercial activity for nonprofit organization, has filled vacant premises in the high streets of the small towns and suburbs of large cities in the United Kingdom. Successful charity retail operation requires distinctive capabilities necessary to manage organizations' resources in commercial environment. Using 60 in‐depth elite interviews, we introduce the concept of managerial capabilities for charity retailing. Research propositions and management implications are discussed.     

Rethinking the Role of Value Communication in Business Corporations from a Sociological Perspective – Why Organisations Need Value-Based Semantics to Cope with Societal and Organisational Fuzziness

Why is it so plausible that business organisations in contemporary society use values in their communication? In order to answer this question, a sociological, system theoretical approach is applied which approaches values not pre-empirically as invisible drivers for action but as observable semantics that form organisational behaviour. In terms of empirical material, it will be shown that business organisations resort to a communication of values whenever uncertainty or complexity is very high. Inevitably, value semantics are applied in organisations first when the speakers are uncertain about which stakeholders to whom they have to address (uncertainty) or when different stakeholder groups have to be addressed simultaneously (complexity); second, when the identity of the organisation has to be described; and third, when future strategic options that cannot be expressed by quantitative terms have to be communicated. Values accordingly play a role in organisational practice when certain aspects are indeterminate. Therefore, they are a means for organisations to communicate under fuzzy circumstances. On the basis of these findings, new approaches to value management can now be formulated.     

Blending practice worlds: Impact assessment as a transdisciplinary practice

Organisations with explicit social missions such as social enterprises, impact investors, nonprofits, and foundations are under increasing pressure to illustrate their impact on the social problems they claim to be addressing. These trends have resulted in an increasing sophistication of attempts to measure and report social impact across sectors. Despite the emerging literature on impact assessment, there is little research on how the growing emphasis on, and drive for, impact assessment is experienced in everyday organisational activities. This paper draws on practice theory to understand the purposes of impact assessment and how it influences, and is enacted in, everyday organisational activities. A multiple case design studies the purpose of impact assessment through qualitative interviews with over 90 practitioners within the Australian and United Kingdom impact investment ecosystems. The findings suggest that impact assessment should be understood as a transdisciplinary practice evolving from, and blending together with, multiple practice worlds such as strategy, accounting, marketing, and organisational learning. The main contributions of the paper are the development of the concept of impact assessment as a transdisciplinary practice and an empirical understanding of how impact assessment links to, and blends with, diverse practice worlds.     

Mutuality as a control for information asymmetry: A historical analysis of the claims experience of mutual and stock fire insurance companies in Sweden, 1889 to 1939

We test two competing arguments regarding the influence of organisational form on underwriting performance using data from the Swedish fire insurance industry for the years 1889 to 1939 – a period of both economic growth and stagnation. Since mutuality is a response to information asymmetry problems, mutual insurers are expected to report lower annual claims relative to premiums than stock insurance companies. However, an alternative view is that stock insurers seek to reduce information asymmetry problems by issuing non-participatory rights insurance contracts with high deductibles that induce risk-sharing between the insurer's shareholders and policyholders. This implies that stock insurers are likely to report lower annual claims than mutual insurers. Our results show that organisational form is an important determinant of the claims experience of Swedish fire insurers, suggesting that mutuality acts as an effective control for information asymmetries in the market.     

Success factors in a CRM strategy: technology is not all

Organisations today need to create, maintain and reinforce relationships with customers. Customer Relationship Management (CRM) seems to have helped firms to better understand their relationships. However, past studies have looked at technology and customer orientations (COs) as key factors. This paper aims to analyse the simultaneous effect of Market Orientation (MO) (rather than CO), Knowledge Management (KM) and other organisational factors in order to explain how to implement a successful CRM. Findings suggest that MO and KM may influence CRM success. Data also suggest that particular organisational factors such as employees, leadership and specific know-how may be key factors in determining the success of CRM. For efficiency resource management, this paper recommends to focus not as much in technology, but on programmes for selection, training and motivation of employees which may enhance CRM objectives. Companies may also pursue a higher customer value by putting in place and reinforcing KM schemes in specific know-hows about CRM.     

Strategic and organisational determinants of sophistication in deployed sales force automation systems within three industry sectors in the UK

Abstract

This paper investigates strategic and organisational context determinants of the sophistication of adopted sales force automation (SFA) systems in three UK industries: financial services, pharmaceuticals, and building/construction. Sophistication of adopted systems is associated with the organisation placing greater emphasis on information orientation, which is itself driven by an increased integration of IT and sales coupled with increased organisational slack. Increased integration of IT and sales is itself driven by increased strategic importance of sales coupled with increased use of internal communication networks. Importantly, a firm's marketing orientation, although also driven by the strategic importance of sales, has no impact on either information orientation or SFA sophistication. We discuss the implications of our findings to aid understanding of SFA implementation failure.     

经济周期对企业资本结构的影响机制及差异性

通过构建一个不完美金融市场条件下经济周期与融资约束程度不同的企业资本结构关系的理论模型并对微观企业特质与宏观经济周期之间的联合效应进行分析。可知信息不对称程度较高的融资约束型企业资本结构调整对于银行稳健有较高的依赖性。通过模型推导还可以看出，经济周期对于非融资约束型企业资本结构的影响机制主要为外源融资溢价，其资本结构逆周期调整；而经济周期对于融资约束型企业资本结构的影响机制主要为外源融资可获得性，其资本结构顺周期调整。由此可知，银行信贷资金在信息不对称程度较高的融资约束型企业中具有明显的不可替代性，银行稳健在经济周期对其资本结构的影响中起到关键作用。     

Corporate Social Responsibility in China: A Corporate Governance Approach

Ethics training—an important means to foster ethical decision-making in organisations—is carried out formally as well as informally. There are mixed findings as regards the effectiveness of formal versus informal ethics training. This study is one of its first kinds in which we have investigated the effectiveness of ethics training as it is carried out in the Indian IT sector. We have collected the views of Indian IT industry professionals concerning ethics training (N = 266), and employed positivist (regression analysis and hierarchical linear modeling) and interpretive research (content analysis). We first have argued that the importance of the perception towards ethics has bearings not only on the individual ideologies but also on the organisational ethical values. In doing so, first we have conceptualised a theoretical framework: Perception of Ethics Training in Employees and Organisations (PETINEO). Second, we have studied the correlations between various components of this model. Third, we, under the rubric of PETINEO, examined the effectiveness of ethics training programmes for the Indian IT companies. Fourth, we have elaborated upon the results of our study. Our results suggest that the combination of both formal and informal means to undertake ethics training has superior impact on ethical decision-making in the Indian IT industry as compared to the use of any one of them in isolation.     

Trust, reputation and corporate accountability to stakeholders

This paper explores the relationship between accountability, trust and corporate reputation building. Increasing numbers of corporations are mobilising themselves to put more and more information out into the public domain as a way of communicating with stakeholders. Corporate social accounting and stakeholder engagement is happening on an unprecedented scale. Rather than welcoming such initiatives, academics have been quick to pick faults with contemporary social auditing and reporting, claiming that in its current form it is not about demonstrating accountability at all, but rather about building corporate reputation. Academics argue that 'accountability should hurt', that if accountability is an enjoyable process, then the organisation isn't doing it right. For organisations that are currently engaging with stakeholders and ostensibly becoming more transparent about their corporate social performance, this kind of critique is likely to be bewildering. This paper argues that central to the notion of accountability and to contemporary social accounting practice is the concept of trust. Accountability is based upon a distrust of corporate management, whereas corporate reputation building is about strategically seeking to establish trust in stakeholder relationships in order to negate formal accountability requirements. Using a split trust continuum, the paper seeks to explain and synthesise what seem to be two very different paradigms of organisational transparency.     

Implementing new financial regulation: actuaries and UK with-profits funds

One feature of the UK Financial Services Authority's (FSA) approach to regulation is the involvement of private actors in the regulatory process. This paper explores the introduction of ‘Principles and Practices of Financial Management’ (PPFM) for the management of with-profits funds of UK life insurers, and reports the experience of actuaries as private actors having a key role in implementing the FSA's PPFM framework. Actuaries reported experiencing considerable challenges in implementing the PPFM framework and, while accountability had increased, actuaries expressed scepticism about the ability of consumers and policyholders to make use of the increased amount of publicly available information.     

Do mutual fund managers exploit the Ramadan anomaly? Evidence from Turkey

Recent literature shows that the holy month of Ramadan exerts a positive influence on investor sentiment in predominantly Muslim countries. This anomaly has been found to be particularly pronounced in Turkey. We therefore examine whether mutual fund managers investing in Turkish stocks are able to benefit from the Ramadan effect. We find that risk-adjusted performance of domestic institutional funds, hybrid funds and foreign Turkish equity funds is substantially higher during Ramadan compared to the rest of the year. By contrast, domestic index funds fail to deliver higher abnormal returns as they are adversely affected by increased money inflows during Ramadan.     

Using Discourse to Restore Organisational Legitimacy: ‘CEO-speak’ After an Incident in a German Nuclear Power Plant

We analyse managerial discourse in corporate communication (‘CEO-speak’) during a 6-month period following a legitimacy-threatening event in the form of an incident in a German nuclear power plant. As discourses express specific stances expressed by a group of people who share particular beliefs and values, they constitute an important means of restoring organisational legitimacy when social rules and norms have been violated. Using an analytical framework based on legitimacy as a process of reciprocal sense-making and consisting of three levels of analysis which capture the relationship between text and context, we investigate the discourse used by CEOs in their initial and subsequent accounts of the incident. We find that CEOs aim to negotiate a resolution between their initial account and organisational audiences’ incongruent interpretations of the event by adopting an ad hoc normative attitude to stakeholders. This manifests itself in the strategic use of the discourse of stakeholder engagement as a means of signalling change, yet maintaining the status quo. It suggests that CEOs strategically use discourse to manufacture organisational audiences’ consent regarding the continued operation of the nuclear power plant affected by the incident. Our findings contribute to the critical corporate communication literature which regards corporate narrative reporting as a means of consolidating the private interests of corporations, rather than increasing transparency and accountability.     

Balancing Performance, Ethics, and Accountability

Practical mechanisms for aligning performance, ethics, and accountability are urgently needed. The context for this includes the organisational, technological, and regulatory transformations underlying current patterns of globalisation. These factors, combined with the associated emergence of civil action concerned with corporate accountability and deeper value-shifts, make such realignments a practical possibility. Social and ethical accounting, auditing, and reporting provides one of the few practical mechanisms for companies to integrate new patterns of civil accountability and governance with a business success model focused on deepening stakeholder relationships around core non-financial as well as financial values and interests. Experience over the past decade has enabled viable and effective methods to evolve and to lay the foundation of "standards-in-practice" against which future accounting, auditing, and reporting, will be benchmarked. Institutions are emerging to regularise this arena of actions, in the first instance through voluntary codes and process standards. A number of challenges exist in securing social and ethical accounting and auditing as a legitimate and effective framework within which organisations can achieve an appropriate balance of financial and non-financial interests, aims, actions, and outcomes. The emerging experience, expertise, methodologies, and institutions provide the basis for these challenges to be effectively met.     

Public-Sector Accounting and E-Governance in Developing Countries: Case of Sri Lanka

This article analyzes how new public financial management system should address the efficiency and effectiveness of the public sector and the emerging accrual basis accounting with e-governance for greater e-transparency on public-sector accounting in Sri Lanka. Despite the setting up of e-framework in 1983, the Sri Lankan public-sector accountancy environment during the last two decades raises concerns about efficiency, effectiveness, and accountability of the e-framework. The findings provide evidence of the importance of the economy and efficiency in the usage of public funds to provide more convenient access to government accounting information for citizens in Sri Lanka.     

Factors encouraging competitive myopia in the performing arts sector: an empirical investigation

Arts and cultural organisations are frequently accused of ‘competitive myopia’, i.e., of failing to realise that damaging competition can emerge as much from developments in the broader leisure and entertainment sectors (cinema, sports arenas, home entertainment, etc.) as from the activities of other arts and cultural venues. This empirical study of 141 British theatre companies explored the influences of certain market and organisational factors (market communality, environmental complexity and volatility, resource slack, accountability systems and managers' backgrounds) on the extent and depth of a theatre management's search for information regarding ‘unconventional’ competitors. Around half the theatres in the sample made no attempt whatsoever to assess competitive threats outside the performing arts domain. The theatres most likely to collect information on unconventional competitors were those which (1) operated in ‘complex’ markets and in markets perceived to overlap with the customer bases of unconventional competitors, (2) possessed organisation systems wherein managers were subject to large amounts of personal accountability, and (3) employed well-qualified people to administer threat assessment processes.     

Internal marketing,organisational culture,job satisfaction,and organisational performance in non-life insurance

The concept of internal marketing employed in the service sector is crucial to excellent service provision and successful external marketing. This study conducts an empirical investigation into the non-life insurance industry in Taiwan, exploring the correlation between internal marketing, organisational culture, job satisfaction, and organisational performance in Taiwan. Results show significant correlations among internal marketing, organisational culture, job satisfaction, and performance of non-life insurers. These findings can provide a basis for future studies of related topics as well as a solid reference for business owners and managers in the non-life insurance sector.     

The battle for commercial hearts and minds and the internal brand within a charity shop network in Ireland

ABSTRACT

Charities are increasingly adopting commercial branding strategies to capture consumer hearts and minds for competitive gain, with little attention on the internal organisational battle for hearts and minds within a not-for-profit context. This paper explores the internal brand of a charity that currently operates 227 charity shops on the island of Ireland, using Hankinson’s 2004 framework that focuses on functional, symbolic, behavioural and experiential components. An exploratory case study was developed based on a survey of organisational members (n = 138), interviews with six regional shop managers, observation in retail stores and supplemented by organisation documentation. Findings indicate a clarity of perception on mission, purpose and core values for the charity, but more ambiguity around perception of the charity shop brand and identified issues relating to communication of policies and procedures, managerial practice and the workplace environment. The study also reveals a gap between the charity’s organisational identity and the brand identity for the charity store network, a clarity in the perception of core values that does not underwrite the store brand and resistance to the implementation of commercial practice within a volunteer-led charity. Trust may be the key in the internal battle for hearts and minds within the charity and may be crucial for the charity to realise its’ potential and successfully meet its’ mission for maximum societal gain.     

Economic policy uncertainty and fund flow performance sensitivity: Evidence from New Zealand

Utilizing a large sample of actively managed equity funds and a recently developed EPU index for New Zealand, we show that fund flow performance sensitivity decreases with policy uncertainty. The role of policy uncertainty as a determinant of fund flow performance sensitivity is found to be stronger, particularly for funds with global focus, large sized funds, high momentum funds and those with high idiosyncratic volatility and low downside risk. The findings support the argument that high policy uncertainty dampens investors' ability to process information that allows them to distinguish fund manager skill from luck. The results remain strong after accounting for various macroeconomic factors.