Staff publications (SoM)

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https://dspace.lib.cranfield.ac.uk/handle/1826/28

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Browsing Staff publications (SoM) by Subject "3501 Accounting, auditing and accountability"

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    Corruption and default risk: global evidence
    (Wiley, 2025-12-31) Nadarajah, Sivathaasan; Atif, Muhammad; Tawiah, Vincent; Liu, Jia; Wood, Geoffrey
    The extant literature explores the consequences of corruption on firms’ growth and survival. However, its impact on default risk remains unexplored. On the basis of a sample of 189,109 firm‐years from 2004 to 2021 across 47 countries, our study reveals that a one standard deviation increase in corruption is associated with an 11.3% increase in default risk. Our channel analysis identifies information asymmetry and managerial risk‐taking as key mechanisms through which corruption influences default risk. This adverse effect is particularly pronounced in countries with opaque information environments, weak governance frameworks and inadequate external monitoring of firms. We further highlight the detrimental impact of corruption on firms’ borrowing costs and banks’ loan performance. Our study emphasizes the importance of enhancing information transparency and implementing stringent control mechanisms as a basis of mitigating corruption's detrimental effects across a range of different socio‐political contexts.
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    Digital transformation as a catalyst for resilience in stock price crisis: evidence from a ‘New Quality Productivity’ perspective
    (Springer, 2025-12-31) Chen, Shunru; Alexiou, Constantinos
    This study explores the impact of digital transformation on stock price crash risk using Chinese A-share listed enterprises from 2011 to 2022. Leveraging the TF-IDF algorithm and deep learning models, it contextualizes digital transformation within China's “new quality productivity” framework, which prioritizes technological innovation over traditional productivity drivers. The findings reveal that digital transformation significantly reduces stock price crash risk, particularly in labor and capital-intensive sectors, by enhancing market transparency and decreasing information asymmetry. Furthermore, the integration of digital transformation with the “new quality productivity” framework amplifies this protective effect, with pronounced benefits for large firms and those covered by analysts or research reports. Conversely, smaller firms or those without such coverage experience a smaller impact. By demonstrating how advanced digital technologies bolster operational agility and investor confidence, this study highlights the critical role of digital transformation in fostering resilience and stabilizing stock prices during crises.
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    ‘E’ of ESG and firm performance: evidence from China
    (Elsevier, 2024-11) Qian, Binsheng; Poshakwale, Sunil; Tan, Yusen
    Following the ESG rating divergence reported in the previous research studies, we develop a novel firm-level Green Commitment (GC) index by incorporating new dimensions of environmental management and governance. We construct GC scores for all A-share listed companies in China from 2015 to 2021 and analyze whether firms with greater environmental commitment exhibit improvements in their future performance. Our results show that firms with high GC scores achieve higher stock returns without incurring extra risk. Additionally, a strong environmental commitment can enhance operating performance by mitigating financial constraints. The evidence supports the view that environmental investing contributes to the creation of positive shareholder value. Our GC index can be applied more widely to resolve the mixed evidence on the value implications of corporate environmental commitments.