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on Corporate Finance |
| By: | Ahmed, Abrar; Siddiqui, Danish Ahmed |
| Abstract: | Objective: This study examines the effect of Board of Directors (BOD) effectiveness on the performance of Takaful companies in Pakistan, with a focus on the moderating role of Shariah Committee quality. It aims to assess how governance elements influence firm performance in the Islamic finance context. Sampling: The study uses panel data from 14 Takaful firms in Pakistan, covering a five-year period (2018-2022). Data were sourced from annual reports and official governance disclosures. Methodology: A quantitative approach is used, employing multiple regression analysis with interaction effects to test the relationships between BOD effectiveness, Shariah committee quality, and firm performance (measured by ROA, ROE, and Tobin's Q). Results: The findings reveal that Board Independence, Shariah Committee Expertise, and Shariah Committee Independence significantly improve firm performance. Conversely, CEO Duality, Shariah Committee Size, and Meeting Frequency show no significant impact. Implications and Significance: The results highlight the importance of board independence and Shariah competence over structural factors. This study offers empirical guidance for regulators, policymakers, and Takaful firms to strengthen governance frameworks and enhance performance through high-quality dual governance. |
| Keywords: | Takaful, Board of Directors, Shariah Committee Quality, Corporate Governance, Firm Performance, Islamic Insurance, Islamic Finance |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:341015 |
| By: | Moiz, Abdul; Siddiqui, Danish Ahmed |
| Abstract: | The economic growth of developing economies depends heavily on Small and Medium Enterprises (SMEs) since they generate significant GDP and employment numbers in Pakistan and other emerging markets. The sustainability of these businesses faces frequent obstacles because they encounter restricted financial resources and poor financial expertise alongside cautious managerial decision-making. This study explored how financial literacy affects SME sustainability. We proposed that financial literacy components i.e. budgeting, investment analysis, and risk management, improve access to finance in turn leading to SME sustainability. We also contend that financial risk attitude moderates the relationship between financial literacy components and sustainability in a way that a higher risk attitude would lead to a more pronounced effect. Empirical validity was established by conducting a survey using a close-ended questionnaire. A structured questionnaire was used to gather data from 309 SME owners financial managers and operational managers who resided in five major Pakistani cities. The analysis employed Partial Least Squares Structural Equation Modeling (PLS-SEM) to process the data. The results show that budgeting (β = 0.165, p = 0.010) and risk management (β = 0.424, p |
| Keywords: | SME Sustainability, Financial Literacy, Access to Finance, Financial Risk Attitude, Pakistan SMEs, PLS-SEM Analysis |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:341018 |
| By: | Fatima, Mishal; Audi, Marc; Ali, Amjad |
| Abstract: | The research investigates the relationship between financial risk, corporate governance, and their impact on bank financial performance in Pakistan through both conventional and Islamic banking systems. The study uses Tobin's Q to evaluate financial performance while assessing financial risk through various measures that include non-performing loans to total assets and other indicators. The research investigates corporate governance through three indicators, which are board size, audit committee existence, and board member independence. The study uses panel data, which includes yearly bank reports from eleven banks, to assess how six conventional banks and five Islamic banks performed financially from 2010 to 2023. The study shows through basic statistical methods and regression analysis that market value increases when lenders make loans that exceed their total deposit amounts. The results show that improvements in financial intermediation lead to better performance by institutions. The research shows that banks experience severe operational problems when their non-performing loans increase because rising credit risk turns into a major obstacle. Corporate governance functions as the fundamental element that establishes how banks will perform financially. The bank system achieves improved financial performance through the combination of independent board members and effective audit committees. The banking system needs both transparent operations and effective supervisory mechanisms with accountability frameworks to ensure its operational efficiency. The research shows that Pakistan needs to improve its governance systems while maintaining strict financial risk control to achieve better efficiency and effectiveness in its dual banking operations. The study improves current academic research by collecting real-world data that demonstrates how financial risk and governance structures influence banking performance in developing nations. The research provides applicable solutions to the financial sector, which regulators and banking professionals can use to create stability and long-term growth. |
| Keywords: | Financial Performance, Tobin’s Q, Financial Risk, Corporate Governance, Liquidity |
| JEL: | G0 M0 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:128921 |
| By: | Ali, Amjad; Haider, Ali; Senturk, Ismail |
| Abstract: | This study examines the extent to which climate risk disclosure and company valuation are related to large-cap companies in the S&P 500 index. Using an analytical sample of 110 companies from 11 sectors, we constructed a composite score of climate risk disclosures in which firms earned between zero and four points, as defined by the Task Force on Climate-related Financial Disclosures. These four key pillars are governance, strategy, risk management, and climate-related metrics and targets; the score captures disclosures based on their depth as well as quality. Using multivariate regression models, we investigate how climate risk disclosure quality relates to two measures of firm valuation: market capitalization measured on a log-transformed scale and the price-to-book ratio, while controlling for other firm characteristics such as size, profitability, leverage, carbon emissions, audit quality, board independence, and industry fixed effects. The study finds a strong positive relationship between higher climate risk disclosure scores and higher firm valuation. Price-book ratio model does not reveal significant results for the disclosure score; the fixed effect model indicates a positive relationship, which means that investors with firm-specific differences tend to reward climate transparency better. The interaction model explains that this effect is accentuated in high-emission industries such as energy, utilities, and basic materials, indicating that pollution-intensive sectors are more sensitive to climate disclosure. Thus, these findings lend credence to signaling theory, stakeholder theory, and legitimacy theory, all of which underpin that high-quality disclosures reflect managerial competency, corporate legitimacy, and strategic foresight. The findings bear implications for corporate managers, institutional investors, and policymakers who advocate for standardized and high-quality climate risk reporting across sectors. |
| Keywords: | Climate Risk Disclosure, Firm Valuation, ESG |
| JEL: | D20 Q50 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:128754 |
| By: | Ali, Amjad; Iqbal, Muhammad Adnan Javed; Irfan, Muhammad |
| Abstract: | This paper examines the complex relationship between corporate social responsibility and financial reporting, focusing on how organizations leverage corporate social responsibility initiatives to enhance their financial performance and market competitiveness. Sector-based analysis reveals that strategic corporate social responsibility investments lead to notable improvements in financial indicators such as return on assets, return on equity, and net profit margin. Organizations with high corporate social responsibility ratings consistently achieve greater financial success than those with average efforts, largely due to stronger stakeholder relationships, greater customer loyalty, and effective risk management strategies. Increased transparency resulting from corporate social responsibility initiatives also boosts investor trust and supports sustained market confidence. The analysis further underscores the importance of corporate governance in corporate social responsibility reporting, emphasizing that uniform disclosure standards are essential for accountability and meaningful comparison. Despite challenges related to non-standardized reporting and sectoral differences, the research confirms that corporate social responsibility is vital to financial sustainability and market strength. Corporations that achieve financial success are those that align social responsibility with business objectives, enabling long-term growth while fulfilling ethical obligations. This research offers valuable insights for policymakers, corporate leaders, and stakeholders seeking to enhance corporate social responsibility efforts for both financial benefit and the public good. |
| Keywords: | Corporate Social Responsibility, Financial Reporting, Profitability, Transparency, Sustainable Growth |
| JEL: | L1 L20 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:128749 |