Search results for: financial studies system

Authors: Godwin Chigozie Okpara, William Chimee Nwaoha

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The paper set out to stress on how financial inclusion index could be calculated and also investigated the impact of inclusive finance on inclusive growth in an emerging economy. In the light of these objectives, chi-wins method was used to calculate indexes of financial inclusion while co-integration and error correction model were used for evaluation of the impact of financial inclusion on inclusive growth. The result of the analysis revealed that financial inclusion while having a long-run relationship with GDP growth is an insignificant function of the growth of the economy. The speed of adjustment is correctly signed and significant. On the basis of these results, the researchers called for tireless efforts of government and banking sector in promoting financial inclusion in developing countries.

Keywords: chi-wins index, co-integration, error correction model, financial inclusion

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Authors: Shamsuddeen Muhammad Ahmad

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The emergence and operations of Islamic Financial Institutions (IFIs) are being regarded as the new economic and financial pride at the global stage today. Admittedly, therefore, the IFIs has continued to impact positively on the economies of its host countries, especially the Gulf Cooperation Council (GCC) region, Asian and Western countries as well as making a steady in-road into the sub-Saharan Africa. Hence, the number of countries that adopted Islamic financial system in Africa has continued to increase. As a matter of fact, this paper examines the role and contributions of Islamic Financial Institutions (IFIs) to the economic growth and financial development of the big emerging markets in the African continent i.e. South Africa, Nigeria, and Egypt. The methods adopted for this study are descriptive, comparative and analytical in nature. Essentially, the findings from this study reveal that the three sampled countries are benefitting from the presence of IFIs in their economies in terms of contributions to economic growth and real sector participation, particularly for Egypt and South Africa. Similarly, they reap from foreign direct investments and economic diversification among others. However, this study recommends that African countries should integrate IFIs as part and parcel of their economic and financial systems, in order to benefit optimally from this new economic phenomenon.

Keywords: Islamic financial services, Africa, emerging markets, development, operation

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Authors: Al-Yaqdhan Al-Rawahi, Kaneez Fatima Sadriwala

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The purpose of this paper is to discover the readiness of Civil Service Employee Pension Fund (CSEPF), a governmental organization, in motivating its staff. Exploratory survey has been conducted in order to extract needed information. For this purpose we proposed a questionnaire to understand staff viewpoint of motivation. Data was analyzed by using SPSS 15.0 for Windowsand Excel. Major results prove that good working conditions is the most important factor of staff and sympathetic help with personal problem is the least important one. Also the relationship between financial motivation and employee motivation is very weak, whereas with non-financial motivation and employee motivation is moderate. Future research may focus on studying all departments of CSEPF.

Keywords: financial motivation, non-financial motivation, employee motivation

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Authors: Mohammed Sani Abdulai

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Ghana’s Public Financial Management reforms have been going on for some two decades now (1997/98 to 2017/18). Given this long period of reforms, Ghana in 2019 is putting together both a Public Financial Management (PFM) strategy and a Ghana Integrated Financial Management Information System (GIFMIS) strategy for the next 5-years (2020-2024). The primary aim of these dual strategies is assisting the country in moving beyond reforms to consolidation and sustainability. In this paper we, first, examined the evolution of Ghana’s PFM reforms. We, secondly, reviewed the legal and institutional reforms undertaken to strengthen the country’s key PFM institutions. Thirdly, we summarized the strengths and weaknesses identified by the 2018 Public Expenditure and Financial Accountability (PEFA) assessment of Ghana’s PFM system relating to its macro-fiscal framework, budget preparation and approval, budget execution, accounting and fiscal reporting as well as external scrutiny and audit. We, finally, considered what the country should be doing to achieve its intended goal of PFM consolidation and sustainability. Using a qualitative method of review and analysis of existing documents, we, through this paper, brought to the fore the lessons that could be learnt by other developing countries from Ghana’s PFM reforms experiences. These lessons included the need to: (a) undergird any PFM reform with a comprehensive PFM reform strategy; (b) undertake a legal and institutional reforms of the key PFM institutions; (c) assess the strengths and weaknesses of those reforms using PFM performance evaluation tools such as PEFA framework; and (d) move beyond reforms to consolidation and sustainability.

Keywords: public financial management, public expenditure and financial accountability, reforms, consolidation, sustainability

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Authors: Olivier Mesly

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This research presents a conceptual framework termed “Consumer Financial Spinning” (CFS) to analyze consumer behavior in the financial/economic markets. This phenomenon occurs when consumers of high-stakes financial products accumulate unsustainable debt, leading them to detach from their initial financial hierarchy of needs, wealth-related goals, and preferences regarding their household portfolio of assets. The daring actions of these consumers, forming a dark financial triangle, are characterized by three behaviors: overconfidence, the use of rationed rationality, and deceitfulness. We show that we can incorporate CFS into the traditional CAPM and Markovitz’ portfolio optimization models to create a framework that explains such market phenomena as the global financial crisis, highlighting the antecedents and consequences of ill-conceived speculation. Because this is a conceptual paper, there is no methodology with respect to ground studies. However, we apply modeling principles derived from the data percolation methodology, which contains tenets explicating how to structure concepts. A simulation test of the proposed framework is conducted; it demonstrates the conditions under which the relationship between expected returns and risk may deviate from linearity. The analysis and conceptual findings are particularly relevant both theoretically and pragmatically as they shed light on the psychological conditions that drive intense speculation, which can lead to market turmoil. Armed with such understanding, regulators are better equipped to propose solutions before the economic problems become out of control.

Keywords: consumer financial spinning, rationality, deceitfulness, overconfidence, CAPM

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Authors: B. Frączek

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The paper analyses the usage of the Internet by university students in Visegrad Countries (4V Countries) who study economic fields in their formal and informal financial education and captures the areas of untapped potential of Internet in educational processes. Higher education and training, technological readiness, and the financial market development are in the group of pillars, that are key for efficiency driven economies. These three pillars have become an inspiration to the research on using the Internet in the financial education among economic university students as the group of the best educated people in finance. The financial education is a process that allows for improving the level of financial literacy. In turn, the financial literacy it is the set of financial knowledge, skills, awareness and patterns influencing the financial decisions. The level of financial literacy influences the level of financial well-being of individuals, determines the scale of saving of households and at the same time gives the greater chance for sustainable and more predictable development of the financial market with the positive impact on economy. The financial literacy is necessary for each group of society but its appropriate level is desirable especially in respect of economics students as future participants of financial markets as well as the experts and advisors in financial decision making. The low level of financial literacy is the great problem of many target groups in both developing and developed countries and the financial education is seen as the best way of improving this situation. Also the financial inclusion plays the special role in enhancing the level of financial literacy in the aspect of education by practice as well as due to interrelation between level of financial literacy and degree of financial inclusion. Despite many initiatives under financial education, the level of financial literacy is still very low. Scientists still search for new ways of solving this problem. One of the proposal is more effective usage of the new technology in financial education, especially the Internet, because of the growing popularity of e-learning and the increasing number of Internet users, especially among young people who are called the Generation Net. Due to special role of the university students studying the economics fields for the future financial markets, students of four universities from Visegrad Countries (Czech Republic, Hungary, Poland and Slovakia) were invited to participate in the survey. The aim of the article is to present the level and ways of using the Internet technology in financial education and indicating the so far unused or underused opportunities.

Keywords: financial education, financial inclusion, financial literacy, internet and university education

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Authors: Ibtissam Mharzi Alaoui, Camélia Sehaqui

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The success of a bank depends upon its effective risk management. With the growing complexity and diversity of financial products and services, as well as the accelerating pace of globalization over the past decade, risk management is becoming increasingly difficult. thus, all measurement and monitoring functions must be much more vigorous, relevant and adequate. The Shariah non-compliance risk is specific aspect of Islamic finance which ipso facto, deserves particular attention. It affects the validity of all Islamic financial contracts and it turns out to be likely to result in considerable losses on the overall Islamic financial institutions (IFIs). The purpose of this paper is to review the theoretical literature on Shariah non-compliance risk in order to give a clearer understanding of its sources, causes and consequences. Our intention through this work is to bring added value to the Islamic finance industry all over the world. The findings provide a useful reference work for the Islamic banks in structuring (or restructuring) of their own system of shariah risk management and internal control.

Keywords: Shariah non-compliance, risk management, financial products, Islamic finance.

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Authors: Raif Parlakkaya, Umran Kahraman, Huseyin Cetin

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Internet financial reporting and corporate governance issues are in the focus of academic and professional studies due to their attributed importance by stakeholders of corporations. Major aim of this study is to reveal the relationship between internet financial reporting which is held as dependent variable and some indicators of corporate governance such as the ratio of managerial ownership, blockholder ownership, number of independent members in the board of directors, frequency of meetings by audit committee and education level of audit committee members which are held as independent variables. Main purpose is to reveal the effect of corporate governance on the voluntary efforts of Internet Financial reporting. The scope of the research is limited to the Turkish Corporations listed in Borsa Istanbul (Istanbul Stock Exchange) and findings which are generated by means of SPSS software are revealed in results section and interpreted in conclusions.

Keywords: audit committee, corporate governance, internet financial reporting, managerial ownership

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Authors: Mrigakshi Das

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The private sector investments and quantum of money required in this sector critically hinges on the financial risk and returns the sector offers to providers of capital. Therefore, it becomes important to understand financial performance of hospitals. Financial Analysis is useful for decision makers in a variety of settings. Consider the small proprietary hospitals, say, Physicians Clinic. The managers of such clinic need the information that financial statements provide. Attention to Financial Statements of healthcare Organizations can provide answers to questions like: How are they doing? What is their rate of profit? What is their solvency and liquidity position? What are their sources and application of funds? What is their Operational Efficiency? The researcher has studied Financial Statements of 5 Private Healthcare Organizations in Guwahati City.

Keywords: not-for-profit organizations, financial analysis, ratio analysis, profitability analysis, liquidity analysis, operational efficiency, capital structure analysis

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Authors: Loukou Amoin Marie Djedri

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Financing is important for all terrorists – from the largest organizations in control of territories, to the smallest groups – not only for spreading fear through attacks, but also to finance the expansion of terrorist dogmas. These organizations pose serious threats to the international community. The disruption of terrorist financing aims to create a hostile environment for the growth of terrorism and to limit considerably the terrorist groups capacities. The World Bank (WB), together with the International Monetary Fund (IMF), decided to include in their scope the Fight against the money laundering and the financing of terrorism, in order to assist Member States in protecting their internal financial system from terrorism use and abuse and reinforcing their legal system. To do so, they have adopted the Anti-Money Laundering /Combating Financing of Terrorism (AML/CFT) standards that have been set up by the Financial Action Task Force. This set of standards, recognized as the international standards for anti-money laundering and combating the financing of terrorism, has to be implemented by States Members in order to strengthen their judicial system and relevant national institutions. However, we noted that, to date, some States Members still have significant AML/CFT deficiencies, which can constitute serious threats not only to the country’s economic stability but also for the global financial system. In addition, studies stressed out that repressive measures are more implemented by countries than preventive measures, which could be an important weakness in a state security system. Furthermore, we noticed that the AML/CFT standards evolve slowly, while techniques used by terrorist networks keep developing. The goal of the study is to show how to enhance the AML/CFT global compliance through the work of the IMF and the WB, to help member states to consolidate their financial system. To encourage and ensure the effectiveness of these standards, a methodology for assessing the compliance with the AML/CFT standards has been created to follow up the concrete implementation of these standards and to provide accurate technical assistance to countries in need. A risk-based approach has also been adopted as a key component of the implementation of the AML/CFT Standards, with the aim of strengthening the efficiency of the standards. Instead, we noted that the assessment is not efficient in the process of enhancing AML/CFT measures because it seems to lack of adaptation to the country situation. In other words, internal and external factors are not enough taken into account in a country assessment program. The purpose of this paper is to analyze the AML/CFT regime in the fight against the financing of terrorism and to find lasting solutions to achieve the global AML/CFT compliance. The work of all the organizations involved in this combat is imperative to protect the financial network and to lead to the disintegration of terrorist groups in the future.

Keywords: AML/CFT standards, financing of terrorism, international financial institutions, risk-based approach

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Authors: Sharon Kun-Amornpong

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In this paper, ASEAN financial integration will be discussed from the perspective of the rule of law. The methodology of the paper is comparative regionalism. It will compare the role of the rule of law in ASEAN financial integration with that of the European Union with particular focuses on, for example, institutions and values. The paper argues that in the realm of financial integration, the rule of law is one of the most important factors that could help strengthen and promote financial integration in ASEAN. This is despite the fact that the ‘ASEAN Way’ emphasises non-interference and utilises a consensus-based cooperation rather than formal institutions. Nevertheless, the rule of law for ASEAN financial integration should be situated in its own historical, cultural, and political contexts. In addition, in the case of ASEAN, the rule of law cannot take root if it does not come from the demand of the people in this region. For instance, a reform or creation of legal institutions should not be imposed by international financial institutions. The paper will conclude that law has a normative force. It could shape expectation of market participants and promote deeper financial integration if norms that the law generates have become a significant norm in the society or industry.

Keywords: Association of Southeast Asian Nations, ASEAN, comparative regionalism, financial integration, the rule of law

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Authors: Zain Khalid

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The paper outlines the trends of cyber financial crimes and frauds – approximating upto – in Pakistan after the enactment of The Prevention of Electronic Crimes Act in 2016. The paper elaborates on the newer methods that fraudsters have adopted after tighter preventive and counter measures were employed in Pakistan partly as a result of following the international finance related commitments, particularly the FATF regulations. The paper adopts case studies methods to highlight various aspects of the financial frauds and crimes committed and later investigated jointly by Pakistan’s one of the federal law enforcement agencies, the Federal Investigation Agency, and Mobilink Microfinance Bank , Pakistan’s premier microfinance bank. It additionally enriches the data through expert interviews – with crime investigators and the experts to carry out an in-depth analysis of the various factors involving the crime. This paper emphasizes the structural and situational factors that shape up the cyber financial crimes in Pakistan vis-à-vis digital illiteracy and lack of awareness among the users of financial services. This paper, thus, on the basis of findings and expert interviews, suggests policy reforms to reduce the instances of the financial crimes, especially in the remotest areas of the country.

Keywords: financial crimes, cyber crimes, digital literacy, terrorism financing, banking sector

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Authors: Xuefan Li

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Parts of Chinese doctoral students in Canada are facing significant academic pressure. The factors contributing to such pressure are diverse, including financial conditions and cultural differences. Students from various academic disciplines have been interviewed to investigate the factors that Chinese students consider when selecting Canada as a destination for doctoral studies, as well as to identify the challenges they face during their academic pursuits and the associated factors influencing their performance. The findings indicate that their motivations to pursue doctoral study in Canada are concluded as both push and pull factors. Financial conditions and cultural differences are critical factors affecting academic performance, with disciplinary variations in the degree of influence observed.

Keywords: Chinese doctoral students, financial status, cultural cognition, academic performance

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Authors: Yusuf Sani Abubakar

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This paper investigates mechanisms of settlement of disputes at the Islamic Financial Institutions (IFIs). Dispute settlement at the Islamic Financial Institutions (IFIs) can be both through litigation as well as Alternative Dispute Resolution (ADR). The paper aims to investigate how disputes are settled at the Islamic Financial Institutions (IFIs), as it is natural to have disagreements between different parties involved in the business of Islamic Financial Institutions (IFIs). The paper adopts a qualitative methodology where the sources are taken from journals, books, websites etc. In analyzing the data obtained from the sources, content analysis will be used. In addition to writings on this topic by various writers, this paper will add to the literature and will recommend certain effective ways of solving disputes arising between parties participating in the business of Islamic Financial Institutions (IFIs).

Keywords: Islamic finance, dispute resolution, Islamic financial institutions, litigation

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Authors: Stanley Yap Peng Lok, Chong Wei Ying, Leow Hon Wei, Fatemeh Kimiyaghalam

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Purpose: This paper examines how people treat on the importance of financial planning for their retirement. There is lack of standard instrument that enable us to access the retirement planning behavior. This paper studies the reliability and validity of a proposed scale for accessing this behavior. Design/methodology/approach: The Retirement Planning Behavior scale (RPB) is developed from the results of reviewing different papers on this topic. A total of 900 Malaysians from the age of 18 and above are used as the sample. Findings: Our results show, firstly, the RPB meets all criteria from the instrument reliability and validity which based on the theory of planned behavior. Second, our findings propose two components for this RPB scale; attitude toward planning for retirement and intention towards retirement planning behavior. Practical implication: An effective retirement planning achieves financial independence after the retirement. Our findings have important implications for the scope and significance of the retirement planning behavior measurement, especially for retirees. Originality/value: This study proposes a new approach to cater consumers’ needs for retirement planning. Therefore, consumers are able to achieve financial independence in their retirement age.

Keywords: retirement planning behavior (RPB) scale, reliability, validity, retirement planning, financial independence

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Authors: Nkrumak Micheal Atta Ofori

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The Vocational System is a decentralized Studies System implemented in Ghana as vocation studies strategy for grassroot that focuses on providing individuals with the specific skills, knowledge, and training necessary for a particular trade, craft, profession, or occupation. This article asks how devolution of vocational studies to local level authorities produces responsive and accountable representation and sustainable vocational learning under the vocational Studies System. It focuses on two case studies: Asokore Mampong and Atwima kwanwoma Municipal. Then, the paper asks how senior high school are developing new material and social practices around the vocational studies System to rebuild their livelihoods and socio-economic wellbeing. Here, the article focusses on Kumasi District, drawing lessons for the two other cases. The article shows how the creation of representative groups under the Vocational Studies System provides the democratic space necessary for effective representation of community aspirations. However, due to elite capture, the interests of privilege few people are promoted. The state vocational training fails to devolve relevant and discretionary resources to local teachers and do not follow the prescribed policy processes of the Vocational Studies System. Hence, local teachers are unable to promote responsive and accountable representation. Rural communities continue to show great interest in the Vocational Studies System, but the interest is bias towards gaining access to vocational training schools for advancing studies. There is no active engagement of the locals in vocational training, and hence, the Vocational Studies System exists only to promote individual interest of communities. This article shows how ‘failed’ interventions can gain popular support for rhetoric and individual gains.

Keywords: vocational studies system, devolution of vocational studies, local-level authorities, senior high schools and vocational learning, community aspirations and representation

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Authors: Rimac Smiljanic Ana, Pepur Sandra, Bulog Ivana

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Financial decision-making in the household is not simple, and it demands that the decision-maker has proper knowledge and skills. Usually, high uncertainty, risk, and stress surround household financial decision-making since it is extremely important and critical for household wealth accumulation and for the well-being of all household members. Generally, skilful people tend to have higher confidence in certain tasks they perform, and they achieve better results. Therefore, in the household context, the possession of certain skills by the ones who make financial decisions for the household is of particular importance. This paper addresses financial literacy as an important skill for household decision-making. Apart from financial literacy, the paper also considers other factors, such as employment, education, and age, as significant for household financial decision-making. The analysis is based on quantitative individual-level survey data. The data collection was conducted during January and February 2021 in Croatia through an online survey. To reach a wide variety of participants, the snowball sampling method was used. The result revealed interesting and somewhat puzzling results. Our results point to the importance of financial literacy skills for household decision-making.

Keywords: skill, financial literacy, decision-making, household financijal decision making

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Authors: Y. Tahat, T. Dunne, S. Fifield, D. Power

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Information about a firm’s usage of Financial Instruments (FIs) plays a very important role in determining its financial position and performance. Yet accounting standard-setters have encountered problems when deciding on the FI-related disclosures which firms must make. The primary objective of this paper is to review the extant literature on FI disclosure. This objective is achieved by surveying the literature on: the corporate usage of FIs; the different accounting standards adopted concerning FIs; and empirical studies on FI disclosure. This review concludes that the current research on FI disclosure has generated a number of useful insights. In particular, the paper reports that: FIs are a very important risk management mechanism in ensuring that companies have the cash available to make value-enhancing investments, however, without a clear set of risk management objectives, using such instruments can be dangerous; accounting standards concerning FIs have resulted in enhanced transparency about the usage of these instruments; and FI-related information is a key input into investors’ decision-making processes. Finally, the paper provides a number of suggestions for future research in the area.

Keywords: financial instruments, financial reporting, accounting standards, value relevance, corporate disclosure

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Authors: Rudra P. Pradhan

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This paper examines the Granger causal nexus between financial development and energy consumption in the group of 35 Financial Action Task Force (FATF) Countries over the period 1988-2012. The study uses two financial development indicators such as private sector credit and stock market capitalization and seven energy consumption indicators such as coal, oil, gas, electricity, hydro-electrical, nuclear and biomass. Using panel cointegration tests, the study finds that financial development and energy consumption are cointegrated, indicating the presence of a long-run relationship between the two. Using a panel vector error correction model (VECM), the study detects both bidirectional and unidirectional causality between financial development and energy consumption. The variation of this causality is due to the use of different proxies for both financial development and energy consumption. The policy implication of this study is that economic policies should recognize the differences in the financial development-energy consumption nexus in order to maintain sustainable development in the selected 35 FATF countries.

Keywords: energy consumption, financial development, FATF countries, Panel VECM

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Authors: Aleksandra Szunke

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Monetary policy is an important pillar of the economy, directly affecting on the condition of banking sector. Depending on the strategy may both support functioning of banking institutions, as well as limit their excessively risky activities. The literature studies indicate a large number of publications, which include characteristics of initiatives, implemented by central banks during the global financial crisis and the potential effects of the use of non-standard monetary policy instruments. However, the empirical evidence about their effects and real consequences for the financial markets are still not final. Even before the escalation of instability, Bernanke, Reinhart, and Sack (2004) analyzed the effectiveness of various unconventional monetary tools in lowering long-term interest rates in the United States and Japan. The obtained results largely confirmed the effectiveness of the zero-interest-rate policy and Quantitative Easing (QE) in achieving the goal of reducing long-term interest rates. Japan, considered as the precursor of QE policy, also conducted research about the consequences of non-standard instruments, implemented to restore financial stability of the country. Although the literature about the effectiveness of Quantitative Easing in Japan is extensive, it does not uniquely specify whether it brought permanent effects. The main aim of the study is to identify the implications of non-standard monetary policy, implemented by selected central banks (the Federal Reserve System, Bank of England and European Central Bank), paying particular attention to the consequences into three areas: the size of money supply, financial markets, and the real economy.

Keywords: consequences of modern monetary policy, quantitative easing policy, banking sector instability, global financial crisis

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Authors: Anupam Das

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Although financial liberalization has been one of the most important policy prescriptions of international organizations like the World Bank and the IMF, the effect of financial liberalization on economic growth in developing countries is far from unanimous. Since the '80s, South Asian countries made a significant development in liberalization the financial sector. However, due to unavailability of a sufficient number of time series observations, the relationship between economic growth and financial development has not been investigated adequately. We aim to fill this gap by examining time series data of five developing countries from the South Asian region: Bangladesh, India, Pakistan, Sri Lanka, and Nepal. Applying the cointegration tests and Granger causality within the vector error correction model (VECM), we do not find unanimous evidence of financial development on positive economic growth. These results are helpful for developing countries which have been trying to liberalize the financial sector in recent decades.

Keywords: economic growth, financial development, Granger causality, South Asia

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Authors: Sumanta Kumar Saha, Jie Qin

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This study analyzes the impact of financial inclusion on gender inequality in 126 countries belonging to different income groups during the 2005–2019 period. Due to its positive influence on poverty alleviation, economic growth, women empowerment, and income inequality reduction, financial inclusion may help reduce gender equality. This study constructs a novel composite financial inclusion index and applies both fixed-effect panel estimation and instrumental variable approach to examine the impact of financial inclusion on gender inequality. The results indicate that financial inclusion can reduce gender inequality in developing and low- and lower-middle-income countries, but not in higher-income countries. The impact is not always immediate. Past financial inclusion initiatives have a significant influence on future gender inequality. Financial inclusion is also significant if the poverty level is high and women's access to financial services is low compared to men. When the poverty level is low, or women have equal access to financial services, financial inclusion does not significantly affect gender inequality. The study finds that compulsory education and improvement in institutional quality promote gender equality in developing countries apart from financial inclusion. The study proposes that lower-income countries use financial inclusion initiatives to improve gender equality. Other countries need to focus on other aspects such as promoting educational support and institutional quality improvements to achieve gender equality.

Keywords: financial inclusion, gender inequality, institutional quality, women empowerment

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Authors: Bita Mashayekhi, Amin Jahangard, Milad Samavat, Saeid Homayoun

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In the modern competitive business environment, one cannot overstate the importance of corporate social responsibility. The controversial link between the social and financial performance of firms has become a topic of interest for scholars. Hence, this study examines the social and financial performance link by taking into account the mediating role of innovation performance. We conducted the Covariance-based Structural Equation Modeling (CB-SEM) method on an international sample of firms provided by the ASSET4 database. In this research, to explore the black box of the social and financial performance relationship, we first examined the effect of social performance separately on financial performance and innovation; then, we measured the mediation role of innovation in the social and financial performance link. While our results indicate the positive effect of social performance on financial performance and innovation, we cannot document the positive mediating role of innovation. This possibly relates to the long-term nature of benefits from investments in innovation.

Keywords: ESG, financial performance, innovation, social performance, structural equation modeling

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Authors: Jerry Szatko, Edan L. Jorgensen, Stacia Jorgensen

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A crucial component to the success of any financial advising relationship is for the financial professional to understand the perceptions, preferences and thought-processes carried by the financial clients they serve. Armed with this information, financial professionals are more quickly able to understand how they can tailor their approach to best match the individual preferences and needs of each personal investor. Our research explores the use of a quantitative assessment tool in the financial services industry to assist in the identification of the personal investor’s consumer behaviors, especially in terms of financial risk tolerance, as it relates to their financial decision making. Through this process, the Unitifi Consumer Insight Tool (UCIT) was created and refined to capture and categorize personal investor financial behavioral categories and the financial personality tendencies of individuals prior to the initiation of a financial advisement relationship. This paper discusses the use of this tool to place individuals in one of four behavior-based financial risk tolerance categories. Our discoveries and research were aided through administration of a web-based survey to a group of over 1,000 individuals. Our findings indicate that it is possible to use a quantitative assessment tool to assist in predicting the behavioral tendencies of personal consumers when faced with consumer financial risk and decisions.

Keywords: behavior-based advising, financial relationship building, risk capacity based on behavior, risk tolerance, systematic way to assist in financial relationship building

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Authors: Irina Bondarenko, Olga Vandina

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The theory of evolutionary economics is the basis for preparation and application of methods forming the stock market infrastructure development concept. The authors believe that the basis for the process of formation and development of the stock market model infrastructure in Russia is the theory of large systems. This theory considers the financial market infrastructure as a whole on the basis of macroeconomic approach with the further definition of its aims and objectives. Evaluation of the prospects for interaction of securities market institutions will enable identifying the problems associated with the development of this system. The interaction of elements of the stock market infrastructure allows to reduce the costs and time of transactions, thereby freeing up resources of market participants for more efficient operation. Thus, methodology of the transaction analysis allows to determine the financial infrastructure as a set of specialized institutions that form a modern quasi-stable system. The financial infrastructure, based on international standards, should include trading systems, regulatory and supervisory bodies, rating agencies, settlement, clearing and depository organizations. Distribution of financial assets, reducing the magnitude of transaction costs, increased transparency of the market are promising tasks in the solution for questions of services level and quality increase provided by institutions of the securities market financial infrastructure. In order to improve the efficiency of the regulatory system, it is necessary to provide "standards" for all market participants. The development of a clear regulation for the barrier to the stock market entry and exit, provision of conditions for the development and implementation of new laws regulating the activities of participants in the securities market, as well as formulation of proposals aimed at minimizing risks and costs, will enable the achievement of positive results. The latter will be manifested in increasing the level of market participant security and, accordingly, the attractiveness of this market for investors and issuers.

Keywords: institutional infrastructure, financial assets, regulatory system, stock market, transparency of the market

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Authors: Oscar E. Cariceo

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In Chile, social workers´ professional training is developed in the undergraduate level, mainly. Despite the fact that several schools have been launched Master of Social Work programs, the Bachelor in Social Work is the minimum qualification to start a professional career. In the current Chilean higher education system, there exist different financial aid options in order to guarantee equal access to higher education. These policies, which are student loans and scholarships, basically, are applied and distributed by Government agencies. They are linked to academic performance and socio-economic needs, in terms of standardized test scores and social vulnerability criteria. In addition, institutions that enroll students with high scores, also receive direct financial support. In other words, social work students must compete for the resources to pay for college tuitions and fees with other students from different programs and knowledge fields and, as a consequence, they can indirectly enhance schools´ money income. This work aims to describe the reality of social work students to access to financial aid in Chile. The analysis presents the results of the University Selection Test of students, who were accepted in social work undergraduate programs during 2014 related to their qualifications to apply to three main financial aid programs, and their contribution to attracting resources to their schools. In general, data show that social work students participate in a low proportion in the distribution of financial aid, both student loans and scholarships. Few of them reach enough scores to guarantee direct financial resources to their institutions. Therefore, this situation has deep implications on equal access to higher education for vulnerable students and affects equal access to training options for young social workers, due to the highly competitive financial aid system.

Keywords: social work, professional training, higher education, financial aid, equity

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Authors: Stanley Yap, Mahadevan Supramaniam, Chong Wei Ying, Fatemeh Kimiyaghalam

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Purpose: The paper shows the framework of financial planning in a different paradigm. It highlights the results from a focus group on retirement planning in the aspect of financial literacy and wealth accumulation in Malaysia. Design/methodology/approach: A focus group consisted of thirty individuals and divided into six different clusters amongst 25 to 55 years old. The selection of focus group members is pertaining to retirement planning behavior and saving profile from the different level of educations. Findings: Our results show, firstly, the focus group reflects individual capacity on saving attitude, financial literacy and awareness towards financial products. Secondly, availability, accessibility and affordability which are the significant factors that influence saving attitude, financial literacy and awareness on personal retirement planning behavior. Practical implications: The participants express the concerns of retirement planning during their golden years and the current financial products in the Malaysian financial market. Originality/value: This study is a different approach that recognizes the needs of the consumers in the context of retirement planning and wealth accumulation. Therefore, customers should obtain financial services and products from financial providers to achieve financial independence.

Keywords: retirement planning, wealth accumulation, financial literacy, focus group, saving attitude, availability, accessibility, affordability

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Authors: Aleksandra Nocoń (Szunke)

Abstract:

The study is a review of the literature concerning the consequences of non-standard monetary policy, which are used by central banks during unconventional periods, threatening instability of the banking sector. In particular, the attention was paid to the effects of non-standard monetary policy tools for financial markets. However, the empirical evidence about their effects and real consequences for the financial markets are still not final. The main aim of the study is to survey the consequences of standard and non-standard monetary policy instruments, implemented during the global financial crisis in the United States, United Kingdom and Euroland, with particular attention to the results for the stabilization of global financial markets. The study analyses the consequences for short and long-term market interest rates, interbank interest rates and LIBOR-OIS spread. The study consists mainly of the empirical review, indicating the impact of the implementation of these tools for the financial markets. The following research methods were used in the study: literature studies, including domestic and foreign literature, cause and effect analysis and statistical analysis.

Keywords: asset purchase facility, consequences of monetary policy instruments, non-standard monetary policy, quantitative easing

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Authors: Sami Adwan, Alaa Alhaj Ismail, Claudia Girardone

Abstract:

This paper examines the changes in the value relevance of book value of equity and net income of financial firms over the crisis period. It also examines how these changes vary with three variables, namely, fair value exposure, ownership concentration, and regulatory capital ratios. Using a sample of financial firms operating in the European Economic Area over 2005-2011, our findings suggest that the value relevance of book value of equity increases while that of net income decreases during the financial crisis. We find that more exposure to fair value accounting mitigates the impact of the crisis on the value relevance of book value of equity and net income. We also find that more concentrated ownership appears to have a mitigating impact on the changes in the value relevance of both book value of equity and net income in times of financial crisis. Finally, we find evidence that the level of regulatory capital ratios tends to have an attenuating effect on the changes in the value relevance of net income (but not book value of equity) in times of financial crisis.

Keywords: value relevance, financial crisis, financial firms, fair value, ownership concentration, regulatory capital

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Authors: Muhammad Arsalan

Abstract:

The efficiency of a financial intermediation system is assessed by its ability to achieve allocative efficiency, asset transformation, and the subsequent economic development. Islamic Banking and Finance (IBF) was conceived to serve as an alternate financial intermediation system adherent to the injunctions of Islam. A critical appraisal of the state of contemporary IBF reveals that it neither fulfills the aspirations of Islamic rhetoric nor is efficient in terms of asset transformation and economic development. This paper is an intuitive pursuit to explore the economic rationale of established principles of IBF, and the reasons of the persistent divergence of IBF being accused of ruses and sophistry. Disentangling the varying viewpoints, the underdevelopment of IBF has been attributed to misinterpretation of Riba, which has been explicated through a narrow fiqhi and legally deterministic approach. It presents a critical account of how incorrect conceptualization of the key injunction on Riba, steered flawed institutionalization of an Islamic Financial intermediation system. It also emphasizes on the wrong interpretation of the ontological and epistemological sources of Islamic Law (primarily Riba), that explains the perennial economic underdevelopment of the Muslim world. Deeming ‘a collaborative and dynamic Ijtihad’ as the elixir, this paper insists on the exigency of redefining Riba, i.e., a definition that incorporates the modern modes of economic cooperation and the contemporary financial intermediation ecosystem. Finally, Riba has been articulated in an agency theoretic framework to eschew expropriation of wealth, and assure protection of property rights, aimed at realizing the twin goals of a) Shari’ah adherence in true spirit, b) financial and economic development of the Muslim world.

Keywords: agency theory, financial intermediation, Islamic banking and finance, ijtihad, economic development, Riba, information asymmetry

Procedia PDF Downloads 109