Corporate governance, accounting and finance: a review

We review accounting and finance research on corporate governance (CG). In the course of our review, we focus on a particularly vexing issue, namely endogeneity in the relationships between CG and other matters of concern to accounting and finance scholars, and suggest ways to deal with it. Given the advent of large commercial CG databases, we also stress the importance of how CG is measured and in particular, the construction of CG indices, which should be sensitive to local institutional arrangements, and the need to capture both internal and external aspects of governance. The ‘stickiness’ of CG characteristics provides an additional challenge to CG scholars. Better theory is required, for example, to explain whether various CG practices substitute for each other or are complements. While a multidisciplinary approach to developing better theory is never without its difficulties, it could enrich the current body of knowledge in CG. Despite the vastness of the existing CG literature, these issues do suggest a number of avenues for future research.

P2-486 Environmental temperature variation and morbidity: a meta-analysis

Extreme temperatures have been shown to have a detrimental effect on health. Hot temperatures can increase the risk of mortality, particularly in people suffering from cardiorespiratory diseases. Given the onset of climate change, it is critical that the impact of temperature on health is understood, so that effective public health strategies can correctly identify vulnerable groups within the population. However, while effects on mortality have been extensively studied, temperature–related morbidity has received less attention. This study applied a systematic review and meta–analysis to examine the current literature relating to hot temperatures and morbidity.

Early childhood education : the natural starting point for environmental education

Young children are most vulnerable to, and most at risk from, environmental and sustainability challenges. Early education investments aimed at addressing such issues, until recently however, have been neglected or under-rated. Fortunately, this is changing. A groundswell of practitioner interest in early childhood environmental education/ education for sustainability is emerging, in contrast to the ‘patches of green’ that have characterised previous decades. Indeed, an international coalition for early childhood education for sustainability (ECEfS) is beginning to develop, evidenced by The Gothenburg Recommendations on Education for Sustainable Development (2008) that identifies early childhood, within a framework of lifelong learning, as a ‘natural starting point’ for all ongoing education for sustainability. This document is important as it is the first international statement to explicitly identify ECEfS as contributing to education for sustainability. The next challenge for ECEfS is for practitioner mobilisation to be matched by research activity aimed at broadening and deepening practice-based responses. This is the next exciting frontier in the legitimisation of ECEfS.

Towards a global carbon integrity system : learning from the GFC and avoiding a GCC

This paper examines some of the central global ethical and governance challenges of climate change and carbon emis-sions reduction in relation to globalization, the “global financial crisis” (GFC), and unsustainable conceptions of the “good life”, and argues in favour of the development of a global carbon “integrity system”. It is argued that a funda-mental driver of our climate problems is the incipient spread of an unsustainable Western version of the “good life”, where resource-intensive, high-carbon western lifestyles, although frequently criticized as unsustainable and deeply unsatisfying, appear to have established an unearned ethical legitimacy. While the ultimate solution to climate change is the development of low carbon lifestyles, the paper argues that it is also important that economic incentives support and stimulate that search: the sustainable versions of the good life provide an ethical pull, whilst the incentives provide an economic push. Yet, if we are going to secure sustainable low carbon lifestyles, it is argued, we need more than the ethical pull and the economic push. Each needs to be institutionalized—built into the governance of global, regional, national, sub-regional, corporate and professional institutions. Where currently weakness in each exacerbates the weaknesses in others, it is argued that governance reform is required in all areas supporting sustainable, low carbon versions of the good life.

Assessing population limits : a carrying capacity approach to planning

While purporting to enhance Australia’s sustainability, the federal government’s Population Strategy rejects the assessment of the limiting factors to future population growth, thus avoiding urgent threshold issues such as resource depletion and environmental destruction. A more forward-thinking and whole-system perspective would assess and incorporate critical biophysical limits into governance processes with suitable prioritisation. It would encourage communities to examine their individual and collective responsibilities in the context of these limits in order to most equitably optimise outcomes; and it would employ both a resource-based examination of minimum population requirements, and an impact-based assessment of maximum thresholds. This carrying capacity approach to planning could help guide society towards a more sustainable future.

The right to be green: using human rights law to achieve environmental protection

The relationship between the environment and human rights has long been recognised. It is now largely accepted that a ‘good’ environment is a necessary precondition for the enjoyment of a wide range of human rights, including the right to health, the right to an adequate standard of living, and even the right to life. It has even been suggested that as humans we all possess a right to live in an environment of a certain standard, based on the intrinsic value of the natural world to all human beings. In this context much has been written regarding the important role that the environment plays in human lives. This paper looks at the flip-side of this discussion, and examines what human rights can do for the environment. It is argued that, while there are valid criticisms for linking environmental protection too strongly to human needs, there is nonetheless much to be gained from using human rights law as a framework to achieve environmental protection.

Corporate governance mechanisms and earnings management in transitional countries – evidence from Chinese listed firms

The objective of this thesis is to investigate whether the corporate governance practices adopted by Chinese listed firms are associated with the quality of earnings information. Based on a review of agency and institutional theory, this study develops hypotheses that predict the monitoring effectiveness of the board and the audit committee. Using a combination of univariate and multivariate analyses, the association between corporate governance mechanisms and earnings management are tested from 2004 to 2008. Through analysing the empirical results, a number of findings are summarised as below. First, board independence is weakened by the introduction of government officials as independent directors on the boards. Government officials acting as independent directors, claim that they meet the definition of independent director set by the regulation. However, they have some connection with the State, which is the controlling shareholder in listed SOEs affiliated companies. Consequently, the effect of the independent director’s expertise in constraining earnings management is mitigated as demonstrated by an insignificant association between board expertise and earnings management. An alternative explanation for the inefficiency of board independence may point to the pre-selection of independent directors by the powerful CEO. It is argued that a CEO can manipulate the board composition and choose the "desirable" independent directors to monitor themselves. Second, a number of internal mechanisms, such as board size, board activities, and the separation of the roles of the CEO and chair are found to be significantly associated with discretionary accruals. This result suggests that there are advantages in having a large and active board in the Chinese setting. This can offset the disadvantages associated with large boards, such as increased bureaucracy, and hence, increase the constraining effects of a large and resourceful board. Third, factor analysis identifies two factors: CEO power and board power. CEO power is the factor which consists of CEO duality and turnover, and board power is composed of board size and board activity. The results of CEO power show that if a Chinese listed company has CEO duality and turnover at the same time, it is more likely to have a high level of earnings management. The significant and negative relationship between board power and accruals indicate that large boards with frequent meetings can be associated with low level of earnings management. Overall, the factor analysis suggests that certain governance mechanisms complement each other to become more efficient monitors of opportunistic earnings management. A combination of board characteristics can increase the negative association with earnings management. Fourth, the insignificant results between audit committees and earnings management in Chinese listed firms suggests that the Chinese regulator should strengthen the audit committee functions. This thesis calls for listed firms to disclose more information on audit committee composition and activities, which can facilitate future research on the Chinese audit committee’s monitoring role. Fifth, the interactive results between State ownership and board characteristics show that dominant State ownership has a moderating effect on board monitoring power as the State totally controls 42% of the issued shares. The high percentage of State ownership makes it difficult for the non-controlling institutional shareholders to challenge the State’s dominant status. As a result, the association between non-controlling institutional ownership and earnings management is insignificant in most situations. Lastly, firms audited by the international Big4 have lower abnormal accruals than firms audited by domestic Chinese audit firms. In addition, the inverse U-shape relationship between audit tenure and earnings quality demonstrates the changing effects of audit quality after a certain period of appointment. Furthermore, this thesis finds that listing in Hong Kong Stock Exchanges can be an alternative governance mechanism to discipline Chinese firms to follow strict Hong Kong listing requirements. Management of Hong Kong listed companies are exposed to the scrutiny of international investors and Hong Kong regulators. This in turn reduces their chances of conducting self-interested earnings manipulation. This study is designed to fill the gap in governance literature in China that is related to earnings management. Previous research on corporate governance mechanisms and earnings management in China is not conclusive. The current research builds on previous literature and provides some meaningful implications for practitioners, regulators, academic, and international investors who have investment interests in a transitional country. The findings of this study contribute to corporate governance and earnings management literature in the context of the transitional economy of China. The use of alternative measures for earnings management yields similar results compared with the accruals models and produces additional findings.

School education as social and economic governance : responsibilising communities through industry-school engagement

This article examines shifts in educational and social governance taking place in Queensland, Australia, through Industry School Engagement Strategy of Education Queensland and its Gateway Schools program. This significant educational initiative is set within the context of the social investment agenda first articulated in the education policy framework, Queensland State Education-2010. The article traces the historic extension of this governmental strategy through establishment of the Gateway Schools concept that brokers industry-school partnerships with global players in the Queensland economy. Industry sectors forming the partnerships include Minerals and Energy, Aerospace, Wine Tourism, Agribusiness, Manufacturing and Engineering, Building and Construction and ICT. We argue that this ‘post-bureaucratic’ model of schooling represents a new social settlement of neoliberal governance, in which educational outcomes align with economic objectives, and frame the conditions for community self-governance.

The role of property law in environmental management

Market-based environmental regulation is becoming increasingly common within international and national frameworks. In order for market-based regimes to attract sufficient levels of stakeholder engagement, participants within such schemes require an incentive to participate and furthermore need to feel a sense of security about investing in such processes. A sense of security is associated with property-based interests. This article explores the property-related issues connected with the operation of environmental markets. Relevant property-related considerations include examining the significant role that market-based regulation is playing in connection with the environment; examining the links between property rights and markets; exploring the legal definition of property; analysing the rights and powers associated with environmental interests in land; advancing theory on the need for landholder responsibilities in relation to land and examining the legal mechanisms used to recognise environmental property rights, including the registration thereof.

The role of gender and framing in shaping community activists' perceptions of environmental risks

campaign to oppose projects proposed in their local community. The social constructionist perspective advocates that these motivations are driven by activists’ interpretation of reality, such that activists will assign multiple meanings to and frame environmental issues in a way that reflects their view of reality. Past research suggest that these are also influenced by patterns of shared meaning and interpretation that develop over time in protest movements that shape activists’ perceptions of the environmental risks and impacts associated with construction activity. This paper explores the role of gender distinctions in shaping perceptions of environmental risk and how this affects their framing of the environmental, social, cultural/ historical impacts associated with a construction project. Using Snow and Benford’s (1988) 3-prong analytical tool for framing: diagnostic framing, prognostic framing and motivational framing, this paper presents findings from the content analysis of in-depth interviews of 24 activists protesting against a highly controversial housing project in the greater Sydney metropolitan area. The research adopts a single case study approach, and is particularly significant as it investigates an extensive and on-going community-based protest campaign (dating back almost 20 years) that has generated the longest standing 24-hour community picket in Australia.

An approximate Bayesian computation approach for estimating parameters of complex environmental processes in a cellular automata

Modelling an environmental process involves creating a model structure and parameterising the model with appropriate values to accurately represent the process. Determining accurate parameter values for environmental systems can be challenging. Existing methods for parameter estimation typically make assumptions regarding the form of the Likelihood, and will often ignore any uncertainty around estimated values. This can be problematic, however, particularly in complex problems where Likelihoods may be intractable. In this paper we demonstrate an Approximate Bayesian Computational method for the estimation of parameters of a stochastic CA. We use as an example a CA constructed to simulate a range expansion such as might occur after a biological invasion, making parameter estimates using only count data such as could be gathered from field observations. We demonstrate ABC is a highly useful method for parameter estimation, with accurate estimates of parameters that are important for the management of invasive species such as the intrinsic rate of increase and the point in a landscape where a species has invaded. We also show that the method is capable of estimating the probability of long distance dispersal, a characteristic of biological invasions that is very influential in determining spread rates but has until now proved difficult to estimate accurately.

Negotiating the Business Environment: Theory, Practice for all Governance Styles

The business environment across the globe is today characterised by three primary governance arrangements - bureaucracies, markets and networks. For organisations operating within each of these business contexts the terms of engagement in regard to negotiation are different. Rather than starting from a broad ‘how to’ approach or a specific cultural interface, Negotiating the Business Environment looks at governance arrangements within the business environment and at how such governance arrangements impact on how negotiation occurs. This text provides an Australian—not an overseas—perspective on negotiations that will be a welcome change for Australian students. Uniquely, it takes into account the context in which negotiations take place. Negotiating the Business Environment demonstrates how responding to business style in negotiations can effect successful outcomes. It include strong pedagogy including: key terms, key points, further reading lists, case studies, and end of chapter questions

Joined-up governance in Australia : how the past can inform the future

Joined-up enterprises have become a cornerstone of the institutional architecture to facilitate closer linkages within and between departments and across sectors. Some of these initiatives are now mainstream enterprises, while others struggled to gain purchase or effect. Since the future is likely to be characterized by an ongoing emphasis on joined-up initiatives, an assessment of past efforts can provide a valuable backdrop for the development of new approaches and the fine tuning of existing ones. Drawing on ten years of research data, this article tracks the ebbs and flows of joined-up or integrated practice in Queensland. In doing so, it examines the drivers for integration, preferred models, and the language used to engender change. It also assesses what has worked and why and whether integrated reform has been sustained. Based on these insights, an extended integration framework is presented, which will assist those responsible for the design, monitoring, and evaluation of joined-up processes.