Earnings quality and performance in the banking industry: a profit frontier approach

The analysis of efficiency and productivity in banking has received a great deal of attention for almost three decades now. However, most of the literature to date has not explicitly accounted for risk when measuring efficiency. We propose an analysis of profit efficiency taking into account how the inclusion of a variety of bank risk measures might bias efficiency scores. Our measures of risk are partly inspired by the literature on earnings management and earnings quality, keeping in mind that loan loss provisions, as a generally accepted proxy for risk, can be adjusted to manage earnings and regulatory capital. We also consider some variants of traditional models of profit efficiency where different regimes are stipulated so that financial institutions can be evaluated in different dimensions—i.e., prices, quantities, or prices and quantities simultaneously. We perform this analysis on the Spanish banking industry, whose institutions have been deeply affected by the current international financial crisis, and where re-regulation is taking place. Our results can be explored in multiple dimensions but, in general, they indicate that the impact of earnings management on profit efficiency is of less magnitude than what might a priori be expected, and that on the whole, savings banks have performed less well than commercial banks. However, savings banks are adapting to the new regulatory scenario and rapidly catching up with commercial banks, especially in some dimensions of performance.

Potentials of process intensification in the Finnish petrochemical industry

This research was motivated by the need to examine the potential application areas of process intensification technologies in Neste Oil Oyj. According to the company’s interest membrane reactor technology was chosen and applicability of this technology in refining industry was investigated. Moreover, Neste Oil suggested a project which is related to the CO2 capture from FCC unit flue gas stream. The flowrate of the flue gas is 180t/h and consist of approximately 14% by volume CO2. Membrane based absorption process (membrane contactor) was chosen as a potential technique to model CO2 capture from fluid catalytic cracking (FCC) unit effluent. In the design of membrane contactor, a mathematical model was developed to describe CO2 absorption from a gas mixture using monoethanole amine (MEA) aqueous solution. According to the results of literature survey, in the hollow fiber contactor for laminar flow conditions approximately 99 % percent of CO2 can be removed by using a 20 cm in length polyvinylidene fluoride (PDVF) membrane. Furthermore, the design of whole process was performed by using PRO/II simulation software and the CO2 removal efficiency of the whole process obtained as 97 %. The technical and economical comparisons among existing MEA absorption processes were performed to determine the advantages and disadvantages of membrane contactor technology.

Working capital management in the value chain of automotive industry

The objective of this Master’s thesis is to examine working capital management in the automotive industry in years 2006-2008. The study is conducted by the analysis of financial statements. The sample consists of 65 companies that represent different stages in the value chain of automotive industry beginning from raw material suppliers and ending to car dealers. Working capital management is studied by the cash conversion cycle (CCC). The results show that the average CCC of the value chain is 67 days. Car manufacturers had the longest CCC, 106 days, whereas the CCC of oil companies was the shortest, 22 days. The findings suggest that the cycle time of working capital usually follows the cycle time of inventories, since the changes in cycle times of accounts receivable and payable compensate each other. Improvements in working capital management could be achieved by sharing more accurate information in the chain for example about inventory levels and order points of customer. It could also be discussed within the automotive industry, if the long credit periods, which tie up working capital, are really needed. New technologies enable faster payments, which would reduce the cash conversion cycles, improve the profitability of companies, and increase the competitiveness of the value chain. Working capital should not be reduced at the expense of value chain partners, because nowadays the competition is rather between the value chains than between the companies. Similar research design is applied earlier to study working capital management in the value chain of pulp and paper industry. Even if the industries and the structures of the chains differ from each other, results were surprisingly similar. In future research, working capital management in other industries’ value chains could still be studied and compared to previous studies. ICT industry, for example, could be an interesting object.

IT Investment Portfolio Management Over Joint Ventures: Case Study in a Multinational Oil & Gas Company

With information technology (IT) playing an increasing important role in driving the business, the value of IT investment is often challenged because not all of those investment decisions are made in a reasonable way or aligned with business strategies. IT investment portfolio management (PfM) is an effective way to prioritize and select the right IT projects to invest in, by taking all the project proposals into consideration as a whole, based on their business value, risks, costs, and interrelationships. There are different decision models to prioritise projects, and the Analytic Hierarchy Process (AHP) is one of the most commonly-used methods and is discussed in this master thesis. At the same time, there are IT projects on different levels for a multinational company, from global to local. For instance, many of them are probably proposed by joint ventures on local level. In the oil & gas industry, joint ventures are often formed especially in the area of the upstream (exploration & production). How to involve those projects into the IT investment PfM approach of the parent company is a challenge, because the parent company cannot make the decisions on its own. It needs to prioritize all projects in an adequate way, communicate with JVs and influence them. Also, different control levels on JVs need to be considered. This paper hence attempts to introduce a tailored approach of IT investment PfM for a multinational oil & gas company to address the issues around JVs.

Biodegradable packaging materials in 2013 and their feasibility in chocolate industry

The development of biopolymers has been rapid in recent years and the range of available bioplastics is increasing continuously, driven by a growing demand for sustainable solutions. There are several key drivers behind this growth. The oil reservoirs are decreasing which is causing a price increase for the traditional plastic materials and therefore the gap to bioplastics’ price is getting smaller. In addition, other environmental topics, such as waste disposal and green production, have become more and more important factors for institutes, companies and consumers. Legislation and directives have to be taken into account as well in decision making concerning different packaging materials. The new environmental law with waste disposal responsibility will also have an effect on the packaging business. Therefore a need has risen to study closer the current offering closer of bio-based materials that could be used in chocolate packaging. In this Master’s Thesis the bioplastics’, and especially biodegradable materials’ technical properties and their development, availability, possible existing products in the markets, waste disposal possibilities and consumers attitude towards environmental friendly packaging is studied. This is a case study where the offering of biodegradable materials was investigated during March 2013 for Fazer Confectionary.

Managing innovation in oil and gas companies: A proposed framework for the management of innovation at Ecopetrol S.A.

Actually, the term innovation seems to be one of the most used in any kind of business practices. However, in order to get value from it, companies need to define a systematic and structured way to manage innovation. This process can be difficult and very risky since it is associated with the development of firm´s capabilities which involves human and technical challenges according to the context of a firm. Additionally, it seems not to exist a magic formula to manage innovation and what may work in a company may not work in another, even though in the same type of industry. In this sense, the purpose of this research is to identify how the oil and gas companies can manage innovation and what are the main elements, their interrelations and structure, required for managing innovation effectively in this critical sector for the world economy. The study follows a holistic single case study in a National Oil Company (NOC) of a developing country to explore how innovation performs in the industry, what are the main elements regarding innovation management and their interactions according to the nature of the industry. Contributory literature and qualitative data from the case study company (with the use of non-standardized interviews) is collected and analyzed. The research confirms the relevance and importance of the definition and implementation of an innovation framework in order to ensure the generation of value and organize as well as guide the efforts in innovation done by a firm. In this way based on the theoretical background, research´s findings, and in the company´s innovation environment and conditions, a framework for managing innovation at the case study company is suggested. This study is one of the few, if not only one, that has reviewed the way as oil and gas companies manage innovation and its practical implementation in a company from a developing country. Both researchers and practitioners will get a photograph of understanding innovation management in the oil and gas industry and its growing necessity in the business world. Some issues have been highlighted, so that future study can be focused in those directions. In fact, even though research on innovation management has significantly grown, there are still many issues that need to be addressed to get insight about managing innovation in various contexts and industries. Studies are mostly performed in the context of large firms and in developed countries, so then research in the context of developing countries is still almost an untouched area, especially in the oil and gas industry. Finally, from the research it seems crucial to explore the effect of some innovation-related variables such as: open innovation in third world economies and in state-own companies; the impact of mergers and acquisitions in innovation performance in oil and gas companies; value measurement in the first stages of the innovation process; and, development of innovation capabilities in companies from developing nations.

Silicon-containing species in used lube oil re-refining

Nowadays, the re-refining of the used lube oils has gained worldwide a lot of attention due to the necessity for added environmental protection and increasingly stringent environmental legislation. One of the parameters determining the quality of the produced base oils is the composition of feedstock. Estimation of the chemical composition of the used oil collected from several European locations showed that the hydrocarbon structure of the motor oil is changed insignificantly during its operation and the major part of the changes is accounted for with depleted oil additives. In the lube oil re-refining industry silicon, coming mainly from antifoaming agents, is recognized to be a contaminant generating undesired solid deposits in various locations in the re-refining units. In this thesis, a particular attention was paid to the mechanism of solid product formation during the alkali treatment process of silicon-containing used lube oils. The transformations of a model siloxane, tetramethyldisiloxane (TMDS), were studied in a batch reactor at industrially relevant alkali treatment conditions (low temperature, short reaction time) using different alkali agents. The reaction mechanism involving solid alkali metal silanolates was proposed. The experimental data obtained demonstrated that the solids were dominant products at low temperature and short reaction time. The liquid products in the low temperature reactions were represented mainly by linear siloxanes. The prolongation of reaction time resulted in reduction of solids, whereas both temperature and time increase led to dominance of cyclic products in the reaction mixture. Experiments with the varied reaction time demonstrated that the concentration of cyclic trimer being the dominant in the beginning of the reaction diminished with time, whereas the cyclic tetramer tended to increase. Experiments with lower sodium hydroxide concentration showed the same effect. In addition, a decrease of alkali agent concentration in the initial reaction mixture accelerated TMDS transformation reactions resulting in solely liquid cyclic siloxanes yields. Comparison of sodium and potassium hydroxides applied as an alkali agent demonstrated that potassium hydroxide was more efficient, since the activation energy in KOH presence was almost 2-fold lower than that for sodium hydroxide containing reaction mixture. Application of potassium hydroxide for TMDS transformation at 100° C with 3 hours reaction time resulted in 20 % decrease of solid yields compared to NaOH-containing mixture. Moreover, TMDS transformations in the presence of sodium silanolate applied as an alkali agent led to formation of only liquid products without formation of the undesired solids. On the basis of experimental data and the proposed reaction mechanism, a kinetic model was developed, which provided a satisfactory description of the experimental results. Suitability of the selected siloxane as a relevant model of industrial silicon-containing compounds was verified by investigation of the commercially available antifoam agent in base-catalyzed conditions.

Potential for synthetic gas in Finnish industry

Finland, other Nordic countries and European Union aim to decarbonize their energy production by 2050. Decarbonization requires large scale implementation of non-emission energy sources, i.e. renewable energy and nuclear power. Stochastic renewable energy sources present a challenge to balance the supply and demand for energy. Energy storages, non-emissions fuels in mobility and industrial processes are required whenever electrification is not possible. Neo-Carbon project studies the decarbonizing the energy production and the role of synthetic gas in it. This thesis studies the industrial processes in steel production, oil refining, cement manufacturing and glass manufacturing, where natural gas is already used or fuel switch to SNG is possible. The technical potential for fuel switching is assessed, and economic potential is necessary after this. All studied processes have potential for fuel switching, but total decarbonization of steel production, oil refining requires implementation of other zero-emission technologies.

Antimicrobial activity of the essential oil from Lippia sidoides, carvacrol and thymol against oral pathogens

Dental caries and periodontal disease are associated with oral pathogens. Several plant derivatives have been evaluated with respect to their antimicrobial effects against such pathogenic microorganisms. Lippia sidoides Cham (Verbenaceae), popularly known as "Alecrim-pimenta" is a typical shrub commonly found in the Northeast of Brazil. Many plant species belonging to the genus Lippia yield very fragrant essential oils of potential economic value which are used by the industry for the commercial production of perfumes, creams, lotions, and deodorants. Since the leaves of L. sidoides are also extensively used in popular medicine for the treatment of skin wounds and cuts, the objective of the present study was to evaluate the composition and antimicrobial activity of L. sidoides essential oil. The essential oil was obtained by hydro-distillation and analyzed by GC-MS. Twelve compounds were characterized, having as major constituents thymol (56.7%) and carvacrol (16.7%). The antimicrobial activity of the oil and the major components was tested against cariogenic bacterial species of the genus Streptococcus as well as Candida albicans using the broth dilution and disk diffusion assays. The essential oil and its major components thymol and carvacrol exhibited potent antimicrobial activity against the organisms tested with minimum inhibitory concentrations ranging from 0.625 to 10.0 mg/mL. The most sensitive microorganisms were C. albicans and Streptococcus mutans. The essential oil of L. sidoides and its major components exert promising antimicrobial effects against oral pathogens and suggest its likely usefulness to combat oral microbial growth.

EXTRACTION OF OIL FROM PRESSED PALM OIL (Elaes guineensis) FIBERS USING SUPERCRITICAL CO2

Residual fibers from palm oil production are a good source of carotene, since they contain more than 5% of the original oil, with about 5000 ppm of carotenoids. As carotenoids are thermosensitive molecules, supercritical CO2 can be used for oil recovery, because this technique employs low temperatures. In this work results of oil extraction experiments from pressed palm oil fibers are shown. Fibers were from AGROPALMA, an industry which is located in Tailândia (Pará, Brazil). Extractions were carried out at 200, 250 and 300 bar and at temperatures of 45 and 55oC. Oil was analyzed by UV/vis spectrophotometry for total carotene determination. Results showed a large increase in extraction rate from 200 to 250 bar and a small variation from 250 to 300 bar. The total amount of carotenes did not increase in the course of extraction at 300 bar, but it showed a large increase at 200 and at 250 bar. Free fatty acids are present in amounts larger than those found in commercial oils.

Determining economical TBHQ doses for corn oil stability

Corn oil obtained from a Brazilian industry, free from antioxidants and citric acid, added of different tertiary butylhydroquinone (TBHQ) concentrations, was submitted to accelerated oxidation in the Schaal oven test at 63°C for 120 hours and for 168 hours in a photooxidation chamber. Peroxide and absorptivity values at 232nm and 270nm were determined for this oil. From the Schaal oven test results, the best and the economical TBHQ doses were determined to this oil. Afterwards, a shelf life experiment was conducted and confirmed 115mg.kg-1 TBHQ as the best and economical dose for that oil.

Evaluation of antioxidants stability by thermal analysis and its protective effect in heated edible vegetable oil

In this work, through the use of thermal analysis techniques, the thermal stabilities of some antioxidants were investigated, in order to evaluate their resistance to thermal oxidation in oils, by heating canola vegetable oil, and to suggest that antioxidants would be more appropriate to increase the resistance of vegetable oils in the thermal degradation process in frying. The techniques used were: Thermal Gravimetric (TG) and Differential Scanning Calorimetry (DSC) analyses, as well as an allusion to a possible protective action of the vegetable oils, based on the thermal oxidation of canola vegetable oil in the laboratory under constant heating at 180 ºC/8 hours for 10 days. The studied antioxidants were: ascorbic acid, sorbic acid, citric acid, sodium erythorbate, BHT (3,5-di-tert-butyl-4-hydroxytoluene), BHA (2, 3-tert-butyl-4-methoxyphenol), TBHQ (tertiary butyl hydroquinone), PG (propyl gallate) - described as antioxidants by ANVISA and the FDA; and also the phytic acid antioxidant and the SAIB (sucrose acetate isobutyrate) additive, which is used in the food industry, in order to test its behavior as an antioxidant in vegetable oil. The following antioxidants: citric acid, sodium erythorbate, BHA, BHT, TBHQ and sorbic acid decompose at temperatures below 180 ºC, and therefore, have little protective action in vegetable oils undergoing frying processes. The antioxidants below: phytic acid, ascorbic acid and PG, are the most resistant and begin their decomposition processes at temperatures between 180 and 200 ºC. The thermal analytical techniques have also shown that the SAIB antioxidant is the most resistant to oxidative action, and it can be a useful choice in the thermal decomposition prevention of edible oils, improving stability regarding oxidative processes.

Synergistic and antimicrobial properties of commercial turmeric (Curcuma longa) essential oil against pathogenic bacteria

Several studies have shown the antimicrobial and antioxidant properties of turmeric (Curcuma longa), widely used in food industry as a colorant, among other functions. The aim of this study was to determine the antioxidant and antimicrobial properties of turmeric essential oil against pathogenic bacteria and to study the influence of the addition of ascorbic acid on the prevention of polyphenols oxidation. The commercial turmeric essential oil alone did not show bactericidal activity against the microorganisms studied, Listeria monocytogenes and Salmonella typhimurium, but when combined with ascorbic acid, it showed significant antibacterial activity. The highest antimicrobial activity of turmeric essential oil against Salmonella typhimurium was 15.0 ± 1.41 mm at the concentration of 2.30 mg.mL-1 of essential oil and 2.0 mg.mL-1 of ascorbic acid. With regard to Listeria monocytogenes, the largest zone of inhibition (13.7 ± 0.58 mm) was obtained at the same concentrations. The essential oil showed antioxidant activity of EC50 = 2094.172 µg.mL-1 for the DPPH radical scavenging method and 29% under the concentration of 1.667 mg.mL-1 for the β-carotene bleaching method.

Influence of spray drying operating conditions on microencapsulated rosemary essential oil properties

Spray drying is an important method used by the food industry in the production of microencapsulated flavors to improve handling and dispersion properties. The objective of this study was to evaluate the influence of the process conditions on the properties of rosemary essential oil microencapsulated by spray drying using gum Arabic as encapsulant. The effects of the wall material concentration (10-30%), inlet air temperature (135-195 ºC), and feed flow rate (0.5-1.0 L.h-1) on the moisture content, hygroscopicity, wettability, solubility, bulk and tapped densities, particle density, flowability, and cohesiveness were evaluated using a 2³ central composite rotational experimental design. Moisture content, hygroscopicity and wettability were significantly affected by the three factors analyzed. Bulk density was positively influenced by the wall material concentration and negatively by the inlet air temperature. Particle density was influenced by the wall material concentration and the inlet air temperature variables, both in a negative manner. As for the solubility, tapped density, flowability, and cohesiveness, the models did not fit the data well. The results indicated that moderate wall material concentration (24%), low inlet air temperature (135 ºC), and moderate feed flow rate (0.7 L.h-1) are the best spray drying conditions.

Characterization of a hydrolyzed oil obtained from fish waste for nutraceutical application

The fish industry generates high volume of waste from fish oil that can have the extraction of its lipids used as nutraceuticals and foods. The objective of this study was to produce unsaturated fatty acids from industrialized fish oil by means of a differentiated hydrolysis process. The samples used were crude fish oil obtained from Campestre industry and characterized through physical-chemical parameters, according to AOCS: acidity, peroxide, saponification, iodine and percentage of free fatty acids and also obtained the fatty acid profile through derivatization method for gas chromatography. The results obtained for the oleochemical indices for refined oil were similar to the data found on the literature. The content of polyunsaturated fatty acids (PUFA) was found of 32,78%, with 9,12% of docosahexaenoic (DHA) and 10,36% of eicosapentaenoic (EPA), regarding monounsaturated fatty acids (MUFA) content was of 30,59% in the hydrolyzed fish oil in relation to refined (20,06%). Thus, it can be concluded that the hydrolysis process used for oils from fish-waste was satisfactory on the production of absolute yield of lipids in the process and significant preservation on the percentages of EPA and DHA, interesting on the production of nutraceuticals and nutrition of aquatic animals, including shrimp in captivity.