Comparing codes of ethics among the top companies in Australia, Canada and the USA

In the twentieth century, industrialized economies around the world enacted legislation to protect free and fair trade. These legislative initiatives were often precipitated by exposure to unethical business practices. With the fairly recent corporate business scandals around the world, ethics is once again at the forefront of concerns about commercial exchanges. This situation has become more complex with the globalization of commercial trade. Subsequently, there have been various attempts by international organizations to regulate the conduct of global corporations. One key technique to try to regulate the conduct of corporation is the use of codes of ethics. This study examines corporate codes of ethics and the measures in place to communicate the ethos of the codes to both internal and external stakeholders in three countries. A questionnaire that was non-sponsored and unsolicited was sent to the top companies operating in the private sector within Australia, Canada and the USA. Nine key areas of corporate ethics are examined and they are divided into two categories as follows:

Regulation
Consequences for a Breach
Ethical Perfonnance Appraisal
Conduct Ethical Audits

Staff Support
Support of Whistle blowers
Guide to Strategic Planning
Ethics Committee
Ethics Training Committee
Staff Training
Ethics Ombudsman.

The need to accumlate human capital across levels of export intensity : activating resources that are increasingly difficult to mobilise

With increasing levels of export intensity, firms begin to face new demands. The first set of resources brought to bear on the issues, and those resources that are most quickly mobilised, are the employees. Indeed, higher levels of exporting require activating relatively less mobile resources through the building of organisational structures and mechanisms for managing repositories of knowledge (particularly organisational specialisation and selectively hiring appropriately skilled staff). This paper explores the management of human capital across different levels of export activity in Australian manufacturing firms. Analyses were based on 90 Australian-headquartered manufacturing exporters that responded to a survey. Overall, the results support the notion that firms need to accumulate knowledge as they internationalise. These results are discussed in terms of their consequences for HRM practices.

Cross-sector organisational engagement with ethics : a comparison between private sector companies and public sector entities of Sweden

Purpose – The purpose of the paper is to describe and compare similarities as well as differences in the organizational engagement with ethics between private sector companies and public sector entities.

Design/methodology/approach – A survey was conducted in order to examine the organizational engagement with ethics in the largest private sector companies and the largest public sector entities in Sweden. Two adapted questionnaires were developed for each sector. The outcome of this research procedure is reported in this paper.

Findings – There are both minor and major differences between the private sector and public sectors, where the private sector companies overall tend to be more engaged with ethics than the public sector entities in areas such as: ethical bodies, ethical tools, internal and external ethical usage, and ethical support measures and ethical performance measures.

Research limitations/implications – This paper makes a contribution to theory as it outlines findings for the benefit of other researchers working in private and/or public sectors in the field. A suggestion for further research is to examine the organizational engagement with ethics in other countries/cultures that differ from the ones in this research effort performed in the private and public sectors of Sweden.

Practical implications – The research may be of managerial interest as it provides a grounded framework of areas to be considered in the examination of organizational engagement with ethics in both private sector companies and public sector entities. It may be used as a benchmark by either sector.

Originality/value – It reports a research effort to develop and describe a cross-sector comparison of the organizational engagement with ethics between private sector companies and public sector entities of Sweden. A framework is also introduced and illustrated. It also makes a contribution to theory and practice in the field as it is based upon a dual sample that provides insight into cross-sector organizational engagement with ethics.

Modelling regulatory change V's volume of trading effects in HSIF and HSI volatility

In an earlier paper, we adopted a bi-variate BEKK–GARCH framework and employed a systematic approach to examine structural breaks in the Hang Seng Index and Index Futures market volatility. Switching dummy variables were included and tested in the variance equations to check for any structural changes in the autoregressive volatility structure due to the events that have taken place in the Hong Kong market surrounding the Asian markets crisis. In this paper, we include measures of daily trading volume from both markets in the estimation. Likelihood ratio tests indicate the switching dummy variables become insignificant and the GARCH effects diminish but remain significant. There is some evidence that the Sequential Arrival of Information Model (SIM) provides a platform to explain these market induced effects when volume of trade is accounted for.

The information content of directors' trades: empirical analysis of the Australian market

We examine the trading activities of directors in shares of their own companies on the Australian Stock Exchange during the July-December 2005 period. We find that directors of small companies in particular earn abnormal return after both their 'Purchase' and as well as their 'Sale' trade. Directors of these companies have an uncanny ability to time the market by trading when mispricing is greatest, and are able to predict the future performance of their firms in short run. For directors of medium and large companies, we find evidence that 'Sale' trades are the ones which work as loss avoiders. Outsiders recognise to some extent that directors' trades are informative, however they are slow to incorporate the new information into prices, refuting much of the market efficiency literature.

A cross country analysis of dynamics in comparative advantage and trade patterns in textiles and clothing

This paper examines pattern of comparative advantage in textiles and clothing trade as revealed by export shares of selected developed and developing economies. The estimated revealed comparative advantage (RCA) indices provided strong evidence of comparative advantage enjoyed by the developing economies. However, a few developed high income economies have enjoyed sustainable comparative advantage, especially in textiles trade. Significant negative correlations are observed between country specific income levels and the estimated absolute and relative RCA indices. While most of the developing economies achieved significant improvement of comparative advantage over time in clothing trade, the evidence is mixed for textiles. Additional evidence from Grubel-Lloyd (G-L) index of intra industry trade (IIT) suggest that global textiles trade could be mainly explained on the basis of product differentiation and economies of scale while clothing trade is more based on comparative advantage. Results of the study also suggest that the trading nations should engage in exploitation of forms of competition such as product differentiation in textiles trade, whereas for clothing, cost minimising remains a valid strategy.

Does the type of derivative instrument used by companies impact firm value?

We explore the relationship between the type of derivative instrument used and firm value, in a sample of Australian firms. Specifically, we examine the impact of the corporate use of swaps, futures, forwards and options, and the extent of such usage, on firm value. Our findings suggest that a 'discount' is most severely imposed on users of swaps.

Top Taiwanese and Turkish companies and their engagement with corporate ethics

The objective of this paper is to describe and compare the current, emerging Taiwanese and Turkish interest in corporate ethical engagement. This paper is based upon a survey amongst the top companies operating in Taiwan and Turkey. There are major differences between the top Taiwanese and Turkish companies, where the Turkish companies appear to be more ethically engaged than the Taiwanese companies which came as a surprise to the researchers as Taiwan is a more substantially developed economy than Turkey and one may have assumed therefore more engaged with ethical practices.

Board structure and firm performance : evidence from India's top 500 companies

The objective of this paper is to investigate the relationship between internal governance structures in Indian companies and financial performance. The
study includes an examination of aspects of the effectiveness of boards of directors', including composition of the board, board size and aspects of board leadership including duality and board busyness.

Jump over the gorge : overcoming cultural gap in doing business with China

China has become a synonym for future business growth. It is the business nirvana of the 21st century (Chung 2004). As a major emerging market, China offers many companies great potential in their future growth. China's economic growth has been consistently double digits for the past two decades. China has become an economic power in the world. To Australia, China became its largest trading partner since 2007. While other parts of the world are experiencing economic down tum, e.g. the US and UK, Australia still enjoys its longest lasting economic growth. Much of the growth is largely built on this Chinese demand of minerals (Kirk 2004). Therefore research of Australian companies' internationalisation into China is timely and in high demand. 40 Australian companies' were investigated in a recent research conducted in July - December 2007. Among many findings through the research, one of the major issues was the impact of cultural differences on companies in their operations. The research discovered the gap of cultural differences between Australia and China is large which has caught many companies by surprise. Further the inability to deal with this large cultural gap as well as being properly prepared for the cultural issue they are about to encounter prior to entering into the Chinese market may cause serious issues on performance. It is through this research an important finding is presented that engaging culturally skilled consultants when dealing with Chinese market is an effective and cost efficient way of conducting businesses in China.

Engagement and learning through social software in finance : the trading room experience

The introduction of a social software blog space called “The Trading Room” in an undergraduate Finance unit for an assessment task generated a great deal of activity to support student learning. A subsequent evaluation of this pilot demonstrated that students perceived high value in the opportunity it provided for them to reaffirm theories, obtain individualized feedback and benchmark their work against others. Whilst assessment is generally seen as both the carrot and the stick of learning, and certification; students in the study reported that they would still participate in reading and posting to the “Trading Room” blog even if there was no assessment requirement! Additionally they did not see any value in the environment as a purely social space, reporting that they saw it primarily as a professional educational community. It would appear that just as there are different communities in the real world social space, there are also different types of communities in the online space. Context, structure and activity design, perhaps are the most important facets of online interaction for learning.

Corporate governance, firm characteristics and risk management committee formation in Australian companies

Purpose – The purpose of this paper is to examine how a risk management committee (RMC), as a newly evolving sub-committee of the board of directors, functions as a key governance support mechanism in the oversight an organisation's risk management strategies, policies and processes. However, empirical evidence on the factors associated with the existence and the type of RMCs remains scant.

Design/methodology/approach – Using an agency theory perspective, this study investigates the association between board factors such as proportion of non-executive directors, Chief Executive Officer duality, and board size; as well as, other firm-related factors (e.g. auditor type, industry, leverage, and complexity), and the existence of a RMC, and the type of RMC (namely, a separate RMC versus one that is combined with the audit committee). Data was collected from the annual reports of the top 300 Australian Stock Exchange (ASX)-listed companies.

Findings – The results, based on logistic regression analyses, indicate that RMCs tend to exist in companies with an independent board chairman and larger boards. Further, the results also indicate that in comparison to companies with a combined RMC and audit committee, those with a separate RMC are more likely to have larger boards, higher financial reporting risk and lower organisational complexity.

Research limitations/implications – Data limited to top 200 top ASX-listed companies, thus restricting generalisability of the results.

Originality/value – The findings of this study provide additional information on the use and design of RMCs in a voluntary setting.

The existence and nature of risk management committees in Australian companies

A risk management committee (RMC), as a newly evolving sub-committee of the board of directors, functions as a key governance support mechanism in the oversight an organisation’s risk management strategies, policies and processes. However, empirical evidence on the factors associated with the existence and the type of RMCs remains scant. Using an agency theory perspective, this study investigates the association between board factors such as proportion of non-executive directors, CEO duality, and board size; as well as, other firm-related factors (e.g. auditor type, industry, leverage, and complexity), and (1) the existence of a RMC, and (2) the type of RMC (namely, a separate RMC versus one that is combined with the audit committee). Data was collected from the annual reports of the top 300 ASX-listed companies. The results, based on logistic regression analyses, indicate that RMCs tend to exist in companies with an independent board chairman and larger boards. Further, the results also indicate that in comparison to companies with a combined RMC and audit committee, those with a separate RMC are more likely to have larger boards, higher financial reporting risk and lower organisational complexity. The findings of this study provide additional information on the use and design of RMCs in a voluntary setting.