Purpose
This study assesses the impact of environmental, social and governance (ESG) certification on capital structure decisions considering the COVID-19 pandemic.
Design/methodology/approach
The study utilizes the annual Asset-4 and Datastream data of Thomson Reuters Eikon for non-financial firms in member states of the Organization of Islamic Cooperation (OIC). Firm-fixed effects are used to avoid unobserved heterogeneity.
Findings
Firms with higher corporate sustainability have a higher leverage ratio. The positive impact of ESG scores on book leverage became more significant during the COVID-19 pandemic. These findings imply that ESG activities might serve as a signalling tool, especially considering the pandemic: ESG activities mitigate financial constraints when they are most pronounced and impactful.
Practical implications
Firms should invest in ESG activities to alleviate financial constraints. Researchers and practitioners are encouraged to explore how ESG and macro-specific factors jointly affect debt financing. Policymakers should incentivize ESG investment to reduce agency conflicts. Regulators in OIC countries should support firms that are encountering obstacles in obtaining ESG certification.
Originality/value
To date, the role of ESG investing in capital structure policy by considering the recent pandemic has not been assessed in OIC countries.
2025, Journal of Asian Business and Economic Studies
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Abstract
Purpose
The impact of export promotion programs (EPPs) on the intensive margin of exports remains somewhat uncertain. This study tackles a crucial question: does export promotion enhance firm-level intensive margin of exports?
Design/methodology/approach
We draw upon comprehensive empirical research conducted up to 2023. We collected 951 estimates, constructed 22 variables, captured diverse contexts and employed a meta-analytical approach to scrutinize the considerable variation in findings.
Findings
The overall meta-effect, after filtering out publication bias, is positive and statistically significant. Firms receiving EPP support exhibit an export intensity that is 1–9% higher than firms not participating in such programs. Assessing the mechanisms through which EPPs bolster this, we observe that support in the form of various services plays a more substantial role compared to assistance in the form of financial resources.
Research limitations/implications
Evaluating EPPs and their activities in terms of social welfare falls beyond the scope of this paper, which specifically focuses on the benefits of EPPs to export intensity. Subsequent research should undertake a comprehensive evaluation, considering both economic impacts and costs for accurate assessments of welfare. We also suggest that future meta-analyses explore other dimensions of firm-level performance linked to EPPs.
Practical implications
Publication bias distorts the impacts of EPPs, leading to an overstatement of their actual effects. Adjusting for publication bias, the practical significance of EPPs for a country’s trade intensity appears to be limited. Additionally, the provision of diverse activities and services primarily contributes to the amplification of export margins as compared to subsidies and grants. While larger firms initially benefit more from EPPs, these effects are found to be transitory.
Originality/value
This is the first meta-analysis scrutinizing the impact of EPPs, specifically concentrating on the firm-level intensive margin of exports.
2025, Journal of Asian Business and Economic Studies
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Abstract
Purpose
Although publicly listed firms in Sri Lanka have been increasingly adapting sustainability reporting into their annual reporting practices, a limited number of firms prepare sustainability reports by integrating sustainable development goals (SDGs) into reporting mechanisms. This study attempts to develop an index to monitor firms' sustainability reporting practices based on Global Reporting Institute (GRI) guidelines integrating SDGs.
Design/methodology/approach
This paper develops a sustainability score index using the 17 SDGs utilising the results of content analysis of corporate annual reports of a selected sample of 100 firms listed on the Colombo Stock Exchange (CSE). Principal component analysis was employed to examine the reliability of data in the developed index.
Findings
Findings show that the developed scoring index is efficient for evaluating the contents of the sustainability reports of Sri Lankan firms. Sustainability reporting practises with regard to the SDGs were observed to have a turbulent period from 2015 to 2019 and the SDGs 12 and 15 were identified to be mostly reported in Sri Lankan corporate sustainability reports.
Research limitations/implications
The results of the study add to knowledge on the monitoring of sustainability reporting practises with reference to SDGs. The study outcomes are useful for the investors, stakeholders, and statutory bodies to measure the sustainable performance of business firms and assess the firm’s commitment towards the global sustainability agenda.
Originality/value
To the best of our knowledge, this is the first study that constructs a sustainability reporting score index integrating SDGs.
2025, Journal of Asian Business and Economic Studies
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Abstract
Purpose
The development of green manufacturing has become essential to achieve sustainable development and modernize the nation’s manufacturing and production capacity without increasing nonrenewable resource consumption and pollution. This study investigates the effect of green industrial practices on technical efficiency for Thai manufacturers.
Design/methodology/approach
The study uses stochastic frontier analysis (SFA) to estimate the stochastic frontier production function (SFPF) and inefficiency effects model, as pioneered by Battese and Coelli (1995).
Findings
This study shows that, on average, Thai manufacturing firms have experienced declining returns-to-scale production and relatively low technical efficiency. However, it is estimated that Thai manufacturing firms with a green commitment obtained the highest technical efficiency, followed by those with green activity, green systems and green culture levels, compared to those without any commitment to green manufacturing practices. Finally, internationalization and skill development can significantly improve technical efficiency.
Practical implications
Green industry policy mixes will be vital for driving structural reforms toward a more environmentally friendly and sustainable economic system. Furthermore, circular economy processes can promote firms' production efficiency and resource use.
Originality/value
To the best of the authors' knowledge, this study is the first to investigate the effect of green industry practices on the technical efficiency of Thai manufacturing enterprises. This study also encompasses analyses of the roles of internationalization, innovation and skill development.
2025, Journal of Asian Business and Economic Studies
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Abstract
Purpose
Examining the role of women on board (WoB) toward corporate sustainable growth (CSG) through leverage policy (LP). This research also investigates the interaction effect of WoB and LP on improving CSG.
Design/methodology/approach
This study uses a moderated mediation model to examine the impact of WoB on CSG, mediated by LP. Data from 48 KEHATI IDX ESG Sector Leaders Index companies observed from 2015 to 2021 were analyzed using the structural equation model partial least square (SEM-PLS) Warp.PLS 8.0. The research applies instrumental variables (IV) to test and control endogeneity due to nonrandom sample selection.
Findings
We found evidence that LP acts as a full mediator between the presence of WoB and CSG. The presence of WoB plays a moderate role by slightly weakening the influence of LP on CSG. Furthermore, we obtained evidence showing that the relationship between WoB and CSG is J-curve-shaped, a nonlinear relationship related to critical mass. Where the WoB ratio is at least 8.35% or higher, it will increase CSG in companies that have implemented the concept of environment social governance (ESG) in Indonesia.
Originality/value
This model uses a moderated mediation model and J-curve analysis; there is an interaction between WoB and LP on different paths of the mediator to CSG. This model examines the role of WoB as a moderator of the effect of LP on CSG. A nonlinear J-curve test was conducted to determine the minimum level of WoB that can influence the increase of CSG.
2025, Journal of Asian Business and Economic Studies
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Abstract
Purpose
This study demonstrates the necessary and significant role of national formal institutional frameworks in shaping the quality of e-governance in Asian countries. Moreover, it presents a robust model of e-governance as a necessary and significant driver of sustainable human development.
Design/methodology/approach
This study applied the cross-lagged panel method in path modelling and conducted competing model and necessary condition analyses to test the lagged, necessary and positive effects of formal institutions on the level of e-governance and sustainable human development in 45 Asian countries from 2012 to 2022.
Findings
Formal governance institutions have necessary direct and indirect (through e-governance development) causal effects on a country’s sustainable human development.
Research limitations/implications
Future studies should explore how informal institutions such as culture, industry and government norms and practices shape the extent of e-governance development and sustainable socio-economic development in Asia and beyond over time.
Practical implications
A renewed focus on the institutional fundamentals of governance and development should be the legislative priority of policymakers and leaders of Asian countries.
Social implications
Proactive digital citizen engagement in institutional building in respective countries is critical to developing sound, human-development-centred institutional governance in Asia.
Originality/value
The study presents robust necessary condition models that offer more nuanced explanations of the institutional imperatives of enabling Asian countries to strengthen their e-governance towards sustainable human development.