Purpose The purpose of this paper is to investigate the relationship between bank-specific characteristics and profitability in European banking sector to find the role of internal factors in achieving high profitability. Design/methodology/approach A regression analysis is built on an unbalanced panel data set comprising 175 observations of 35 top European banks over the period 2009-2013. To this end, the empirical data are collected from Bankscope and a comprehensive set of internal characteristics is examined. Findings All the determinant variables included in the model have statistically significant impacts on European banks’ profitability. However, the effects are not uniform across profitability measures. Regression findings reveal that size and capital ratio are significant company-level determinants of bank profitability in Europe, while higher loan loss provisions result in lower profitability levels. Findings also suggest that banks with higher deposits and loans ratio tend to be more profitable but the effects on profitability are statistically insignificant in some cases. Practical implications This study has considerable policy implications, as the performance of the European banking sector depends on its efficiency, profitability and competitiveness. In view of these findings, some suggestions may be functional for bank regulatory authorities to intensify and sustain robustness and stability of the banking sector. Originality/value The results provide interesting insights into the characteristics and practices of profitable banks in Europe. Few econometric studies have empirically explored the determinants of bank profitability in Europe so far, even though similar studies have been conducted in several developed countries. Therefore, this paper tries to close an important gap in the existing literature improving the understanding of bank profitability in Europe.

The purpose of this paper is to explore the relationship between gender and profitability in the Italian hospitality industry during the period 2008–2017. The study examines whether female executive managers have any significant effect on the performance of hotel firms. Gender differences result in female underperformance when performance is measured by firm size. Within a bivariate model, findings show few differences when growth and profitability are compared by gender. When a regression model is designed to control other performance determinants (demographic, financial, and family variables), women‐managed hotels outperform those managed by men for hotel growth.

Purpose The purpose of this paper is to investigate the relationship between gender diversity and the risk profile of Italian banks during the period 2015–2019. This study examines whether the presence of female board directors or top executives has any significant effect on bank risk-taking. Design/methodology/approach To explore the influence of women on bank risk-taking, the authors analyzed a sample of 387 Italian banks and developed an econometric model applying unbalanced panel data with firm fixed effects and controls per year. Within a multivariate regression model, the authors considered five risk dimensions to verify the effect of gender diversity. Findings The findings suggest that female board directors and executives are considerably more risk averse and less overconfident than their male colleagues, thus confirming a negative causality between risk-taking and gender diversity. The results reveal that banks headed by women are less risky because they report higher capital adequacy and equity to assets ratios. As credit risk in female-led banks is no different from male-led ones, higher capital adequacy does not derive from lower asset quality because it is linked to the higher risk aversion of female directors and top managers. Research limitations/implications From a theoretical standpoint, the results suggest that having women in executive positions entails different risk implications for Italian banks; from a managerial perspective, the results highlight conditions that may promote the role of women in the banking sector. The conclusions are of particular significance because they provide some support for the view that regulators should favor gender quotas in the board management of banks to reduce risk-taking behavior. Originality/value This paper offers an in-depth examination of the risk practices of banks and it attempts to bridge the gap in prior literature on the risk profile of the Italian banking industry given that few empirical studies have examined the determinants of risk-taking in this field, to date. The findings on the higher risk aversion of women directors advance the understanding of the determinants of risk-taking behavior in banks, suggesting that gender quotas in bank boards can contribute to reducing risk-taking behavior. This also unveils some policy implications for bank regulatory authorities.

Purpose This study aims to investigate the impact of environmental performance, social responsibility and corporate governance (ESG) on bank performance (BP) in the Italian banking sector. It analyzes the relationships between 10 dimensions of ESG pillars and BP indicators during the period 2016–2020. Design/methodology/approach This study examines a sample of 105 Italian banks and develops three econometric models to verify the effect of ESG initiatives on BP indicators. The independent variables are the ESG dimensions collected from the Refinitiv database, whereas the explanatory variables are performance indicators measured through accounting and market variables. Findings The findings show that ESG policies negatively affect operational and market performance in the banking sector, suggesting that Italian banks have not fully embraced strong sustainability procedures. However, the relationships between ESG dimensions are mixed if measured individually. The results show a significant positive impact of emission and waste reductions on financial and operating performance, but regarding social aspects, it is proved that better product responsibility decreases accounting performance. Research limitations/implications This study offers an in-depth examination of ESG practices in relation to current and future performance. In particular, the findings provide practitioners and academics with an actual set of predictors in the ESG area to improve BP. Originality/value To the best of the authors’ knowledge, this is the only study that has investigated the impact of ESG issues on BP in Italy. Few prior studies have used all dimensions of ESG policies at a disaggregated level to investigate their effect on various performance indicators.

This study examines the influence of the diversity of the board of directors (BoD) and the environmental, social and governance (ESG) performance of 105 Italian banks during the period 2017–2021. Our analysis investigates board diversity in terms of board attributes (board size, board age, board gender diversity, board independence and CSR (corporate social responsibility/sustainability committee) and measures ESG dimensions by using the ESG score provided by the Refinitiv database hosted by Thomson Reuters. The main empirical results reveal that the board size, board independence and the presence of a CSR/sustainability committee positively influence a bank’s ESG performance while no significant relationship between board average age and ESG performance is found. Additionally, the relationship between gender-balanced boards and ESG performance is positive but the impact of female directors on ESG performance is non-linear when a critical mass of women is reached. This paper comprises an in-depth inspection of the corporate governance (CG) in banks, since in Italy there is limited literature concerning diversity in BoDs despite the relevance of the topic. This study is the first that examines the impact of specific CG characteristics (board diversity) on ESG performance in the Italian banking sector, to date. The investigation is highly relevant to managers and investors considering ESG issues in their decision-making process. In addition, findings have implications for both regulators and practitioners, suggesting that policymakers and managers should pay more attention to corporate governance aspects to enhance ESG performance.

The aim of this paper was to explore the relationship between bank-specific characteristics and profitability in European banking sector in order to determine the impact of internal factors on achieving high profitability. A regression analysis was done on an unbalanced panel dataset related to 28 European banks over the period of 2006-2015. The largest bank for any single country of the European Union was selected. Regression results show that capital ratio and size have positive impacts on bank profitability in Europe,; while higher asset quality results in lower profitability levels. Findings also suggest that banks with higher deposit ratio tend to be more profitable. The study provides interesting insights into the characteristics and practices of profitable banks in Europe. Few econometric studies have empirically explored the determinants of profitability in Europe banking sector so far, even though similar studies have been conducted in several developed countries.Key words: Bank profitability, determinants of bank performance, internal factors of bank profitability, European banking sector.

Purpose The aim of this paper is to review the main results of accounting research literature examining the role of fair value accounting (FVA) within financial crisis. This research analyzes theoretical and empirical studies on the controversial topic about FVA and its alleged pro-cyclicality in the context of the financial crisis to offer solid reflections for improving the fair value research agenda. Design/methodology/approach This paper consists of a descriptive literature review. Theoretical and empirical research studies were investigated and then systematized in a framework to guide a literature-based analysis and critique of the relevant literature published about this topic. Findings The review reveals that there has been only a limited amount of research into the role of FVA within the financial crisis. This topic has not been researched extensively, and there is no empirical evidence that FVA caused the financial crunch and the subsequent financial crisis. Research limitations/implications The restricted amount of literature that directly deals with FVA in the context of the financial crisis is the main limitation of this paper. The specificity of the theme narrows the coverage. However, the adopted research methodology enabled the main contributions concerning this issue to be collected, to realize a concise and comprehensive portrait of the debate surrounding FVA and the financial crisis. Practical implications This paper can be of use to both researchers and practitioners interested in investigating strengths and weaknesses of the fair value concept for accounting purposes. The paper sets out the main findings of the academic literature and identifies future avenues of theoretical and practical research which may support standard setters to draw up improved accounting regulation. Originality/value Few existing studies consist of a literature review that examines theoretical and empirical researches on the influence of FVA on the financial system. This review offers a comprehensive overview on research literature concerning the responsibility of FVA in causing the financial crisis. The main contribution of this paper relates to further understanding the role and effects of accounting matters concerning fair value in a broad sense within the context of the financial crisis.

Corporate reporting has undergone many changes. One main reason is that stakeholders see their needs change and evolve, thus making it necessary for them to express their various requests for information which, in turn, force companies to rethink their external reporting practices. Recent studies support the position that the traditional annual report does not provide stakeholders with an adequate picture of the assets and the value created by the company. In response to this, Integrated Reporting (IR) has been adopted as a solution capable of providing both a holistic view of a company's ability to create value in a sustainable way and an integrated vision of the company from a financial and a non-financial point of view. Thus, this paper aims to examine the real reasons that have pushed major Italian companies to opt for IR and, especially, to explore the benefits that can now be identified a few years beyond the first publication of an Integrated Report. To investigate this topic, an exploratory field study involving eleven Italian companies was conducted. The methodology relied on a qualitative approach, as it allows researchers to deal with complex "how" questions and, at the same time, offers a wide and complete picture of the phenomenon. The paper gives senior managers an overview of Italian companies that have already developed this new form of information reporting, while providing valuable insights and an understanding of the perceived organizational benefits of implementing IR requirements. The study also contributes to the debate on managerial motives for producing an Integrated Report and how that may affect future decisions. The findings reveal a common thread among all the study participants, summarized by the completeness and transparency of the results. They also highlight an exhaustive list of benefits reported by these companies, which may serve as an incentive for those that have not yet adopted IR.