No abstract

PurposeA structural equation model is proposed to explain internet reporting by banks. The model relates three constructs of financial institutions (size, financial performance, and internet visibility) to their final influence on internet information disclosure (e‐transparency).Design/methodology/approachThis paper's proposed model analyses a sample of Spanish financial institutions using publicly available data. The model is tested using partial least squares.FindingsA positive and statistically significant relationship has been found between size, financial performance, internet visibility, and e‐transparency, with direct and indirect effects. The study shows that size accounts for most of the variance. Size has a positive effect on e‐transparency, financial performance, and internet visibility. However, the direct effect of financial performance and internet visibility on e‐transparency is small.Research limitations/implicationsThe researchers have analysed only one year of data from one country and one sector. The direction of cause and effect assumed in the model is a logical one, but statistical methods cannot prove causality, only association. Even though any bank can disclose its financial information online for a very low cost, building a robust, interactive web site requires major resources. This gives larger banks a value added advantage.Originality/valueThe paper examines the relationship between size, financial performance, internet visibility and e‐transparency using a structural model. Although structural models are commonly used in many scientific disciplines, they have not yet been applied in disclosure research.

Purpose -The purpose of this paper is to explore the determinants of online corporate reporting in three Latin American emerging markets, Argentina, Mexico and Chile, providing further evidence to test the mediation role of web presence development in the relationship between these determinants and e-disclosure. Web presence development measures the firm's efforts to archive web visibility, web usability and convenience. Design/methodology/approach -Based on a content analysis of corporate web sites, the extent of the information is measured by three internet disclosure indexes. Four constructs which are considered key drivers of a firm's disclosure strategy are identified. Structural equation modelling (SEM) was used to assess the research model. The sample contains publicly available data on listed companies' web sites. Findings -The results reveal that the development of a firm's presence on the internet is as important as its characteristics in determining corporate transparency and in mediating the relationship between firm size and cross-listing and e-disclosure. Practical implications -Companies should be aware that investors are attaching increasing importance to corporate transparency. Consequently, managers should put more effort into improving web sites, which would increase corporate visibility and open up a direct communication channel with their stakeholders. They should also take advantage of web sites to provide information, above and beyond that required by local law. Not only do current and potential investors find this useful, it also increases their confidence in the company. Originality/value -This paper proposes an integrative model of the determinants of the level of online corporate reporting using constructs that reflect their multidimensional nature. A non-financial latent variable for web presence on the internet is proposed as a mediator in the relationship between e-disclosure and traditional determinants. The SEM approach simultaneously examines the direct and indirect relationships between the proposed latent variables and how these relationships influence the level of e-disclosure. 806OIR 38,6 asymmetries between managers and stakeholders. One of the stakeholders for which companies issue corporate information is the shareholder. As soon as firms compete with each other for funds in capital markets, information on investor relations becomes essential. Greater corporate transparency improves investor protection rights and enhances the market's valuation of stocks (Klapper and Love, 2004).The increasing need for companies to send messages to the public has resulted in a sharp rise in the number of business news items and business-related media. New technologies have brought challenges and opportunities to the field of corporate communication enabling more direct, dynamic and interactive contact with stakeholders regardless of their location and without the need for intermediaries (Cormier et al., 2010). Corporate information on the internet provides benefits in cost-cutting, distribu...

This paper examines the dynamics between growth and profitability in an economic crisis context by considering the endogeneity of this relationship. It also analyzes the role of innovation and export intensity in the growth-profit relationship. Using a large firm-level dataset comprising Spanish manufacturing companies during the pre-crisis (2000–2007) and the crisis (2008–2014) period, static and dynamic panel data models are estimated. The analysis suggests the following results. First, in the short term, growth has a positive impact on profits, while the effect of profits on growth depends on the measure of growth used. So, employee’s growth requires previous profit but profit does not play a major role as determinant of sales growth. Second, profit rates are found to persist in the short term. In contrast, a reversion of turnover and employees growth rates is observed. Thirdly, the moderation analysis applied shows that the strategy that has enabled firms to grow is export. Moreover, the influence of the export intensity on profitability in the economic crisis period is obtained indirectly through sales and employee’s growth. Unlike expected, innovation efforts do not moderate the relationship between profitability and firm growth.

Numerous papers demonstrate the usefulness of financial ratios in predicting the bankruptcy of companies, but in the case of new companies their usefulness is questionable.Many of the firms that are successful today made few profits when they were first created. On the other hand, both structural inertia from the theory of organizational ecology and the 'survival of the fitter' principle advocate that companies that are healthy in their early years will go ahead in greater proportion than those that start with many difficulties. Our empirical study used financial data from a sample of 6,167 new-born Spanish start-up companies, analysing their evolution up to eight years later. We found healthier financial indicators in the first years of start-up companies that survived eight years than in those that failed, supporting the organizational ecology theory. We found statistically significant differences in profitability, productivity, liquidity, leverage, and size. The models developed showed predictive capacity, but they did not reach that of the bankruptcy models made with mature companies. The analysed period corresponded to a period of economic crisis. The study was repeated with data from another non-crisis period to enhance the validity of the results, and obtained very similar results.

Microfinance institutions (MFIs) lend to the poor, fostering these individuals' financial inclusion. However, microfinance clients suffer from high interest rates, a type of poverty penalty. Reducing margins and lowering interest rates should be a target for MFIs with a strong social commitment. This paper analyzes the determinants of margin in MFIs. A banking model has been adapted to the case of MFIs. This model has been empirically tested using 9-year panel data. Some factors explaining bank margin also explain MFI margin, with operating expenses being the most important factor. Specific microfinance factors are donations and legal status, as regulated MFIs can collect deposits. It has also been found that MFIs operating in countries with a high level of financial inclusion have low margins. ABSTRACTMicrofinance institutions (MFIs) lend to the poor, fostering these individuals' financial inclusion. However, microfinance clients suffer from high interest rates, a type of poverty penalty. Reducing margins and lowering interest rates should be a target for MFIs with a strong social commitment. This paper analyzes the determinants of margin in MFIs.A banking model has been adapted to the case of MFIs. This model has been empirically tested using 9-year panel data. Some factors explaining bank margin also explain MFI margin, with operating expenses being the most important factor. Specific microfinance factors are donations and legal status, as regulated MFIs can collect deposits. It has also been found that MFIs operating in countries with a high level of financial inclusion have low margins.JEL classification: G21, C23, R51

Purpose -This paper aims to present research on how and why microfinance institutions (MFIs) disclose financial and social information on the internet. Legitimacy theory provides the theoretical framework. Design/methodology/approach -The empirical study analysed factors influencing MFIs to publish financial and social information on the internet. The model was tested using regression analysis. The sample consisted of publicly available data from the web sites of 273 MFIs. Findings -The study found that MFIs' internet presence overall is scarce and that greater levels of disclosure are needed. It was found that large MFIs with a high degree of public exposure on the internet disclose greater amounts of information on their web sites than smaller MFIs with a low degree of public exposure. It was also found that for-profit MFIs disclose more financial information on their web sites, while non-profit non-governmental organisations (NGOs) reveal more social information. Practical implications -MFIs should be proud to tell the world what they are doing. MFI managers need to remember that transparency increases funds from donors. Donors are mostly based in developed countries, so the internet plays a key role in disclosure and attracting potential donors. Thus, managers of MFIs are encouraged to increase disclosure levels -especially on the internet. Originality/value -Academic research into the factors that influence MFIs' internet disclosure is still scarce. This is an important area of study because full disclosure offers enormous benefits. Since MFIs have a social mission, they are legitimated in the eyes of their donors by disclosing social information. Since they are also financial institutions, they have to show that they use the funds they receive efficiently.

No abstract