Business Commons^™

Xbrl-Formatted Financial Reporting And The Feedback Effect Of Price, Young Jun Cho, Ying-Chi Huang, Holly I. Yang

Research Collection School Of Accountancy

We examine whether the SEC’s XBRL-formatted financial reporting mandate allows investors to better process public financial information, reducing the extent to which managers learn private information from stock price. We find a significant decrease in the investment-price sensitivity for firms that started to file their 10-Ks in an XBRL format, consistent with a reduction in the cost of information processing crowding out private information in stock price. We also find that the decrease in the investment-price sensitivity associated with XBRL adoption is more pronounced for firms with higher business and information complexity and for firms with higher incentives for managers …

Female Ceos And Esg Visual Expressions, Ziming Guo, Beng Wee Goh, Dan Li, Yuan Wang

Research Collection School Of Accountancy

Prior studies have shown that women possess unique personality traits that cause them to communicate differently than men do. Hence, we investigate whether the presence of female CEOs affects the use of visual expressions in a firm’s ESG report (“ESG visual expressions”). Using detailed disclosure data from ESG reports in China, we find that firms with female CEOs use more ESG visual expressions. This result is stronger when the firm prioritizes ESG performance, when the female CEO is more powerful, and when there are more women on the top management team. ESG visual expressions are also positively associated with the …

Non-Audit Services And Knowledge Spillover: Evidence From Audit Hours And Billing Rates, Jaeyoon Yu, Yongsuk Yun, Yoonseok Zang

Research Collection School Of Accountancy

Using audit hours from firms listed on the Korea Exchange as a direct proxy for audit effort, this study examines whether non-audit services (NAS) purchased from audit firms improve audit efficiency. Our results reveal that the ratio of NAS fees to total fees paid to audit firms is associated with lower audit hours and audit fees, but it is not significantly related to audit billing rates. The reduction in audit effort associated with NAS is more pronounced when NAS provided are audit-related, and for clients who hire Big 4 auditors, have short-tenured auditors, and report a profit. Further, using path …

Perceptions Of Game-Based Assessments: The Role Of Test Takers' Occupational Background, Marie L. Ohlms, Klaus G. Melchers, Filip Lievens

Research Collection Lee Kong Chian School Of Business

Game-based assessments (GBAs) have become increasingly popular in personnel selection. However, research on perceptions of GBAs has yielded mixed results, highlighting the need to explore variables that may shape perceptions of GBAs. Therefore, we examined whether test takers' occupational background and other person-related characteristics (i.e., gender, age, video game usage, openness to experience) are associated with their perceptions of GBAs. N = 179 individuals from technical and social occupational backgrounds rated their perceptions of GBAs and non-gamified tests. We found that GBAs were generally rated more positively than non-gamified tests in terms of organizational attractiveness, behavioral intentions toward the organization, …

The Distinctiveness Effect: How Cross-Country Dissimilarities Influence Governance Decisions, Ilya Cuypers, Gokhan Ertug, Niels G. Noorderhaven, Korcan Kavusan

Research Collection Lee Kong Chian School Of Business

Transaction cost theory is one of the most commonly used theories to explain how firms govern their economic activities. In the context of cross-border collaborations, transaction cost theory proposes that dissimilarities between the partners’ home countries, which constitute a key source of behavioral uncertainty, affect how collaborations are governed (i.e. whether firms opt for equity joint ventures or non-equity alliances). Although many firms are likely to face more than one dimension of dissimilarity—for example, in terms language and religion, as well as culture—studies in transaction cost theory typically focus on how each source of dissimilarity impacts governance choices independently, in …

The Asymmetric Effects Of Posting An Online Review On Future Spending And The Dark Side Of Solicitations, Hulya Karaman

Research Collection Lee Kong Chian School Of Business

Motivated by the prevalence of online review creation and solicitation, this paper examines whether posting an online review impacts the reviewer’s future spending on the reviewed brand. Identifying the causal effects of posting an online review is challenging because reviewers self-select into posting, making it an endogenous decision. I overcome this challenge by using randomized online review solicitations as an instrument for the endogenous treatment variable of posting an online review and establish that doing so decreases the average future spending by the reviewers on the reviewed brand. Additionally, I show that soliciting customers to post increases their propensity to …

Information Sharing Within Institutional Investor Networks, Wei Ting Loh

Research Collection School Of Accountancy

This study examines whether information sharing occurs within institutional investor networks. I identify networks of institutional investors who share common investments and find that in-network investors earn significantly higher returns than other investors of the same firm, suggesting that valuable private information is shared within these networks. I also find that ownership by investor networks is associated with speedier price discovery and incorporation of more firm-specific news in prices, consistent with information sharing facilitating efficient price formation. In addition, ownership by network investors is associated with higher information risk as reflected in the probability of informed trading and market liquidity. …

The Impact Of Innovation Belief On Strategic Product R&D, Yan Zhou

Dissertations and Theses Collection (Open Access)

In highly uncertain innovation scenarios characterized by long R&D cycles and high risks, how to continuously drive enterprises to develop market-competitive blockbuster products has become a critical issue of shared concern in both practice and academia. Existing research has mostly explained differences in blockbuster product R&D from perspectives such as resource allocation, organizational structure, or institutional incentives, while paying insufficient attention to cognitive and belief factors at the individual level. Based on this, this paper introduces the psychological and cognitive variable of "innovative belief" to systematically examine its impact mechanism on blockbuster product R&D capability.

Taking the R&D team of …

Market Culture And Innovation Acceptance In Fire Safety Products: The Moderating Role Of Perceived Market Regulation, Xu Zhang

Dissertations and Theses Collection (Open Access)

Against the backdrop of continuously rising global fire safety standards and ongoing technological iteration in fire protection products, whether innovative fire protection products can be effectively accepted by the market has become a critical issue influencing the returns on firms’ innovation investments and the high-quality development of the industry. Existing studies have predominantly explored innovation diffusion mechanisms from the perspectives of technological attributes or organizational factors, while paying relatively limited attention to market culture as a contextual factor, as well as to the differentiated role that government regulation may play in this process. Based on this, this study takes institutional …

Are Cities Losing Innovation Advantages? Online Versus Face-To-Face Interactions, Ruben Gaetani, Naqun Huang, Jing Li, Yanmin Yang

Research Collection School Of Economics

How did COVID-19 affect the innovation advantages of dense locations? Using data on the universe of U.S. patent applications, we find that the density premium in the production of novel inventions declined by 18.5%-22.9% in 2020-2021 relative to its pre-pandemic level. Smartphone data on local mobility suggest that the drop in the frequency of local interactions can explain a significant portion of this effect. While COVID-19 resulted in a temporary setback in the innovation advantages of dense locations, the role of urban density in facilitating the exchange and recombination of ideas is unlikely to be persistently replaced by online communication.

Are Less Hierarchical Firms Organized Around Stronger Cultures? Evidence From Big Data, Arianna Marchetti, Phanish Puranam

Research Collection Lee Kong Chian School Of Business

Research Summary: Are less hierarchical firms organized around stronger cultures instead? We analyze 1.5 million employee reviews on Glassdoor.com from 23,000 US-based firms, alongside data on managerial hierarchy estimated from 42 million professional social media profiles. Our findings confirm a negative association between managerial hierarchy and organizational culture strength. We explore two potential explanations for this association: Functional equivalence between the two, and culture fragmentation caused by managerial hierarchy. Multiple correlational tests show support for functional equivalence as a plausible explanation for the observed negative correlation. Our findings enhance our understanding of the complex relationships between organizational structure and culture …

Modernising Wills For A Smart Nation, Hang Wu Tang, Edward Ti

Research Collection Yong Pung How School Of Law

In a commentary, SMU Lee Kong Chian Professor of Law Tang Hang Wu and SMU Associate Dean (Undergraduate Curriculum and Teaching) and Associate Professor of Law Edward Ti highlighted that Singapore has digitalised almost everything around the will, but not the will itself. Prof Tang and Assoc Prof Ti noted that the current legislation insists that the will itself remains a paper ritual, which is not just an inconvenience but also risks Singapore’s competitiveness. They argued that Singapore should modernise without compromising on steps to prevent fraud and undue influence. They highlighted that the law should be modernised so that …

Uncertain Search With Knowledge Transfer, Woonghee Tim Huh, Michael Jong Kim, Meichun Lin

Research Collection Lee Kong Chian School Of Business

We consider a sequential search over a group of similar alternatives. The individual value of an alternative contains two components, an observable utility and an idiosyncratic value. Observable utilities share an unknown population distribution, which captures the similarity across the alternatives and allows for knowledge transfer within the group. Once a decision maker encounters an alternative, its utility is revealed immediately, whereas the idiosyncratic value is unobservable and needs to be learned by sampling. The goal is to select an alternative with the highest individual value while accounting for the sampling and search costs. A novel feature of this problem …

Old Signals, New Era: Reconsidering How Customer Satisfaction And Employee Satisfaction Impact Shareholder Wealth, Cesar Zamudio, Suyun Mah, Vanitha Swaminathan

Research Collection Lee Kong Chian School Of Business

Extant research suggests that higher levels of customer and employee satisfaction signal a firm’s competitive advantage, resulting in greater firm value. This article advances the understanding of how firms can manage customer satisfaction and employee satisfaction to increase shareholder wealth in a new environment due to the emergence of social media and a new class of retail investors. Drawing from stakeholder theory and signaling theory, we argue that inconsistency in customer satisfaction and employee satisfaction can be informative to investors and lead to greater shareholder wealth in such a new environment. Our findings demonstrate that there is a negative joint …

A Social Norm Perspective On Distorted Information In China, Zhe Li, Massimo Massa, Nianhang Xu, Hong Zhang

Research Collection Lee Kong Chian School Of Business

Can social norms give rise to distorted information in China? We observe that China’s leading social norm related to alcohol consumption and social drinking enhance earnings management. An analysis of toxic alcohol scandals supports a causal interpretation. Further evidence suggests that the influence of alcohol may come from the negative externality that it creates, which is propagated by corporate leaders and cannot be attenuated by market-oriented institutions. Our results reveal a social norm externality that may have important normative implications.

The Effects Of Linguistic Ostracism On Job Performance. A Replication And An Extension, John Fiset, Devasheesh P. Bhave

Research Collection Lee Kong Chian School Of Business

We examined the phenomenon of linguistic ostracism—instances where a focal workgroup member perceives other members of their workgroup have rejected and/or excluded them by using a language they cannot comprehend. In a 2021 article, Fiset and Bhave observed that linguistic ostracism was related to two dimensions of job performance (interpersonal citizenship and deviance) and that disidentification served as an explanatory mechanism for the linguistic ostracism–job performance relationship. We constructively replicate and extend their work in several ways. First, we replicate prior effects on interpersonal citizenship and deviance and extend their work to focus on a third dimension of job performance: …

There Is No One-Size-Fits-All Approach To Sovereign Finance, Guan Seng Khoo, Annie Koh

Research Collection Lee Kong Chian School Of Business

In a commentary, SMU Professor Emeritus of Finance (Practice) Annie Koh and Khoo Guan Seng, Asia-Pacific advisory council member of the SWF Academy and EU-Asean Centre, opined that in a volatile world, the strength of a sovereign wealth fund lies in its ability to fulfil its specific, sovereign purpose. Prof Koh and Mr Khoo said that sovereign wealth funds are bespoke instruments of national policy, and in the world of sovereign capital, one size does not, and cannot, fit all. They noted that each fund is a reflection of a country’s unique ambitions, its resource endowments and its specific fears …

Situation Descriptions In Situational Judgment Tests: A Matter Of Including Trait-Relevant Situational Cues?, Philipp Schapers, Stefan Krumm, Filip Lievens, Jan-Philipp Freudenstein, Julian Schulze, Cornelius J. Konig

Research Collection Lee Kong Chian School Of Business

SJTs have traditionally been conceptualized as low-fidelity simulations of how respond to work-related situations. Yet, several studies demonstrated that situation descriptions were necessary to solve some SJT items, whereas they were not needed for other SJT items. So far, no solid support was found for various factors (e.g., item characteristics, presentation format, instructions, and content domain) that make some situation descriptions relevant and others irrelevant for responding to SJT items. Building on trait activation theory, we posit that trait-relevant situational cues serve as an ignored factor in SJT situation descriptions. Across two main studies (N-1 = 269, N-2 = 1,092), …

Eliciting Supplier Cooperation For Value Chain Decarbonization: A Field Experiment With Smallholder Farmers In India, Sukti Ghosh, Jasjit Singh

Research Collection Lee Kong Chian School Of Business

Many firms are pledging to reduce greenhouse gas emissions across their value chains. However, this requires their suppliers to also adopt more climate-friendly practices for decarbonization. This can involve addressing gaps in not only the suppliers’ ability but also their willingness to adopt such practices, which can be challenging if the suppliers perceive the practices as risky or potentially detrimental to their economic well-being. We examine the effectiveness of relational investments to help mitigate this challenge, arguing that relational investments can serve as a signal of the firm’s commitment towards joint value creation. In a field experiment conducted with supplier …

Business Schools In The Internal Environment: What Should Schools Do Now?, Kai Peters, Howard Thomas, Michael Thomas

Research Collection Lee Kong Chian School Of Business

In our previous article, we set out to explore external factors (Brexit, the pandemic, technological change and nationalism) which have made life more difficult for business schools. In this follow-up, we explore challenges of our own making within business schools, especially those that are a part of a larger university. We posit that many of us are not financially savvy, running too many under-scaled and poorly costed programmes. We see extensive university centralisation and related risk aversion. We see schools scheduling programmes for their own preference, not the preference of students. In conclusion, we propose some ways forward.

Agency Mbs As Safe Assets, Zhiguo He, Zhaogang Song

Research Collection Lee Kong Chian School Of Business

Measured as yield spreads against Treasury securities and AAA corporate bonds, the convenience premium of newly issued agency MBS averages more than half of the long-term Treasury convenience premium. The agency MBS convenience premium and issuance amount vary negatively with mortgage rate, consistent with a prepayment-driven channel. Placing agencies into conservatorship in 2008 and introducing liquidity regulations in 2013 significantly affected MBS convenience premium, consistent with government guarantee and regulatory treatment channels. Analyses of dispersion of dealers’ prepayment forecasts, seasoned MBS, and investors’ MBS holdings deliver further economic implications for agency MBS as safe assets.

Paid Search Marketing Vs. Search Engine Optimization: Analytical Models Of Search Marketing Based On Search Engine Quality, Kai Li, Chunyang Shen, Mei Lin, Zhangxi Lin

Research Collection School Of Computing and Information Systems

As search engines are leading revenue growth in online marketing, search marketing has become a popular area of academic research. Although search engine advertising has interested researchers for decades and much has been learned, one thing that puzzles scholars is why search engine optimization companies are tolerated rather than excluded from the market, even though they capture a significant share of the advertising market. In this paper, we shed light on this phenomenon and establish an analytical model based on organic search quality. Through analysis of the model, we were able to draw several intriguing conclusions. First, there is no …

Design Principles For Customer-Engaging Digital Service Systems: An Action Research Study, Keng Leng Siau, Xiaofeng Chen, Xin Tan

Research Collection School Of Computing and Information Systems

Digital services represent a business approach employed by organizations to operate in the digital environment. However, systematic development guidelines for developing quality digital service systems are lacking in the literature. The authors identified four general challenges for developing and implementing customer-engaging digital service systems (CEDSS). By employing the method of canonical action research in a digital service system project, they derived 10 design principles for developing high-quality CEDSS. They empirically evaluated the design principles in the development project and through follow-up focus group sessions. The design principles provide applicable and actionable guidelines for the development of CEDSS.

Prosocial Ceos And Accounting Manipulation, Mei Feng, Weili Ge, Zhejia Ling, Wei Ting Loh

Research Collection School Of Accountancy

This paper examines the association between chief executive officers’ (CEOs’) prosocial tendency and their firms’ likelihood of accounting manipulation. We measure CEOs’ prosocial tendency based on their involvement with charitable organizations. We find that prosocial CEOs are less likely to engage in accounting manipulation, as proxied by material non-reliance restatements and SEC or DOJ enforcement actions. The effect is more pronounced when CEOs are involved with charities that directly aim to improve the welfare of others and when they face stronger incentives to misreport. These results continue to hold in analyses of changes in CEOs’ prosocial tendency around turnover events. …

Sports And Corporate Innovation, Bing Qin

Dissertations and Theses Collection (Open Access)

Driven by the digital economy and intensifying global competition, corporate innovation has become a core driver of sustainable growth. Topmanagement members are key strategic decision-makers, and their individual characteristics critically influence the formulation and implementation of innovation strategies. While existing studies have examined the impact of topmanagement’s cognitive and psychological traits on innovation performance, significant gaps remain in understanding how their routine behavioral preferences—particularly running, a globally prevalent exercise—affect innovation performance through psychological mechanisms. The systematic relationship between running preferences, top management’s psychological traits, and organizational innovation outcomes remains underexplored.

Against this backdrop, the study investigates the mechanismthroughwhich top management’s …

Bridging The Social Class Capital Gap: A Psychological Intervention In The Newcomer Adjustment Context, Grace J. H. Lim, Marko Pitesa

Research Collection Lee Kong Chian School Of Business

Motivated by observations that workers from lower social class backgrounds often experience lower career outcomes even after securing desirable jobs, we adopted an abductive approach—combining theory (the newcomer personal capital framework) with qualitative evidence from open‐ended accounts (Study 1)—to identify three challenges these workers face after joining organizations as newcomers: limited cultural capital (i.e., institutional knowledge), lower social capital (i.e., social self‐efficacy), and lower psychological capital (i.e., distress tolerance). Furthermore, in Study 1, we developed and tested a psychological intervention targeting these challenges and found that it effectively addressed them. In Studies 2 and 3, both preregistered field experiments, we …

Tuned Out Or Dialed In: How Attributions Shape Observer Reactions To Music Listeners At Work, Oguz Gencay, Trevor Foulk, Michael Schaerer

Research Collection Lee Kong Chian School Of Business

Music listening while working is prevalent in contemporary workplaces, with extensive research demonstrating its psychological and behavioral implications. Shifting focus from intra-individual outcomes, the present research examines the social implications of music listening at work. To do so, we adopt a novel third-party perspective to investigate how observers perceive and react to music listeners. Building on attribution theory, we argue that music listening is an ambiguous behavior that invites observers to make leisure or productivity attributions, thereby shaping how they perceive and treat music listeners. We hypothesize that observers perceive music listeners (vs. non-listeners) as less engaged if they attribute …

The Effect Of Cybersecurity Breaches On Analysts’ Earnings Forecasts, Chih-Ying Chen, Beng Wee Goh, Kiat Bee Jimmy Lee, Na Li

Research Collection School Of Accountancy

We investigate the implications of cybersecurity breaches for financial analysts because they play an important role as information intermediaries in capital markets, and it is unknown whether analysts’ earnings forecasts are affected by cybersecurity breaches. Based on a sample of cybersecurity breaches from 2005 to 2018, we find that analysts’ earnings forecasts for firms with cybersecurity breaches are less accurate and more dispersed after a breach than for firms without such breaches. In cross-sectional analyses, we find that the adverse effects of cybersecurity breaches on analysts’ earnings forecasts are more pronounced for firms operating in more volatile business environments, for …

Does Auditor Quality Enhance Csr Disclosure?, Jimmy Lee, Chee Yeow Lim, Gerald J. Lobo, Yanping Xu

Research Collection School Of Accountancy

We investigate the relation between auditor quality and client firms’ corporate social responsibility (CSR) disclosure. Using an international sample of firms from 36 countries over the period 2009–2018 and a measure of the extent of CSR disclosure from Bloomberg, we find strong evidence that client firms with higher quality auditors provide more CSR disclosure. In cross-sectional analyses, we show that the relation between auditor quality and CSR disclosure is accentuated when the information environment is poorer and when the financial reporting environment and the legal institutions are weaker. Lastly, we document that firms with higher quality auditors also exhibit better …

The Impact Of Executives’ Social Networks And Digital Capabilities On Firm Performance In Dynamic Environments, Lijun Men

Dissertations and Theses Collection (Open Access)

With the acceleration of digital transformation, improving firm performance in complex and dynamic market environments has become a central challenge for companies. This study examines the effects of executives’ social networks and firms’ digital capabilities on firm performance. Further, it investigates the moderating roles of digital capabilities and environmental dynamism in these relationships. Using panel data for Chinese listed firms from 2005 to 2024, we conduct empirical analyses with fixed-effects models. The results indicate that executives’ political, business, and academic networks all contribute positively to firm performance, underscoring the importance of executives’ social networks in resource acquisition, information flows, and …