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By proposing a novel continuous and time-varying measure of Sharia compliance, we investigate whether it enhances the effects of corporate social responsibility, proxied by Environmental-Social-Governance scores, on firms' equity costs and market risks in emerging countries. We construct a large dataset of non-financial listed firms incorporated in eighteen emerging markets, both Sharia-compliant and conventional (4612 firm-year observations from 2002 to 2018), finding a consistent, statistically significant, and negative association between the interaction of ESG scores and the Sharia sensitivity with the cost of equity. Moreover, we reveal that this negative relationship is mediated by firms' market risk (risk channel).

The growing application of bibliometric reviews in Finance, as well as the ongoing consolidation processes across firms and countries, motivated this study on mergers and acquisitions (M&A) in the Financial Industry. From a starting count of around 4500 papers, we refine our database accordingly to keywords and journal quality, reviewing a final sample of 174 papers. By combining bibliometric and content analysis, we identify leading journals, countries, institutions, authors, articles, and related research questions that mostly contributed to this field. Moreover, we provide a keyword/cartographic analysis identifying five leading research streams and their evolution over time, that we extensively discuss. Finally, we summarize the main questions proposed by the literature as a suggestion for future research.

In this paper, we explore how the adherence to Sharia principles in non-financial firms impacts on Corporate Social Responsibility (CSR) aptitudes, proxied by Environmental, Social and Governance (ESG) scores. By employing a worldwide dataset of 4,725 entities from 2002 to 2018, we find that Sharia-compliant firms are more likely to engage in sustainable and responsible practices, especially towards the environmental dimension. Evidence from a set of quasi-natural experiments, built around a range of significant natural disasters and social events, reveals a greater response of Sharia firms to CSR engagement, confirming the role played by faith-based business ethics in Islamic entities. Our results offer precious insight to policymakers and investors, suggesting that the integration of ethical and religious-oriented incentives can improve sustainability practices and resilience of firms.

Using a large and extended global dataset of non-financial firms (4624 listed entities from 2002 to 2018), we provide the first empirical evidence on how ESG and Sharia screenings interact and influence market risks. We link two contrasting literature streams: the risk reduction role that the stakeholder theory attributes to ESG scores, and the opposite effect for Sharia-compliance anticipated by the portfolio and agency theories. We find that when ESG scores are not considered, Sharia certification increases risks. We also prove that engagement in sustainable activities mitigates risks for both Sharia-compliant and conventional firms. More interestingly, we show that Sharia-compliant firms obtain a larger risk-mitigating effect for greater levels of ESG scores. These results are robust to endogeneity and to extensive additional checks. Our findings validate the hypothesized complementarity between ESG and Sharia screenings.