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The increasing dependence of South Asian countries on international remittances (IRM) and international tourism development (ITR) in the presence of political uncertainties has attracted scholars' attention. Although the largest receiver of IRM, South Asia fails to channel these funds to the tourism industry, which continues to operate below its potential. This study estimates the impact of IRM, political stability (PS), and their interaction with foreign direct investment (FDI) and relative price (RP) on ITR in South Asia. We used a balanced panel dataset of six South Asian countries from 1996 to 2020. We applied the pooled ordinary least squares (POLS), fixed effects (FE), feasible generalized least squares (FGLS), and Prais-Winsten regression with panel-corrected standard errors (PCSE), to estimate the results. The study discovered quite interesting and surprising results between IRM and ITR. The results suggest a statistically significant negative impact of IRM on ITR in South Asia, implying that the recipients of IRM tend to spend most of it on their basic level consumption needs and do not have incentives to save and invest. Further, the results suggest that PS positively moderates the relationship between IRM and ITR, suggesting that IRM will be channelized to the tourism sector if domestic investors expect low political risks in the region. In addition, the results indicate that PS and FDI have a statistically significant positive effect on ITR in South Asia. Moreover, RP has a negative and significant impact on ITR, implying that international tourists prefer cheaper destinations. This study provides crucial implications for South Asian economies. First, effective public policies are specifically designed for channelling IRM and FDI, focusing on enhancing the tourism industry's infrastructure. Second, PS is necessary for ITR and domestic investors to invest IRM in the tourism sector. Thus, policymakers must consider political factors while designing tourism policies and strategies. Third, the findings highlight the significance of price competitiveness for developing the tourism industry. Hence, we argue that policymakers should implement effective economic policies to stabilize regional prices to attract international tourists.

Purpose This study aims to investigate the impact of family ownership on firm performance. The authors examine whether family ownership in a firm reduces the adverse consequences of political connections on firm performance. Further, the authors analyze whether monitoring benefits of family ownership vary over family generations. Design/methodology/approach This study examines the financial data from 229 active nonfinancial firms listed on the Pakistan Stock Exchange between 2011 and 2019. First, the authors estimated several panel data regression models after incorporating control variables in the full sample. Second, the authors estimated models in the subsample of family firms for investigating whether the results vary among different generations of family firms. Further, for checking the robustness of the authors’ statistical results, the authors have used two proxies of family ownership and revalidated the findings in several subsamples of the data. Findings This study finds that family firms financially outperform nonfamily firms. Further, the results suggest that boards with family members tend to enhance monitoring and governance mechanisms which reduce the harmful effects of political connections. Finally, this study finds that the monitoring benefits of family ownership which reduce the adverse effects of political connections on family firm performance diminishes over generations. Originality/value First, this study provides evidence of whether the monitoring benefits of family ownership reduce the adverse effects of political connections on firm performance. Second, to the best of the authors’ knowledge, no prior study provides evidence whether first-generation family firms are superior in monitoring and ultimately reducing the negative effects of political connections.

PurposeThis study aims to analyze whether family ownership and working capital management (WCM) affect firm profitability and liquidity. Further, we also investigate the moderating effect of family ownership on the association between WCM, firm profitability and liquidity.Design/methodology/approachThis study uses a sample of 150 nonfinancial companies listed on the Pakistan Stock Exchange for the period 2014–2019. For empirical analysis, this study used multiple proxies of family ownership and applied robust and bootstrapped quantile regression models.FindingsThe results suggest that family ownership has a negative association with firm profitability and liquidity. Moreover, this study finds a positive association between WCM and firm profitability and liquidity. Furthermore, the results indicate that family ownership negatively moderates the association between WCM and firm profitability. In addition, we argue that family ownership rescinds the impact of WCM as excess liquidity may be used for extracting private benefits and related party transactions.Originality/valueFirst, this study has examined the nexus between family ownership, WCM, firm profitability and liquidity in the context of a developing country, i.e. Pakistan. Second, previous studies have not analyzed the moderating role of family ownership in the association between working capital management, firm profitability and liquidity. Third, this study provides unique evidence that family-owned firms have an adverse liquidity position as compared with other firms.

This study analyzes the impact of corporate governance (CG) practices and Shariah Supervisory Board (SSB) on the financial performance of Islamic banks (IB). A sample of 20 Islamic banks from Arab and Non-Arab countries i.e. Bahrain, Kuwait, Jordan, Saudi Arabia, United Arab Emirates, Pakistan and Malaysia were used. A CG-index was adopted from the literature which comprises of three sub-indices including Board of Directors (BOD), Audit Committee (AC) and Shariah Supervisory Board (SSB). The dataset covers the period from 2012 to 2018. The panel data regression technique was used for data analysis. The descriptive statistics suggest that the average score for CG-index is 76% which indicates that Islamic banks reasonably adhere to CG regulations. The panel regression results suggest an insignificant relationship between (1) CG and IB’s financial performance and (2) BOD and IB’s financial performance. These findings are consistent with earlier studies conducted on Arab countries. Moreover, the results also suggest that SSB and AC contribute positively towards asset performance but negatively towards equity performance. Policymakers should revisit the CG regulations in their countries to make them more influential towards the performance of Islamic banks.

PurposeThe study analyzes the influence of corporate governance and ownership concentration levels on the cost of equity. Further, the authors extend the literature by investigating the moderating effect of ownership concentration levels (i.e. at 5%, 10% and 20%) on the relationship between corporate governance and the cost of equity.Design/methodology/approachThe study applies several robust panel regression techniques to a sample of 114 active non-financial companies listed on the Pakistan Stock Exchange from 2011 to 2016. Corporate governance was measured through a unique index comprising 30 governance attributes. The cost of equity was measured through the capital asset pricing model. Further, the authors construct three variables for ownership concentration levels, i.e. at 5%, 10% and 20%. To address the endogeneity problem, the one-lagged variable model and GMM approaches were also applied.FindingsThe results indicate that better corporate governance reduces the cost of equity, while ownership concentration at high thresholds would increase the cost of equity. Further, the authors find that ownership concentration at the 20% threshold moderates the relationship between corporate governance and the cost of equity. Thus, the authors argue that firms can minimize the risk faced by shareholders by implementing substantive corporate governance mechanisms. In addition, effective corporate governance mechanisms at high ownership concentration levels are imperative for managing the cost of equity.Originality/valueThe study reports novel evidence that ownership concentration at a high threshold moderates the effect of corporate governance on the cost of equity.

The study investigates whether effective audit committees, gender-diverse boards, and corruption controls affect the level of voluntary disclosures of Asian banks. Further, we analyze whether directors’ experience moderates the impact of audit committee independence, audit committee meetings, board gender diversity, and corruption controls on voluntary disclosures. We use data for commercial banks operating in six Asian countries, i.e., China, India, Pakistan, Malaysia, Hong Kong, and Singapore. For empirical analysis, we apply several robust statistical techniques. We find that commercial banks with effective audit committees, gender-diverse boards, and corruption controls tend to disclose less information voluntarily as they perceive limited benefits from optional disclosures. Further, we find unique evidence that directors’ experience significantly moderates the impact of audit committee independence, audit committee meetings, board gender diversity, and corruption controls on voluntary disclosures of Asian banks. Our unique findings are consistent with the proprietary cost theory. Further, our results indicate that commercial banks operating in countries that maintain rule of law, regulatory quality, and government effectiveness tend to disclose less information voluntarily.

Current corporate governance failure and financial scandals are the reason for the governance mechanism due to ignoring the adoption of governance mechanisms in corporate practices. The main objective of the paper is to investigate the association between governance mechanism corporate performances based on extant literature and to put a light on the current governance mechanism in the Malaysian firms. This paper emphasizes the compliance of governance mechanism and the role of MCCG in improving the performance of corporate firms. This paper highlights the issues, current corporate scandals, and failure of corporate governance mechanisms in the first and second decades of the 21st century. Various scandals and misconduct are discussed to report the problems allied to corporate governance. This paper addresses the various corporate governance theories, models, and good governance structure. The internal and external governance mechanisms have been discussed in detail to put a light on its influence on corporate performance

PurposeThis paper aims to investigate the effect of political connections on earnings quality by simultaneously controlling the firm characteristics; to test whether Pakistani firms’ ownership, specifically family ownership, plays a significant role in political connections–earnings quality association; to draw a conclusion about the agency theory in the context of Pakistan.Design/methodology/approachA quantitative approach was used to examine the influence of political connections and family ownership on the earnings quality of listed firms in Pakistan. The study uses historical data from 238 active non-financial firms listed on the Pakistan Stock Exchange during the period of 2009-2015. The final data set comprises more than 1,600 firm-year observations from ten major non-financial industry classifications. To enhance the robustness of the empirical relationship, the study used several proxies of earnings quality in conjunction with robust regression methods and diagnostic checks.FindingsThe present study’s findings are consistent with the findings of the studies on agency theory previous literature, where politically connected firms have significantly lower earnings quality as compared to non-connected firms. The results also indicate that family firms have superior earnings quality than non-family–controlled firms. Furthermore, family ownership moderates the negative influence of political connections on earnings quality. This implies that family ownership diminishes the costs of political connections and improves the earnings quality of the firm.Originality/valueThis study is different from previous research in three respects. First, it examines whether family ownership concentration has a moderating influence on the relationship between political connections and earnings quality. Second, it uses a robust methodology and extensive data set to examine the influence of political connections and family ownership concentration on earnings quality. Further, this study is the first to analyze the nexus between financial reporting quality and the political business environment in the context of Pakistan.