Saudi Cultural Missions Theses & Dissertations
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Item Restricted The Impact of Environmental, Social, and Governance (ESG) Factors on Firm Financial Performance: An Empirical Study of Non-Financial Constituents of the S&P 500(University of Liverpool, 2024-09) Fallatah, Ahmed Zaki; Giorgioni, GianluigiAbstract This study empirically examines the influence of Environmental, Social, and Governance (ESG) factors on financial performance of non-financial firms listed on the S&P 500. It analyzes data for 425 firms over the period from 2010 to 2023. This research study apply panel data analysis using Generalized Least Squares (GLS) Regression and reveals a significant and positive relationship between overall ESG scores and Corporate financial performance metrics, Return on Equity, Return on Assets and Tobin's Q for current S&P 500 firms. For the firms that were removed from the index, while ESG scores significantly enhance Tobin's Q in terms of market evaluation and their impact on financial measurement is less pronounced. The analysis highlights that environmental scores influence financial outcomes across both current and dropped firms. Social scores positively affect financial performance in current firms but show limited impact for firms removed from the index. Governance scores appear to have a more nuanced impact, suggesting that good governance alone may not be enough to differentiate performance among firms. The study shows the importance of robust ESG practices, particularly in environmental and social pillars, for enhancing corporate financial success and market valuation. The firm’s market position and financial health may influence the relationship between ESG factors and immediate financial returns. The research shows that ESG investments can boost a market position of company and resilience and their direct impact on immediate financial returns can vary depending on the company’s financial health and market status. Therefore, this study reveals the complex relationship between ESG practices and financial performance. The findings provide useful valuable insights for business leaders, investors, and policymakers looking to align ESG practices with financial goals and foster sustainable, long-term growth.36 0Item Restricted What Do Investors Care About in Cryptocurrency Markets? Evidence from ESG Ratings and NFTs(University of East Anglia, 2024-09) Alsultan, Sarah Abdulrahman; Markellos, Raphael; Kourtis, ApostolosWhile cryptocurrencies have seen limited adoption as a medium of exchange, they have been recognised as a new class of investment assets. A broader range of investors, including institutional investors, has shown growing interest in cryptocurrency and digital assets. Therefore, this thesis contributes to the literature by thoroughly examining digital technologies as investment assets through three empirical studies. The first study explores whether investors prefer blockchains with strong Environmental, Social, and Governance (ESG), using a novel dataset of blockchain ESG scores. The findings reveal a time-varying preference for high-ESG blockchains. The top-rated blockchains outperform lower-rated ones during favourable market conditions and optimistic market sentiment but underperform during times of negative sentiment. Our findings also indicate that high-ESG blockchains exhibit higher market volatility. Furthermore, governance and environmental factors have the strongest influence on investor preferences among the three ESG dimensions. The second study examines NFTs as a relatively new asset class that is not yet fully understood, particularly in terms of risk modelling. It evaluates and compares the forecasting performance of various GARCH models in estimating NFT market volatility across different time horizons. The selected models include GARCH(1,1), IGARCH(1,1), EGARCH(1,1), GJR- GARCH(1,1), and TGARCH(1,1). The dataset comprises three major NFT categories, six NFT token platforms, and major cryptocurrencies, including Bitcoin and Ethereum. Empirical evidence shows that different models perform better depending on the asset type and forecast horizon. The findings highlight the highly volatile nature of NFT markets. The third study assesses the impact of visual attractiveness on NFT market prices. Prior art literature has demonstrated the role of aesthetics in influencing art prices. Given the similarities between NFTs and traditional art, this study investigates whether aesthetics similarly impact NFT prices. The empirical analysis focuses on one of the largest NFT collections, CryptoPunks, by applying a hedonic pricing model. We employ quantitative aesthetic measures to capture aspects of NFT art, including colourfulness, brightness, colour intensity, and texture. Our results reveal a significant impact of visual aesthetics on determining NFT prices. The results indicate that more colourful and visually complex NFTs are associated with higher prices, while brighter and more saturated NFTs are associated with lower prices.18 0Item Restricted Causes and Effects of Corporate Social Responsibility: An Examination of Corporate Social Responsibility in Saudi Arabia(University of New England, 2024) Alhazzaa, Ateeq Mesfer; Reddy Yarram, Subba; Moss, SupawadeeThe recent adoption of sustainable development goals (SDGs) and the two-decade-long work involved in evolving these goals has led to increased attention to corporate social responsibility (CSR) in developing countries. As a United Nations (UN) member committed to achieving the SDGs by 2030, the Saudi government released its Vision 2030 economic blueprint in 2016, which includes significant environmental targets such as reducing carbon emissions. However, research is still limited because few studies have considered the causes and consequences of CSR, particularly in Saudi Arabia. The current study aims to address this gap in the literature, specifically in the context of emerging economies. This study explores how ownership structure and leadership characteristics influence environmental, social and governance (ESG) practices in the Saudi Arabian context. It also examines the effect of ownership structure, leadership and ESG performance on financial performance. In addition, this thesis focuses on assessing how ESG practices, in conjunction with ownership structure and leadership, affect financial risk in Saudi Arabia. Hypotheses for this study were devised based on various theories, existing literature and the institutional context. Data were collected from Invest ESG and the annual reports of 136 non- finance industry firms listed on the Saudi Stock Exchange between 2016 and 2020, resulting in 647 annual observations. The generalised method of moments technique was employed to manage potential endogeneity issues in panel data analysis. The findings of the first study suggest that foreign, government and managerial ownership positively affect CSR. In contrast, institutional and family ownership of businesses and frequent CEO turnover impede CSR investment. The outcomes from the second study show that institutional, foreign, family and managerial ownership—as well as leadership elements like CEO turnover and leadership experience—are likely to enhance a firm’s value when aligned with ESG practices. Such enhancements in financial outcomes could be attributed to these ownership and leadership groups recognising the value generation potential of ESG and corporate governance. Conversely, investments in environmental and social initiatives might diminish value owing to the associated expenses to make such projects viable. Finally, the third study reveals that risk-taking is reduced in Saudi firms when these firms are participating in CSR practices. Evidence from this study broadly supports the view that CSR engagement leads to diminished risk-taking in Saudi firms.12 0Item Restricted The Importance of Friends and Corporate Finance Practices Around the World(La Trobe University, 2024-12) Grami, Madaniah; Al Mamun, Muhammad; Balachandran, Balasingham; Karuna, Christo; Baghdadi, GhasanThis dissertation adopts an interdisciplinary approach by drawing on the theoretical framework of the New Institutional Economics proposed by Williamson (2000). It investigates the influence of the importance of friends (FRI) on the financial decisions and outcomes of listed firms from around the world. The thesis is structured into six chapters: an introduction, a presentation of the concept of the importance of friends, three empirical chapters, and a conclusion. The introductory chapter builds on the existing literature on friendship and it explores the following: (a) the background, (b) the motivation supported by theoretical arguments and anecdotal evidence linking FRI with corporate finance decisions, (c) summaries of the three empirical chapters, and (d) contribution to the literature on this subject. The second chapter explains the conceptual understanding of the importance of friends. The first empirical chapter (Chapter 3) explores how FRI, as a measure of social connections, shapes firms’ relationships with their suppliers. Specifically, it examines the role of FRI on firms’ trade credit policy (TC) and shows that higher FRI increases firms’ usage of TC. Extending the potential implication of FRI on the managerial agency behavior of firms, the second empirical chapter (Chapter 4) investigates the influence of FRI on firms’ dividend policy. Empirical results show that higher FRI increases the dividend decision-to-pay and payout ratio; in fact, it mitigates the agency implications of dividend policy. The third empirical chapter (Chapter 5) extends the potential caring argument of FRI to firms’ communities by examining its influence on businesses’ environmental, social, and governance (ESG) performance. The results show that higher FRI promotes firms’ ESG performance. Collectively, these findings offer a new perspective on understanding corporate decisions related to financing, distribution, and stakeholder commitments. The findings from this thesis have significant implications for relevant stakeholders in making investment decisions, financing choices, and other related decisions.38 0Item Restricted The Effect of ESG on The Financial Sector(University of New Orleans, 2024-05-09) Sendi, Asaad; Kabir, Hassan MThis paper explores the intricate impact of ESG (Environmental, Social, and Governance) factors on the stability of banks across different continents, with a specific focus on distinguishing the effects on both conventional and Islamic banking institutions. Our comprehensive empirical analysis reveals a substantially positive influence of ESG activities on the stability of both types of financial institutions. Notably, after employing pooled and fixed estimator regressions, the findings highlight the significantly positive effect of lagged ESG scores on the stability of conventional and Islamic banks, signifying the potential for ESG performance to enhance their overall stability. Further examination shows that the environmental pillar score, particularly in the conventional banking sector, displays highly positive and statistically significant outcomes, emphasizing the constructive impact of environmentally responsible practices. Conversely, the social pillar exhibits a positive correlation with the z-score in the Islamic banking segment, indicating that banks actively involved in community service and social responsibility initiatives experience improved stability. In conclusion, our study underscores the transformative potential of ESG activities in positively shaping both the external perception and internal operations of banks, ultimately contributing to increased valuations and improved stability.31 0Item Restricted A QUANTITATIVE ANALYSIS OF ESG PERFORMANCE AND ITS EFFECTS ON FINANCIAL PERFORMANCE(Saudi Digital Library, 2023-09-02) Bineid, Waleed Mohamed A; Goncharenko, GalinaRecently, the Environmental, Social, and Governance (ESG) goals are becoming a primary focus for companies worldwide. Studies have found positive and negative relationships between good ESG performance and the company’s financial performance. Hence, this research aims to explore the relationship between ESG and financial performance and find which balance sheet element has the most significant relationship with ESG performance. From a ranked list of 100 global companies, 46 firms had complete financial data for three years (from 2020 to 2022) and were eligible to be included in analysis. Using each company’s ESG rating and financial data, two statistical tests were performed to determine the relationship between ESG rating and financial performance. Although one significant relationship was found, both tests have shown weak positive and negative relationships. The hypothesis that ESG ranking will have a significant positive relationship with at least two of the five indicators used: net profits and operating revenue was not proven by the findings of this study.39 0Item Restricted An Empirical Investigation into the Impact of Environmental, Social, and Governance (ESG) Reporting on Firm Value: A Cross-Sector Analysis.(Saudi Digital Library, 2023-11-23) Alturayeif, Rawan; Harakeh, MostafaThis study investigates the correlation between Environmental, Social, and Governance (ESG) scores and firm value across major sectors in the United States, including energy, technology, healthcare, and consumer staples staples during the period from 2012 to 2022. The study employs Tobin's Q as proxy for firm value. Preliminary descriptive analysis provides valuable insights into sector-specific ESG adherence, while regression analyses substantiate a positive association between ESG scores and firm value. Interestingly, while environmental and governance components of ESG significantly influence firm value, social components yield an insignificant impact, possibly due to strict U.S. regulations. Sector-specific analysis reveals distinct dynamics, with the healthcare and energy sectors showcasing unique and noteworthy ESG-firm value relationships. By further disaggregating ESG effects and introducing an alternative dependent variable for robustness, this research underscores the strategic importance of ESG practices, suggesting the need for a tailored approach to enhance sustainable corporate value.58 0Item Restricted A Comprehensive Case Study on ESG Integration and Analysis for Sustainable Commercial Banks in the United Kingdom(Saudi Digital Library, 2023-03-18) Alnabood, Ali; Hayward, RobertCommercial banks in the United Kingdom strive to operate sustainably and satisfy the demands of their stakeholders, which has increased the importance of environmental, social, and governance (ESG) factors. This comprehensive case study employs a mixed-methods approach that discusses analysing and integrating ESG elements for sustainable commercial banks in the UK. The study commences with a comprehensive examination of current literature on integrating and analysing ESG factors in the banking sector. Subsequently, the literature review outcomes are employed to construct a conceptual framework for integrating and analysing ESG factors customised to the commercial banking industry in the UK. Next, the study uses publicly available data to analyse the ESG performance of the leading five commercial banks in the UK. The analysis includes assessing the banks' implementation of various ESG indicators, including carbon emissions, diversity and inclusion, and governance practices. Finally, the analysis results identify trends and best practices in ESG integration and analysis among UK commercial banks. The study results emphasise the significance of incorporating and evaluating ESG factors for promoting sustainability in commercial banks operating in the UK. The analysis results demonstrate notable disparities in ESG performance among commercial banks in the UK. Certain banks exhibit superior ESG performance compared to others, with statistically significant differences. The study's author has presented a series of suggestions for UK commercial banks seeking to enhance their ESG performance and incorporate ESG factors into their business practices based on the research results. The suggestions encompass the necessity for endorsement from upper-level management, the significance of thorough data gathering and evaluation, and the advantages of involving stakeholders to comprehend their ESG preferences. Overall, this thorough case study offers insightful information on the difficulties and possibilities of ESG integration and analysis for sustainable commercial banks in the UK. The study's mixed-methods methodology provides a comprehensive understanding of the subject. It also gives helpful advice for UK commercial banks aiming to enhance their ESG performance. Finally, the study's conclusions apply to banks and financial institutions worldwide, not only in the UK, as they work to operate sustainably and satisfy changing stakeholder expectations.29 0Item Restricted Essays on global corporate bank(2023-01) Saharti, Mohammed; Chuadhry, SajidSyndicated loans are an important source of external finance for a firm’s financing. In 2019, global syndicated loans volume was about 41% of the total funds raised from capital markets, the second-highest source of external finance after bonds. Over the first nine months of 2021, $4 trillionwasdisbursedthroughsyndicatedlending.1 Givenimportanceofsyndicatedloans,wetake a holistic approach and start this thesis with a citation-based comprehensive systematic literature review (SLR) of the syndicated loan market. Therefore, in this this we fill the knowledge gap by first surveying a comprehensive SLR. This helps us in highlighting some areas that need to be explored. Second we study the effect of bank mergers and acquisitions (M&As) on borrowers syndicate structure and the testing of bank–firm relationships. Finally, we explore the impact of environmental, social, and governance (ESG) factors on the cost of capital for firms and the structure of syndicate loans.23 0Item Restricted Would achieving ESG (Environment Social Governance) targets require increased collaboration between industries and potential adjustments to the EU competition law.(2023) Alharbi, Tahani; brok, OrThe key purpose of this dissertation is to analyse the rules of EU competition laws and their compatibility with the sustainability goals within the EU law framework. The dissertation will look at the EU Green Deal followed by the EU Sustainability Corporate Governance Rules. It will be argued that the current EU law needs to be revised to make it compatible with the aims of the European Green Deal. EU member states must comply with EU law as their primary law and the Commission is under an obligation by way of Article 11TFEU to comply with environmental issues in all its policies. If the EU competition law continues if competition law continues to interfere with urgent enterprises to tackle climate change, the Commission must clarify the law, or amend it within the scope of the treaties for instance by way of a block exception Therefore, the key objective of the thesis is to analyse whether and to what extent can the sustainability goals be reconciled with the competition law rules. This is because the achievement of sustainability goals requires collaboration between corporations and any collaboration may trigger the application of anti-competition laws. Therefore, the thesis will aim to answer the question of whether the current framework of the EU competition laws is consistent with the sustainability goals. This dissertation will argue that unless the Commission is prepared to make radical changes to competition law to make it suitable for the development of sustainable initiatives, the goals of the Commission will not be met, and this will affect not just the EU but also the entire world in respect of climate change.34 0