We examine whether analyst coverage influences corporate fraud in China. The fraud triangle specifies three main factors, i.e. opportunity, incentive, and rationalization. On the one hand, analysts may reduce the fraud opportunity factor through external monitoring aimed at discouraging managerial misconduct, which can moderate agency problems. On the other hand, analysts may increase the fraud incentive factor by pressurizing managers to achieve short-term performance targets, which can exacerbate agency problem. In either case, the potential influence of analysts on (...) the fraud rationalization factor may be more pronounced among firms that are more dependent on the capital market for corporate finance. Using a sample of Chinese listed firms, we show a negative association between corporate fraud propensity and analyst coverage, and that this effect is more pronounced among non-state-owned enterprises, which are more reliant on the stock market for external funding. These findings suggest that analyst coverage contributes to corporate fraud deterrence in emerging economies characterized by weak investor protection. The main policy implication is that further development of the analyst profession in emerging economies may benefit investors and strengthen business ethics. (shrink)

Based on prior studies which show that firms headquartered in high religiosity counties exhibit high level of business ethics, this study examines whether these firms are associated with low audit risk, and therefore low audit fees. In investigating this relationship, we draw a distinction between intrinsic and extrinsic religiosity of auditees. Using a sample of 25,872 U.S. observations from 2003 to 2012, we find that intrinsic religiosity of the auditees is associated with low audit fees after controlling for auditee extrinsic (...) religiosity, social capital, firm-specific characteristics, and county-specific characteristics. Furthermore, we find that external monitoring weakens the negative relationship between auditee intrinsic religiosity and audit fees. Finally, we conclude that the effect of auditor religiosity on audit fees is a regional effect that may affect the relationship between audit fees and auditee intrinsic religiosity. (shrink)

While commentators have long decried managerial short-termism, the deleterious effects of managerial short-termism on corporate social performance (CSP), and how to ameliorate those negative effects, remain underexplored. Specifically, due to the difficulty of unobtrusively measuring what is fundamentally a cognition in managers, empirical evidence at the organizational level of managerial short-termism’s effect on CSP is relatively sparse. Here, we measure managerial short-termism by content analyzing firms’ publicly filed annual reports (10-Ks). Using a combined dataset for 1,665 U.S. firms for the (...) period 2000–2012, we show that managerial short-termism is negatively associated with CSP. However, we also show that this effect can be reduced through increased external monitoring by important stakeholders who value CSP. Specifically, we show that increasing dedicated institutional ownership and increasing analyst coverage both decrease the negative effect of managerial short-termism on CSP. We contribute to theory by predicting and showing the negative effect of managerial short-termism on CSP, and how external monitoring can reduce its deleterious effects. We contribute to practice by showing how this managerial cognition can be identified, and how its negative effects can be ameliorated, at the organizational level. (shrink)

We propose a new integrative framework of external time monitoring in prospective memory (PM) tasks and its relation with performance. Starting from existing empirical regularities and our theoretical analysis, the framework predicts that external monitoring in PM tasks comprises a first stage of loose monitoring to keep track of the passage of time, and a subsequent stage of finer-grained monitoring, based on interval reduction, to meet the PM deadline. Following our framework, we predicted and (...) observed in three different datasets (N = 375): (1) a marked increase in external monitoring frequency in the final part of the period of the PM task, well captured by a proportional rate exponential growth function; (2) a positive association between individual compliance with this monitoring pattern and PM performance; (3) a positive relation between monitoring frequency in the time window immediately preceding the PM deadline and PM performance at the individual level; and (4) good individual compliance with an interval reduction pattern in external monitoring, especially in the time window closer to the PM deadline. These results support the proposed integrative framework, which has the potential to foster future research on external monitoring in PM and in other fields of cognitive science. (shrink)

This article evaluates effectiveness and costs of external regulation, in particular the Sarbanes-Oxley Act of 2002 (SOX) in restricting managerial malfeasance and safeguarding shareholder interests. It discusses the role of managerial ethics as an alternative corporate governance mechanism to protect shareholder value. This article builds a mathematical model to illustrate shareholders' choices of best corporate governance mechanisms, taking into account the influence of managerial ethics, effectiveness and costs of monitoring. We suggest that the best corporate governance design and (...) the optimal monitoring expenses are influenced by managerial types, monitoring efficiency, and effectiveness of ethics education. We conclude that stringent regulation and monitoring may not always enhance shareholder value. When managerial ethics could be improved by ethics education or social norms, ethics education may be a better alternative than stringent regulation. (shrink)

Political corruption imposes substantial costs on shareholders in the U.S. Yet, we understand little about the basic factors that exacerbate or mitigate the value consequences of political corruption. Using federal corruption convictions data, we find that firm-level economic rents and monitoring mechanisms moderate the negative relation between corruption and firm value. The value consequences of political corruption are exacerbated for firms operating in low-rent product markets and mitigated for firms subject to external monitoring by state governments or (...) monitoring induced by disclosure transparency. Our results should inform managers and policymakers of the tradeoffs imposed on firms operating in politically corrupt districts. (shrink)

Type 1 diabetes (T1D) is a chronic illness that requires intensive lifelong management of blood glucose concentrations by means of external insulin administration. There have been substantial developments in the ways of measuring glucose levels, which is crucial to T1D self-management. Recently, continuous glucose monitoring (CGM) has allowed people with T1D to keep track of their blood glucose levels in near real-time. These devices have alarms that warn users about potentially dangerous blood glucose trends, which can often be (...) shared with ther people. CGM is consistently associated with improved glycemic control and reduced hypoglycemia and is currently recommended by doctors. However, due to the costs of CGM, only those who qualify for hospital provision or those who can personally afford it are able to use it, which excludes many people. In this paper, I argue that unequal access to CGM results in: (1) unjust health inequalities, (2) relational injustice, (3) injustice with regard to agency and autonomy, and (4) epistemic injustice. These considerations provide prima facie moral reasons why all people with T1D should have access to CGM technology. I discuss the specific case of CGM policy in the Netherlands, which currently only provides coverage for a small group of people with T1D, and argue that, especially with additional considerations of cost-effectiveness, the Dutch government ought to include CGM in basic health care insurance for all people with T1D. (shrink)

This paper offers an explanation of how collaboration leads to abstract and flexible problem solving. We asked the individual and paired subjects to indicate 3/4 of 2/3 of the area of a square sheet of paper and found that (1) they primarily folded or partitioned the paper rather than algorithmically calculating the answer, (2) they strongly tendened to backtrack and confirm their proto‐plans on externalized traces such as creases on the paper, and (3) only the paired subjects shifted to the (...) mathematical strategy in their second trials. Based on these results, we propose that two factors, individuals' activeness in choosing and confirming the initial strategies and the frequent role exchange between task‐doing and monitoring in collaborative situations, interact in collaboration to generate various solutions differing in the degree of abstraction, which are then reflected upon by the participants to lead them to abstraction. (shrink)

Anosognosia for hemiplegia is a lack of awareness about paralysis following stroke. Recent explanations use a ‘forward model’ of movement to suggest that AHP patients fail to register discrepancies between internally- and externally-generated sensory information. We predicted that this failure would impair the ability to recall from memory whether information is internally- or externally-generated . Two experiments examined this prediction. Experiment 1 demonstrated that AHP patients exhibit a reality monitoring deficit for non-motor information , whilst hemiplegic controls without anosognosia (...) perform like age-matched healthy volunteers . Experiment 2 explored if this deficit occurs when AHP patients discriminate performed, imagined, or observed movement. Results showed impaired reality monitoring for movements in AHP and nonAHP patients relative to HVs. Findings suggest that reality monitoring processes not directly related to movement, together with a failure to reality monitor movements, contribute to the pathogenesis of AHP. (shrink)

Load monitoring in basketball is fundamental to develop training programs, maximizing performance while reducing injury risk. However, information regarding the load associated with specific activity patterns during competition is limited. This study aimed at assessing the external load associated with high-intensity activities recorded during official basketball games, with respect to different activity patterns, playing positions, and activities performed with or without ball. Eleven male basketball players competing in the Lithuanian third division were recruited for this study. Three in-season (...) games were assessed via time-motion analysis and microsensors. Specifically, the high-intensity activities including sprints, high-intensity specific movements and jumps were identified and subsequently the external load [PlayerLoad™ and PlayerLoad™/min ] of each activity was determined. Linear mixed models were used to examine differences in PL, PL/min and mean duration between activity pattern, playing positions and activities performed with or without ball. Results revealed PL was lower in jumps compared to sprints [p < 0.001, effect size = 0.68] and HSMs, while PL/min was greater in sprints compared to jumps. Jumps displayed shorter duration compared to sprints and HSMs, with HSMs lasting longer than sprints. Jumps duration was longer in backcourt than frontcourt players. When considering activity patterns combined, PL and duration were greater without ball. Regarding HSMs, PL/min was higher with ball, while duration was longer without ball. The current findings suggest that external load differences in high-intensity activities exist among activity patterns and between activities performed with and without ball, while no differences were found between playing positions. Practitioners should consider these differences when designing training sessions. (shrink)

Background The field of personal health monitoring (PHM) develops rapidly in different contexts, including the armed forces. Understanding the ethical dimension of this type of monitoring is key to a morally responsible development, implementation and usage of PHM within the armed forces. Research on the ethics of PHM has primarily been carried out in civilian settings, while the ethical dimension of PHM in the armed forces remains understudied. Yet, PHM of military personnel by design takes place in a (...) different setting than PHM of civilians, because of their tasks and the context in which they operate. This case study therefore focusses on obtaining insights into the experiences and related values of different stakeholders regarding an existing form of PHM, the Covid-19 Radar app, in the Netherlands Armed Forces. Methods We carried out an exploratory qualitative study, using semi-structured interviews with twelve stakeholders in the Netherlands Armed Forces. We focussed on participation in the use of PHM, reflections on the practical use and use of data, moral dilemmas and the need for ethics support, all in regard to PHM. The data was analysed using an inductive thematic approach. Results Three interlinking categories reflecting ethical dimensions of PHM emerged: (1) values, (2) moral dilemmas, and (3) external norms. The main values identified were: security (in relation to data), trust and hierarchy. Multiple related values were found. Some, but no broadly shared, moral dilemmas were identified and no strong need for ethics support was expressed. Conclusion This study shed light on key values, provide insights in the experienced and presumed moral dilemmas and bring to mind ethics support considerations when looking at PHM in the armed forces. Some values bring a certain vulnerability to military users when personal and organisational interests are not aligned. Furthermore, some identified values may hinder a careful consideration of PHM because they potentially conceal parts of ethical dimensions of PHM. Ethics support can assist in uncovering and addressing these concealed parts. The findings highlight a moral responsibility for the armed forces to devote attention to the ethical dimensions of PHM. (shrink)

Prior research has demonstrated that antisocial behavior, substance-use disorders, and personality dimensions of aggression and impulsivity are indicators of a highly heritable underlying dimension of risk, labeled externalizing. Other work has shown that individual trait constructs within this psychopathology spectrum are associated with reduced self-monitoring, as reflected by amplitude of the error-related negativity (ERN) brain response. In this study of undergraduate subjects, reduced ERN amplitude was associated with higher scores on a self-report measure of the broad externalizing construct that (...) links these various indicators. In addition, the ERN was associated with a response-locked increase in anterior theta (4–7 Hz) oscillation; like the ERN, this theta response to errors was reduced among high-externalizing individuals. These findings suggest that neurobiologically based deficits in endogenous action monitoring may underlie generalized risk for an array of impulse-control problems. (shrink)

In China, Buddhism and Taoism are two major religions. Using a sample of 10,363 firm-year observations from the Chinese stock market for the period of 2001–2010, I provide strong and robust evidence that religion (i.e., Buddhism and Taoism on the whole) is significantly negatively associated with owner-manager agency costs. In particular, using firm-level religion data measured by the number of religious sites within a radius of certain distance around a listed firm’s registered address, I find that religion is significantly negatively (...) (positively) associated with expense ratio (asset utilization ratio), the positive (reverse) proxy for owner-manager agency costs. This finding is consistent with the following view: religiosity has remarkable effects on the way how an individual thinks and behaves, and thereof can curb managers from unethical business practices. Moreover, my findings suggest that the negative association between religion and owner-manager agency costs is attenuated for firms with strong external monitoring mechanisms such as higher Marketization and high-quality auditors. Furthermore, after separating Buddhism from Taoism, my finding indicates that above conclusions are only available for Buddhism, suggesting that different religions may have asymmetric influence on owner-manager agency costs. Above results are robust to various measures of religiosity and a variety of robustness checks. (shrink)

This study examines how the CSR committee and CSR-linked executive compensation jointly affect CSR performance as governance mechanisms. Prior studies provided mixed results on the CSR committee’s effect on CSR performance. We posit that a CSR committee has both a direct and an indirect positive effect on CSR performance, with CSR-linked compensation playing the role of mediator in the relationship. We base our analysis on a sample of 164 Canadian firms covering the period 2012–2018, for a total of 952 firm-year (...) observations. We propose a regression-based approach for our mediation research design. Our findings reveal that CSR-linked compensation mediates the CSR committee’s positive effect on performance, but the type of mediation depends on whether the performance is social or environmental. We provide evidence of both direct and indirect effects on environmental performance but only a positive indirect effect on social performance. These results suggest that demands from the firm’s internal and external stakeholders are treated differently, with the former receiving priority. (shrink)

This paper offers a framework for consciousness of internal reality. Recent PET experiments are reviewed, showing partial overlap of cortical activation during self-produced actions and actions observed from other people. This overlap suggests that representations for actions may be shared by several individuals, a situation which creates a potential problem for correctly attributing an action to its agent. The neural conditions for correct agency judgments are thus assigned a key role in self/other distinction and self-consciousness. A series of behavioral experiments (...) that demonstrate, in normal subjects, the poor monitoring of action-related signals and the difficulty in recognizing self-produced actions are described. In patients presenting delusions, this difficulty dramatically increases and actions become systematically misattributed. These results point to schizophrenia and related disorders as a paradigmatic alteration of a ''Who?'' system for self-consciousness. (shrink)

We investigated whether inconsistencies in previous studies regarding emotional experiences in dreams derive from whether dream emotions are self-rated or externally evaluated. Seventeen subjects were monitored with polysomnography in the sleep laboratory and awakened from every rapid eye movement sleep stage 5 min after the onset of the stage. Upon awakening, participants gave an oral dream report and rated their dream emotions using the modified Differential Emotions Scale, whereas external judges rated the participants’ emotions expressed in the dream reports, (...) using the same scale. The two approaches produced diverging results. Self-ratings, as compared to external ratings, resulted in greater estimates of emotional dreams; positively valenced dreams; positive and negative emotions per dream; and various discrete emotions represented in dreams. The results suggest that this is mostly due to the underrepresentation of positive emotions in dream reports. Possible reasons for this discrepancy are discussed. (shrink)

We propose that local corruption distorts the allocation of government-controlled resources and impairs the contract environment, thereby reducing firms’ use or suppliers’ provision of trade credit. We use a sample of Chinese-listed firms from 2007 to 2020 to examine the role of local corruption in firms’ access to trade credit and find that the level of local corruption is negatively related to firms’ trade credit use. This effect is more pronounced in firms with weak (vs. strong) internal governance, slack (tight) (...) external monitoring and high (low) supplier concentration. The results of path analysis show that local corruption extends short-term bank loans as well as government subsidies and impairs firms’ accounting quality, thereby inhibiting firms’ demand for or suppliers’ provision of trade credit. Moreover, the post-2012 anti-corruption campaign in China plays a significant role in correcting the misallocation of trade credit caused by corruption. The results of this study illuminate the negative external effects of local corruption on trade credit. (shrink)

This article examines the impact of the prevailing state ownership in the Chinese stock market on corporate governance and the financial regulatory system, respectively, as the internal and external monitoring mechanisms to deter corporate fraud and protect investors. In line with the literature that state ownership exaggerates the agency problem, we find that the retained state ownership in privatised firms increases the incidence of regulatory enforcements against fraud. For the state-owned enterprises (SOEs), however, larger state ownership is associated (...) with a lower incidence of enforcement actions. This is attributed to the mutual political affiliation of the fraudulent SOEs and the regulatory commission. A new regulation "Solutions for Listed Firm Checks" promulgated in March 2001 has mitigated this effect by empowering the regulatory commission to increase the severity of regulatory conditions. Our evidence confirms the improvement in the regulatory environment and investor protection in the Chinese stock market brought about by the regulatory reform and development. (shrink)

Trust is both ethically important and essential for business but difficult to measure. This paper contributes toward clarifying the nature of trust in a way that is both conceptually helpful for ethical inquiries concerning business and pertinent to the measurement of trust as an element in organizations. Several papers hypothesize that increasing the role of trust in a corporation reduces the need for external monitoring and contracts. Assessing this important hypothesis requires a way to gauge whether a firm (...) has a trusting corporate culture. We develop an objective measure of trust in a firm’s corporate culture by counting the number of times 21 trust-related words appear in an important kind of document: the Management Discussion and Analysis section of the annual report. We report two significant findings: that, contrary to what one might think, firms with a trusting culture frequently use audit and control-type words and that trust is positively linked with subsequent share price volatility. We propose explanations of these findings with the hope of facilitating the objective measurement of trust and enhancement of a trusting atmosphere in corporate culture. (shrink)

Over the last 20+ years, multinational corporations have been confronted with accusations of abuse of market power and unfair and unethical business conduct especially as it relates to their overseas operations and supply chain management. These accusations include, among others, worker exploitation in terms of unfairly low wages, excessive work hours, and unsafe work environment; pollution and contamination of air, ground water and land resources; and, undermining the ability of natural government to protect the well-being of their citizens. MNCs have (...) responded to these accusations by creating voluntary codes of conduct which commit them to specific standards for addressing these issues. These codes are created at both the industry-wide and the individual company level. Unfortunately, these codes have generated little credibility and public trust because their compliance claims cannot be independently verified, and they lack transparency and full public disclosure. In this article, we present a case study of the voluntary code of conduct by Mattel, Inc., the world’s largest toy company. The code, called the Global Manufacturing Principles, confronts the general criticism leveled against voluntary codes of conduct by creating detailed standards of compliance, independent external monitoring of the company’s compliance with its code of conduct, and making full, and uncensored public disclosure of the audit findings and company’s response in terms of remedial action. We present a detailed account of how Mattel’s voluntary code of conduct was created, implemented, and ultimately abandoned over 9 years. We provide an evaluative analysis of the company’s GMP compliance throughout its life span, which suggests a bell-shaped curve, where early top management commitments were met with pockets of resistance from operational groups, who were concerned about balancing GMP compliance efforts with traditional performance criteria. The early stage response from Mattel’s top management was quick and supported with the requisite resources. As a result, the compliance process accelerated, becoming increasingly more robust and effective. The success of code compliance and increased transparency in public disclosure energized field managers with a sense of professional satisfaction and publicly recognized accomplishments. The decline in GMP compliance was equally steep. When all the easily attainable targets had been reached at the company-operated plants, addressing vendor plants’ compliance presented a new set of challenges, which taxed corporate resources and management commitment. It would seem that value-based and ethics-oriented considerations, i.e., doing the right thing for the right reason, were no longer the driving force for Mattel’s management. Mattel did not see any economic benefit from its proactive stance, when competitors did not seem to suffer adverse consequences for not following suit. The final contributing factor to the code’s abandonment was a widely publicized series of product recalls which absorbed top management’s attention. (shrink)

We discuss how the approach taken by regulators to address financial reporting issues has a significant influence on tone at the top. While tone must ultimately be established internally, regulators are more likely to have a positive impact on the quality of financial reporting by addressing organizational tone. A strong tone at the top should ensure that the financial reports are characterized by greater transparency and complete disclosures, and a regulator’s response will depend upon their perspective as to what motivates (...) management. A compliance-based approach, rooted in agency theory’s assumption that managers act in their own best interests, seeks to mandate desirable behavior through elevated monitoring and reduced managerial discretion. Alternatively, an empowerment-based approach rooted in stewardship theory views managers as trustworthy guardians and grants them greater discretion without burdensome external monitoring. In practice, regulations fall on a continuum between these two approaches. To illustrate the continuum between compliance and empowerment, we present three cases in financial and tax reporting and examine the outcomes of these recent regulatory responses. We then provide conclusions regarding the effectiveness of each regulation by considering how tone was influenced within organizations. (shrink)

Companies that have joined the United Nations Global Compact are required to submit a Communication on Progress, which is an environmental, social, and governance report, to the UNGC every year. If they fail to do so, they are marked and listed as non-communicating on the UNGC website. Using the event study methodology, this study shows that a company that fails to report to the UNGC is penalized in the financial markets with an average cumulative abnormal return of −1.6% over a (...) period of 5 trading days around the event. Although a major critique against the UNGC is that the initiative’s voluntary nature and its lack of external monitoring and sanction mechanisms render it ineffective in terms of the business participants’ implementation of the UNGC principles into their operations, this result suggests that investors may be able to pressure UNGC business participants to increase their compliance with the UNGC requirements and to “walk the talk.”. (shrink)

Using a panel data of 806 U.S. firms from 2006 to 2015, we find that in their ratings of corporate social responsibility performance, firms with top managers who attended religiously affiliated schools outperform their peers with no such managers. The positive relationship between religious school attendance and CSR performance is stronger among firms with lower level of community religiosity or less external monitoring. Our findings lend support to early theoretical work that suggests managerial CSR-oriented values can be key (...) motivating factors for CSR initiatives. (shrink)

During the Nineties Italian politics underwent major changes. Following the uncovering of systemic corruption, the current political establishment was wiped out. The system of representation at both the national and local level underwent a significant transformation that improved voters’ control over their elected representatives. We argue that both events were the consequence of citizens’ demand for greater accountability of public officers. We model the relationship between voters and politicians as a repeated Trust game. In such game, cooperation can be attained (...) by means of external or internal controls. Whereas judicial investigation is an external monitoring mechanism, the electoral reform provides controls internal to the political system. We explain the Italian transition between these different modes of control and show under which conditions a cooperative equilibrium can be established in which voters trust their representatives who in turn act in the public interest. (shrink)

Taking advantage of the China’s recent anti-corruption campaign, we attempt to examine the effect of public governance on a firm’s incentive to commit fraud. Using enforcement actions data from the Chinese Securities Regulatory Commission (CSRC) from 2004 to 2014, we find that, due to enhanced public governance, firms are less likely to commit fraud in the post-campaign period than in the pre-campaign period. We further show that the effect of public governance is more evident in privately held listed firms, in (...) firms with weak legal environment, and in firms in areas with poor local economies. In addition, we find that older CEOs respond less actively to the public governance caused by anti-corruption regulations. This paper offers clear policy implications for business ethics by indicating that public governance provides external monitoring of corporate decisions. (shrink)

Using an international sample of firms from 32 countries, we study the relation between media independence and corporate tax aggressiveness. We measure media independence by the extent of private ownership and competition in the media industry. Using an indicator variable for tax aggressiveness when the firm’s corporate tax avoidance measure is within the top quartile of each country-industry combination, we find strong evidence that media independence is associated with a lower likelihood of tax aggressiveness, after controlling for other institutional determinants, (...) including home-country tax system characteristics. We also find that the effect of media independence is more pronounced when the legal environment is weaker, and when the information environment is less transparent. We contribute to the business ethics literature by documenting the role of independent media as an external monitoring mechanism in constraining corporate tax aggressiveness. (shrink)

We examine the impact of a city’s cultural diversity on a firm’s tax avoidance. Our findings suggest that when a firm is located in a culturally diverse city, it exhibits less TA than a firm located in a less culturally diverse city. The findings are robust to alternative metrics of cultural diversity and TA and after accounting for omitted sample bias and endogeneity. Additional analysis suggests that the negative impact of cultural diversity on a firm’s TA is more salient in (...) a firm with strong managerial incentives or in a city that is characterized by more migration. Furthermore, we document that the negative impact of cultural diversity on TA is more pronounced when firms face strong financial constraints or effective internal and external monitoring. (shrink)

The paper focuses on mainstreaming gender equality goals at the level of local government. On the part of local government, this requires foremost the using these different needs to inform all local governance processes – policymaking, planning, budget allocation, Programme development, local service delivery and performance monitoring – in order to directly address existing gender inequalities. The authors proposed a methodology for assessing the gender orientation of local management systems, which is designed in the following parameters: Gender Focal Point (...) (in the organizational structure), gender-sensitive leadership style, gender budget, gender statistics, and gender planning, gender-responsible performance. The use of qualitative characteristics of gender orientation in the local management system allows for both internal introspection and external monitoring. The analysis technique is proposed to the gender content of the municipality website and applied to the Vienna website as a “best practice” of city governance. The model was tested by assessing the gender mainstream practices of local government bodies in Ukraine. In addition, a comparative analysis, and monitoring of the websites of the municipalities of cities with a population of one million in Ukraine (Kyiv, Kharkiv, Dnipro) was carried out. This will allow municipalities to design an individual trajectory for improving gender-mainstreaming practices. (shrink)

My paper addresses a topic--the implications of Rawls's justice as fairness for affirmative action--that has received remarkably little attention from Rawls's major interpreters. The only extended treatments of it that are in print are over a quarter-century old, and they bear scarcely any relationship to Rawls's own nonideal theorizing. Following Christine Korsgaard's lead, I work through the implications of Rawls's nonideal theory and show what it entails for affirmative action: viz. that under nonideal conditions, aggressive forms of formal equality of (...) opportunity (e.g., sensitivity training, outreach efforts, external monitoring and enforcement) and compensating support (e.g., special fellowship programs, childcare facilities, mentoring, co-op opportunities, etc.) can be justified, but that "hard" and even "soft" quotas are difficult to defend under any conditions. I conclude the paper by exploring the implications of these surprising results for contemporary liberalism more broadly and for constitutional law and public policy. (shrink)

This article analyzes the relationship between corporate social responsibility (CSR) decoupling and financial market outcomes. CSR decoupling refers to the gap between CSR disclosure and CSR performance. More specifically, we analyze the effect of CSR decoupling on analysts’ forecast errors, cost of capital, and access to finance. We also examine the moderating effect of forecast errors on relationships between CSR decoupling and cost of capital and access to finance. For a sample of U.S. firms consisting of 7,681 firm-year observations for (...) the period 2006–2015, our empirical evidence supports the idea that a wider gap results in higher analysts’ forecast errors, a greater cost of capital, and reduced access to finance. In addition, our results show that forecast errors enhance the effect of the CSR decoupling on cost of capital and access to financial resources. We also note that external monitoring, in the form of greater analysts’ coverage, reduces CSR decoupling. (shrink)

A product harm crisis undermines a firm’s reputation as well as its managers’ career outlook. To shake off the stigmatization resulting from the PHC and regain a firm’s legitimacy among stakeholders, managers usually face an ethical dilemma as they choose to be transparent about the crisis’ financial implications or to obfuscate them to neutralize the negative impact of the PHC. We find evidence that managers engage in income-increasing earnings management when their firms experience PHCs. Moreover, while income-increasing earnings management in (...) PHCs reduces the likelihood of customer loss and CEO forced turnover in the short run, such behavior can be deemed opportunistic and unethical as it carries long-run negative consequences in terms of a higher likelihood of accounting restatement and weaker future operating performance. Finally, managers in firms that are subject to stricter external monitoring and managers in firms with proactive ethical policies are less likely to engage in upward earnings management in PHCs. (shrink)

Can doctors maintain good character? This paper shifts the focus from patient care to ethical considerations that bear on the physician and impact her as a person. By decentering patient care, the paper highlights certain factors that habituate a particular way of reasoning that is not conducive to inculcating good character. Such factors include, standards of professionalism, being influenced by external monitors, and emphasis on adherence to guidelines. While such factors may benefit patients, they often adversely affect the character (...) of physicians. (shrink)

This study investigates the conditions under which host country portfolios are more likely to regularize corporate tax behavior. We use a sample comprising data on Japanese multinationals covering 2004 to 2014 to examine the relationship between foreign direct investment host country portfolios and tax avoidance from the perspectives of investor protection and ethical standards. Our multivariate regression results show that the number of countries with strong investor protection/high ethical standards in the FDI host country portfolio is negatively related to tax (...) avoidance. We also find that the effect of investor protection/ethical standards is less pronounced when the degree of indulgence is high. Further analyses show that the relationships we find are affected by disclosure requirements, local regulations, and accounting standards. These findings remain unchanged after several sensitivity checks. Overall, this study contributes to the business ethics literature by showing that FDI host country investor protection and ethical standards are external monitoring mechanisms for mitigating tax avoidance by multinationals. (shrink)

The sex ratio at birth in China exhibits a major occurrence of “missing women” due to the high son preference in Chinese culture. Clearly, the large gender discrepancy in China can be explained not only by ethical, moral, or social fairness theories but also by the economic benefits of women's particular abilities, experiences, and talents. This article examines the influence of female chief financial officers on information disclosure violations in order to highlight women's positive contributions. Our data imply that having (...) a female CFO can dramatically lower the number of companies that fail to disclose information. The results are strong after controlling endogeneity with propensity score matching, Heckman's two-stage self-selection model, and CFO change, as well as controlling the gender of the chairman and chief executive officer, utilizing different study periods, and using exogenous shock. We further examined the moderate effects of CFO power and external monitoring, and we found that CFO power magnifies the negative effect of female CFO on violations; the more the power, the more the negative effect of female CFO on violations. We also found that when the firm has effective external monitoring, there are fewer future infractions of information disclosure. (shrink)

This study of the workings of neural networks in perception and understanding of situations and simple sentences shows that, and how, distributed conceptual constituents are bound together in episodes within an interactive/dynamic architecture of sensorial and pre-motor maps, and maps of conceptual indicators (semantic memory) and individuating indicators (historical, episodic memory). Activation circuits between these maps make sensorial and pre-motor fields in the brain function as episodic maps creating representations, which are expressions in consciousness. It is argued that all consciousness (...) is episodic, consisting of situational or linguistic representations, and that the mind is the whole of all conscious manifestations of the brain. Thought occurs only in the form of linguistic or image representations. The book also discusses the role of consciousness in the relationship between causal and denotational semantics, and its role for the possibility of representations and rules. Four recent controversies in consciousness research are discussed and decided along this model of consciousness: • Is consciousness an internal or external monitoring device of brain states? • Do all conscious states involve thought and judgement? • Are there different kinds of consciousness? • Do we have a one-on-one correspondence between certain brain states and conscious states. The book discusses also the role of consciousness in the relationship between causal and denotational semantics, and its role for the possibility of representations and rules. (Series A). (shrink)

Capitalizing on a unique setting in China where auditors disclose their prosocial activities, we examine the role that auditor social responsibility plays in shaping their performance. In one direction, behavior consistency theory implies that individual auditors exhibiting more social commitment in their off-the-job activities behave similarly during engagements, enhancing the quality of their audits. In the other direction, accounting firms’ internal structures along with external disciplinary forces mute the impact of heterogeneous auditor characteristics on their performance. In a staggered (...) difference-in-differences design, we report a significant fall in the magnitude of companies’ discretionary accruals and the incidence of financial reporting irregularities after their auditors begin contributing to social welfare, relative to companies whose auditors refrain from contributing during the same timeframe. Additional evidence implies that the higher audit quality stems from auditors better protecting their independence and improving their competence in the post-contribution period. Collectively, our results provide insights into the importance of auditors’ prosocial attitudes to their external monitoring. (shrink)

The monitoring role performed by the board of directors is an important corporate governance control mechanism, especially in countries where external mechanisms are less well developed. The gender composition of the board can affect the quality of this monitoring role and thus the financial performance of the firm. This is part of the “business case” for female participation on boards, though arguments may also be framed in terms of ethical considerations. While the issue of board gender diversity (...) has attracted growing research interest in recent years, most empirical results are based on U.S. data. This article adds to a growing number of non-U.S. studies by investigating the link between the gender diversity of the board and firm financial performance in Spain, a country which historically has had minimal female participation in the workforce, but which has now introduced legislation to improve equality of opportunities. We investigate the topic using panel data analysis and find that gender diversity – as measured by the percentage of women on the board and by the Blau and Shannon indices – has a positive effect on firm value and that the opposite causal relationship is not significant. Our study suggests that investors in Spain do not penalise firms which increase their female board membership and that greater gender diversity may generate economic gains. (shrink)

Memory technologies are cultural artifacts that scaffold, transform, and are interwoven with human biological memory systems. The goal of this article is to provide a systematic and integrative survey of their philosophical dimensions, including their metaphysical, epistemological and ethical dimensions, drawing together debates across the humanities, cognitive sciences, and social sciences. Metaphysical dimensions of memory technologies include their function, the nature of their informational properties, ways of classifying them, and their ontological status. Epistemological dimensions include the truth-conduciveness of external (...) memory, the conditions under which external memory counts as knowledge, and the metacognitive monitoring of external memory processes. And lastly, ethical and normative dimensions include the desirability of the effects memory technologies have on biological memory, their effects on self and culture, and their moral status. Whilst the focus in the article is largely philosophical and conceptual, empirical issues such as the way we interact with memory technologies in various contexts are also discussed. We thus take a naturalistic approach in which philosophical and empirical concepts and approaches are seen as continuous. (shrink)

According to phenomenal conservatism or dogmatism, perceptual experiences can give us immediate justification for beliefs about the external world in virtue of having a distinctive kind of phenomenal character—namely phenomenal force. I present three cases to show that phenomenal force is neither pervasive among nor exclusive to perceptual experiences. The plausibility of such cases calls out for explanation. I argue that contrary to a long-held assumption, phenomenal force is a separate, non-perceptual state generated by some metacognitive mechanisms that monitor (...) one’s first-order mental processes and states. This new account advances our understanding of the nature of phenomenal force. (shrink)

How do we know that our own actions belong to us? How are we able to distinguish self-generated sensory events from those that arise externally? In this paper, I will briefly discuss experiments that were designed to investigate these questions. In particularly, I will review psychophysical and neuroimaging studies that have investigated how we recognise the consequences of our own actions, and why patients with delusions of control confuse self-produced and externally produced actions and sensations. Studies investigating the failure of (...) this 'self-monitoring' mechanism in patients with delusions of control will be discussed in the context of the hypothesis that overactivity in the parietal cortex and the cerebellum contribute to the misattribution of an action to an external source (). (shrink)

Environmental degradation and extractive industry are inextricably linked, and the industry’s adverse impact on air, water, and ground resources has been exacerbated with increased demand for raw materials and their location in some of the more environmentally fragile areas of the world. Historically, companies have managed to control calls for regulation and improved, i.e., more expensive, mining technologies by (a) their importance in economic growth and job creation or (b) through adroit use of their economic power and bargaining leverage against (...) weak national governments, regional and international regulatory bodies. More recently, the industry has had to contend with another set of challenges that involved treatment of indigenous people and their traditional land rights, fair treatment of workers, human rights abuses, and bribery and corruption involving local officials and political leaders. These challenges currently fall outside the traditional areas of regulation and control. Nevertheless, they pose serious threat to the industry’s business practices because of their global scope, threat to company’s reputation, and long-term risks of political instability leading to increasing cost of capital. Industry has responded to these challenges by creating voluntary codes of conduct that would signify their intent to comply with higher standards of conduct, and assuage public opinion that no further action is called for. These codes, however, lack any monitoring mechanism and reporting integrity to assure the public that the industry members are indeed meeting their commitments. Consequently, pressure on the industry continues unabated and with ever increasing calls for mandatory regulation and oversight. This article examines the activities of one mining company, Freeport-McMoRan Copper & Gold, Inc., which has taken a radically different approach in responding to these challenges at its mining operations in West Papua, Indonesia. While cooperating with industry-based efforts of voluntary codes of conduct, Freeport also initiated a radically different response through its own voluntary code that would directly focus on issues of human rights, treatment of indigenous people on whose traditional land its mine was located; economic development and job creation and, improvements in health, education, and housing facilities, to name a few. Additionally, the company earmarked large sums of money and involved representatives of the indigenous people in their management and disbursement. The company took an even more radical action when it committed itself to independent external audits of the company’s compliance with the code, and that these findings and company’s responses would be made public without prior censorship by the company. We analyze the nature of corporate culture, vision and risk-taking propensities of its management that would impel the company to embark on a high risk strategy whose outcomes could not be predicted with any degree of certainty before the fact. The parent company also had to confront discontent among the management ranks at the mine site because of cultural differences and management styles of expatriates and local (Indonesian) managers. Finally, we discuss in some detail the extensive and intensive character of a two phase audit conducted by the outside monitors, their findings, and the process by which they were implemented and reported to general public. We also evaluate the strengths and challenges posed by such audits, their importance to the company’s future, and how such projects might be undertaken by other companies. (shrink)

Companies are expected to monitor sustainable behaviour to help improve performance, enhance reputation and increase chances of survival. This paper examines the relationship between sustainability committees and independent external assurance on the inclusion of sustainability-related targets in CEO compensation contracts. Using a sample of UK FTSE350 companies for 2011–2015 and controlling for governance and firm characteristics, we find both board-level sustainability committees and sustainability reporting assurance have a positive and significant association with the inclusion of sustainability terms in compensation (...) contracts. However, there is no joint impact between the voluntary use of independent external assurance and the role of sustainability committees on CEO compensation contracts. Sustainability-related terms in compensation contracts are more likely to be included, and higher compensation is likely to be paid, when assurance is provided by a Big4 firm and when a company operates in a sustainability-sensitive industry. Our findings highlight the potential of assured sustainability reports in assessing CEO performance in sustainability-related tasks, especially when sustainability metrics are included in CEO compensation contracts. Overall, our results suggest companies that invest in voluntary assurance are more likely to monitor management’s behaviour and be concerned about the achievement of sustainability goals. (shrink)

In Europe, telecare is the use of remote monitoring technology to enable vulnerable people to live independently in their own homes. The technology includes electronic tags and sensors that transmit information about the user's location and patterns of behavior in the user's home to an external hub, where it can trigger an intervention in an emergency. Telecare users in the United Kingdom sometimes report their unease about being monitored by a ?Big Brother,? and the same kind of electronic (...) tags that alert telecare hubs to the movements of someone with dementia who is ?wandering? are worn by terrorist suspects who have been placed under house arrest. For these and other reasons, such as ordinary privacy concerns, telecare is sometimes regarded as an objectionable extension of a ?surveillance state.? In this article, we defend the use of telecare against the charge that it is Orwellian. In the United States, the conception of telecare primarily as telemedicine, and the fact that it is not typically a government responsibility, make a supposed connection with a surveillance state even more doubtful than in Europe. The main objection, we argue, to telecare is not its intrusiveness, but the danger of its deepening the isolation of those who use it. There are ways of organizing telecare so that the independence and privacy of users are enhanced, but personal isolation may be harder to address. As telecare is a means of reducing the cost of publicly provided social and health care, and the need to reduce public spending is growing, the correlative problem of isolation must be addressed alongside the goal of promoting independence. (shrink)

Digital medicine is a medical treatment that combines technology with drug delivery. The promises of this combination are continuous and remote monitoring, better disease management, self-tracking, self-management of diseases, and improved treatment adherence. These devices pose ethical challenges for patients, providers, and the social practice of medicine. For patients, having both informed consent and a user agreement raises questions of understanding for autonomy and informed consent, therapeutic misconception, external influences on decision making, confidentiality and privacy, and device dependability. (...) For providers, digital medicine changes the relationship where trust can be verified, clinicians can be monitored, expectations must be managed, and new liability risks may be assumed. Other ethical questions include direct third-party monitoring of health treatment, affordability, and planning for adverse events in the case of device malfunction. This article seeks to lay out the ethical landscape for the implementation of such devices in patient care. (shrink)

According to most accounts of trust, you can only trust other people (or groups of people). To trust is to think that another has goodwill, or something to that effect. I sketch a different form of trust: the unquestioning attitude. What it is to trust, in this sense, is to settle one’s mind about something, to stop questioning it. To trust is to rely on a resource while suspending deliberation over its reliability. Trust lowers the barrier of monitoring, challenging, (...) checking, and questioning. Trust sets up open pipelines between yourself and parts of the external world. Trust permits external resources to have a similar relationship to one as one’s internal cognitive faculties. This creates efficiency, but at the price of exquisite vulnerability. We must trust in this way because we are cognitively limited beings in a cognitively overwhelming world. Crucially, we can hold the unquestioning attitude towards objects and technologies. When I trust my climbing rope, I stop worrying about its reliability. When I trust my online calendaring system, I simply go to the events indicated, without question. But, one might worry, how could one ever hold such a normatively loaded attitude as trust towards mere objects? How could it ever make sense to feel betrayed by an object? Trust is our engine for expanding and outsourcing our agency — for binding external processes into our practical selves. Thus, we can be betrayed by our smartphones in the same way that we can be betrayed by our memory. When we trust, we try to make something a part of our agency, and we are betrayed when our part lets us down. To unquestioningly trust something is to let it in—to attempt to bring it inside one’s practical functioning. This suggests a new form of gullibility: agential gullibility, which occurs when agents too hastily and carelessly integrate external resources into their own agency. (shrink)

The Metacognitive, Affective, Cognitive Experience questionnaire was designed to assess metacognition across sleep and waking . The present research evaluates the psychometric properties of the MACE. Data from two recent studies were used to assess the inter-item consistency, test–retest reliability, and factorial, convergent, and discriminant validity of the MACE. Results show that the MACE is a reliable measure with good construct validity. Exploratory factor analyses revealed one self-regulation and two monitoring factors. One monitoring factor emphasized monitoring internal (...) conditions; the other emphasized monitoring external conditions. This factor structure is consistent with the Metacognitive Model . Tests of convergent and discriminant validity suggest that the MACE is assessing metacognition and is appropriately related to similar constructs such as mindfulness and self-consciousness. The implication of these findings as well as suggestions for research and clinical applications of the MACE are discussed. (shrink)

The criticism that voluntary codes of conduct are ineffective can be met by giving greater centrality to human rights in such codes. Provided the human rights obligations of multinational corporations are interpreted as moral obligations specifically tailored to the situation of multinational corporations, this could serve to bring powerful moral force to bear on MNCs and could provide a legitimating basis for NGO monitoring and persuasion. Approached in this way the human rights obligations of MNCs can be taken to (...) include support for political as well as economic rights. This will go some way towards filling the regulatory gap created by the difficulty of controlling the activities of corporations operating globally. However, such a proposal will require a measure of ‘meta-regulation’ whereby the operations of MNCs are legally required to be sufficiently transparent to create the conditions for effective external moral scrutiny. (shrink)

Patients with psychotic disorders experience a range of reality distortions. These often include auditory-verbal hallucinations, and thought insertion to a lesser degree; however, their mechanisms and relationships between each other remain largely elusive. Here we attempt to establish a integrative model drawing from the phenomenology of both AVHs and TI and argue that they in fact can be seen as ‘spectra’ of experiences with varying degrees of agency and ownership, with ‘silent and internal own thoughts’ on one extreme and ‘fully (...) external and clearly audible voices’ in the absence of a speaker on the other. We believe a spectral model will add emphasis to the continuity of experience and help to better understand how one type of psychotic symptom may interact with another, and put forward the argument that the experience of TI itself is not sufficient to classify as a delusion. In addition we aim to discuss some of the conceptual issues surrounding AVHs and TI with first-person accounts and current philosophical and neuropsychological theories in mind. We propose that the mechanisms behind AVHs and TI are more complex than source-monitoring deficits; indeed, to understand such phenomena one must appreciate that their very ‘existence’ and ‘reality’ as experienced by the individual have much deeper implications and meaning, both philosophically and clinically. (shrink)