We examine whether mood images in an annual report—cosmetic and information-free graphical elements—influence shareholder votes on the say-on-pay (SOP) proposals. Consistent with the cognitive dissonance theory, we find that on average mood images promote heuristic decision making and increase shareholder voting support for SOP proposal. However, in the presence of signals conflicting managers’ SOP proposal, such as a proxy advisor’s investigation of the firm, mood images prompt a more critical evaluation of the SOP resolution by shareholders, which negates their positive effect on SOP resolution support. Our findings reveal the contingent nature of the effect mood images have on shareholder voting behavior.

Incumbent digital firms take different approaches to respond to the competitive threat posed by newcomers, in particular acquiring the startup vs raising one’s game. Incumbents must decide on an appropriate response, yet often fail to do so in due course due to a phenomenon known as ‘incumbent inertia.” I investigate the tradeoffs faced by incumbents in such situations. I cast the incumbent digital firm’s choice as a real-options problem specifying the conditions under which the incumbent ignores the threat or decides to either acquire the innovative startup or raise its game. Incumbent inertia may arise if the incumbent waits until the market is ripe or if the incumbent is ambivalent about the appropriate response, i.e., if the various responses generate payoffs that are nearly equal. Different circumstances explain this latter scenario, depending on the magnitudes of the acquisition and implementation costs and on the respective (option) values of either response. This second rationale has not previously been identified as a cause for incumbent inertia in the literature.

The University of Cyprus and the Cyprus University of Technology are co-organizing two academic research workshops.

The workshop will be held on June 9th and it is devoted to the memory of Professor George Nishiotis. Professor George Nishiotis served as the Chair of the Department of Accounting and Finance of the School of Economics and Management of the University of Cyprus. During his tenure as Chairman he contributed substantially both to the development of the department’s undergraduate and master’s programs in Finance and to the department’s global
recognition as an outstanding research institution among the best in the world. Prof. Nishiotis will always be remembered for his valuable contributions to the community, his dedication to teaching, his research curiosity and excellence and his exemplary collegiality.

“On the crossroads of Accounting and Finance Research and Current issues in Accounting and Finance Research”

“Context matters: The role of fair value footnote narrative”, Argyro Panaretou (Lancaster University)

“Green financing and politicians’ incentives: Evidence from proprietary loan assessment data”, Aaron Yoon (Nortwestern University)

“Federal Regulations on Fair Lending and Sexual Orientation Discrimination in the Mortgage Market”, Scott Liao (University of Toronto)

“Broadband internet and information acquisition costs: Evidence from market response to earnings announcements”, Mohan Venkatachalam (Duke University)

“Subjective Extremeness: Contrast Effects in the Perception of Stock Returns”, Constantinos Antoniou (University of Warwick)

“The role of managerial reporting quality in investment efficiency”, Franco Wong (University of Toronto)

“Is the Goodwill Impairment Only Model Broken? An Examination of Post-Acquisition Accounting for Goodwill versus Other Intangibles”, Anne Beatty (Ohio State University)

“The Determinants and Informativeness of Banks’ Return on Tangible Common Equity Disclosures”, Zac Wiebe (University of Arkansas)

The menace of climate change poses increasing real threats to life on earth and requires immediate actions from all quarters to remedy the situation. The impact of firms actions on climate change has attracted significant attention and discussions abound at national and international level on how firms can be more responsible and accountable for their carbon emissions. Our study examines how an integrated approach to reporting (IR) can be deployed as a tool to drive firms’ understanding and management of their carbon emissions and its implications. Using data from the Johannesburg Stock Exchange (JSE) which is the only capital market where IR is being mandatorily adopted, we draw on organizational learning to explore how IR introduces new knowledge into firm and results in changes in firm behaviours. The results show that firms with better quality of integrated reporting demonstrate better carbon performance. The results are robust to a battery of sensitivity tests and overall support that IR facilitates changes in the internal decision-making process regarding management of carbon emissions.