Fossil Fuel Divestment Strategies

[We’re pleased to welcome authors Dr. Chelsie Hunt and Dr. Olaf Weber of the University of Waterloo. They recently published an article in Organization & Environment entitled “Fossil fuel divestment strategies: Financial and carbon-related consequences,” which is currently free to read for a limited time. Below, they reflect on the inspirations, challenges, and related papers to their research:]

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The research on this paper has been motivated by the discussion about whether fossil fuel divestment decreases financial returns. This question is discussed controversially in academia and practice. Since the Canadian financial market is very fossil fuel heavy, it was interesting to understand both, financial and carbon related consequences of different fossil fuel divestment strategies.

Another influence is the intensive public discussion about how to mitigate climate change. As divestment is proposed as one way to address the problem, we wanted to understand the effect of this type of socially responsible investment that has been promoted by the NGO 350.org. However, divestment moved from being a niche political activity of NGO to the center of institutional investing with a number of big institutional investors announcing divestment from fossil fuels.

A challenging part of this research is the quality of climate related corporate data. Though many firms disclose their carbon related data, there are still gaps and the risk of biases because often those with higher carbon performance publish their data. However, I think we used an innovative approach that correlated both financial and carbon related performance to analyze whether divestment really has an effect on the decarbonization of financial portfolios.

The results might influence investors with regard to divestment decisions and also contributes to finance research by adding non-financial risks to the equation. Maybe they also influence younger scholar to conduct research in this field though it is still often seen as a niche in general corporate and financial performance research.

Finally, we would like to mention three other papers in the field that have been extremely interesting. First, it is a paper that discusses why financial implications of climate risks are not discussed in conventional financial journals (Diaz-Rainey, Robertson, & Wilson, 2017). Second, there are two more papers that discuss the consequences of fossil fuel divestment that suggesting no negative financial effects from fossil fuel divestment (Henriques & Sadorsky, 2017; Trinks, Scholtens, Mulder, & Dam, 2018)

References
Diaz-Rainey, I., Robertson, B., & Wilson, C. (2017). Stranded research? Leading finance journals are silent on climate change. Climatic Change, 143(1), 243-260. doi:10.1007/s10584-017-1985-1

Henriques, I., & Sadorsky, P. (2017). Investor implications of divesting from fossil fuels. Global Finance Journal. doi:https://doi.org/10.1016/j.gfj.2017.10.004

Trinks, A., Scholtens, B., Mulder, M., & Dam, L. (2018). Fossil Fuel Divestment and Portfolio Performance. Ecological Economics, 146, 740-748. doi:https://doi.org/10.1016/j.ecolecon.2017.11.036

 

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How Changes in the House Advantages of Reel Slots Affect Game Performance

backgammon-2488089_1920[We’re pleased to welcome authors Dr. Anthony F. Lucas of the University of Nevada and Katherine Spilde of San Diego State University. They recently published an article in Cornell Hospitality Quarterly entitled “How Changes in the House Advantages of Reel Slots Affect Game Performance,” which is currently free to read for a limited time. Below, they reflect on the inspiration for conducting this research:]

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Our motivation for this research stemmed from inquiries regarding extant policies for par selection and from the results of our previous research projects. Our prior work suggested that the highly skewed outcome distributions of modern slot machines would obscure even considerable differences in programmed casino advantages (i.e., pars), especially given the limited number of trials produced by individual players. In spite of these results, many industry stakeholders and casino operators contended that experienced players from high-visitation segments would be able to detect such differences over time. It was for these reasons that we decided to conduct the longitudinal field study with data collected from venues relying on a repeat clientele.

Our work is the first to focus on the longitudinal effects of par on unit-level game performance, within live casino settings. The results of our study were surprising in a couple ways. First, the high par games outperformed their low par counterparts, in terms of theoretical win. This surprised many operators who believed that frequent players would quickly recognize the value of the low par games, which were located a mere three feet away. Second, there was a lack of evidence of play migration, i.e., from the high par games to the low par games. The time series analyses failed to indicate a statistically significant and positive change in the magnitude of differences for both daily coin-in and theoretical win levels, over the sample periods. That is, the data failed to indicate a growing recognition of the differences in pars. If players were able to detect such differences we would expect to see both increased play and theoretical win levels on the low par game, over time. We would also expect to see simultaneous decreases in the same metrics on the high par game. To the contrary, these difference metrics remained stable within each two-game pairing, in spite of the clear economic disincentive for players to risk and lose bankroll to the game with the greater par.

Our results present an empirical challenged to the innervate wisdom regarding player hypersensitivity to par settings. Other slot operating paradigms related to “price” positioning and revenue optimization strategies are also contradicted by our findings. Because these all represent critical operating platforms, we are not sure how this work will ultimately impact the gaming industry. In large part, it depends on the willingness of those within it to re-examine longstanding beliefs and predispositions, and place evidence above instinct. While we expect some operators to accelerate in-house experimentation, it is likely that many will wait for future research, which we have in the pipeline.

It should be noted that without the cooperation of willing casino operators this research cannot be completed. They deserve a great deal of credit for bringing this work to light. Open minds bring positive change.

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How Do Senior Leaders Navigate the Need to Belong?

[We’re pleased to welcome author Dr. Jessy Zumaeta of the University of Chile and the London School of Economics. Dr. Zumaeta recently published an article in Journal of Leadership & Organizational Studies entitled “Lonely at the Top: How Do Senior Leaders Navigate the Need to Belong?” which is currently free to read for a limited time. Below, Dr. Zumaeta speaks about the motivations, challenges, and findings of this research:]

JLOS_72ppiRGB_powerpointWhat motivated you to pursue this research?

I’m very interested in Leadership research and practice. Leaders may contribute to a great extent to organizations’ success or failure. They can make organizations and its people to thrive or, on the contrary, leaders may block employees’ and organizations’ progress. Due to the importance of their role, managers at the top echelons of organizations are usually highly pressured to deliver results. Among other things, I wanted to explore to what extent these pressures affected the person behind the professional mask.

What has been the most challenging aspect of conducting your research

Considering the abundant leadership literature, I wanted to look at it from a novel perspective, so I started to explore these kind of questions: How does it feel to be a senior leader? What are the main challenges? How do top managers experience their role? I did my research to shed light on leaders’ experiences in their role, going beyond the common view of the leader as a hero. My investigation focused on senior leaders as people with personal and social needs, as everyone else.

Were there any surprising findings?

In the interviews that I conducted, I could gather very personal accounts that may give the reader a good sense of what is like to perform a high-ranked leadership role in a corporate context on a daily basis. It was surprising to me the high degree of openness that the leaders showed during the interviews, which seem to contrast with the usual levels of authenticity that they are able to perform among other workers.

What advice would you give to new scholars and incoming researchers in this particular field of study?

Organizations can be very difficult places, even for those that we all deem as super powerful. In consequence, I think we have to look at leadership phenomenon from different perspectives. It is a misleading message to think about top leaders as glamorous or highly desirable roles. Senior leaders have great responsibilities and setting them apart from the rest of people, it doesn’t seem to be helping organizations or leaders themselves. We need more workplaces centered on real people and their fundamental needs.

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Call for Editor: Journal of Applied Behavioral Science

The NTL Institute invites applications for the Editorship of the Journal of Applied Behavioral Science.

The Journal of Applied Behavioral Science isJABS_72ppiRGB_powerpoint the leading international journal on the effects of evolutionary and planned change. Founded and sponsored by the NTL Institute, the Journal is continually breaking ground in its exploration of group dynamics, organization development, and social change.

For more details click here.

 

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What Motivated CEO Wrongdoing?

[We’re pleased to welcome authors Karen Schnatterly of the University of Missouri, K. Ashley Gangloff of the University of Missouri, Anja Tuschke of the Ludwig-Maximilians-Universität München. They recently published an article in the Journal of Management entitled “CEO Wrongdoing: A Review of Pressure, Opportunity, and Rationalization,” which is currently free to read for a limited time. Below, Dr. Schnatterly reveals the inspiration for conducting this research :]

JOM_44.1_72ppiRGB_powerpointWe were motivated to explore CEO wrongdoing because of its prominence in popular press headlines and in academic publications. We know CEOs engage in or facilitate wrongdoing, and have known for a long time. Mechanisms exist that should limit or prevent it, yet it still occurs! Not even the terrible consequences of wrongdoing prevents it from happening. For all of these reasons, we were interested in understanding why it still occurs. Moreover, if we know more about the internal and external forces that foster or allow for CEO misbehavior, we can better help organizations choose CEOs and build structures and processes that are more effective in encouraging ethical behavior.
In this review paper, we examined scholarship over the past 10 years on the antecedents to CEO wrongdoing. We adopted a framework from accounting and applied it to the management literature to structure our review in a way such that we would see gaps in the current literature. (We recommend this approach to other scholars, by the way.) The gaps were interesting. The Fraud Triangle suggests that when pressure (‘I have to’), opportunity (‘I can’) and rationalization (‘it’s okay’) are possible, wrongdoing is more likely. We found extensive research in the area of pressures applied to the CEO to commit wrongdoing—this was to be expected as much management literature deals with CEO compensation or activist investors, for example, both examples of pressure on the CEO. We did find much research on the role of the CEO’s status (whether they have it and don’t want to lose it, or don’t have it and want it) on wrongdoing.

There were more gaps in both opportunity and rationalization. We think this is largely because factors in these areas are harder to measure—this takes us outside of our comfort zone. But, it also makes them very interesting.
We were surprised by the gaps in the literature regarding CEOs’ opportunity to misbehave. While there is literature on CEO structural power (e.g., duality), CEO ownership, and board monitoring, there is very little research on the deeper nuances of these issues—do CEOs create distractions to enable them to commit wrongdoing? Are certain board characteristics or board members likely to create more opportunity than others are?

Finally, there is very little work on the CEO’s ability to rationalize his or her wrongdoing beyond simple demographic variables or personality traits (e.g., Machiavellianism). Are there behaviors that influence the CEO’s ability to rationalize wrongdoing? Or firm characteristics? Or board characteristics? Do large-scale firm events, like an M&A, require such effort that the CEO commits fraud, and rationalizes it as ‘otherwise the merger would fail?’
As with any good review paper, we hope we brought together previous research, identified gaps, and generated a number of questions that can now be tested. We also think we generated some things for practitioners to think about.

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Expatriates’ Performance Profiles

[We’re pleased to welcome authors Dr. Riki Takeuchi of the University of Texas at Dallas, Yixuan Li of the University of Florida and Mo Wang of the University of Florida. They recently published an article in Journal of Management entitled “Expatriates’ Performance Profiles: Examining the Effects of Work Experiences on the Longitudinal Change Patterns,” which is currently free to read for a limited time. Below, Dr. Takeuchi reveals the inspiration for conducting this research :]

JOM_44.1_72ppiRGB_powerpointWhat motivated you to pursue this research?

If you are talking about this particular study, the basic motivation is to understand further what causes expatriates to differ in their performance while overseas. While many scholars, including myself, have focused on cross-cultural adjustment as an important antecedent of performance, we actually do not have a very good understanding of factors that causes performance since adjustment only explains a small portion (10-15%) of variance in expatriate performance (see meta-analysis by Bhaskar-Shrinivas, Harrison, Shaffer, & Luk, 2005) and I had a suspicion that this may be partly due to variation in the performance levels for different “groups” of expatriates. Having this four-wave longitudinal data allowed me to test such an idea and I must thank Mo for getting this data.

Were there any specific external events—political, social, or economic—that influenced your decision to pursue this research?

When I was 11 years old, I moved to Raleigh, NC, because my father took a visiting position at North Carolina State University for 2 years so I’ve had to adjust to a foreign culture and re-adjust back to Japanese culture. This prompted me to identify cross-cultural adjustment issues as one important research area. So, you could say that this was a social event that influenced my decision to pursue this line of research, including this particular study.

What has been the most challenging aspect of conducting your research? Were there any surprising findings?

I’d like to comment more broadly on the most challenging aspect of conducting expatriation research, which is data accessibility and the mismatch between (many) reviewers’ high expectations regarding research design rigor and actual design/data quality. Given that expatriates typically are middle-level managers who are in charge of the foreign subsidiary spread across many countries, having access to multi-wave and/or multi-level data is significantly more difficult than collecting data from employees and managers who are co-located in one particular area, be it across time or across levels (teams and individuals). Thus, I don’t think it fair to apply the same standard for different types of research (experiment, field survey, qualitative study, for instance) and topics (e.g., coworker influence or justice, to pick from my own research interests) because the challenges associated with expatriation research is quite different from challenges associated with a different topic.

For this study, one of the most surprising finding is the existence of a low performance group who did/could not improve their performance over the two years period. In retrospect, this may make more sense as these individuals are more likely the ones terminating their assignment early.

In what ways is your research innovative, and how do you think it will impact the field?

In the past, there is an implicit assumption underlying existing expatriation literature that an entire population of expatriates holds a uniform performance change pattern. Our research is among the first to challenge this assumption and explore the possibility that expatriates may vary in terms of their performance change patterns over the course of international assignment. Using latent class growth analysis, we identified the coexistence of four distinct longitudinal change patterns of expatriate job performance based on different types of experiences one has accumulated (international, job, and organization), which is a distinct contribution to the expatriation literature. 

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New special issue on precarious labour from Work, Employment and Society

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[We are pleased to welcome Gabriella Alberti, Ioulia Bessa, Kate Hardy, Vera Trappmann and Charles Umney from Leeds Business School. They recently edited a special issue for Work, Employment and Society on precarious labour.]

The special issue In, Against and Beyond Precarity: The Struggles of Insecure Workers received almost 100 submissions, one of the highest in the history of the British Sociological Association’s journals. The call for papers was launched following the 2016 Work, Employment and Society conference organised by Centre of Employment Relations Innovation and Change at the University of Leeds. The volume of submissions reflects the level of academic interest in the topic and its political relevance. As workers’ power relative to capital has weakened, the use of the term has rapidly expanded. It is often used to describe a rise in contingent forms of employment (such as short-term or zero-hours contracts), but also to denote an increase in more subjective perceptions of insecurity among workers. There is therefore a risk of overusing the term, or stretching its meaning beyond recognition. We sought to address some of these problems in compiling the special issue.

In our introduction, we argue that it is more useful to think of ‘precarity’ not as the defining characteristic of a particular social group or class (as in Guy Standing’s notion of the “precariat” which is widely influential among many sociologists) but as a process of precarisation that encompasses increasing insecurity observable across a much wider range of employment contexts, and an increasing uncertainty through peoples’ life courses. The articles selected in the special issue identify different drivers of precarisation. Sometimes, it is driven through employer efforts to directly undermine workers’ job security. Companies may rely on outsourcing or forcing workers into dubious self-employment to secure more ‘flexible’ (read: insecure) labour sourcing (as shown by Moore and Newsome’s article). Governments themselves may also restructure their own supply chains leading to intensified insecurity for public service workers, or else normalise insecurity in the wider economy through changes to welfare systems (as discussed in Jaehrling et al. and Rubery’s contributions to our issue respectively).

Other contributions also show how restrictions on people’s wider rights as citizens can have profound effects on work. In different ways this is evidenced by two contributions on China: by Pun and Smith who examine the legal restrictions which subordinate the emerging Chinese working class, and in Choi’s study of Chinese taxi drivers forbidden from owning their own vehicles. It is also demonstrated by Simola’s discussion of “citizenship precarisation”: in which young university-educated intra-EU migrants’ access to benefits, health and social assistance have become increasingly conditional upon complex entitlement requirements.

Finally, it is also important to recognise a much more diffuse process of implicit ‘precarisation’, which is revealed in many studies of working life extending well beyond only those focusing on low-paid, low-skilled jobs. In our special issue, this is compellingly illustrated by Hassard et al., who show how company policies in pursuit of competitiveness have led to a much stronger perception of job insecurity among managerial professionals (along with a belief among younger managers that this was becoming the new normal).

Which actors are best placed to combat these processes of ‘precarisation’? First, we should not be defeatist about the role that can be played by workers themselves. Manky’s study of outsourced Chilean mine workers shows the surprising levels of industrial power they were able to wield given support from sympathetic political actors. Alternatively, Jaehrling’s study shows the value of direct political interventions (such as implementing clauses in government procurement contracts) in mitigating the consequences of supply chain restructuring. Ultimately, the special issue underlines the urgent need for a research agenda which is more empirically grounded and more imaginative in engaging with people’s security in work and the diverse ways in which it is being undermined.

The special issue In, Against and Beyond Precarity: The Struggles of Insecure Workers is free to access until 2 July 2018.