Recent Submissions

  • The relevance of climate-related information to analysts

    Brié, Bjarne; Stouthuysen, Kristof; Verdonck, Tim (2023)
    We investigate the usefulness of emission information and climate-related annual report disclosures to financial analysts. We extract climate disclosures from annual reports using a state-of-the-art machine learning model, ClimateBert, and automatically identify and quantify the underlying disclosure topics using a structural topic model. For a large international sample of firms subject to a European nonfinancial disclosure mandate, we find that analysts face greater uncertainty while forecasting future earnings for firms with greater emission intensities and for firms that show weaker commitment to reducing emissions. We also show that the aggregate level of climate disclosure does not significantly reduce this uncertainty. However, we do find that disclosure on a specific set of topics improves analysts’ ability to forecast future earnings. Nevertheless, for firms with greater emission intensities, this relationship reverses. These findings suggest that, overall, current climate reporting practices are not informative to analysts since they do not mitigate the uncertainty inherent to the potential impacts of climate change.
  • Mandatory CSR reporting in Europe: A textual analysis of firms’ climate disclosure practices

    Brié, Bjarne; Stouthuysen, Kristof; Verdonck, Tim (2023)
    We introduce a machine learning approach that accurately captures disclosure quality by quantifying the thematic content of climate reporting in annual reports. We then use our approach to analyze firms’ climate reporting practices in the context of the widespread European Non-Financial Reporting Directive. For a large sample of annual reports from 2010 to 2020, we find that firms significantly changed their climate reporting narratives in the periods following the announcement and implementation of the mandate. Using the Task Force on Climate-Related Financial Disclosures’ framework as the benchmark for high-quality climate reporting, we show that these changes correspond with improvements in disclosure quality. We further show that the comparability of reporting improves over time and provide first descriptive evidence of a more pronounced comparability change in the years following the implementation of the mandate. Overall, our results highlight the validity of our model and provide further descriptive evidence on the disclosure impact of nonfinancial reporting regulation. Our study also adds to the growing body of research applying machine learning to analyze information from annual reports.
  • Mandatory CSR reporting in Europe: A textual analysis of firms’ climate disclosure

    Brié, Bjarne; Stouthuysen, Kristof; Verdonck, Tim (2023)
    We introduce a machine learning approach that accurately captures disclosure quality by quantifying the thematic content of climate reporting in annual reports. We then use our approach to analyze firms’ climate reporting practices in the context of the widespread European Non-Financial Reporting Directive. For a large sample of annual reports from 2010 to 2020, we find that firms significantly changed their climate reporting narratives in the periods following the announcement and implementation of the mandate. Using the Task Force on Climate-Related Financial Disclosures’ framework as the benchmark for high-quality climate reporting, we show that these changes correspond with improvements in disclosure quality. We further show that the comparability of reporting improves over time and provide first descriptive evidence of a more pronounced comparability change in the years following the implementation of the mandate. Overall, our results highlight the validity of our model and provide further descriptive evidence on the disclosure impact of nonfinancial reporting regulation. Our study also adds to the growing body of research applying machine learning to analyze information from annual reports.
  • A comparison of activity ranking methods for taking corrective actions during project control

    Vaseghi, Forough; Vanhoucke, Mario (Computers & Industrial Engineering, 2023)
    Monitoring and controlling projects in progress is key to support corrective actions in case of delays and to deliver these projects timely to the client. Various project control methodologies have been proposed in literature to include activity variability in the project schedule and measure the performance of projects in progress. Much of these studies rely on a schedule risk analysis to rank activities according to their time sensitivity and expected impact on the total project duration. This paper compares two classes of activity ranking methods to improve the corrective action process of projects under uncertainty. Each method ranks activities based on certain criteria and places the highest ranked activity in a so-called action set that is then used to take certain corrective actions. The first method is the analytical based ranking method which relies on exact or approximate analytical calculations to provide a ranking of activities. This analytical ranking method will be compared with a second simulation-based ranking method that relies on Monte Carlo simulations to measure the sensitivity of each activities. Results on a set of artificial projects show that the analytical ranking method and one specific simulation-based ranking outperform all other methods, not only for predicting the contribution of actions on the expected project duration and its variability, but also in the efficiency of the project manager’s control.
  • Regulatory sandboxes: Do they speed up innovation in energy?

    Beckstedde, Ellen; Correa Ramírez, Mauricio; Cossent, Rafael; Vanschoenwinkel, Janka; Meeus, Leonardo (Energy Policy, 2023)
    Regulatory sandboxes are generally seen as an important tool to make policy and regulation evolve with the changes in our energy system and to create an equal playing field for new technologies and business models that arise with the energy transition. Although an increasing number of legal frameworks on regulatory sandboxes are being implemented in Europe, the pioneers in the Netherlands decided to close their sandbox program. These contradictory events lead to questions about the potential of regulatory sandboxes to bring innovation to the European energy sector. This paper contributes to this discussion by examining the experiences with regulatory sandboxes in Austria, Belgium, France, Germany, Great Britain, the Netherlands, Norway and Spain. We compare approved sandbox projects based on their scope and regulatory derogations to identify areas of innovation and regulatory learning brought by regulatory sandboxes. We also examine the legal frameworks of the concerned countries to evaluate the interaction between the implementation of the framework and its potential to bring innovation. In this way, we develop best practices on the topics of regulatory sandboxes and their implementation frameworks.
  • Linking production geography and financial performance

    von Dzengelevski, Oliver; Netland, Torbjørn H.; Vereecke, Ann; Ferdows, Kasra (International Journal of Operations and Production Management, 2023)
    Purpose – When is manufacturing in high-cost environments and more profitable for multinational manufacturers and when in low-cost environments? While the literature offers many cues to answer this question, too little empirical research directly addresses this. In this study, we quantitatively and empirically investigate the financial effect of companies’ production footprint in low-cost and high-cost environments for different types of production networks. Design/methodology/approach – Using the data of 770 multinational manufacturing companies, we analyze the relationship between production footprints and profitability during four calendar semesters in 2018 and 2019 (N 5 2,940), investigating the moderating role of companies’ production network type. Findings – We find that companies with networks distinguished by both high levels of product complexity and process sophistication profit the most from producing to a greater extent in high-cost countries. For these companies, shifting production to low-cost countries would be associated with negative performance implications. Practical implications – Our findings suggest that the production geography of companies should be attuned to their network type, as defined by the companies’ process sophistication and product complexity. Manufacturing in low-cost countries is not always the best choice, as doing so can adversely affect profits if the products are highly innovative and the production processes are complex. Originality/value – We contribute to the scarce empirical literature on managing global production networks and provide a data-driven analysis that contributes to answering some of the enduring questions in this critical area
  • Contracting in private equity-backed buyouts

    Wynant, Luc; Manigart, Sophie (2023)
    Private equity (PE)-backed buyouts are transactions in which a business or business units are acquired from its current shareholders by a PE investor together with the management team (Gilligan and Wright 2014; Renneboog and Vansteenkiste 2017), and in which the PE investor typically becomes the majority shareholder. PE investors are professional investors who invest in private companies with the aim to create value in the medium term, through enhancing governance, providing strategic advice and access to networks (Manigart et al. 2022). As they rely on the management team to execute the value creation process, agency problems may arise between PE investors as principals and the management as agents (Jensen 1989). To mitigate potential agency problems, elaborate contracts are negotiated between PE investors and management, but also between the buyers and the sellers....
  • Optimal robust inventory management with volume flexibility: Matching capacity and demand with the lookahead peak-shaving policy

    Gijsbrechts, Joren; Imdahl, Christina; Boute, Robert; Van Mieghem, Jan A. (Production and Operations Management, 2023)
    We study inventory control with volume flexibility: A firm can replenish using period-dependent base capacity at regular sourcing costs and access additional supply at a premium. The optimal replenishment policy is characterized by two period-dependent base-stock levels but determining their values is not trivial, especially for non-stationary and correlated demand. We propose the Lookahead Peak-Shaving policy that anticipates or peak shaves orders from future peak-demand periods to the current period, thereby matching capacity and demand. Peak shaving anticipates future order peaks and partially shifts them forward. This contrasts with conventional smoothing, which recovers the inventory deficit resulting from demand peaks by increasing later orders. Our contribution is three-fold. Firstly, we use a novel iterative approach to prove the robust optimality of the Lookahead Peak-Shaving policy. Secondly, we provide explicit expressions of the period-dependent base-stock levels and analyze the amount of peak shaving. Finally, we demonstrate how our policy outperforms other heuristics in stochastic systems. Most cost savings occur when demand is non-stationary and negatively correlated, and base capacities fluctuate around the mean demand. Our insights apply to several practical settings, including production systems with overtime, sourcing from multiple capacitated suppliers, or transportation planning with a spot market. Applying our model to data from a manufacturer reduces inventory and sourcing costs by 6.7%, compared to the manufacturer's policy without peak shaving.
  • Resource dependencies and the legitimatization of grocery retailer’s social evaluations of suppliers

    Gorton, Matthew; Kastenhofer, Klaus; Lemke, Fred; Esquivel, Luis; Nicolau, Mariana (Journal of Business Ethics, 2023)
    Multinational corporations (MNCs) are increasingly judged not only on their own social impacts but also on those of their supply chain partners. To reduce this environmental dependence, many MNCs implement social evaluations and codes of conduct which suppliers must follow. But how do MNCs legitimise and implement social evaluations in their supply chains? To address this, we draw on and augment resource dependence and legitimacy theories, to analyse a multinational grocery retailer’s implementation of labour standards for its fruit and vegetable suppliers. The case study utilises interviews, analysis of a database of audits, internal documents, and observational data. It provides the basis for theorizing corporate reputation as a resource dependency, with social evaluations a distinct means to co-opt external actors to preserve the focal organization’s autonomy while reducing environmental contingencies. The legitimacy of social evaluations of supply chain partners depends on processes that reconcile both moral and pragmatic concerns, allowing the focal organization to mitigate resource dependencies without ceding control over enforcement and enabling actions.
  • Reviving the stalled revolution of the working mother: Multi-level intervention paths towards more gender balance

    Boros, Smaranda (Journal of Community and Applied Social Psychology, 2022)
    This commentary advances evidence-based propositions for interventions targeting the stalled side of the gender revolution: gender balanced roles in the home domain. Such interventions should be approached in a multi-level frame, from (1) socialization; to (2) family-level interventions; (3) organisational policies; and (4) societal policy/governance levels. Please refer to the Supplementary Material section to find this article's Community and Social Impact Statement.
  • Common short selling and excess comovement: Evidence from a sample of LSE stocks

    Valerio Geraci, Marco; Gnabo, Jean-Yves; Veredas, David (Journal of Financial Markets, 2023)
    For a sample of 356 LSE stocks from the period 2013–2019, we find that common short sold capital is positively and significantly associated with one-month ahead four-factor residual return correlation, controlling for many pair characteristics, including similarities in size, book-to-market, and momentum. The relation weakens with stock illiquidity, whereas it strengthens when short positions originate from informed agents, such as hedge funds, active investors, and short sellers with high past performance. This supports our hypothesis that the relation is driven by information, not price pressure. We show that these results can be used to obtain diversification benefits.
  • Value in psoriasis (IRIS) trial: Implementing value-based healthcare in psoriasis management – a 1-year prospective clinical study to evaluate feasibility and value creation

    Hilhorst, Niels; Roman, Erin; Borzée, Joke; Deprez, Elfie; Hoorens, Isabelle; Cardoen, Brecht; Roodhooft, Filip; Lambert, Jo (BMJ Open, 2023)
    Introduction: Currently, the healthcare sector is under tremendous financial pressure, and many acknowledge that a dramatic shift is required as the current system is not sustainable. Furthermore, the quality of care that is delivered varies strongly. Several solutions have been proposed of which the conceptual framework known as value-based healthcare (VBHC) is further explored in this study for psoriasis. Psoriasis is a chronic inflammatory skin disease, which is associated with a high disease burden and high treatment costs. The objective of this study is to investigate the feasibility of using the VBHC framework for the management of psoriasis. Methods and analysis This is a prospective clinical study in which new patients attending the psoriasis clinic (PsoPlus) of the Ghent University Hospital will be followed up during a period of 1 year. The main outcome is to determine the value created for psoriasis patients. The created value will be considered as a reflection of the evolution of the value score (ie, the weighted outputs (outcomes) divided by weighted inputs (costs)) obtained using data envelopment analysis. Secondary outcomes are related to comorbidity control, outcome evolution and treatment costs. In addition, a bundled payment scheme will be determined as well as potential improvements in the treatment process. A total of 350 patients will be included in this trial and the study initiation is foreseen on 1 March 2023. eEthics and dissemination This study has been approved by the Ethics Committee of the Ghent University Hospital. The findings of this study will be disseminated by various means: (1) publication in one or more peer-reviewed dermatology and/or management journals, (2) (inter)national congresses, (3) via the psoriasis patient community and (4) through the research team’s social media channels.
  • When and how developmental rewards and expected contributions relate to emotional exhaustion through work engagement: The multilevel moderating role of the leader’s work pressure

    Gils, Willemijn; Audenaert, Mieke; Patient, David; Decramer, Adelien (Review of Public Personnel Administration, 2023)
    This study focuses on public secondary schools to examine the extent to which leader-level job demands impact the relationship between employees’ job resources, job demands, and well-being. Specifically, we investigate (1) how teachers’ developmental rewards and expected contributions relate to their work engagement and emotional exhaustion and (2) the role of school principals’ work pressure in this relationship. Building on recent developments in job demands-resources (JD-R) theory, we argue a leaders’ work pressure can trickle down to the employee level. Hierarchical linear analyses reveal that principals’ work pressure moderates the relationship between teachers’ expected contributions and emotional exhaustion. We thus add to JD-R theory by suggesting that employee work outcomes are also shaped by job demands at the leader level. Policies aimed at improving employee well-being should therefore be based on a comprehensive image of the organization that also takes the leader’s job demands into account.
  • On the complexity of efficient multi-skilled team composition

    Snauwaert, Jakob; Van Eynde, Rob; Vanhoucke, Mario (Computers & Operations Research, 2023)
    Workers that master multiple skills increase the flexibility and the working range of teams in organizations. Efficient multi-skilled team formation or workforce composition is therefore paramount for the organization’s success. In this paper, we study various multi-skilled workforce formation problems that are complementary to problems in the scheduling literature. The goal of these problems is to design a set of multi-skilled workers (or resources) that can fulfill a certain skill demand. More specifically, we investigate the complexity of problems that minimize the skill availability or the size of the workforce. Next, we look at the impact of specific skill and worker characteristics on the complexity of these problems. We propose a set of fixed individual multi-skilled workforce problems, in which the number of available skills per skill type or the number of mastered skills per worker is defined upfront. Furthermore, we introduce and discuss the complexity of fixed total multi-skilled workforce problems in which either the total skill availability or the workforce size is fixed and the other quantity is minimized. We conclude this paper by applying the presented problems to real-life projects and by performing computational experiments that analyze the empirical hardness of the multi-skilled workforce problems.
  • Constructive heuristics for selecting and scheduling alternative subgraphs in resource-constrained projects

    Nekoueian, Rojin; Servranckx, Tom; Vanhoucke, Mario (Computers & Industrial Engineering, 2023)
    In this paper, we investigate two constructive heuristics based on existing and newly developed priority rules (PRs) for the resource-constrained project scheduling problem with alternative subgraphs (RCPSP-AS). The RCPSP-AS deals with scheduling the selected activities from work packages that can be executed in different ways, resulting in a selection and a scheduling subproblem. The inclusion of alternatives in the project structure implies that even moderate-sized projects become very large, motivating the use of PR-based approaches. In the existing literature, many PRs were already developed for the scheduling subproblem, however, no studies have focused on specific PRs for the selection subproblem. Therefore, we examine the performance of previously developed PRs for the RCPSP-AS and observe that employing a unique PR for each subproblem decreases the project makespan. Based on this knowledge, we develop two constructive heuristics based on well-suited PRs. In the first constructive heuristic, distinct PRs are selected based on the project properties, while several schedules according to different PRs are generated in the second constructive heuristic. Our experiments show that project managers should consider the project properties and select the appropriate selection PRs accordingly in order to minimise the project makespan in the RCPSP-AS.
  • Being (like) a leader. Essays on the effects of leaser identity through a social identity lens

    Desmet, Lien (2023)
    Although research on leader identity has been ongoing for twenty years, there are still considerable gaps in the literature, in particular related to its potential drawbacks. This dissertation employs social identity theory to examine the effects of having or lacking a leader identity on managers, non-managers, and their surroundings. While our research strengthens existing research on the benefits of having a leader identity, it also presents an argument for a more nuanced approach, acknowledging that having a leader identity may also lead to unwanted outcomes. These findings not only enhance our understanding of leader identity but also contribute to the broader leadership and organizational behavior literatures, including research streams on leadership behavior, performance, well-being and impression management.
  • Preparing for scaling: A study on founder role evolution

    Van Lancker, Evy; Knockaert, Mirjam; Collewaert, Veroniek; Breugst, Nicola (Journal of Business Venturing, 2023)
    One of the major entrepreneurial challenges faced by scaling firms involves changing their internal organization. Our study focuses on a particular aspect of internal organizing—namely, how founder roles evolve in preparation for scaling. By means of an in-depth case study and a combination of data collection methods, we study the evolution of formal and informal founder roles. For both types of roles, we identify a founder-driven and an interaction-driven phase, during which founder and/or joiner role-crafting take place. Through both types of role-crafting, founder roles are (re)shaped. Particularly unique to our study is that we identify three scaling-specific paths through which the role-crafting of joiners shapes founders' roles. Specifically, founders experience a role efficiency increase as they take over some of the joiner-introduced role behaviors, or a role set decrease as joiners take over some of their (formal or informal) roles. We further point to the importance of psychological safety and value fit for successful joiner role-crafting to occur and for founder roles to change following founder-joiner interactions. Our study adds to the literatures on scaling and entrepreneurship as well as to role theory and role-crafting literature.
  • Organizational frontlines in the digital age: The consumer–autonomous technology–worker (CAW) framework

    van Doorn, Jenny; Smailhodzic, Edin; Puntoni, Stefano; Li, Jia; Schumann, Jan Hendrik; Holthöwer, Jana (Journal of Business Research, 2023)
    While organizational frontlines in the digital age involve complex interactions between consumers, autonomous technology (AT), and frontline workers, research so far largely focuses on the effect of AT on either the consumer or the worker. Bridging the fields of marketing and organizational behavior, we develop the Consumer–Autonomous Technology–Worker (CAW) framework, which reflects the implications of consumer–worker–AT interactions. We consider that AT can be consumer-facing, such as service robots, or worker-facing, such as AT-enabled knowledge-based systems supporting a worker’s decision-making. Drawing on illustrative interviews in hospitality contexts with workers who co-work with robots and the consumers served, we develop research propositions that highlight avenues for future research. We expect consumer–worker relations to strengthen when AT augments instead of replaces the worker. Human leadership is critical for consumers’ and workers’ acceptance of AT, while AT anthropomorphism is less critical in the presence of a human worker.
  • How digitally mature is your finance office?

    Stouthuysen, Kristof (MIT Sloan Management Review, 2023)
    As more CFOs try to capitalize on the promise of data and analytics, many find their offices aren’t seeing the expected gains. What separates digital finance leaders from the laggards? How can CFOs that struggle with the use of advanced analytics catch up with — and even surpass — their more successful colleagues? In this article, I offer a framework to help CFOs assess their office’s current data sophistication, and I illustrate how finance teams can improve their analytics capability by focusing on seven areas: strategic use of advanced analytics, model explainability, cross-functional data collaboration, analytics skills, exploration and experimentation, data-driven culture, and digital inclusivity.
  • Stability and accuracy of deterministic project duration forecasting methods in earned value management

    Barrientos-Orellana, Alexis; Ballesteros-Pérez, Pablo; Mora-Melia, Daniel; Gonzalez-Cruz, Maria Carmen; Vanhoucke, Mario (Engineering, Construction and Architectural Management, 2022)
    Earned Value Management (EVM) is a project monitoring and control technique that enables the forecasting of a project’s duration. Many EVM metrics and project duration forecasting methods have been proposed. However, very few studies have compared their accuracy and stability. Design/methodology/approach – This paper presents an exhaustive stability and accuracy analysis of deterministic EVM project duration forecasting methods. Stability is measured via Pearson’s, Spearman’s and Kendall’s correlation coefficients while accuracy is measured by Mean Squared and Mean Absolute Percentage Errors. These parameters are determined at ten percentile intervals to track a given project’s progress across 4,100 artificial project networks with varied topologies. Findings – Findings support that stability and accuracy are inversely correlated for most forecasting methods, and also suggest that both significantly worsen as project networks become increasingly parallel. However, the AT þ PD-ESmin forecasting method stands out as being the most accurate and reliable. Practical implications – Implications of this study will allow construction project managers to resort to the simplest, most accurate and most stable EVM metrics when forecasting project duration. They will also be able to anticipate how the project topology (i.e., the network of activity predecessors) and the stage of project progress can condition their accuracy and stability. Originality/value – Unlike previous research comparing EVM forecasting methods, this one includes all deterministic methods (classical and recent alike) and measures their performance in accordance with project duration.

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