Magda Donia will present a conceptual paper exploring the link between corporate social responsibility actions and employee behaviors at the annual meeting of the Academy of Management, August 3-7 in Boston.

Assistant professor of human resource management and organizational behaviour at the Telfer School, Dr. Donia is studying the mechanisms to explain when organizational-level care toward external stakeholders leads to individual-level caring of employees toward their organization. Her work will contribute to theory development and provide managers with practical implications in considering their choice of corporate social responsibility initiatives.

Weiwei (Vivi) Wu will present her research on innovation-enabling organizations at the Academy of Management’s annual meeting, August 3-7 in Boston.

A 2011 Telfer MSc Graduate, Ms. Wu developed the paper last year in collaboration with Professor Margaret Dalziel. She reports that innovation intermediaries have been examined from the point of view of the impact of specific types of organizations, but comparative analyses of the impact of different types of intermediaries have been rare.

Based on an analysis of survey data from a sample of 499 firms from four countries, the paper concludes that firms are identified as the most important facilitators of learning, universities as the most important sources of expertise, governments as the most important coercive actors, and industry associations as the most important facilitators of collaboration.

Has IFRS adoption had a net benefit? The shift from domestic accounting practices to International Financial Reporting Standards was expected to deliver high-quality financial reporting to serve the needs of investors and companies, but the actual outcomes have been debated, says Professor Daniel Zéghal, Director of the CGA Accounting Research Centre at the Telfer School.

Professor Zéghal currently leads a multi-year program of research examining how the adoption of global accounting standards has played out around the world.

Harmonization Rules

Canadian listed companies have been required to prepare their financial statements under IFRS, as set out by the International Accounting Standards Board, since 2011. While the U.S. remains a significant holdout, other G20 countries and reporting jurisdictions are rapidly making a transition to IFRS, and the European Union (EU) has mandated the use of IFRS by listed companies since 2005.

Earnings Management

One of the countries studied in detail by Zéghal and his colleagues is France, which underwent a major change from stakeholder-oriented “generally accepted accounting practices” to the more shareholder-oriented IFRS. The team looked at the level of earnings management within companies; i.e., the use of accounting practices to adjust reported earnings and thereby meet market expectations. Data from 353 French listed groups from 2003-2006 was examined.

“We found that, generally speaking, mandatory introduction of IFRS has reduced earnings management, and thereby led to improvement in financial reporting,” Zéghal says.

Earnings Quality

Do reported earnings properly reflect underlying economic effects; are they predictable? The question is closely tied to earnings quality, or the reasonableness of reported earnings.

Zéghal and his team looked at whether the application of IFRS in 15 EU countries is associated with higher accounting quality. Overall, their results demonstrate that there has been some improvement in accounting quality following IFRS adoption.

Developing Markets

On this front, too, there’s evidence favouring harmonization. When they examined data from 38 developing countries where IFRS was adopted, Zéghal and his co-researcher discovered a positive association between IFRS adoption and the development of the nations’ capital markets.

This became clear in the higher-quality financial statements released by listed companies, and in the motivation of investors to make more transactions. Fewer problems associated with “information asymmetry” led to greater trust regarding the mechanisms of capital markets, Zéghal explains; “That, in turn, encouraged market actors to make more transactions.”

Conclusion

The research will be of particular interest to those guiding progress on IFRS adoption. The lessons, Zéghal suggests, apply not only to jurisdictions that haven’t yet committed to the standards, but to nations such as Brazil, China, and India that have timelines to either adopt IFRS, or modify their accounting practices to achieve an equivalent result.

Says Zéghal: “Harmonization involves a transition towards a new accounting paradigm, and our results highlight some of the key impacts that can be anticipated at the other end.”

A new study from the Telfer School explores the idea that consumers of organic food tend to be health-focused or socially-conscious but not all of them are equally “organic.” This can translate into variations in their willingness to pay premium prices in relation to food categories and the type of organic food consumer they represent, the research shows.

The research by Professors Leila Hamzaoui-Essoussi and Mehdi Zahaf presents a detailed profile of Canadian organic food consumers. Among the notable findings: Most are willing to pay a premium of up to 45% for organic food products, on average, but beyond that point, the number of consumers willing to pay a premium drops significantly.

A survey of consumers identified differences in purchasing patterns, motivations, and reasons to buy organic food. The reasons were linked to health, taste, food quality, and the environment; they also included connection to the local economy. “All of these aspects should come into play when marketers and policymakers determine positioning and marketing strategies in order to reach these segments,” the researchers say.

Tracking consumer demand, willingness to pay more

Analysis of survey data from people who bought organic foods at supermarkets, organic food stores and farmers’ markets made it possible to identify three distinct consumer segments. (1) People who rarely buy organic food (IOFC, or inexperienced organic food consumers) do not describe themselves as socially conscious consumers, are not motivated to buy organics, and are not willing to pay any premium price. (2) Habitual consumers (TOFC - trust organic food consumers) tend to be socially conscious and are motivated to buy organics out of concern for the local economy or the environment. Urbanized and highly educated, they spend about $100-400 per month on groceries and are willing to pay up to a 120% premium price for organic food.

More intriguing is a middle segment (3) that buys organic food products between 3 to 10 times per year (SOFC - sporadic organic food consumers). This variety-seeking group does not perceive significant differences between organic food and conventional food, but occasionally buys organics mainly for health reasons. They rely on the information available at the point of purchase because unlike habitual consumers, they do not collect information to build their knowledge of organics.

The results underlined different purchasing patterns and consumer rationale. Organic food products are most likely to be purchased by TOFC for principle-oriented values such as sustainability, or by SOFC as a result of egocentric values such as health. The importance of the product attributes (food mileage, taste, quality, etc.) and willingness to pay vary with the consumer segment. Willingness to pay a premium price varies by food category and by consumer type.

“Providing a greater understanding of the profile of each consumer segment will help producers and distributors better address the specific values underlying their consumption,” the researchers say.

Professors Hamzaoui-Essoussi and Zahaf’s work was supported by major grants from the Social Sciences and Humanities Research Council and from the Ontario Ministry of Agriculture, Food and Rural Affairs. “Canadian Organic Food Consumer’ Profile and Their Willingness to Pay Premium Prices” was recently published in the Journal of International Food & Agribusiness Marketing.

Access the study.