The purpose of this study is to provide a way of pursuing a balanced profitability between franchisors and franchisees leading to the sustainability in franchising. Based on a belief that the formation of brand-centric relationship is vital for the success of franchising system, we constructed a model that examines the relationships between marketing decisions, brand equity, and the financial performances of franchisors and franchisees. We used actual data of the Korean franchise chains, including measures of channel intensity and advertising and promotional activities as franchise marketing decisions as well as the profitability of franchisors and franchisees for the analysis. The results of analysis show that while advertising and promotion expenditure has a positive impact on the performances of both franchisors and franchisees, the number of stores does not influence them in the same way. This indicates that their interests may conflict. This study suggests that marketing decisions can be utilized as a means of achieving balanced profitability that would benefit the sustainability in franchising between franchisors and franchisees.

Recent studies on tax avoidance report that having female executives in companies increases accounting transparency and firm value by reducing tax avoidance. These studies explain that the more risk-averse and conservative characteristics of females affect corporate decision making about tax strategies if the company has female executives. In this study, we assume that the higher the proportion of female employees in a company, the more likely the risk-averse and conservative characteristics of females will affect the firm’s decision making, thereby reducing tax avoidance activities and improving corporate sustainability. To verify this hypothesis, we empirically analyze the association between the female employee ratio and tax avoidance. From the empirical results, we find increasing the female employee ratio may reduce the level of tax avoidance. We also find that companies with a high percentage of female employees show less tax avoidance than those with a low percentage of female employees. The findings suggest that by increasing the ratio of female employees, a company can improve its sustainability in terms of tax avoidance by forming a risk-averse and conservative corporate environment.

A firm’s corporate social responsibility (CSR) aids in social well-being, but it is costly. It is thus necessary to study whether a firm’s CSR activities are valuable in terms of costs and benefits for shareholders’ interest. Recent studies reported that firms’ CSR activities help to develop the corporate environment and improve financial performance. In addition, prior studies explained that a firm’s CSR activities can have a positive effect on financial performance by increasing employees’ commitment to their firm. The purpose of this study research is to examine the effect of CSR activities on sustainable employability through empirical analysis. We measured the sustainable employability using the percentage of regular employees and then examined the effect of CSR activities on sustainable employability using 3802 firm-year data for Korean listed firms. From the empirical results, we found that firms engaging in CSR activities improve more in terms of sustainable employability than do firms who are not engaging in CSR activities. We also found that the companies engaging in a high CSR index score showed greater sustainable employability than did those with a low CSR index score. The results of this study suggested a way to increase sustainability in terms of employment by supporting a rational basis for companies to adopt CSR. These findings are expected to contribute to academia and the capital market by providing empirical evidence that a company’s CSR activities have a positive impact on sustainable employability.

This study investigates the effect of financial analyst coverage on audit efforts by examining the association between the number of analyst followings and audit hours. Existing literatures report that there are inconsistent results between analyst coverage and audit efforts, and most studies used audit fee as a proxy for audit efforts. However, audit fee may cause measurement error. We consider that audit hour is a better proxy for measuring audit efforts than audit fee because practically auditors are less likely to charge extra audit fee for their additional efforts in competitive audit market. Also, after audit engagement contract, the amount of audit fee is almost fixed. Thus, it cannot reflect variable auditors decision whether inputting additional efforts or not during audit service. Intuitively, audit hours are more accurate measure of audit efforts as long as it indicates how much hours auditors work. For the above reasons, we use unique dataset of audit hours in Korea. We find that analyst coverage is positively associated with audit hour. This means auditors make more efforts on their audit service in case of greater analyst following, and they crucially consider reputational damage from audit failure when they provide audit services to their clients with great analyst following. Next, we still observe positive relation in both pre and post global financial crisis periods. Lastly, we find that BIG4 auditors are more concerned about reputational loss than Non-Big4 in case of greater analyst following.

The prior studies report that the global big4 audit firms (Big4) generally provide higher quality audit services compared to the local audit firms, but inconsistent result on audit quality of the Big4 audit firms was observed in the Chinese stock market. We believe that it may be not appropriate to distinguish high or low audit quality as separating the Big4 and non-Big4 because the market share of the Big4 and non-Big4 on Shanghai stock market is considerably lower than that of other countries. Therefore, we use the measure of Chinese big10 audit firms (Big10) as higher audit quality and examine the association with the level of earnings management using the sample of Shanghai Stock Market listed companies in China. From the empirical tests, we find that the Big10 provide better audit service to prevent their clients’ earnings management than non-Big10 audit firms. The finding of this study demonstrates the Big10 provide differentiated audit service from non-Big10 audit firms on Shanghai stock market in China.