Purpose: This paper aims to analyze the determinants of Portuguese energy companies' performance.Design/methodology/approach: To achieve our objective, we have used data from 457 Portuguese energy companies, in the period between 2011 and 2018. Three dependent variables were tested using panel data, through the generalized method of moments (GMM) estimation method.Findings: The results point out that the determinants of companies' performance change according to how different stakeholders appreciate corporate performance. In general, shareholders are concerned with maintaining their levels of profitability over time as well as with the company's market image. Managers are centered on maintaining solid margins on EBITDA through good management of cash flow, leverage and current assets. For the rest of the stakeholders, including global society, debt and investments in tangible fixed assets reduce profitability while investments in immaterial assets help to create value and performance for energy companies.Originality/value: As far as the authors are aware, this is the first time that a study has been carried out in the Portuguese energy sector using the GMM-system model for three different stakeholders' views of corporate performance determinants.

Understanding how to address today’s global challenges is critical to improving corporate performance in terms of economic and environmental sustainability. In wastewater treatment systems, such an approach implies integrating efficient treatment technologies with aspects of the circular economy. In this business field, energy costs represent a large share of operating costs. This work discusses technological and management aspects leading to greater energy savings in Portuguese wastewater treatment companies. A mixed methodology, involving qualitative and quantitative aspects, for collecting and analysing data from wastewater treatment plants was used. The qualitative aspects consisted of a narrative analysis of the information available on reports and websites for 11 wastewater management companies in Portugal (e.g., technologies, treated wastewater volumes and operating costs) followed by a review of several international studies. The quantitative approach involved calculating the specific energy consumption (kWh/m³), energy operating costs (EUR/m³) and energy operating costs per population equivalent (EUR/inhabitants) using data from the literature and from Portuguese companies collected from the SABI database. The results suggested that the most environmentally and economically sustainable solution is algae-based technology which might allow a reduction in energy operating costs between 0.05–0.41 EUR/m³ and 15.4–180.8 EUR/inhabitants compared to activated sludge and other conventional methods. This technology, in addition to being financially advantageous, provides the ability to eliminate the carbon footprint and the valorisation of algae biomass, suggesting that this biotechnology is starting to position itself as a mandatory future solution in the wastewater treatment sector.

This work analyses whether financial information quality is relevant to explaining firms’ probability of default. A financial default prediction model for SMEs (Small and Medium Enterprises) is presented, which includes not only traditional measures but also financial reporting quality (FRQ) measures. FRQ influences the decision-making due to its impact on financial information, which has repercussions on the accounting ratios’ informativeness. A panel data of 1560 Portuguese SMEs in the construction sector, from 2012 to 2018, is analysed. First, firms are classified as default or compliant using an ex-ante criterion which allows us to identify signs of financial constraints in advance. Then, the stepwise method is employed to identify which variables are more relevant to explain the default probability. Results show that FRQ measures, namely accruals quality and timeliness, impact firms’ defaulting, supporting their relevance in predicting financial difficulties. Finally, using a logit approach, the accuracy of the model increased when FRQ variables were included. Results are confirmed using “new age” classifiers, namely the random forest methodology. This work is not only relevant to the extant financial distress literature but has also relevant implications for practice since stakeholders can understand the impact of financial reporting quality to prevent additional risks.

Accounting information is used to evaluate the firm’s financial performance. Although, firms may have incentives to engage in earnings management, misleading all stakeholders. This study aims to analyse earnings management behaviours of Portuguese listed firms. Both accrual-based and real activities of earnings management are analysed to draw an overall picture of earnings management’ strategies. Most studies focused only in discretionary accruals as a proxy for earnings management, since cash flow-based earnings management is more difficult to detect. Although both strategies can be complementary instead of substituting. Moreover, the impact of financial crisis, family control, and firm characteristics is taken into account. Previous literature found that 2008 crisis had impact on earnings management as firms want to meet debt covenants and investors’ expectations. Moreover, family firms also impact the magnitude of earnings management. While some researchers found a negative relationship since managers are highly controlled, others found the opposite relationship because the family may want to maximize their own wealth. Analysing 51 listed firms, from 2003 till 2015, results show that firms engage more in earnings management during crisis, when the firm’s financial situation is less stable. In addition, accrual-based earnings management is higher in family firms than in non-family ones, suggesting less quality of information in the first group. Due to less control of family firms, the family may expropriate minority investors’ wealth to increase personal benefits. Finally, the impact of firms’ characteristics on earnings management depends on the proxy of earning management analysed, suggesting that firms use accrual or real-activities earnings management depending on its purposes.info:eu-repo/semantics/publishedVersio

An important part of environmental degradation is caused by the discharge of untreated or mistreated wastewater. The reuse of water is paramount to the National Strategic Plan for the Water Supply and Wastewater Sanitation Sector in Portugal and Spain. Since centralized treatment systems have proved to be inefficient, tackling environmental issues requires a regional approach. Wastewater treatment plants (WWTPs) mitigate environmental impacts and contribute to the financial savings of other firms. However, the literature evaluating WWTPs’ financial performance and economic sustainability is scarce. The implementation of a resource recovery technology depends heavily on economic viability. Thus, this paper analyses the financial sustainability of 222 WWTPs in the Iberian Peninsula by NUTS II regions in 2016–2019 to assess the region with the best performance and financial stability and provide regional policy implications. Using the SABI database, this research encompasses a numerical and narrative analysis of key financial ratios. Results show that firms in Algarve and La Rioja exhibit higher financial sustainability when compared to other regions. Results can foster enhancements in the governance of regulated utilities.