We contribute new ideas and fresh thinking to the academic discipline and research community of finance, accounting, banking, economics, and FinTech. Our mission is to inform and impact policymakers and governments, and corporations and individuals through rigorous analysis.
We actively regularly publish in top-tier academic journals in finance, accounting, banking, and economics. Our research, both theoretical and empirically based, is core to our scholarly activity. We continuously develop new, insightful, and leading research with fellow colleagues within the department, the University, and co-authors across the world. The department members hold editorial posts in a variety of highly-ranked journals and have won several research-related awards.
Our department conducts research specifically focused on the following topics:
- Capital structure and corporate policies
- Cash, dividend, litigation, and tax policies
- Financial accounting and auditing
- Investor sentiment, private equity.
Corporate finance is a mainstay of our departmental research. Our interests range from issues in financial accounting to the role of private equity. A firm’s capital structure, that is, how the firm finances its activities through a mix of debt and equity, is pivotal to understanding wider issues concerning firms and corporations. For instance, the firm’s attitudes towards holding cash, paying dividends, and its taxation. Of interest are matters relating to litigation and the emerging strand of research focusing on investor sentiment.
Academics in our department address salient research questions including: is an auditor’s propensity to issue going concerns a valid measure of audit quality? Which firm-level and country-level factors are suitable determinants of green investments? What are the relationships between financial hedging, corporate cash policy, and the value of cash? How does government control affect the value of cash? What impact did political uncertainty and sentiment emanating from Brexit exert on financial markets?
- Board structure
- Corporate Social Responsibility
- CEO characteristics including overconfidence and traits
- Executive compensation.
The role of corporate governance in explaining the variation in firm behaviour and firm performance outcomes has assumed critical importance as evidenced by countries developing and implementing codes of best practice. The emergence of CSR – corporate social responsibility – is part of this process and illustrates the broader linkages between finance and sustainability and accountability. Departmental research investigates the behavioural characteristics and biographical features of firm CEOs and explains their effects on firm performance outcomes. Research also considers the role of executive compensation in motivating employees and explaining differences in firm behaviour and performance.
Academics in our department address important research questions including: what is the relationship between corporate social responsibility and long-run debt? Does female representation on corporate boards improve intellectual capital efficiency? Do LGBT workplace diversity policies create value for firms? What are the relationships between female CFOs, leverage and the moderating role of board diversity and CEO power?
- Auction theory
- Asset sales and securitisation
- Behavioural finance
- Corporate and sovereign debt
- Credit risk
- Derivatives, risk management and hedging
- Real estate finance, mortgages, household finance
- Mathematical finance, stochastic processes, and continuous-time finance
- Venture capital.
Financial Markets and Risk is another speciality of the Department. Our research investigates the activities and behaviours of several types of firms, such as, banks, corporations, and venture capitalists. It considers many important functions these firms carry out from asset sales and securitisation, credit risk analysis, the use of derivatives for the purposes of risk management and hedging, and mortgages. It also examines specific market segments, such as, corporate and sovereign debt markets, and real estate finance. In addition to empirical-based research, we are also interested in theoretical research including auction theory as well as mathematical finance.
Academics in our department address research questions including: Do market conditions impact the time-varying performance of analysts’ recommendation revisions? Can trade credit rejuvenate Islamic banking? What is the effect of redenomination risk on corporate bond spreads? How do negative interest rates impact banks’ risk-taking?
- Artificial intelligence in financial services, blockchain technologies, robo-advisory
- Competition, efficiency, and market structure
- Crypto assets and new asset classes
- Digitisation, digital business models and the digital economy
- P2P lending and alternative credit.
A rapid development of FinTech firms and new financial technologies has been occurring the end of the Global Financial Crisis (2007-09). The development and introduction of new financial technologies, such as, blockchain, artificial intelligence, and cloud computing to name a few are examples of enabling technology which is leading a digital revolution in financial services. With FinTech firms and BigTech firms (the major tech firms including Amazon and Google) competing in financial services, how these markets will evolve and how new entrants and incumbents, such as, banks might compete or cooperate has significant implications not only for consumers but also for regulators and the design of an appropriate regulatory structure.
Academics in our department address evolving research questions including: Is Bitcoin a safe-haven for currencies? Can an equity-credit hybrid model improve on estimating asset correlations? Does the rapid growth of FinTech constitute a perfect day or walk on the wild side? In the past two years, our academics have co-edited and published books on the broad area of FinTech: Artificial Intelligence in Finance (2020); Disruptive Technology in Banking and Finance: An International Perspective (2021).
- Capital restructuring
- Corporate control and ownership structure
- International or cross-border M&A
- Leveraged buy outs
- Merger waves.
Mergers and acquisitions are an important feature of national and increasingly international corporate activity. M&A can result in changes in firm ownership and firm leadership with anticipated effects on firm performance outcomes, and also changes in competitiveness and innovation among many others. Departmental research has investigated whether the announcement of M&A deals creates value – or destroys value - for shareholders, and which factors might be the key drivers of changes in firm value. Our research also considers mechanisms through which M&A could occur, for instance, leverage buy outs, and in which ways firms can issue equity like initial public offerings as part of their capital restructuring. Mergers tend to come in waves and can lead to significant consolidation effects.
Our academics address important questions arising from M&A, such as, should firms sell assets to buy? Does it benefit firms to buy distressed or punished firms? Do M&A generate value for firm shareholders? What are the long-run performance effects of research and development investment?
- Competition, culture, efficiency, and productivity
- Financial development and economic growth; law and finance
- Government intervention and public policies
- Incomplete markets and market structures
- Institutions and political economy
- International economics
- Macro-financial linkages
- Public finance
- Renewables and sustainability.
In addition to micro-econometric research on firms and markets, another area of departmental research is focused more on the effectiveness of public policy and public finance in addition to macro-financial linkages. This strand of research examines the rationale and impact of government intervention and the various effects associated with state ownership vis-á-vis private ownership, as well as the role of institutions and political economy. Our research speaks to the broader literature on relationships between financial development and economic growth, and law and finance. Our interests extend to consider new and globally important areas of research, such as, sustainability and renewable energy.
Academics in our department address evolving research questions including what are the roles of networking on firm financing and foreign ownership in corrupt host environments? How can we price new types of mortgages to insure homeowners against decreases in house prices? Is the privatisation of banks in emerging economies a justifiable response to financial crises? How should firms selectively hedge in incomplete markets?