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Technical efficiency in banking is a critical aspect of the financial industry and has been widely studied using various measurement techniques. This systematic literature review offers a comprehensive examination of 305 studies on the application of technical efficiency measurement techniques in both Islamic and conventional banking sectors from 1989 to 2019. Our comprehensive analysis not only provides a broad view of the efficiency measurement literature but also outlines a future research agenda. Despite the extensive research in this field, several issues remain unresolved, including input–output selection, a comparison of efficiency between Islamic and conventional banks, limited cross-country studies, and a lack of exploration into the impact of regulation and Shariah principles. To address these gaps, this review highlights the most commonly used methods, variables, and findings and provides three key recommendations for future research. Three key themes emerge from our examination. First, there is a need to better understand and the application of new frontier techniques other than the traditional methods, which currently dominate the existing literature. Second, the intermediation approach is the most frequently used in variable selection, thus more studies with comparative findings with applications of production and value-added approaches are suggested. Third, the most frequently used input variables are ‘labor’, ‘deposits’ and ‘capital’, whilst ‘loans’ and ‘other earning assets’ are the most popular output variables. We recommend three vital directions for future research: (i) non-interest expenses to be included amongst the inputs, while non-interest income should be added to the list of outputs, especially when estimating efficiency scores of Islamic banks. (ii) The impact of environmental variables such as, inter alia, Shariah principles, country-specific factors, and management quality is suggested to be considered simultaneously in models measuring

Purpose – We examine the impact of audit quality (AQ) on Classification Shifting (CS) among non-financial firms operating in the UK and Germany. Methodology – This paper used various audit committee variables (size, meetings, gender diversity, and financial expertise) to measure AQ and its impact on CS. We used a total of 2110 firm-year observations from 2010 to 2019. Findings - We found that the presence of female members on the audit committee and audit committee financial expertise deter the UK and German managers from shifting core expenses and revenue items into special items to inflate core earnings. However, audit committee size is positively related to CS among German firms but has no impact on UK firms. We also document evidence that audit committee meetings restrain UK managers from engaging in CS. However, we found no impact on CS among German firms. Our results hold even after employing several tests. Originality - Most CS studies used market-oriented economies such as the USA and UK and ignored bank-based economies such as Germany, France, and Japan. We provide a comparison among bank and market-oriented economies on whether the AQ has a similar impact on CS or not among them. Implications - Overall, our findings provide broad support in an international setting for the board to improve its auditing practices and offer essential information to investors to assess how AQ affects the financial reporting process.

The study examines the impact of board committee indexes on the relationship between Environmental, Social, and Governance (ESG) disclosure, and accounting- and market-based performance measures of multinational enterprises (MNEs). Using quantile regression analysis and a large balanced panel data of 500 multinational companies operating in 40 countries from 2009 to 2019 (i.e., 5500 firm-year observations), we uncovered the following significant associations: (i) a positive relationship between ESG disclosure and accounting performance indicators for large-sized MNEs, but this relationship is counteracted by the negative influence of the audit and sustainability committee indexes; (ii) the association between market-based performance outcomes and ESG disclosure is positively affected by the compensation, nomination, and sustainability committee indexes, while it is negatively influenced by the audit committee index; (iii) the combined board committee index has varying impacts on the connection between the components of ESG disclosure, and accounting and market-relevant performance metrics for different sizes of MNEs; and (iv) while the audit and sustainability committee indexes exert negative effects on the relationship between the components of ESG disclosure and performance measures, these effects are countered by the positive moderating impacts of the compensation and nomination committee indexes. The study concludes by discussing the policy implications of these results.