Literature Review The Work Environment

Question: Discuss about theLiterature Reviewfor the Work Environment. Answer: Introduction In new trend is taking shape in the business world as innovation spaces are already changing the landscape. In the last ten years, the world has experienced a considerable growth in co-working spaces, innovation centres, incubators, research institutes, and start up spaces (Wagner Watch 2017). However, people have missed the innovation spaces that are manifested in physical aspects because of the broader cultural, economic, and demographic forces. The ambition to remain the market leader has pushed many leading corporations to adopt a creative experimentation in designing their working environment. Companies are measuring whether designing their workspaces is helping or hurting their performance. Based on the published work of Weber, Magnolfi, and Lindsay (2016), workspaces could be offering a new competitive edge to the businesses. Every company is in a hurry to redesign its workspaces such as Telenor, Google, and Samsung are among the companies that have redesigned their working e nvironment to create the best working atmosphere that can maximize productivity. This mini-literature review confirms the level of attraction that this topic has received from architecture and other companies worldwide. Brief Summary In this article, Weber et al. (2016) have acknowledged the significance of the new workspaces that encourages collaboration by increasing personal interaction through innovation. These scholars have identified the major companies that are leading the park in redesigning their workspaces in hope of improving employee performance. According to these scholars, the companies would never achieve their goals by compelling works to sit behind the monitors. The new designs enhance collaboration and innovation. However, the core question is whether the executives can prove that the new designs work. For example, Google is establishing a new campus to maximize performance, Facebook building a single mile-long room for is employees, while Samsung is introducing new workspaces just to motivate employees. Despite all these efforts, nobody is sure of the effectiveness of these initiatives. The new deigns embraced by some companies like Facebook is a threat to employees privacy, the power of proxim ity, and the significance of virtual working environment. It has thus raised the issues of Density, proximity, and social nature relating to the working environment. Working Environment The Digital Offices The world is becoming digital and companies are already taking the initiative to adapt to these changes. Reeve (2016) has identified that the new dispensation has compelled companies to compete on the perspective of innovation and creativity. Since employees are the most important internal clients of an organization, it is important to consider their needs and expectations. For example, allowing them to work from home or outside the offices would justify their ability to work independently. Ferrazzi (2014) maintains that virtual teams have ensured the workers operate in a flexible working environment. The employees can use the opportunity to manage their lives and work flexibly. However, getting virtual teams has proved a nightmare in the society because most people value face-to-face interaction as important. Nonetheless, the new technology promotes collaboration as dispersed teams have outperformed that those working in offices. According to Fayard and Weeks (2011), the use of virt ual teams has improved organizations performance and employee productivity by about 43 percent. The main problem revolves around creating a virtual team because the managers must consider various factors. However, research has indicted that experience can help managers to navigate collaborative environment and overcome challenges by putting together the right team, technology, touch points and leadership (Botsman Rogers 2011). It involves following the simple high-return rules that maximize productivity. Reeve (2016) believes that virtual teams are perfect and would always meet deadlines. Virtual Proximity The virtual environment ensures the employees are physically separated. It bars the employees from enjoying the nonworking activities such as accessing the restrooms because it separates them. Research has indicated that the virtual working environment in the new workspaces can thrive in an environment that promotes awareness, voluntary engagement, and the rules or occasions for engagement. Fayard and Weeks (2011) held that physical workspaces have incessantly stimulated interactions thus promoting awareness among them. It also creates a sense of teamwork. To this effect, Reeve (2016) believes that a virtual environment should also convey or embrace similar situation where workers experience a sense of interaction and awareness. This involves the use of various software applications such as instant messaging, Twitter, Facebook, and Skype. The modern managers have never underestimated the significance of these factors and have allowed employees to use smartphones and desktops or other mobile devices to complete their tasks. Some team leaders have requested their members to customize Skype mood messaging or IM status thus discourage informal interactions. Promoting knowledge management system is essential because it reduces time wastage. In fact, it provides the environment where discussion forums and virtual teams can operate. Conversely, the new technology has created a chicken-and-egg problem because promoting an online social environment is impossible without a core group (Cappelli Keller 2013). It has created a sense of proximity that has further proved for many virtual team members. For instance, in educational programs, lecturers have used various technologies such as interactive whiteboards and video links to reach out to their students. Nonetheless, the managers must ensure they protect virtual privacy (Lange 2011). For instance, when employees understand that their bosses are monitoring them through electronic exchanges, they would be reluctant to engage in the virtual conversation. Coworking The knowledge economy has provided opportunity for workers to interpret data online. The new workspaces have given a cold bath to the physical spaces by promoting online networking among the employees (Reed 2007). Without a doubt, a collaborative production is always the best approach to maximize the opportunities available in the environment. Therefore, embracing a network-based processes prove significant to sustainable production as explained by Moriset (2014). The social media has promoted corporation and networking among the workers. In fact, the companies can organize audio conferencing to manage the workers beyond the proximity (Musterd Murie 2011). This new development is evident in freelancing where workers complete tasks online and adhere to the laid down rules of the game (Florida 2002). Therefore, creativity and collaboration have ensured the employees maximize their performance thus triggering economic growth as determined by Pratt (2008). Grugulis and Stoyanova (2012) highlighted the significance of the technology in the promoting urban economies. Productivity The new workspace design is increasing the performance of employees. According to Giang (2014), workers must avoid sitting pretty in offices to maximize their performance. Waber, Magnolfi, and Lindsay (2014) have affirmed that the new path that involves unique workspaces, designing agile environment provide solutions to the problems they experience. The new design promotes creativity, collaboration, and productivity. The modern office must maximize the impact of technology and sustainability. To Giang (2014), the infrastructural solution maximizes human performance, potential, and productivity. But what could productivity mean for the organization? The productivity of employees is beyond sitting at the desk but focuses on solving problems and creating ideas collaboratively. The businesses should also design spaces that nobody has to sit in a designed spot. In fact, the social hub has connected co-workers thus promoting working environments. According to Giang (2014), an agile design ensures the employee feel comfortable and can balance work and life. An agile working environment also increases the movement of employees based on choice and the assignment. This implies that people or workers have the choice, power and more control. However, the issues emerging from such an agile working environment agreement as the worker should work on strategies to control destructions (Giang 2014). Studies have also shown that sitting for so long is harmful to ones health. To this effect, an individual should be concerned about the employees health as explained by Johns and Gratton (2013). Therefore, the solution would be based on adjusting the desk that has been proved to be healthier thus make people feel alert (Guang 2014). Conclusion The increasing customer base and global workforce has made the employees to consider working beyond their office spaces. This has made the working environment complex thus increasing the aspects of collaboration and teamwork. The new workspace designs seem to promote productivity and performance. In this era of innovation, the physical offices are becoming scarce and companies have to respond. In fact, the physical office spaces increase the operating costs that many companies are turning to virtual working environment to maximize their performance. With the technology and internet, managers are opting for digital working spaces to remain relevant and minimize costs. The large conglomerates are taking the leads, but managing virtual teams proves difficult. Bibliography Botsman, R. Rogers, R. 2011, Whats mine is yours: how collaborative consumption is changing the way we live. Collins, New York. Cappelli, P. Keller, J.R. 2013, Classifying work in the new economy, The Academy of Management Review, vol. 38, no. 4, pp. 1-22. Fayard, A-L. Weeks, J. (2011) Who moved my cube, Harvard Business Review, July/August. (Available at https://hbr.org/2011/07/who-moved-my-cube) Ferrazzi, K. (2014) Getting virtual teams right, Harvard Business Review, Dec. (available at https://hbr.org/2014/12/getting-virtual-teams-right) Florida, R. (2002) The rise of the creative class. Basic Books, New York. Giang, V. (2014), Workspace design trends to increase your productivity, FastCompany, Sep 7, (available at https://www.fastcompany.com/3032792/6-workspace-designs-trends-to-increase-your-productivity) Grugulis, I. Stoyanova, D. 2012 Social capital and networks in film and TV: Jobs for the boys? Organization Studies, vol. 33, no. 10, pp. 1311-1331. Johns, T. Gratton, L. 2013, The third wave of virtual work, Harvard Business Review, Jan/Feb: 1-9. Lange, B. 2011, Rescaling governance in Berlins creative economy, Culture Unbound, vol. 3, pp. 187-208. Moriset, B. 2014, Building new places of the creative economy. The rise of coworking spaces, Proceedings of the 2nd Geography of Innovation, International Conference 2014, Utrecht University, Utrecht (The Netherlands). Musterd, S. Murie, A. (Eds.). 2011, Making competitive cities. Wiley-Blackwell, Oxford. Pratt, A. 2008, Creative cities: the cultural industries and the creative class, Geografiska Annaler: Series B, Human Geography, vol. 90, no. 2, pp. 107-117. Reed, B. 2007, Co-working: the ultimate in teleworking flexibility, Network World. (Available at https://www.networkworld.com/news/2007/102307-coworking.html) Reeves, G. 2016, Comparative analysis between digital offices and traditional office spaces, Propel, Dec 6. (https://propelbusinessworks.com/guest-blogs/comparative-analysis-digital-offices-traditional-office-spaces/). Spinuzzi, C. 2012, Working alone together: coworking as emergent collaborative activity, Journal of Business and Technical Communication, vol. 26, no. 4, pp. 399-441. Waber, B., Magnolfi, J., Lindsay, G. 2016, Workspaces that move people. In W. Lazonick, The definitive management ideas of the year from Harvard Business Review (pp.139-151). Harvard Business Review Press, Boston, Mass. Waber, B., Magnolfi, J., Lindsay, G. 2014, Workspaces that move people, Harvard Business Review, vol. 92, no. 10, pp. 68-77. Wagner, J. Watch, D. (2017) Innovation spaces: the new design of work, April. (available at https://www.brookings.edu/wp-content/uploads/2017/04/cs_20170404_innovation_spaces_pdf.pdf)

Outlining Your Academic Background

Outlining Your Academic BackgroundWhen beginning to outline your academic interests or writing an essay, it is very important to outline your history and experiences as well as your interests, hobbies, and background. By being able to write a concise narrative outlining your academic interests essay sample, you will be able to save time and get the job done right.A quick way to outline your academic background is to list all of your degrees from various schools and colleges. You can also use your university degree or graduate degrees, the job you have completed, etc. By listing this information, you are essentially establishing your academic history. This is a good way to summarize your academic background in one sentence or even less.Next, you can use this information to write a personal history or educational experience about your interests. Be sure to include any stories, experiences, memories, and reflections you may have. For example, if you are interested in English Literature, you may have a story about how this interest or this story shaped your life or how you eventually became a writer.Or, you may choose to have a particularly fun or exciting event that resulted in your interest in the subject matter you write about. You can include any events or memories that occurred during the time that you were learning about the topic. This will allow your essay to be much more interesting to read.For example, if you have always enjoyed the hobby of camping and fishing, you may use this in your essay to give an illustration of your hobby and passions. Or, if you are a music buff, you may cite an event, such as when you were listening to a song for the first time, that has changed your life in a wonderful way.Writing an essay is not an easy thing to do. However, by using this outline, you will be able to save time and get the job done right. Using this information will also help you make any grammatical mistakes you may make while writing the essay.Outlining your academic background is a great way to give an easy introduction to your essay or any other writing project. You can use this to develop your own idea on how you will write your essay and what questions you will be asking yourself throughout the entire writing process. This allows you to get the right information on your paper, which will improve your writing skills.

Robber Barons Vs. Captains of Industry Essay Example

Robber Barons Vs. Captains of Industry Essay Robber Barons Vs. Captains of Industry In comparison between robber barons and captains of industry, most of these people are considered captains of industry. This is because most of the given people all affected the country and the business world positively for reasons that are stated as well as others. Although a couple people are obviously Robber Barons, for example Cornelius Vanderbilt, most of the rest are obviously captains of industry, donating money, making money and becoming a key reason for how the business industry became as fair as it is now. All of these people have in some way either contributed to the increase of productivity, providing more jobs, or expanding the market in a very crucial way. A very important reason why these eight guys would be considered captains of there industries is because the captain of our industries today are also doing things that are going to help this country that kinda relate what they were doing back then. Back then they were doing many thing to help out there country for example Henry Frick began buying coal mines, and he eventually controlled 80 percent of the coal output of Pennsylvania. We will write a custom essay sample on Robber Barons Vs. Captains of Industry specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Robber Barons Vs. Captains of Industry specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Robber Barons Vs. Captains of Industry specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Also, another example of this would be James hill and how he started his own business called the St. Paul, Minnesota Manitoba Railway Company, and expanded until his production of agricultural and other products carried to the rest of the country. He helped out the country a lot, and really stepped it up a notch and showed the country what technology is about. Not only was he making billions of dollars but he was also giving away about 58% of all of his money to charity every year to people who need the money a lot more that he does. To me I think that the captain of industries today and the ones from back then really relate to each other a lot, in doing good things for the country. Another reason that these men were considered captains of industry instead of robber barons has to do with the amount of money they gave away. John D. Rockefeller alone gave away more then 80 million dollars before he died and Henry Fick gave away 15 million and the rights to his mansion so a museum could be built. Andrew Carnegie believed that men who died rich, died isgraced, which showed that he was a charitable contributor to the things he cared most about. Granted some of them held their money a little tighter then others many of them gave away more then enough to schools and libraries and other establishments that bettered America. The final reason that these people are very important captains of industries are because they did what was needed to be done to get make their company successful, sure they stepped on a few people on the way up but it was only to better their own company. For example, Carnegie was a very poor man who started working as a bobbin boy for less then $1. 20 a day and he ended up being one of the richest men. He knew what it was like to work and earn so little that when he became rich and had money to blow he gave up a large potion of his fortunes to cultural, educational, as well as scientific institutions for the improvement of humanity. In conclusion, these eight men should be classified as captains of industry because of the given information. These men are all important parts of our history and most of these eight men were a very positive influence on industry itself and what we decide to do nowadays. These are very important figures of the industry because they gave us the ideas that we use today to consider what is acceptable for industry and how we pay or treat individuals working today. Without these men, then the United States would have a completely different outlook on how industry is ran and why we do things the way that we do.

10 Words That Dont Mean What You May Think They Do

10 Words That Dont Mean What You May Think They Do 10 Words That Don’t Mean What You May Think They Do 10 Words That Don’t Mean What You May Think They Do By Mark Nichol As English evolves, word meanings shift and turn, sometimes reversing themselves altogether. These ten words have shifted their senses over the years. In some cases, we are wise to likewise be flexible; in others, we relax our vocabulary at the expense of useful distinctions: 1. Decimate The literal meaning of this word, as all you lovers of Latin (not to be confused with Latin lovers) know all too well, is â€Å"to reduce by one-tenth,† supposedly from the punitive custom of selecting one out of ten captives by lot and killing those so selected. But the senses for this rhadamanthine Roman policy have proliferated, so that now it means â€Å"tithed,† â€Å"drastically reduced,† or â€Å"destroyed† as well. 2. Disinterested Commonly employed to mean â€Å"not interested,† disinterested has a precise, useful meaning of â€Å"neutral, unbiased.† 3. Enormity Some people would reserve this word to mean â€Å"monstrously wicked,† but, in truth, it is properly invoked to refer to anything overwhelming or an unexpected event of great magnitude, and thus it need not be invariably corrected to enormousness except when it is clearly in reference to a loathsome occurrence. Refrain, however, from diluting the word’s impact in such usage as â€Å"The enormity of the new stadium struck them as they approached the towering entrance.† 4. Fortuitous This word means â€Å"occurring by chance,† but its resemblance to fortune has given it an adopted sense of â€Å"lucky.† For meticulous adherence to the traditional meaning, use fortuitous only in the sense indicated in this sentence: â€Å"His arrival at that moment was fortuitous, because her note had not specified the exact time of her departure.† Nothing in the context qualifies his arrival as fortunate; the sentence merely states that he arrived in time without knowing that he would do so. The informal meaning is expressed here: â€Å"His fortuitous arrival at that very moment enabled him to intercept the incriminating letter.† In this sentence, the time of his appearance is identified as a lucky stroke. 5. Fulsome This term originally meant â€Å"abundant, generous, full,† but that sense was rendered obsolete when the word acquired a negative connotation of â€Å"offensive, excessive, effusive.† Conservative descriptivists rail against the use of fulsome in a positive sense, but the cold, hard fact is that this sense has been increasingly resurgent for many years, and the adulatory meaning is now much more common than the condemnatory one. If you wish to stand fast before the tsunami of inevitability, be my guest, but fulsome as an exquisite insult has been consigned to the dustbin of history. Some commentators recommend that because of the word’s ambiguity, it’s best to avoid its use altogether. If you insist, make sure the context is clear. 6. Ironic The impact of ironic has been diluted because many people use it to mean â€Å"coincidental,† when its traditional definition is â€Å"counter to expectations or what is appropriate.† 7. Literally Some folks get exercised when this term is used in place of its antonym, figuratively. However, in a hyperbolic sense, that meaning is justified. Unfortunately, that sense is literally overused. 8. Notorious This term is occasionally used in a neutral sense, but that’s not an error, but the word literally means â€Å"known.† However, its dominant connotation is that the fame is a result of infamy. 9. Peruse This victim of definition reversal literally means â€Å"to use thoroughly,† and its first sense is that of careful steady or attentive reading. However, many writers (myself included) have employed it as a synonym for scan enough writers, as a matter of fact, that its second sense is â€Å"to look over or through in a casual or cursory manner. Unfortunately, these mirror meanings mean that if you use the word, I advise you to support it with context that clarifies the intended sense. 10. Plethora Plethora originally referred to an excess of something, but that usage is rare now, and more often the sense is simply of abundance. The medical meaning of swelling caused by an excess of blood is all but unknown. Want to improve your English in five minutes a day? Get a subscription and start receiving our writing tips and exercises daily! Keep learning! Browse the Misused Words category, check our popular posts, or choose a related post below:7 Types of Narrative ConflictThat vs. WhichHow to Style Legislative Terms

The dietary requirements necessary to maintain a healthy Essay

The dietary requirements necessary to maintain a healthy - Essay Example Digestion breaks down proteins into amino acids. Amino acids are of three categories – essential, nonessential and conditional amino acids. Essential amino acids are nine – â€Å"Histidine, Isoleucine, Leucine, Lycine, Methionine, Phenylalanine, Threonine, Tryptophan and Valine† – and can only be obtained from food intake. Nonessential amino acids are four – â€Å"Alanine, Asparagine, Aspartic Acid and Glutamic Acid† – and are made by the body by breaking down essential amino acids. Conditional amino acids are eight in number – â€Å"Arginine, Cysteine, Glutamine, Glycine, Ornithine, Proline, Serine and Tyrosine† – and are not viewed as essential. They are only needed in times of illness. There are many sources of proteins: all types of meat, all types of beans, nuts and seeds, soy proteins products, dairy products and eggs. Intake of proteins should be regulated. This is because a high level of proteins may overwork the kidney. Meat and eggs intake should also be watched as these products contain high levels of cholesterol. Accumulation of cholesterol in the body is a risk factor for heart disease. In severe deficiency of proteins, Kwashiorkor is likely to develop. The recommended daily intake of proteins is â€Å"2 to 3 ounces of cooked lean meat, poultry, or fish;  ½ cup of cooked dried beans; 1 egg, 2 tablespoons of peanut butter, or 1 ounce of cheese†. Carbohydrates Carbohydrates are very important as they provide the fuel to the body after being broken down to glucose which is oxidized to release energy. Carbohydrates are of two main types – complex and simple carbohydrates. Complex carbohydrates include starch and dietary fiber. Complex carbohydrates must be broken down to glucose for the body to utilize. Starch is contained in foods such as breads, cereals and vegetables. Dietary fiber is of two categories: soluble and insoluble fiber. Soluble dietary fibers include oatmeal, nuts and seeds among others while insoluble dietary fibers include brown rice, barley, fruits among others. Simple carbohydrates are those that naturally have sugars, for instance, fruits, milk products among others (Centers for Disease Control and Prevention 2012). Dietary fibers are recommended over refined meals. Removing the external cover of grains converts them into refined foods. The diagram below show the recommended amount of grams required daily (Centers for Disease Control and Prevention 2012). Nutrient (Units) Child 1-3 Female 4-8 Male 4-8 Female 9-13 Male 9-13 Female 14-18 Male 14-18 Female 19-30 Male 19-30 Female 31-50 Male 31-50 Female 51+ Male 51+ Total Fiber (grams) 14 17 20 22 25 25 31 28 34 25 31 22 28 Excessive intake of carbohydrates especially the simple carbohydrates are associated with obesity because excess glucose is stored. Deficiency in carbohydrates in the body forces the body to burn fats and proteins to use as a source of energy (Centers for Disease Control and Prevention 2012). This deficiency therefore leads to malnourished people. However, in severe cases of carbohydrate deficiency, marasmus is likely to develop. Marasmus develops when there is severe malnutrition. Lipids Lipids are needed in the body to transport the fat soluble vitamins, supply energy and provide fatty acids. Lipids exist in various forms; if a lipid is a liquid at room temperature then it is called oil, if it is solid at room temperature t hen it referred to as fat. Lipids are hydrolyzed to release glycerol, fatty acids, diglycerides and monoglycerides. Fatty acids are particularly important in the

Visual analysis paper Coursework Example | Topics and Well Written Essays - 1500 words

Visual analysis paper - Coursework Example Rococo or late Baroque style later came in the 18th century and impacted on art’s sculpture, painting, decoration and interior design. Giotto di Bondone’s â€Å"Madonna Enthroned† created in 1300 by an Italy using the Rococo technique and Garofalos "Madonna and Child in Glory" created in 1935 in Pinacoteca Capitolina are two distinct but closely related masterworks whose exploration can be quite enthralling. This paper shall candidly and comprehensively analyze the two artworks with the predominant aim of determining how similar or different they are in terms of style and the thematic implications or the messages that the artists envisioned to deliver to the audience. Giotto’s â€Å"Madonna Enthroned†, drawn on tempera on panel, patently indicates that the art was painted by an iconic painter, probably cultured and trained in Greek but working in Italy or for a western promoter. This can be derived from the way the artist blends byzantine with western elements in the entire masterpiece. The folds of the cloths are defined by a byzantine concord and the image’s composition is modeled on the Hodegetria, the virgin, who points at the child to show that he is the way, the truth and the light. Additionally, the son, Jesus, gives the Western signs of blessings. The halos on the side of the child are decorated with floral patterns that are popular in Italy. Moreover, the image has a 3-D view, particularly in the virgin’s thrown, to indicate western influence. The artist intentionally uses a virgin with archangels’ majestic regalia and red shoes in the elaborate throne to accentuate Mary’s role as the crowned hea d of Heaven. In the artwork, the golden background connotes the heavenly kingdom implying that the artist knew quite well how gold was treasured in the then community due to its economic value and its imperative role in determining one’s social and economic status. At

Analysis of Board of Directors and Risk Propensity

Analysis of Board of Directors and Risk Propensity Banks are all similarly confronted with particular regulations and inspections of banking supervisions. Within this topic, the board of directors plays an important role. There are different factors considering how the composition of a board might influence its performance and the decision-making process. Therefore, factors like independence, age structure, percentage of minorities and women and the size of the board will be analyzed. After determining the composition, the influence of it on the percentage of equity financing and therefore the risk propensity will be analyzed. Furthermore, the composition will also be linked to performance indicators as Return on Assets (ROA), Return on Equity (ROE), and the development of stock quotations. 3.1. Corporate Governance The term corporate governance describes processes through which an organization is controlled and directed. Those structures specify which rights and duties certain participants in a company have and how the decision-making process works. This mostly affects the board of directors, the top management team (TMT) as well as shareholders and other stakeholders (OECD, 2005). Corporate governance is concerned with the possible abuse of power of the managers and the need for certain qualities like openness, integrity and accountability during the whole decision-making process. As shown in Figure 3.1, it also examines how certain mechanisms, including incentives, can help to minimize transactions costs that arise in an organization between principals and agents as described in the agency theory below (Mathiesen, 2002). 3.2 Structure of the Board of Directors The members of the board are generally elected by the shareholders and their responsibilities vary with the nature and the complexity of the organization. However, there are two different systems regarding the boards of directors. On the one hand there is the Anglo-Saxon system in countries like the United States and Japan (12Manage: The Executive Fast track, 2008). This consists of a one-tier board structure, where executive and non-executive directors work together in the board of directors (Weimer and Pape, 1999). This single board is usually entirely appointed by the shareholders and the CEO often also holds the board chair (12Manage: The Executive Fast track, 2008). On the other hand, in countries like Germany and the Netherlands, companies have adopted a two-tier board structure. There, the board is divided into the managing board and the supervisory board to formally separate powers (12Manage: The Executive Fast track, 2008). The managing board is monitored and advised in major policies by the supervisory board (Weimer and Pape, 1999). The CEO holds the chair of the managing board, but cannot hold the chair of the supervisory board at the same time (12Manage: The Executive Fast track, 2008). Even though, the board of directors is usually elected by the shareholders, in some cases also employees elect their own representative(s) from the workforce to support their interests on the board. In state-owned banks directors are delegated to the bank by the State Council and in where the board of directors is spitted up into managing board and supervisory board, the managing directors are appointed by the supervisory board members as shown in Figure 3.2. 3.3 Tasks of the Board of Directors In general, directors represent the shareholders interests, because they provide the elementary assets for running a company. Therefore, the main role of the board of directors is to govern an organization while acting for the shareholders in order to protect their assets and to ensure a decent return on their investments (Oss, 2003; Kennon, 2008). The board of directors is the à ¢Ã¢â€š ¬Ã…“highest governing authority within the management structure at any publicly traded companyà ¢Ã¢â€š ¬? (Kennon, 2008, n.p.). For this reason, the board is in charge of defining the corporate mission, setting the companys objectives and approving the firms strategy concerning the well judged allocation of the financial resources (Oss, 2003). Even though the board holds the total authority for a companys decision making they cannot manage the companys day-to-day operations, because this is the role of the CEO and the TMT (Oss, 2003). The resulting conflict potential is discussed in the Agency Theory below. According to Oss (2003) it is the boards task to govern and the CEOs to manage. Therefore, a clarified classification of who is in charge will eliminate these conflicts. Furthermore, another stakeholder group exists, as mentioned in the Stak eholder Theory (see Figure 3.3) with additional interests and requirements for the board of directors. Regarding all players and interest groups in an organization, the responsibilities of the board are possible to be divided into a Governance Role, a Service Role and a Control Role. Beside the strategic decisions, an important task of the board members is to appoint special committees like the Audit and Risk Committee, and to select qualified managers, as well as to help and to support them with their skills and expertise. Finally, the board controls if the management meets the companys objectives concerning ethical tenets or laws (Oss, 2003). 3.5 Related Research regarding Board Composition From the theories and former research, it becomes clear that boards have different tasks. Therefore, an optimal structure or composition of the board is essential for fulfilling the tasks. The main tenor in the literature is that in order to work efficiently boards have to be independent with diversity in backgrounds, gender, race and age. However, a certain composition of the board might also affect how much risk the directors are willing to take. The composition of the board receives more and more attention in terms of structure and stability. If a better structured and more stable board of directors is related to a better firm performance, companies with a well-composed board should perform better than other companies. For the purpose of this paper, a well-composed board is defined as a stable and diverse board composed of a majority of independent members along with a number of women and ethnic minority directors. To build the connection to the topic terms à ¢Ã¢â€š ¬Ã¢â‚¬Å" board composition on the one side and firm performance and risk propensity on the other side à ¢Ã¢â€š ¬Ã¢â‚¬Å" it is important to focus on different behavioral patterns which are the result of variations in board compositions. By investigating the influence of the board composition on firm performance and risk propensity it is possible to get insights into how differently composed boards behave regarding specific board tasks. Differently composed boards behave differently in various situations; for example, when they decide whether to replace a poorly performing CEO or when they choose at what price the company should be sold. The boards decision is also important when the acquisition of another firm has to be approved or whe n takeover defenses have to be adopted and employed. Finally, the board plays a big role when it comes to establishing the CEO and executives compensation packages (Bhagat and Black, 1999). 3.5.4 Board Size Board size is seen as one of the most important factors when it comes to the influence on the performance of a company (Kyereboah-Coleman and Biekpe, 2005). The main view regarding board size is that large boards have a negative impact on the performance of the company. That is, because tasks like coordination, decision-making and the communication between the members are more difficult and expensive, the more directors have to be included (Belkhir, 2008). Therefore, the costs would outweigh the gains of having more expertise on the board. Belkhir (2008) cited Jensens (1993) statement that boards with more than seven or eight people are less effective and easier to control for the CEO. Earlier research of the board size supports the proposition that smaller boards are better. Yermack (1996) discovered a negative relationship between board size and firm performance measured by Tobins Q and several other accounting figures. In their sample of small Finnish firms, Eisenberg et al. (1998) also find a negative relationship between the number of directors and financial success of the company. Furthermore, Kyereboah-Coleman and Biekpe (2005) determined that large board sizes are bad for the sales and growth ratio of companies in Ghana. However, Belkhir (2008) found a non-negative relationship between the size of the board of directors and the firm performance measured by Tobins Q, as well as, by return on assets (ROA) for financial institutions. Especially savings-and-loan holding companies (SLHC) might increase the value of the company with a rising number of directors. Therefore, the next hypothesis is that: H4a: An increasing board size has no negative influence on the company performance. When it comes to taking risks, there is not as much empirical evidence. However, if one looks at the decision-making process of a board, especially when its number of directors is very high, the obvious assumption is that for risky decsions it is more difficult to get a consensus the more people have to vote for it. Furthermore, Pfeffer and Salancick (1978) and Lipton and Lorsch (1992) determined a relationship between the capital structure of a company and its board size. Additionally, a study of Abor and Biepke (2005) discovered that an increasing board size and the debt level of Ghanaian SME are negatively related. Thus, the authors assume that: H4b: The board size is negatively related to the risk propensity of the company. 3.5.5 Board Independence You can distinguish between inside directors (current officers of the company) affiliated outsiders (former company officers, and persons who have business relationships with the company) and independent directors (Bhagat and Black, 1999, p. 4). Independent board members (outside directors) are à ¢Ã¢â€š ¬Ã…“not associated with or employed by the companyà ¢Ã¢â€š ¬? (Kennon, 2008, n.p.). According to Kennon, in the United States at least fifty percent of the directors must meet the requirements of independence. A board with fifty percent of independent directors is called a majority-independent board (Bhagat and Black, 1999, p. 4). The Sarbanes-Oxley Act of 2002 places a strong emphasis on the independence of directors. Brown et al. (2004) confirmed this requirement with positive results in their study on the effects of the independence of the board members on financial firm performance data. They found that independent boards have higher return on equity (ROE) and profit margins. Furthermore, it is determined that outside directors can monitor the management more effectively than insiders (Bonn, Yoshikawa, and Phan, 2004). Therefore, the conclusion of several empirical studies is that, besides a more diverse board, a more independent board has a positive effect on the financial performance (see also Adams and Mehran, 2008). But, boards with majority-independent directors have both positive and negative effects. On the one hand, inside directors are more involved in the companys operations and might know the business better than outsiders. On the other hand, outside directors might keep cool and act in a more objective way than insiders. Besides that, several studies did not find significant evidence that a higher number of independent directors within the board is related to the quality of financial reporting, or to the likelihood of firm failure. Additionally, there is no evidence of more firm-level diversification or a connection to research and development spending (Bhagat and Black, 1999). Therefore, Bhagat and Black (1999) recommend that it might be valuable for companies to compose their boards with at least a moderate number of inside directors. This is supported by their results that there is a negative relationship between the degree of board independence and firm performance. However, different firms need different types of boards and an optimal board contains a combination of inside, affiliated and independent directors who bring different skills and knowledge to the board (Bhagat and Black, 1999, pp. 32-33). Along with the companys objectives and shareholder interests, boards of banks additionally bear micro- and macro-economic responsibilities, which can be positively influenced by the optimal composition of the board. For board members of financial institutions, a cooperative board-CEO relationship is elementary. Only when the board gets the complete information about the operating business processes from the CEO, can they make the right decisions for the company. For this reason, it is important to know if inside or outside directors can deal better with the CEO or TMT and generate a higher performance. The writers therefore hypothesize for the banking sector, that: H5a: A higher number of outside directors does not influence firm performance. Pfeffer and Salancik (1978) developed the Resource Dependency Theory and determined that a number of outside directors upgrade a companys ability to protect itself against outside influences and reduce the uncertainty level. Furthermore, they stated that outsiders might help the company retain a certain status and raise funds. Thus, a higher number of outside directors on the board should increase the debt level of the company. On top of that, independent directors might act more in the shareholders interests than inside directors (Bonn, Yoshikawa, and Phan, 2004), and for this reason we hypothesize: H5b: A higher number of outside directors will be positively connected to the risk propensity of the company. 3.6 Summary of the Hypotheses In table 3.1. below, all hypotheses are presented at one glance. These propositions have been derived from past studies and behavioral theories as presented above. Table 3.1 Hypotheses Composition Company Performance Risk Propensity Gender Diversity H1a: A higher percentage of women on the board of direc-tors has a positive influence on firm performance. H1b: A higher percentage of women on the board is nega-tively connected to the risk pro-pensity of the company. Average Age of Directors H2a: The average age of the board of directors is nega-tively connected with firm performance. H2b: The average age of the board is positively connected to risk avoidance of the company. Ethnic Diversity H3a: A higher number of minority directors on the board is positively related to company performance. H3b: Minority directors do not affect the risk propensity of the company. Board Size H4a: Increasing board size has no negative influence on the company performance. H4b: The board size is nega-tively related to the risk pro-pensity of the company. Board indepen-dence H5a: A higher number of outside directors does not in-fluence firm performance. H5b: A higher number of outside directors is positively related to the risk propensity of the company. 4. Empirical Study 4.1 Research Methodology 4.1.1 Sample In this empirical research the top 50 banks in the world according to Bankersalmanac.com4 were investigated. The banks were ranked according to their total assets as of June 30, 2008. For the data collection, there was a time span of three years, from 2005 to 2007. This particular group of banks has been chosen, because of their size and international branches. The reasons for choosing the largest banks from all around the world were to have a comparable size of international business when comparing them. If the banks had only been from one or two countries the differences in size would have been significant and the developments on the financial market would have probably only affected the bigger banks. This might have had an effect on the performance. Thuse, for 2007 the results could have possibly been very inconsistent. Regarding the chosen sample, it can be assured that the international situation has affected them all à ¢Ã¢â€š ¬Ã¢â‚¬Å" some banks more than others, depending on how risky their business operations were. That results in a possible interpretation on how each bank, with managers and board directors, has dealt with the problems and obstacles. 4.1.2 Data Collection Method The necessary data for this study were collected from the annual reports of the 50 financial institutions. The data about the board of directors were found in the corporate governance section of the reports. Data about the company performance were gathered from the consolidated income statements and balance sheets of the banks. The data were usually dated the 31st December of the year. However, some bans adopted a fiscal year ending on March 31, or September 30 of the year. Then, we considered the Annual Reports from March 31, 2008 as belonging to 2007 as well as the Annual Reports from September 30, 2007. This way, it could be assured that the figures were all derived during the similar time period. Furthermore, the main capital ratios, necessary for the risk propensity were taken from the section risk management. However, there are no strict regulations on how companies have to structure their annual reports. Therefore, the relevant data of some financial institutions was found in different parts of the annual reports or on the websites of the companies. 4.2 Operationalization The research data were collected in an Excel sheet for further calculations and preparation purposes with regard to the statistical analysis using the statistics program SPSS. During the research process the researchers also used a complementary list to record secondary and supportive information needed to calculate the total numbers for the primary Excel list. 4.2.1 Board Composition Data The five board composition variables were selected by the authors and the corresponding information about those data were collected as presented in the following paragraphs. 4.2.1.1 Board Size The board size was recorded by counting the members and listing their names. This was done for all three years to find out if there were any changes in the board composition from one year to another. The changes were recorded in the complementary lists. The total number of board members for each bank and each of the three years were transferred to the primary Excel sheet. 4.2.1.3 Independent Directors Next, the authors looked at the percentage of independent directors. The financial institutions usually indicated in the annual reports or on their homepage which members of the board were independent. However, sometimes it was not explicitly alluded neither in the annual report nor on the companys website. Then, the researchers decided if a director was independent or not using an own definition described above. The authors examined if s/he has any other connection to the company beyond the board activities; for instance if him/her is or was employed by the bank in the last years or bears executive tasks. If there was no connection (excluding shareholding) at all, s/he was defined as independent director. The share ownership of directors was excluded, because at some banks each director is obliged to hold at least a small number of shares. The sum of all independent directors of each bank was copied to the list and divided by the total number of members. 4.2.2 Company Performance Indicators To investigate the influence of the board composition on the firm performance the authors chose four performance measures divided into two categories: operating performance and shareholder payout. The three most important financial indicators are the performance measures Return on Assets (ROA), Return on Equity (ROE), and the Efficiency Rate (CIR). Besides this, the researchers also looked at the share performances compared to previous years. These are all common indicators, which are important for shareholders. Furthermore, they are well comparable to the results previous studies in other industry branches showed using the same indicators. To control for the possibility that the performance indictors will be connected to the size of the bank, total assets were also recorded and will be included in the correlation tables and regression models. 4.2.2.1 Return on Assets The accounting measure of a companys profitability, Return on Assets (ROA), indicates net income from all of the banks operations relative to the average book value of all assets (Carter, DSouza, Simkins, Simpson, 2007, p. 15). It shows how beneficial assets are used by management to create earnings for the company. This means that it is possible to see how much profit was derived from invested assets (Investopedia, Definitions, 2008). It is calculated as: ROA= Net Income/ Avg. Total Assets 4.3 Credibility of the Research Data 4.3.1 Reliability Reliability is concerned with the question if the data that were collected by the researchers would be consistent with the findings other researchers would have using the same sources (Saunders et al., 2007). The most data were collected by the authors in a quantitative but diligent manner from the published and certified annual reports of the banks. Due to this fact, the research data cannot be interpreted wrong by the researchers and therefore have a high reliability. However, when it comes to the board composition data about women, minorities and independent directors, the authors had to interpret by using pictures or curriculum vitae of the directors. The gender of the board members is usually recognizable when using pictures. Thus, it is clear and should not be inconsistent when other researchers collect these data. A little more difficult is the question about minorities. For that part, the biographies have to be considered, especially, when it comes to questions about backgrou nds and where the people grew up. This fact can lead to different interpretations depending on who collects the data. However, the definitions on ethnic minorities were made clear in the theoretical part and thus, the results should be very consistent. When deciding about the independence of the directors, there are two factors to consider. First, when the banks noted if the directors were independent, this was just copied for the research. These data are very reliable, because there is no space for interpretation. However, if it was not indicted and the biographies of the directors were read and the decisions about the independence were basically made after reading the professional background. Therefore, other researchers could have a different opinion about directors independence. To summarize, most of the data are very reliable, because they are published and just have to be copied. Only for factors, that the authors had to interpret, it could come to inconsistencies, which should be very limited though, because the data collection was done very diligently and clearly set definitions have been used. 4.3.2 Validity Validity of data is concerned with the question if the findings are what they appear to be. The researcher has to find out if the variables really have a causal relationship (Saunders et al., 2007, p.150). In this study, it was made clear through the theoretical background that board composition and company performance, as well as, risk propensity influence each other. This is mainly secured by the fact that the board of directors makes decisions which are intended to influence the financial results. However, to make sure that the relations between the board and firm performance and risk propensity are not accidental, four performance measures and two risk measures that were studied. A problem could arise, if the results are inconsistent. If that was the case, the contradicting results have to be interpreted and explained. 4.3.3 Generalisability The aim of this research study was to be able to generalize the results, which means to be able to apply the results to other settings (Saunders et al., 2007). Other settings could be for example a different group of banks or maybe other companies located in the same countries and also have international operations. For this reason, the quantitative research method was applied. To get reliable and valid results the authors collected almost 150 data sets by investigating 50 banks over three years. The number of banks was not selected by the authors but provided by a public resource which registered the 50 largest banks as measured by their total assets as of June 30, 2008. This amount of research data and the fact, that the sample includes banks situated on three continents in many different countries, allows the authors to generalize the findings. 5. Analysis 5.1 General Findings The sample of fifty banks consists of the largest financial institutions from North America, Europe and Asia. The biggest group are the European banks. One bank from the sample had to be excluded because its structure differed too much from the other banks and did not fit to the research questions. It was a state-owned bank which was controlled by politicians to a large percentage. Furthermore, for the year 2005, one more bank had to be left out, because it was just created in 2006 by a merger of two smaller banks. To be able to compare the banks, all performance indicators that were stated in different currencies have been converted into Euros with the currency rate of December 31 of each year.6 In table 5.1 general statistical values of the variables are listed. A value that was controlled for in the research was total assets. This was important for detecting if the board size or any of the other independent variables changed with the size of the bank. However, there is no significant relationship between the total assets and the size of the board (see table 5.2). Therefore, it is possible to say, that banks do not decide about the number of directors based on their size measured by total assets. It is rather noticeable that banks with a two-tier board system have larger boards than the other banks. The maximum number of directors came up to 48, when adding up the number of directors in the supervisory and the managing board compared to a minimum of seven board members in a one-tier system bo ard of directors. Table 5.1 Descriptive Statistics years 2005-2007 Samples Minimum Maximum Mean Median Std. Deviation Total Assets (Mio. à ¢Ã¢â‚¬Å¡Ã‚ ¬) 146 168,119 2,579,194 732,994 557,269 415,293 Board Size 146 7 48 18.36 17.00 6.92 Board Age (years) 142 49.1 64.70 57.32 57.74 3.44 Women (%) 146 0.00 42.90 10.02 6.8 9.32 Minorities (%) 146 0.00 41.20 3.73 0.00 7.79 Independent Directors (%) 146 0.00 94.10 49.15 50.00 28.80 Share Development cp. to Previous Year (%) 100 -44.75 106.67 14.61 16.90 27.52 ROE (%) 146 -37.90 37.50 14.56 15.35 8.60 ROA (%) 146 -0.30 1.75 0.65 0.59 0.40 Cost/Income Ratio (%) 125 34.70 114.00 58.89 56.00 13.07 Debt-Ratio (%) 146 87.73 98.54 95.31 95.95 2.19 B.I.S Capital (%) 135 8.5 19.70 11.79 11.60 1.72 5.2 Interdependency between the Independent Variables Before checking for the influence of the board composition on performance and risk propensity, the interdependency of the independent variables was evaluated in table 5.2. It is noticeable that many of the factors correlate with each other within the one percent significance level. The strongest correlation exists between the variables board age and percentage of independent directors. It shows that the higher the average age of the directors is the more independent directors are on the board. This leads to the conclusion that outside board members are usually older than executive directors. Another strong significant relationship is shown between the variables board age and board size. This correlation is negative and implies that the average age of the directors decreases when the number of board members increases. The reason for this link could be that the younger board members are introduced into the tasks before the older directors retire. One more noticeable factor is that the percentage of women on the board is positively correlated with the percentage of minorities on the board. This supports the results of Carter et al. in 2002. Furthermore, independent directors correlate significantly positively with women and minorities, which supports the conclusion that female and minority directors usually seem to be outsiders to the bank. An interesting fact is also that minority directors usually seem to be of more importance in smaller boards. The correlation between the board size and the percentage of minorities is slightly negative, which indicates that smaller boards have a higher percentage of ethnic minority directors. Furthermore, it is interesting that the boards of directors of banks do not significantly correlate with their total assets, as mentioned before. However, the board age has a very significant positive correlation with the assets. This implies that larger banks usually have an older board of directors. Besides, those banks also seem to have a slightly higher percentage of independent outside directors as shown by the positive correlation between these two factors. With the high interdependencies between the independent variables, it could come to multicollinearity problems in the regression analyses for the dependent performance and risk indicators. Fortunately, this is not the case as shown by the VIF-values, which are lower than 2.5, in the regression models below. Table 5.2 Correlations between Independent Variables 1 2 3 4 5 6 1 Total Assets a 1 2 Board Size a -.113 1 3 Board Age a .308*** -.403*** 1 4 Women (%) a -.052 .037 -.026 1 5 Minorities (%) a .098 -.176** .254*** .267*** 1 6 Indep. Directors (%) a .208** -.114 .465*** .369*** .308*** 1 *** Correlation is significant at the 0.01 level (2-tailed) ** Correlation is significant at the 0.05 level (2-tailed) a Pearson correlation coefficient 5.3 Influence of Board Composition on Performance Data At the beginning, the correlations of the data from all three years were evaluated together to get a general overview over the connections made between the independent and dependent variables. 5.3.1 Return on Assets When regarding the influence of the board composition on the first performance indicator it is very obvious that ROA is connected to all variables, except for total assets (see table 5.3). The strongest positive correlation exists between the variables return on assets and percentage of independent directors, followed by minorities. A little weaker connection is shown with the percentage of female directors and the board age. The linkages indicate that outsiders or a more divers and experienced board (concerning average