Purpose This paper aims to examine how board composition, political connections and sustainability practices affect risk-taking and performance of firms. Design/methodology/approach This paper used secondary data and regression technique to analyse the relationship. A sample consisting of 290 firm-year observations was applied in the analysis. Findings The findings show that a larger board size contributes to greater financial risk; however, this risk can be reduced with more independent directors in the boardroom. An optimal board size with appropriate number of independent directors is desired, as a large board size can be harmful to firm performance. Politically connected firms also generate lower risk-taking and performance, and the double-edged sword effect of political connections needs to be considered. In terms of sustainability practices, firms have to engage in sustainable development to maximise the firms’ value, not ignoring the vital role of women in strategising business performance. However, the effect of sustainability practices on firms’ risk-taking is still not noticeable. Research limitations/implications Even though the sample size is not large because of the limited availability of data, the findings, to a certain extent, could be generalised to emerging markets, as most emerging markets do have similar financial and economic developments. Practical implications The findings from this paper can be used to support the implementation of sustainability practices, especially in those countries where sustainability initiatives are yet to be widely accepted. Originality/value This is one of the first few studies that examined the effect of non-financial information on risk-taking and performance of firms. This study concludes the positive effect of sustainability practices on firm performance.

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PurposeThe purpose of this paper is to identify the relationships between risk management committee characteristics and risk taking of the Malaysia's insurance companies, from 2003‐2011. The paper aims to examine three identified characteristics of a risk management committee, namely, size, independence, and number of meetings.Design/methodology/approachThe sample comprises 329 observations throughout the nine years' time frame until 2011. Pearson's correlation, pooled ordinary least squares regression, and panel regression model are used in this study. Sensitivity testing with an alternative measure of underwriting risk is also performed.FindingsOut of the three characteristics, size and committee independence appear to be negatively associated with underwriting risk. Meanwhile, the frequency of risk management committee meetings is insignificant in this study.Research limitations/implicationsThe sample of this study is limited to the Malaysia's insurance sector only.Originality/valueA risk management committee is an influencing force for risk oversight and the internal control system. The empirical evidence enriches the understanding of corporate governance in the context of the role of a risk management committee.

Purpose – The purpose of this study is to delineate the factors influencing the use of financial derivatives by non-financial firms in managing their exchange rate exposure. In total, 219 non-financial firms are surveyed in regard to their financial hedging decision. Design/methodology/approach – This study is conducted via a survey and the questionnaires were sent to the treasurers and financial controller of the firms. Descriptive analysis is employed to assess the profiles of the respondents. Then, factor analysis is carried out to determine the factors influencing the use of financial derivatives in Malaysia. Findings – The results indicate that the hedging decision of non-financial firms is influenced by their assertive level toward the market and regulators and also how flexible they are for derivative instruments. The intellectual capability that firms acquire to perform hedging strategies is also vital in influencing them to make hedging decision. Practical implications – The insights of this survey would assist and prepare firms to hedge their exchange rate risk by employing financial derivatives. Knowing the influences of firms' adoption of currency derivatives would allow policy makers to formulate their policies in boosting the liquidity of Malaysian derivative market. Originality/value – This study presents findings on the factors influencing the execution of financial hedging by non-financial firms in Malaysia. Survey data are used to seek for the feedback from the market players in order to provide empirical evidence on the corporate use of financial hedging.

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