LETTER FROM THE EDITOR IN CHIEF

NUMBER 81 BUSINESS AND SOCIETY REVIEW

The article titled “Social and Circular Economy: Measurement and Reporting for Sustainability Management in Nonprofit Entities” aims to identify activities undertaken by social entities and define new professional profiles related to closing material loops and circular business models. The authors of this research are: D. Gallardo Vázquez (Universidad de Extremadura) and from the University of Zaragoza, professors S. Scarpellini, A. Aranda-Usón, and V. Kuba-Khoury.

Understanding the main activities developed by the circular economy provides support and implies policy implications not only for professionals but also, and especially, for public administrations and the academic world. The article develops a reporting analysis for the circular economy, which is particularly valuable in a sector where small entities comprise the majority of this population.

Under the title “Retro-Innovation, Sustainability, and Viability of Agricultural Exploitations in the Extremaduran Dehesa,” Professors E. P. Herrera González and M.T. Méndez Picazo from the Universidad Complutense de Madrid developed the hypothesis that retro-innovation, or the reintroduction of traditional techniques and processes to conserve the environment and exploit it economically in a sustainable manner, can be of great social and economic relevance for a given geographical and economic area. As the article points out, in the case of the Extremaduran dehesas, there are precedents of rational and sustainable exploitation carried out by the monks of the Monastery of Guadalupe between 1389 and 1835. During this period, the Monastery integrated a diversified economy for the entire geographical area. By applying their retro-innovated techniques and processes in some of the current Extremaduran dehesas, it has been possible to make their sustainable economic use viable.

The article “Modeling of Production Chains in the Food Industry from the Perspective of System Dynamics for Decision Making: A Mapping Review” written by Professors M. Guzmán Rincón and A. Guzmán Rincón, both at the Corporación Universitaria de Asturias, Colombia, aims to identify and analyze research trends in modeling food production chains through system dynamics, with a particular focus on decision making. It is crucial to understand that food production is not an isolated system; it is complex and interconnected with other social and economic agents, leading the authors to emphasize the need to adopt multidisciplinary perspectives. Various publication sources indicate that research in system dynamics applied to food production chains is disseminated through multiple academic channels.

The application of system dynamics in the production chains of the food industry represents an opportunity for transformation in terms of management and operation. The analysis was conducted mainly using SCOPUS as a database, which is broadly recognized by the academic community. The publications also reveal the complexity of the global food system, for example, with changes in diets, the importance of food trade, and food security. System dynamics offer a way to understand these complexities and contribute to global food security through detailed analysis.

The article titled “Shariah Compliance and Earnings Management: Insights on Reporting, Transparency, and Financial Stability,” authored by Manu Abraham, examines the influence of Muslim religious law on the performance and outcomes of business firms located in regions where approximately a quarter of the world’s population resides. Shariah law serves as a religious code that promotes ethical conduct and prohibits transactions that are inconsistent with Muslim religious beliefs. Consequently, firms that comply with Shariah law are limited to generating no more than 5% of their income from non-permissible sources. Firms adhering to Shariah law are perceived positively by investors due to the quality of their earnings.

This research is based on data from a limited number of firms listed on the Indian stock exchange. It examines the financial stability and transparency of firms that comply with or do not comply with Shariah law in India. The financial characteristics of Shariah-compliant firms, which reduce managerial discretion, include lower leverage, reduced liquidity holdings, and fewer accounts receivable.

As Manu Abraham concludes, the article contributes to existing literature by highlighting the relevance of Shariah compliance in enhancing the transparency of financial and non-financial reporting, thereby reducing the potential for earnings manipulation. Islamic finance is an emerging concept on the international stage.

José Durán Herrera. Director UCJC Business & Society Review

Juan Díez Nicolás. Director UCJC Business & Society Review

June 30, 2024