Economic and Social Development

Varazdin Development and Entrepreneurship Agency in cooperation with University North Faculty of Management University of Warsaw Faculty of Law, Economics and Social Sciences Sale - Mohammed V University in Rabat

Economic and Social Development 33rd International Scientific Conference on Economic and Social Development – "Managerial Issues in Modern Business"

Editors: Tomasz Studzieniecki, Melita Kozina, Dunja Skalamera Alilovic

Book of Proceedings

Warsaw, 26-27 September 2018

Varazdin Development and Entrepreneurship Agency in cooperation with

University North Faculty of Management University of Warsaw Faculty of Law, Economics and Social Sciences Sale - Mohammed V University in Rabat

Editors: Tomasz Studzieniecki, Melita Kozina, Dunja Skalamera Alilovic

Economic and Social Development rd

33 International Scientific Conference on Economic and Social Development –

"Managerial Issues in Modern Business"

Book of Proceedings

Warsaw, 26-27 September 2018

Title ◼ Economic and Social Development (Book of Proceedings), 33rd International Scientific Conference on Economic and Social Development - "Managerial Issues in Modern Business" Editors ◼ Tomasz Studzieniecki, Melita Kozina, Dunja Skalamera Alilovic Scientific Committee ◼ Marijan Cingula, University of Zagreb, Croatia (President); Sandra Raquel Alves - University of Aveiro, Portugal; Ayuba A. Aminu, University of Maiduguri, Maiduguri, Nigeria; Anona Armstrong, Victoria University, Australia; Gouri Sankar Bandyopadhyay, The University of Burdwan, Rajbati Bardhaman, India; Haimanti Banerji, Indian Institute of Technology, Kharagpur, India; Elisabeth de Jesus Oliveira Brito - University of Aveiro, Portugal; Alla Bobyleva, The Lomonosov Moscow State University, Russia; Leonid K. Bobrov, State University of Economics and Management, Novosibirsk, Russia; Rado Bohinc, University of Ljubljana, Slovenia; Zeki Atil Bulut, Dokuz Eylul University, Turkey; Adnan Celik, Selcuk University - Konya, Turkey; Angelo Maia Cister, Federal University of Rio de Janeiro, Brasil; Mirela Cristea, University of Craiova, Romania; Sreten Cuzovic, University of Nis, Serbia; Oguz Demir, Istanbul Commerce University, Turkey; T.S. Devaraja, University of Mysore, India; Onur Dogan, Dokuz Eylul University, Turkey; Darko Dukic, University of Osijek, Croatia; Gordana Dukic, University of Osijek, Croatia; Alba Dumi, Vlora University, Vlore, Albania; Ksenija Dumicic, University of Zagreb, Croatia; Galina Pavlovna Gagarinskaya, Samara State University, Russia; Fran Galetic, Zagreb University, Croatia; Mirjana Gligoric, Faculty of Economics, Belgrade University, Serbia; Mehmet Emre Gorgulu, Afyon Kocatepe University, Turkey; Aleksandra Grobelna, Gdynia Maritime University, Poland; Liudmila Guzikova, Peter the Great Saint-Petersburg Polytechnic University, Russia; Anica Hunjet, University North, Koprivnica, Croatia; Oxana Ivanova, Ulyanovsk State University, Ulyanovsk, Russia; Irena Jankovic, Faculty of Economics, Belgrade University, Serbia; Lara Jelenc, University of Rijeka, Croatia; Myrl Jones, Radford University, USA; Gorazd Justinek, Graduate School of Government and European Studies, Slovenia; Hacer Simay Karaalp, Pamukkale University,Turkey; Grzegorz Karasiewicz, University of Warsaw, Poland; Dafna Kariv, The College of Management Academic Studies, Rishon Le Zion, Israel; Salih Katircioglu, Eastern Mediterranean University, Northern Cyprus, Turkey; Hilal Yildirir Keser, Uludag University, Bursa, Turkey; Martina Dragija Kostic; Sophia Khalimova, Institute of Economics and Industrial Engineering of Siberian Branch of Russian Academy of Science, Novosibirsk, Russia; Marina Klacmer Calopa, University of Zagreb, Croatia; Vladimir Kovsca, University of Zagreb, Croatia; Goran Kozina, University North, Koprivnica, Croatia; Dzenan Kulovic, Univeristy of Zenica, Bosnia and Herzegovina; Robert Lewis, Les Roches Gruyère University of Applied Sciences, Bulle, Switzerland; Ladislav Lukas, Univ. of West Bohemia, Faculty of Economics, Czech Republic; Pascal Marty, University of La Rochelle, France; Vaidotas Matutis, Vilnius University, Lithuania; Marjana Merkac Skok, GEA College of Entrepreneurship, Ljubljana, Slovenija; Daniel Francois Meyer, North West University, South Africa; Marin Milkovic, Rector, University North, Koprivnica, Croatia; Zlatko Nedelko, University of Maribor, Slovenia; Gratiela Georgiana Noja, West University of Timisoara, Romania; Zsuzsanna Novak, Corvinus University of Budapest, Hungary; Alojzy Z. Nowak, University of Warsaw, Poland; Tomasz Ochinowski, University of Warsaw, Poland; Mislav Ante Omazic, University of Zagreb, Croatia; Vera Palea, Universita degli Studi di Torino, Italy; Dusko Pavlovic, Libertas International University, Zagreb, Croatia; Igor Pihir – University of Zagreb, Croatia; Dinko Primorac, University North, Koprivnica, Croatia; Zeljka Primorac, University of Split, Croatia; Miroslaw Przygoda, University of Warsaw, Poland; Nicholas Recker, Metropolitan State University of Denver, USA; Kerry Redican, Virginia Tech, Blacksburg, USA; Humberto Ribeiro, University of Aveiro, Portugal; Robert Rybnicek, University of Graz, Austria; Elzbieta Szymanska, Bialystok University of Technology, Poland; Katarzyna Szymanska, The State Higher School of Vocational Education in Ciechanow, Poland; Jan Turyna, University of Warsaw, Poland; Ilaria Tutore, University of Naples Parthenope, Italy; Claudia Miranda Veloso - University of Aveiro, Portugal; Rebeka Danijela Vlahov, University of Zagreb; Ilko Vrankic, University of Zagreb, Croatia; Thomas Will, Agnes Scott College, USA; Li Yongqiang, Victoria University, Australia; Peter Zabielskis, University of Macau, China; Tao Zeng, Wilfrid Laurier University, Waterloo, Canada; Snezana Zivkovic, University of Nis, Serbia. Review Committee ◼ Marina Klacmer Calopa (President); Ana Aleksic; Sandra Raquel Alves; Ayuba Aminu; Mihovil Andjelinovic; Josip Arneric; Lidija Bagaric; Tomislav Bakovic; Sanja Blazevic; Leonid Bobrov; Ruzica Brecic; Anita Ceh Casni; Mirela Cristea; Oguz Demir; Jasmina Dvorski; Stjepan Dvorski; Robert Fabac; Ivica Filipovic; Sinisa Franjic; Fran Galetic; Mirjana Gligoric; Tomislav Globan; Anita Goltnik Urnaut; Tomislav Herceg; Irena Jankovic; Emina Jerkovic; Dafna Kariv; Oliver Kesar; Hilal Yildirir Keser; Tatjana Kovac; Vladimir Kovsca; Angelo Maia Cister; Katarina Marosevic; Vaidotas Matutis; Marjana Merkac Skok; Josip Mikulic; Ljubica Milanovic Glavan; Daniel Francois Meyer; Natanya Meyer; Guenter Mueller; Ivana Nacinovic Braje; Zlatko Nedelko; Gratiela Georgiana Noja; Zsuzsanna Novak; Alka Obadic; Claudia Ogrean; Igor Pihir; Najla Podrug; Vojko Potocan; Dinko Primorac; Zeljka Primorac; Sanda Renko; Humberto Ribeiro; Vlasta Roska; Souhaila Said; Armando Javier Sanchez Diaz; Tomislav Sekur; Lorena Skuflic; Mirko Smoljic; Petar Soric; Mario Spremic; Matjaz Stor; Tomasz Studzieniecki; Lejla Tijanic; Daniel Tomic; Boris Tusek; Rebeka Daniela Vlahov; Ilko Vrankic; Thomas Will; Zoran Wittine; Tao Zeng; Snezana Zivkovic; Berislav Zmuk. Organizing Committee ◼ Domagoj Cingula (President); Marina Klacmer Calopa; Spomenko Kesina; Erlino Koscak; Miroslaw Przygoda; Michael Stefulj; Rebeka Danijela Vlahov; Sime Vucetic. Publishing Editor ◼ Domagoj Cingula Publisher ◼ Design ◼ Print ◼ Varazdin Development and Entrepreneurship Agency, Varazdin, Croatia / Faculty of Management University of Warsaw, Warsaw, Poland / University North, Koprivnica, Croatia / Faculty of Law, Economics and Social Sciences Sale - Mohammed V University in Rabat, Morocco Printing ◼ Online Edition ISSN 1849-7535 The Book is open access and double-blind peer reviewed. Our past Books are indexed and abstracted by ProQuest, EconBIZ, CPCI (WoS) and EconLit databases and available for download in a PDF format from the Economic and Social Development Conference website: http://www.esd-conference.com © 2018 Varazdin Development and Entrepreneurship Agency, Varazdin, Croatia; Faculty of Management University of Warsaw, Warsaw, Poland; University North, Koprivnica, Croatia; Faculty of Law, Economics and Social Sciences Sale - Mohammed V University in Rabat, Morocco. All rights reserved. Authors are responsible for the linguistic and technical accuracy of their contributions. Authors keep their copyrights for further publishing.

CONTENTS MANAGEMENT OF CORPORATE HUMAN CAPITAL IN THE BULGARIAN ECONOMIC UNITS AS AN OBJECT OF THE BEHAVIORAL PARADIGM .............. 1 Adelina Milanova, Pavlinka Naydenova NEXUS BETWEEN HUMAN CAPITAL DEVELOPMENT AND HUMAN CAPITAL INVESTMENT IN NIGERIA ................................................................................................. 9 Awe Isaac Tope TECHNOLOGICAL QUALITY ASSESSMENT IN ONLINE COMMERCIAL SERVICES .............................................................................................................................. 21 Ireneusz Czarnowski, Monika Szyda FAMILY VIOLENCE ........................................................................................................... 30 Dasa Panjakovic Senjic IMPLEMENTATION OF THE SIX SIGMA METHODOLOGY IN A-ROSA HOTEL .................................................................................................................................................. 38 Elizabeta Mitreva, Elena Lazarovska, Oliver Filiposki THE FUTURE OF MANAGERIAL EDUCATION ........................................................... 48 Grazyna Wieczorkowska Wierzbinska FROM EL BOUAZIZI TO ISIS: PAST SEEDS AND PRESENT HARVEST (TOWARDS UNDERSTANDING THE CAUSES OF THE SHIFT FROM CLAIMS FOR FREEDOM TO VIOLENCE) .................................................................................................................... 55 Housni Hamid, Maliki Sadik, Biad Tayeb IMPACT OF THE ORGANIZATION OF THE ASSOCIATION OF COMPANIES ON THE ECONOMY OF ITS PARTICIPANTS ...................................................................... 61 Eva Vitkova, Vit Hromadka, Jiri Kusak INNOVATIONS AND SAFETY IN PASSENGER RAILWAY TRANSPORT - THE TRAVELERS’ PERSPECTIVE ........................................................................................... 71 Joanna Hernik, Rafal Mazur COMPARATIVE ANALYSIS OF BUSINESS EXCELLENCE MODELS ................... 82 Andzela Veselova DECISION ENGINEERING: SETTLING A LEAN DECISION MODELING APPROACH ........................................................................................................................... 93 Vanja Bevanda METHODICAL APPROACH FOR THE ECONOMIC EVALUATION OF SPECIFIC PROJECTS ON WATERWAYS ........................................................................................ 103 Vit Hromadka, Eva Vitkova, Jana Korytarova

THE INFLUENCE OF FEMALE CEOS ON PERFORMANCE AND INDEBTEDNESS: AN EMPIRICAL ANALYSIS OF SPANISH HOTEL COMPANIES ........................... 109 Belen Arnao-Nieto, Joanna Hernik, Antonio Minguez-Vera INTRA- VS INTER-INDUSTRY TRADE: A ROBUST ANALYSIS OF THE DETERMINANTS OF THE DIFFERENT TRADE TYPESERROR! BOOKMARK NOT DEFINED. Krzysztof Beck THE ROLE OF PROCESS IMPROVEMENTS TOOLS IN BUILDING RELATIONSHIP BETWEEN SUPPLIERS AND INDUSTRIAL CLIENTS ............... 127 Maciej Urbaniak THE STRATEGY OF NOSTALGIC BRAND – EXPERTS’ STUDY ........................... 135 Magdalena Grebosz-Krawczyk, Jean Marc Pointet GLOBL BLOCKCHAIN TECHNOLOGY MARKET ANALYSIS – CURRENT SITUATIONS AND FORECAST ....................................................................................... 143 Alexey Chernov, Victoria Chernova CONDITIONS AND DIRECTIONS OF DEVELOPMENT OF BOOK FAIRS PERSPECTIVE OF THE POLISH MARKET ................................................................. 153 Anita Proszowska INVESTMENT PSYCHOLOGY AND BEHAVIOR ANALYSIS IN THE KOREAN RECONSTRUCTION MARKET ....................................................................................... 160 Chang-Wook Park, Seong-Hoon Jeong CRYPTOCURRENCY: GENERAL CHALLENGES OF LEGAL REGULATION AND THE SWISS MODEL OF REGULATION ....................................................................... 168 Dragan Zelic, Nenad Baros THE EVOLUTION OF ROMANIAN MACROECONOMY POST-CRISIS................ 177 Dragos Ion Smedescu RESEARCH ON ACCESSING EUROPEAN FUNDS FOR YOUNG FARMERS IN ROMANIA UNDER THE TWO NATIONAL RURAL DEVELOPMENT PROGRAMS ................................................................................................................................................ 184 Marius Mihai Micu THE PECKING ORDER THEORY (POT) AND START-UP FINANCING OF SMALL AND MEDIUM ENTERPRISES (SMES): INSIGHT INTO AVAILABLE LITERATURE IN THE LIBYAN CONTEXT ................................................................. 191 Nassr Saleh Mohamad Ahmad, Ramadan Ahmed A Atniesha MULTI-CRITERIA HIERARCHY OF DEVELOPMENT REGIONS FROM THE TOURISM PERSPECTIVE – ROMANIA ........................................................................ 201 Nela Steliac, Dumitru Steliac FUNCTION AND IMPORTANCE OF INTERNAL AUDIT IN HOTEL GROUP „BUDVANSKA RIVIJERA“ .............................................................................................. 212

Olivera Simovic, Djurdjica Perovic EFFICIENT MARKETING METHODS AIMING TO COMPLY WITH THE REQUIREMENTS OF MODERN CLIENTS ................................................................... 224 Ioan Iulian Alecu GRI REPORTING FRAMEWORK AS A TOOL OF SOCIAL ACCOUNTING ........ 230 Grazyna Michalczuk, Urszula Konarzewska THE CONCEPT OF ORGANIZATIONAL AMBIDEXTERITY AS AN EXAMPLE OF PARADOXICAL STRATEGY ........................................................................................... 241 Marta Kozakowska-Kedzierska ’QUESTIONS BANK’ IN TERMS OF WŁADYSŁAW JACHNIAK AS A MANAGERIAL TOOL OF FINANCIAL EDUCATION ............................................... 250 Michal Kozlowski, Danuta Jachniak A POLITICAL ECONOMY ANALYSIS OF THE CHINESE SYSTEM OF SOCIALIST MARKET ECONOMY ........................................................................................................ 260 Nenad Rancic, Ying Zhang, Ozren Pilipovic CONTEMPORARY INNOVATION PROCESSES AND MANAGERIAL ISSUES ... 269 Andrzej H. Jasinski ROMANIAN WINES - PAST, PRESENT, FUTURE ...................................................... 279 Petrica Stefan R&D EFFECTIVENESS IN THE PHARMACEUTICAL INDUSTRY ........................ 287 Lukasz Konopielko, Anastasiia Trechubova BETWEEN CONSUMERISM AND DECONSUMPTION - ATTITUDES OF YOUNG POLES AS A CHALLENGE FOR MARKETERS .......................................................... 297 Agnieszka Wilczak SELECTED PROBLEMS OF THE CREATION AND DEVELOPMENT OF THE INFORMATION SOCIETY AGAINST A BACKGROUND OF GLOBALIZATION 306 Anna Janiga-Cmiel THE INFLUENCE OF CLIMATE CHANGE ON SUSTAINABLE DEVELOPMENT ................................................................................................................................................ 316 Dorina Nicoleta Mocuta THE EFFECT OF OVERFLOW AT WORKPLACE ON EMPLOYEES PRODUCTIVITY AND WELL BEING ............................................................................ 322 Krzysztof Nowak, Anna Olga Kuzminska, Katarzyna Kinga Kowalczyk PERFORMANCE APPRAISAL SYSTEM FOR ADMINISTRATIVE STAFF: A PILOT IMPLEMENTATION STUDY AT THE UNIVERSITY OF WARSAW ....................... 332 Maria Cywinska, Konrad Zawadzki THE LEGAL ASPECTS OF INSOLVENCY OF THE ENTERPRISE (SELECTED ISSUES) ................................................................................................................................. 341

Monika Smusz - Kulesza THE INFLUENCE OF THE TYPE OF CUSTOMER (INDIVIDUAL VS INSTITUTIONAL) ON THE PRINCIPLES OF WRITTEN COMMUNICATION OF A LARGE ORGANIZATION ................................................................................................ 351 Grazyna Rosa, Izabela Ostrowska, Kamila Slupinska, Leszek Gracz CHANGE OF THE PREVIOUS PATH OF DEVELOPMENT IN THE ACTIVATION OF PERIPHERAL AREAS OF WEST POMERANIA IN POLAND ............................ 361 Piotr Nowaczyk USING THE APPARATUS OF SIMULATION MODELING IN THE PROCESS OF DEVELOPING ADVERTISING STRATEGIES OF ENTERPRISES .......................... 372 Zoya Sokolovska, Alexey Alyohin, Iryna Kapustyan COMMUNICATION WITH EXTERNAL AND INTERNAL PUBLIC ACCORDING TO STAKEHOLDER MANAGEMENT PRINCIPLES: EXAMPLE OF SPORTS ORGANIZATIONS ............................................................................................................. 383 Goran Pavelin, Nikolina Lucic ANALYSIS OF THE CORRELATION BETWEEN CORPORATE GOVERNANCE AND THE ECONOMIC-FINANCIAL PERFORMANCE OF THE ECONOMIC ENTITIES ............................................................................................................................. 394 Raluca Florentina Cretu ANALYSIS OF THE ECOTOURIST PROFILE IN ROMANIA, HUNGARY AND BULGARIA .......................................................................................................................... 404 Romeo Catalin Cretu TOURISM NETWORK: KRAPINA – ZAGORJE COUNTY CASE ............................ 414 Sinisa Hajdas Doncic, Ivan Pavelic, Mihael Zmajlovic ANALYSIS OF CROSS-BORDER ACQUISITIONS OF FAMILY-OWNED COMPANIES IN THE REPUBLIC OF CROATIA......................................................... 424 Karla Grgic, Davor Filipovic, Najla Podrug ECONOMIC ASPECTS OF VIRTUAL SERVICES ....................................................... 434 Stanislaw Walukiewicz THE INFLUENCE OF AN EXCESSIVE PUBLIC DEBT ON THE ECONOMIC TRENDS IN THE REPUBLIC OF CROATIA ................................................................. 449 Zeljko Sudaric, Mateja Glavota SELECTED METHODS OF PSYCHOLOGICAL MANIPULATION IN THE MARKETING OF FINANCIAL SERVICES ................................................................... 460 Sylwia Lach CASE STUDY METHOD AND ITS USEFULNESS IN BRANDING ACTIVITIES RESULTS OF RESEARCH ................................................................................................ 468 Beata Tarczydlo

BUSINESS PROCESS MATURITY MODELS RESEARCH – A SYSTEMATIC LITERATURE REVIEW .................................................................................................... 476 T. Bartosz Kalinowski THE ANALYSIS OF THE CHOSEN METHODS OF THE EVALUATION OF STARTUPS ON THE SPECIFIC CASE ......................................................................................... 484 Daniela Majercakova, Alexandra Mittelman THE ECONOMIC IMPACT ON DEVELOPMENT OF DEMOCRATIC PARTICIPATION IN VISEGRÁD GROUP COUNTRIES ............................................ 491 Tomasz Madras PERIPHERAL ANTECEDENTS OF THE PROSUMER CULTURE AS A SOURCE OF INSPIRATION FOR HUMANISTIC MANAGEMENT ................................................. 500 Tomasz Ochinowski, Edyta Rosinska-Wielec ANALYSIS OF THE VALUATION ACTIVITY ON VEGETABLES AND FRUITS CHAINS FOR THEIR IMPROVEMENT ......................................................................... 508 Valentina Constanta Tudor THE ROLE OF ICT IN THE ZADAR CITY MUSEUMS AS A CHALLENGE FOR CULTURAL TOURISM ..................................................................................................... 515 Sime Vucetic, Domagoj Cingula, Djani Bunja THE IMPORTANCE OF QUALITY ASSESSMENT CRITERIA OF BANKING APPLICATION IN POLAND............................................................................................. 526 Witold Chmielarz, Konrad Luczak THE SUSTAINABILITY ASSESSMENT – THE CASE OF A RUSSIAN PETROCHEMICAL COMPANY ...................................................................................... 536 Yulia Fomina, Svetlana Apenko SOFT LAW ACTS AND THE PRINCIPLE OF LEGAL CERTAINTY ON THE EXAMPLE OF THE ACTIVITIES OF THE POLISH FINANCIAL SUPERVISION AUTHORITY AND THE PRESIDENT OF THE OFFICE OF ELECTRONIC COMMUNICATIONS ......................................................................................................... 544 Tomasz Klemt, Michalina Szpyrka QUALITY MANAGEMENT TOOLS USED IN THE FUNCTION FAILURE DESIGN METHOD .............................................................................................................................. 552 Fabis-Domagala Joanna, Filo Grzegorz, Domagala Mariusz, Momeni Hassan REDEFINING THE ROLE OF THE CONSUMER IN THE PROCESS OF CREATING MARKETING INNOVATIONS ......................................................................................... 561 Katarzyna Liczmanska-Kopcewicz DESIGN OF RESILIENT SUPPLY CHAINS .................................................................. 571 Grazyna Wieteska

REVITALIZATION OF DEGRADED PORT AREAS AS A CHANCE FOR LOCAL DEVELOPMENT ON THE EXAMPLE OF KOŁOBRZEG MUNICIPALITY .......... 579 Piotr Nowaczyk, Arkadiusz Malkowski CHANGE AREAS IN BIG INDUSTRIAL COMPANIES AND THEIR EVALUATION ................................................................................................................................................ 589 Jerzy Paszkowski CHANGES IN THE USE OF WEBSITES IN E-COMMERCE IN 2017 -2018 ............ 597 Witold Chmielarz, Tomasz Parys

33rd International Scientific Conference on Economic and Social Development – ”Managerial Issues in Modern Business” – Warsaw, 26-27 September 2018

THE INFLUENCE OF FEMALE CEOS ON PERFORMANCE AND INDEBTEDNESS: AN EMPIRICAL ANALYSIS OF SPANISH HOTEL COMPANIES Belen Arnao-Nieto University of Murcia, Spain [email protected] Joanna Hernik West Pomeranian University of Technology in Szczecin, Poland [email protected] Antonio Minguez-Vera University of Murcia, Spain [email protected] ABSTRACT One of the most detailed areas studied in business is female presence on boards of directors. There are many factors that affect the situation of women in society and stop them from having a career, but for sure the recent access of women to university studies, their preference for studying social sciences, and the difficulty of combining family and work commitments should be mentioned. Additionally, there is a deep-rooted cultural phenomenon, called 'Glass Ceiling', which gives social acceptance for inequality of genders. On the other hand, nowadays women are present in almost every area of the economy, and they start to perform many responsible functions. This is due to different factors, such as industrialization, the First and Second World War, many technological advances, but also declining birth rates, and women’s access to education. Considering such a background, this paper analyzes the influence of gender diversity in management on the profitability and degree of indebtedness, on a sample of 4347 companies from the hotel sector. The purpose of this article is to show the relationship between presence of women in the top management and the level of profits and indebtedness of companies. Apart from the financial analysis, different theories and empirical evidence regarding the relationship between women in senior management and profitability of the company have been discussed. The results obtained in the research show that hotels run by women generated lower financial results, such as profitability, ROA or ROE. This may be related to greater caution of women in making decisions. The study focuses on the Spanish market, where there is currently an open debate about the importance of women's presence in business management, driven by the creation of legislation on gender equality, which is also observed in other European countries. Thus, the discussed topic is important both from the economic and social point of view. Keywords: code of good governance, gender equality, hospitality, social changes, Spain, stereotype of a woman 1. INTRODUCTION It is evident that incorporation of women into the paid labor market represents one of the most important events that has taken place in the last two centuries. However, it is a slow process that has been conditioned by a series of demographic, economic, social, and above all historical factors. In Spain, one hundred years ago education was usually taught by religious orders or by individuals, since the state offered public education only to men. The situation of women in this period varied according to the social group to which they belonged. Women from the middle and upper classes enjoyed a better economic and social position, living within puritan mentality: 109


their life was basically spent at home and they were dedicated to attending religious and social events and doing charitable work. Woman did not have any political rights and the legislation of that time established legal inferiority of women and their dependence on fathers and husbands. This was reflected in the Spanish Civil Code of 1889 in its Article 57 and following, where it was stipulated that 'woman must obey the husband', that 'the husband is the representative of a woman' or 'is the administrator of the property of the conjugal society', among other things (Civil Code). All this has its origin in the influence of Catholic Church in society, presenting women as a weakling who must be submitted to a man, as well as philosophers, moralists and doctors, who have preached an idea of both physical and mental inferiority of woman compared to men. The evolution of women's rights at that time is closely linked to feminist movements, and although they had a lesser presence and social influence in Spain than in the rest of Europe, still they were important. Feminism in Spain was based on social claims, such as the right to education or work, rather than political demands, such as the right to vote. During the Second Spanish Republic (1931-1939), important reforms were carried out in the field of private law. Among the most relevant was that the marriage was based on equality of rights of both spouses, the admission of consensual divorce, equality of marital children and extramarital ones in the eyes of the law, suppression of religious orders, and separation of church and state. However, the most significant development was the approval of the Spanish Constitution of 1931, which recognized civil marriage and divorce, and granted the right to vote to women, which led to the emergence of the most important social changes of that time. During almost forty years of the Franco dictatorship (1939-1976), the Spanish economy experienced a remarkable growth. But unfortunately, it was a very authoritarian regime in which women were relegated back to their traditional role. The mixed-sex school was abolished and the law that allowed for civil marriage and divorce were repealed, forcing women to stay at home until they got married. The situation of women since the 1980s. has improved in social and legal aspects, if we compare it with the previous two decades. The abortion was legalized in 1985 and in 1981 the right to divorce was approved. However, despite the fact that the new legislation recognized important rights of women in Spain, they continued to play the role of mothers and housewives, which placed them in an inferior position, compared to men. The equality of opportunities and rights of men and women is one of the most important legal principles in today's societies and a universal right recognized in many international publications. In business, gender equality and diversity has become very important in recent decades not only as a result of the human rights principles, but also because of enhanced corporate social responsibility and sustainable development. So, the participation of women in economy is fundamental for strategic reasons. Therefore, belittling and discriminating against half of the population means an inefficient allocation of resources that leads economies to lower growth and competitiveness. As is known, discrimination against women due to gender in terms of promoting and occupying positions in the top management of companies, although illegal, is a fact. This should be evaluated from an economic point of view, and many works, such as Carter et al. (2003), or Ehrdhart et al. (2003), show a relationship between the presence of women in the management teams and economical results of enterprises. Due to importance of this topic and its repercussion for the economy, in this work an analysis of gender diversity in the top company management of the Spanish hotel sector is made. It is worth noting that this sector constitutes ca. 11% of Spanish GDP, which is why it has always been of great importance to the economy (Cuenta Satélite del Turismo de España 2010-2016). Moreover, as it generates large revenues in other sectors, e.g. in transport, it is considered even a strategic area. However, according to a study ‘Glass Roof in the Hotel Industry’ prepared by the Insular Foundation for Training, Employment and Business Development (Eifede), and the General Foundation of the Unviersidad de la Laguna, women occupy 36% of management positions in the hotel sector, which is less than the 40% suggested by legislation for effective equality between genders (Ley 110


Orgánica 3/2007, from 22 March 2007, for the effective equality of women and men). This insufficient level can be explained by influence of social factors such as the traditional belief of women’s role in the family and society, the lack of social support on which women count, as well as an unequal distribution of household chores. Besides, due to its seasonality and reduction of employees in the off-season time in the tourism sector, women find greater difficulties in comparison with other sectors, and, as a consequence, there is a high risk that they will abandon their professional career soon, staying at home or looking for another job. Considering the above circumstances, we analyzed the presence of women in management positions of hotels in Spain. The main purpose of the research was to explore profitability and indebtedness of hotel companies in relation to women’s presence as the CEOs. The connection of the gender of CEO to various variables related to profitability and indebtedness has been studied as well. We put forward the thesis that because women are more cautious than men, their position of a CEO is important for profitability and debt – companies are less profitable, but also less indebted. 2. REVIEW OF LITERATURE AND CONCEPTS In 1998, the Ethical Code, prepared by a commission chaired by Manuel Olivencia, addressed to listed companies was published in Spain (Lozano, 2000, pp. 175–180). It was a code that did not contain any legal norms but simple recommendations whose application was totally voluntary, with the aim of guaranteeing a more transparent behavior of boards of directors. However, companies were asked to explain their reasons for not following provisions of the Code. Some years later, on January 9, 2003, a report of the Special Commission for the Promotion of Transparency and Security in the Financial Markets and Listed Companies was published in Madrid. That report introduced the expression ‘Corporate Governance’ in Spain and included the same views as the Olivencia Code but with a new approach, more specific in some aspects. Finally, in June 2013 the Conthe Code of Good Governance of the Listed Companies was published, which on February 24, 2015 was replaced by the new Code of Good Governance of the Listed Companies. That new code contained 64 recommendations; its content was voluntary, but was a subject to the principle of ‘comply or explain’. One of the most important assumptions was that at least 30% of the members of a board of directors be made up of women before 2020. Moreover, one of the articles said that: When there are few or no female directors, the board should explain the reasons and the initiatives adopted to correct this situation; and that, in particular, the appointments committee should ensure that when new vacancies are provided (Galan Zazo, 2014, pp. 212-213): a) selection procedures do not suffer from implicit biases that hinder the selection of female directors; b) company deliberately seeks, and includes among the potential candidates, women which meet the professional profile sought. First of all, an appointment committee should favor the diversity of knowledge, experiences and gender. Moreover, the director selection policy should promote the goal that in 2020 the number of female directors will represent at least 30% of the total number of board of directors. The appointment committee should annually verify compliance with the director selection policy and should inform of this in the annual corporate governance report. The number of 30% is based on research carried out in Germany by Joecks, Pull and Vetter, (2013, pp. 61–72), in which 151 companies were analyzed. The results show that from that number of women in management boards the performance of a company is higher than the one obtained when members are entirely men. At present, in Spain an average percentage of women in managerial positions is 19.15% (ATREVIA 2018), compared to the average of 20.2% in Europe. Although in Spain progress has been significant, the country is still below European leaders, such as 111


Norway and France, with percentages close to 40% and 30% respectively. It should be noticed that the European Commission proposed an objective of 40% of the women’s presence in boards of directors of listed companies (excluding small and medium-sized companies), so Spanish law is in line with recommendations of the EC. The arguments defending women representation in the boards of directors can be divided fundamentally into two categories: ethical and economic. The first of them argues that it is immoral to exclude women from boards of directors because of gender, and that companies should increase the presence of women in their governing bodies to achieve a more equitable outcome from a society perspective. Therefore, this type of argument suggests that companies should consider greater women representation not as a means to an end, but as a desirable end in itself (Brammer et al., 2007). On the other hand, economic arguments are based on the theory that companies which do not select the most capable candidates for their boards of directors, damage their financial performance (Bravo et al. 2018; Hernik, Minguez Vera, 2017). Results of the analysis of the relationship between gender diversity in boards of directors and the performance of companies show that women can play significant role in this area. There are different studies discussing female presence on boards and their influence on significant improvements in working conditions, as well as the economic, social and cultural balance of the company (Ghosh, 2018; Fregidou, 2004; Gómez, 1998). The various financial scandals of recent years (Lehman Brothers, Madoff, Tyco, Enron... etc.) have generated an atmosphere of concern in this area, which is why there was a need for different stable measures, such as creation and development of regulations related to a good code of corporate governance in companies, both private and public. Therefore, in the last decades codes of good corporate governance have acquired a great importance in domestic and international business. This is mainly due to the fact that they generate a certain level of confidence for the rule of law. The Organization for Economic Cooperation and Development (OECD) defines it as follows: ‘Corporate Governance is the mechanism of the shareholders that serves as a counterbalance and guides the administration of the business to ensure efficiency, equity, transparency and results through executive actions followed by the organization, in order to achieve reasonableness, accountability, results, transparency and responsibility.’ Code of corporate governance is a key element in increasing economic efficiency and boosting company growth, as well as improving investor confidence. Hence, corporate governance covers a whole series of relationships between the company management board, its shareholders and other interested parties (OECD Principles of Corporate Governance 2004, p. 11). Codes of governance are strongly influenced by the ownership structure and by the structure of management boards – including the presence of women (Pass, 2006; Garegnani, Merlotti and Russo, 2015). 3. HOTEL INDUSTRY IN SPAIN – CHARACTERISTICS More than half (52 %) of the 2.4 million enterprises in the tourism industries in the EU in 2016 were located in four Member States: in Italy, France, Spain, and Germany. In 2016, Spain was the most frequently visited country by foreign tourists, who purchased 295 million nights at accommodation facilities, which constituted 22.2% of the total number of nights in the EU-28. Moreover, in Spain tourists leave the most money, compared to other EU states: in 2016 receipts came to 54,660 million EUR, while in EU-28 the income amounted to 112,299 million EUR. Tourists come to Spain mainly from Great Britain, Germany and France (Spain Tourist Arrivals). According to Eurostat, in 2017 the increase in tourist traffic was the strongest in Africa (+9%) and Europe (+8%), followed by Asia and the Pacific (+6%), the Middle East (+5%) and the Americas (+3%). It is worth noting that the tourism sector in EU, measured by the number of enterprises, grows faster than the economy in general (Fig. 1).

112


Total economy EU-28

110

Services

100 2012

2014

2016

Tourism services

Figure 1: Number of enterprises: evolution for selected sectors of the economy, EU-28, 20122016 (Eurostat: Tourism statistics http://ec.europa.eu/eurostat/statisticsexplained/index.php?title=Tourism_industries_-_economic_analysis) The hotel industry in Spain is very well developed. As it was mentioned, along with such countries as Greece, Italy and Germany, Spain has one of the most-developed tourism infrastructures. The number of hotels operating in Spain is almost 20,000 (in 2016: 19,524), and in most cases these are small hotels with no more than 25 rooms (Eurostat). 4. METHODOLOGY, RESEARCH SAMPLE AND RESULTS We put forward a thesis that female presence as CEOs is important for profitability and debt – companies are less profitable, but also less indebted. To verify this thesis, a study of 4,347 Spanish hotels was carried out. Data was obtained in 2015 from the SABI database (Iberian Balance Sheet Analysis System), which provided information on more than 2.5 million of Spanish and more than 700,000 Portuguese companies. We have chosen the hospitality industry, as this sector is constantly booming and in recent years it has become one of the branches of greater relevance and economic impact, occupying a key role in the output of the crisis (Gómez and González, 2014). In this paper, as we already mentioned, we studied the influence of CEO’s gender on various variables related to profitability and indebtedness. As a measure of gender, a dichotomous variable indicative of the presence of a woman as CEO was included (dummy variable). Furthermore, measures of performance that were studied included: 1) Return on Equity (ROE) or financial return, calculated as net profit between the net of liabilities; 2) Return on Assets (ROA), showing how profitable a company is, relative to its total assets; 3) the profit margin, understood as the difference between the sale price without VAT and costs. Subsequently, measures related to indebtedness included: 1) the debt percentage ratio (%), which indicates the proportion of debt that a company has (long and short term) with respect to total liabilities; 2) the average cost ratio of external financing (%), which shows how much a company pays for financing with external resources, calculated as the quotient between the payment of interest and the total debt; 3) the interest coverage ratio, calculated as interest divided by earnings before interest and taxes, which is used for assessing cash flow balance generated by the company to meet its financial obligations; 4) the degree of financial leverage calculated as the absolute value of the quotient between the operating profit minus the financial charges (interests). Next, we obtained descriptive statistics of each of enumerated variables: mean, median, standard deviation, minimums and maximums, which are shown in Table 1.

Table following on the next page

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VARIABLES

mean

median

Dummy CEO = 0 man Profit margin (%) ROA (%) ROE (%) Debt percentage ratio External financing ratio Interest coverage ratio (%) Degree of financial leverage

0,25 -7,03440 -0,04274 6,22336 50,17 0,07 0,19157 5673,00

0 0,25500 0,91300 1,97000 48,72 0,03 0,94350 83,80

standard deviation 0,43 31,534131 12,461958 110,782950 30,904 0,519 42,784611 7608,319

min

max

0 -215,384 -97,450 -3565,996 0 0 -328,673 0,00

1 181,381 97,472 4898,140 100 17 328,071 460742,00

Table 1: Descriptive statistics (own study) In the first place, we note that only 25% of the 4,347 companies analyzed was run by women. First calculations also show that the financial profitability was 6.22%, while the economic profitability was negative (-0.0427%), and the indebtedness of the companies was 50%. Profit margin took values between -215.4 and 181.4, and the degree of financial leverage presented a minimum value of 0 and a maximum of 460,742 in absolute value. The leverage in company's finances allowed it to achieve an above-average economic effect, and the calculations showed that some companies obtained such results. To carry out the comparative analysis, first of all, we used the Kolmogorov-Smirnov test in order to check the normality of the variables of the two groups of companies (with women as CEOs and without). It turned out that our samples did not follow a normal distribution, thus we finish our analysis with non-parametric tests for two samples, specifically the Mann-Whitney U Test. Table 2 shows the results of the normality tests. VARIABLES Profit margin ROA ROE Debt percentage ratio Time of CM of external financing Interest Coverage Ratio Degree of Financial Leverage

DUMMYCEO=1 6,164 5,753 10,210 2,170 13,954 9,252 10,727

DUMMYCEO=0 10,879 10,350 14,801 3,233 25,677 15,537 23,892

Table 2: Statistical comparison of two samples (DUMMYCEO=1 is a group with women as CEOs) (own study) As we see in Table 2, none of the obtained samples was normal, therefore to calculate the significance test for two means, the Kolmogorov-Smirnov non-parametric test was used. Table 3 presents main results obtained regarding the difference between these two samples. VARIABLES Profit margin ROA ROE Debt percentage ratio Average cost ratio of external financing

CEO WOMAN 2029,17 2080,69 2110,73 2211,75 2119,57

CEO MAN 2165,69 2204,35 2194,58 2161,72 2191,71

STATISTICAL. Z -3,123*** -2,796** -1,896** -1,132 -1,633

Interest coverage ratio Degree of Financial Leverage

1870,99 2092,19

1985,38 2200,61

-2,719*** -2,453***

* significance at 10% level ** significance at 5% level *** significance at 1% level Table 3: Difference of means (own study) 114


In this table we can see that the majority of differences in means is significant, between 5 and 10%, and generally in favor of companies run by men. Thus, we observe that the companies with masculine CEOs obtain a higher financial return (ROE), and this is statistically significant at 5%. This can be explained by the theories analyzed in previous sections which argue that companies run by women are less profitable because, in general, they are more averse to risk. In terms of economic profitability (ROA), again we see that it presents higher levels for companies run by men. Likewise, it is observed that there is a greater profit margin, with a significance of 10%, for companies managed by men. These results coincide with those obtained by Adams and Ferreira (2009) whose studies reveal that, on average, the effect of gender diversity on the performance of the company is negative. In this sense, we can prove theories that argue that women expect less benefit than men. Among them there is Romani et al. (2012), who concluded that women invest less money in their businesses and expect fewer benefits than men; Lundeberg, Fox and Puncochar (1994) argued that women were less secure than men in their investment decisions, so they were more cautious. These differences in confidence with respect to men can cause dissimilar risky behavior. On the other hand, Table 3 shows lack of significant differences between the debt ratio of companies run by men and that of companies run by women. The same may be said about the average cost of external financing ratio. In effect, no differences are observed, but it is shown that companies run by men have a greater degree of financial leverage, and therefore, run greater financial risk. Finally, it is observed that the interest coverage ratio is higher for companies run by men. This may be due to the higher profitability presented by these companies, a conclusion that coincides with the one found by authors such as Böhren and Ström (2005), among others. 5. CONCLUSION Many theories and evidence show that there are differences between women and men when running a company and show the consequences of having women at the head of the top management. These consequences, as we have seen, can be both positive and negative. Thus, there are several studies that show that the presence of women in the management positions of a company increases their profitability by increasing the company's competitive advantage, boosting innovation and creativity. There are also studies which have shown that the diversity of gender in the company leads to a reduced level of indebtedness. However, our analysis showed that in general, companies in hotel industry which are run by men as CEOs are more profitable and have a wider profit margin than the companies run by women. Other indicators were also better for men-CEOs – ROA, ROE debt percentage ratio or Degree of Financial Leverage. Although high financial leverage means greater financial risk, because of partial financing of business activities with external capital, this indicator may be evaluated negatively. The obtained results confirm the thesis that women are more cautious than men, which is probably why their companies are less profitable, but also less indebted with external capital. This means that they have gained the current situation by themselves, and this may be due to the overall strategy of the company's owners. The general assessment of female CEOs depends on a larger number of variables, as well as their dynamics over time. E.g. we do not know the situation of hotels in the past, perhaps the female CEOs improved their financial situation and this trend will continue in the future. We also do not know external market factors. Taking all of this into account, it should be said that more reliable and universal results might be obtained in wider time and sample. In addition, more complex statistical data analyses could have been made, and finally the study could be extended to other sectors. LITERATURE: 1. Adams, R.B., Ferreira, D.B. (2009). Women on the Boardroom and Their Impact on Governance and Performance. Journal of Financial Economics, 94(1), 291–309. 115


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