The Business Review, Cambridge

The American Academy of Business Journal

Vol. 27 * Number 1 * March 2022

The Library of Congress, Washington, DC  ISSN: 1540–7780

Online Computer Library Center * OCLC: 805078765

National Library of Australia * NLA: 42709473

The Cambridge Social Science Citation Index, CSSCI

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Copyright © 2001-2022 AABJ. All rights reserved.

Textual Analysis of Corporate MD&As to Determine Readability

Dr. Roberta Cable, Pace University, NY

Dr. Chunyan Li, Pace University, NY

Zhe Yu, Pace University, NY



The Management Discussion and Analysis section (MD&A), a disclosure required by the SEC, is found in a company’s Form 10-K or annual report.  It is written by management and provides investors and analysts with an overview of the company’s prior-year operations, as well as insights into the future. We believe it is important to consider that, although guidelines for the MD&A are provided by the SEC, style and format are at the discretion of management. The purpose of this paper is to determine the readability of MD&As as it relates to the overall performance of a company.  We used textual analysis to test and compare the readability of MD&As of stronger companies with those of weaker companies. The companies were classified into three different industries.  We found that the MD&As of stronger companies were more readable than those of weaker companies, particularly for those classified by Bloomberg as Industrials.  The Securities and Exchange Commission (SEC) has long recognized the need for a narrative explanation of the financial statements because a numerical presentation and brief accompanying footnotes alone may be insufficient for an investor to judge the quality of earnings and the likelihood that past performance is indicative of future performance.  The Management Discussion and Analysis section (MD&A), a disclosure required by the SEC is found in a corporation’s Form 10-K or annual report.  Among other items, this section provides a commentary on financial statements, systems and controls, compliance, risks, changes in accounting regulations and policies, and future goals and projects.  This section is not audited.  It is written by management and provides investors and analysts with an overview of the company’s prior-year operations as well as insights into the future.  The MD&A is intended to give the investor an opportunity to look at the company through the eyes of management by providing both a short and long-term analysis of the company (SEC 1987).  The MD&A section of the annual report began in 1968 as part of the guide for Preparation and Filing of Registration Statements (SEC 1968). Since then, there have been multiple releases by the SEC to enhance disclosure requirements and promote understandability of annual report information. For example, in the 1980 amendment, the SEC wanted to see more discussion about liquidity and results of operations, adopting the present form of the disclosure requirements for MD&A (SEC 1980).  In 1987 and 1989, the SEC provided more explicit guidance on prospective disclosures, with the 1989 release specifying that a disclosure duty exists when a trend, demand, commitment, event or uncertainty is both known to management and likely to have material effects on the financial condition or results of operations (SEC 1987; 1989). The 1987 amendment explicitly states the need for a narrative explanation of the financial statements, “because a numerical presentation and brief accompanying footnotes alone may be insufficient for an investor to judge the quality of the earnings and the likelihood that past performance is indicative of future performance. MD&A is intended to give the investor an opportunity to look at the company through the eyes of management” (SEC 1987).  In 2001, the SEC issued cautionary advice on accounting assumptions and estimates. There was a need for greater investor awareness of the sensitivity of financial statements to the methods and estimations used in their preparation. This cautionary advice encouraged full explanations of “critical accounting policies” in the MD&A (SEC 2001). Again in 2003, the SEC adopted additional requirements to include off-balance sheet financial obligations. The new rules required a designated section of the MD&A for the disclosure of off-balance sheet agreements, along with an overview of certain known contractual obligations (SEC 2003).  As recently as 2019, the SEC issued an amendment intended to improve the readability and provide investors with all material information.  In the 2019 amendment, the SEC said that in year-to-year comparisons, management may use judgment to determine what type of presentation best communicates trends to investors (SEC 2019).


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 Russian Agricultural Support Policies: The Case of Krasnodar Region

Dr. Olga Murova, Associate Professor, Texas Tech University, TX



Russian agriculture has gained momentum in recent years. Agricultural production has increased in the crops and livestock industries. This study aims to investigate current Russian agricultural policies on producers’ subsidies and to assess how these policies, together with governing policies of local institutions, impact the development of agriculture and agribusiness in Russia and in the Krasnodar region.  Krasnodar ranks first place in Russia in the terms of the volume of gross agricultural production. It is also an important player in the food industry of the Russian Federation. The Krasnodar’s region produces 7% of the overall food production in the Federation. Recent Krasnodar agricultural statistics show solid performance of production in the region. As the leading region within Russian Federation, Krasnodar receives federal support funds for agriculture and agribusinesses. The total amount of support allotted for agribusinesses of the Krasnodar region in 2021 is 5.48 billion rubles, comprised of 79% federal funds and the remaining 21% of the funds coming from the regional budget. Given continuation of current leadership policies and a stable investment climate, the Krasnodar region will continue to grow and expand its agricultural production, agribusiness and exports of grain. Since 2005, Russia has released multiple agricultural policies aimed to improve the poor state of agriculture especially in the livestock and dairy industries. Ten years later, these policies have brought only very modest improvements to the agricultural sector. In 2014, after the events in Crimea and Donetsk, the U.S. and Europe banned the majority of their exports to Russia. In return, Russia implemented aggressive protectionist measures in its own agricultural sector to counteract the U.S. and European sanctions. Russia’s “import substitution” strategy, numerous Sanitary and Phytosanitary Standards, and countersanctions have supported Russia’s food security initiatives.  In 2021, the Food Security Doctrine was set in place, followed by the State Program on Development of Agriculture and Regulation of Agricultural Commodity Markets for 2013-2020. Initially these policies had a slow start, but by 2018, Russia had met six of the eight production target levels set by the Doctrine of 2010, bringing Russian agriculture to more advanced levels. In March 2017, State Program amendments increased the total cost of the State Program to 1.55 trillion rubles, 2.6% higher than the original plan adopted in 2012 (GAIN Report, 2018). The amendments also changed the structure of the State Program. Sub-programs were merged to give regions more flexibility in using federal funds and the new structure of the State Program emphasized import substitution in the food supply and enhancement of Russian agricultural exports. The last amendments to the State Program were made in December 2017 and budget funds were increased for 2018-2020. Main protective measures for agricultural producers include various subsidies and partial compensation of capital expenditures, costs, and interest rates. In 2017, the latest implementations of agricultural programs and reforms produced positive results. The Russian agricultural sector increased its GDP by 2.4% (GAIN Report, 2018). Figure 1 provides comparison of the overall GDP growth and the production growth of Russian agriculture since 1994. As seen from this figure, agricultural growth outperformed the general economic growth since 2008.  In 2017, the agriculture’s share in GDP in real terms remained 4.1% (Diloette CIS Research Center, 2018). In 2017, the net profits of agrobusiness companies reached RUB 270 billion. The profits of the crop farming companies fell significantly, due to lower prices for crops in 2017 as a result of a record harvest. The profits of animal farming and fishing companies remained flat.  The objective of this research is to investigate current Russian agricultural policies on subsidies and to assess how producers’ support measures impact the development of agriculture and agribusiness of Russia and one of the best performing agricultural regions in Russia, Krasnodar.  This overarching objective has the following sub-objectives: 1. Provide an overview of the current Russian policy on agricultural subsidies; 2. Review current performance and desired goals for agricultural development of the Krasnodar region; 3. Review the current investment climate and available input subsidies and price support options for agricultural producers and agrobusiness of the Krasnodar region. Russian agriculture receives a high level of support from the government. However, looking at subsidies over a longer time period, 2006-2018, and using data in real values, it can be seen that the level of support fluctuated and did not increase over this time (Figure 2). Shik estimates the value of support decreased by 3% in constant prices, the share of agricultural spending in total budget expenditure decreased by 24% since 2006 (Shik, 2020).


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E‑N‑K‑T‑G‑A‑M‑I‑R:  Marketing Model 101 For Non-Business Executives

Nadeem M. Firoz, B.Com (Hons); M.Com; MBA; Ph.D.; Fulbright Scholar / Fulbright Specialist

Retired Professor of Int’l Mktg., Montclair State University, Upper Montclair, NJ

Adjunct Prof. of Mktg currently at Baruch, CUNY. NY



This paper describes how systems of classifying and defining the variables in the marketing mix were developed and the status of these systems today. In this paper the authors propose an expanded definition of marketing and develop a new systematic expression for the mix of variables found in marketing.  The variables are expressed in a logical order using the acronym E‑N‑K‑T‑G‑A‑M‑I‑R.  One can rearrange these initials to spell - M‑A‑R‑K‑E‑T‑I‑N‑G. and hence remember. In this acronym one can find most important key ingredients without which it will be impossible to do any kind of marketing activity. The life line of marketing variable for example starts with E: Environment (SWOT), N: Needs and wants include, Market information system or Market research, basic marketing K: Knowhow, segmentation and T: Targeting, marketing mix which include (product) G: Goods, (price) A: Amount, (place) M: Market, (promotion) I: Information and at the end R: Reward or profit. This model makes it very easy not to miss any important ingredient in the recipe of marketing. This acronym will help a non-marketing or non-business executives like engineers, doctors, lawyers, architect, historians, educators & many more to have basic idea how to market any product or service.  This paper concludes with a diagram of the new system which can help non-marketing practitioners, develop marketing plans. This author has used very successfully this model in teaching marketing classes for under graduate and graduate levels for last 20 years.  All businesses must perform two basic functions.  They produce goods or services, and then they market them.  This is true for all firms regardless of size from giant multinationals such as General Motors down to small neighborhood stores.  Unfortunately, most people consider marketing to be selling or advertising, not realizing it is much, much, more HubSpot Blog, Feb 25, 2021.  Marketing is the study of consumers: to find out what they will buy, and why, where, when, and how, they will buy it.  Marketing relates to all of us every day of our lives.  If we have a good understanding of marketing, we will understand consumers better. Heidi in “72 Marketing Definitions” states, “Marketing comes in a wide variety of flavors based on audience, media platform and business in today’s evolving and dynamic marketplace. - Therefore, it’s no surprise that marketers define what they do differently” (Heidi Cohen Mar 29, 2011, Investopedia, Aug 17, 2020)  No single definition of marketing has ever been universally accepted.  Here are some marketing definitions from experts and professionals along with old and new definitions of American Marketing association’s The American Marketing Association (AMA) in 1960 defined Marketing as: "Marketing is the performance of business activities that direct the flow of goods and services from producer to consumer or user." (AMA). Many marketing authorities have considered their definition too narrow because it deals only with the distribution process.  It pertained more to economics than to marketing possibly because the forefather of marketing was economics.  Because of the myopic nature of the definition, the AMA revised the definition in March 1985. "Marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational objectives. This author proposes a further slight change to include satisfaction of societal objectives since what is good for society is good for the individual and good for the organization.  Thus, the last line would read, “that satisfy individual, organizational, and societal objectives." Society will allow a business to operate as long as the business makes contributions to the members of society.  Businesses satisfy this commitment to society by producing and marketing desired goods and services. Most recently in 2013 AMA revised the definition again to “Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large (AMA 2013). Frey (1961) suggests that marketing variables should be divided into two parts: the offering (product, packaging, brand, price and service) and the methods and tools (distribution channels, personal selling, advertising, sales promotion and publicity). McCarthy (1964) refined Borden’s (1965) idea further and defined the marketing mix as a combination of all of the factors at a marketing manger’s command to satisfy the target market. He regrouped Borden’s 12 elements to four elements or 4Ps, namely product, price, promotion and place at a marketing manger’s command to satisfy the target market.  Some other definitions of the marketing concepts are these: Malcolm P. McNair, "The creation and delivery of a standard of living" (McNair 1968). Ben M. Enis, "Marketing is everybody's business" (Enis 1974). Peter F. Drucker, "The aim of marketing is to make selling superfluous.  The aim is to know and understand the customer so well that the product or service fits him and sells itself" (Drucker 1974; Kumar. (2011),  HubSpot Blog. Feb 25, 2021.  Oct 28, 2021 —Marketing definition is - the act or process of selling or purchasing in a market. How to use marketing in a sentence.  Especially in 1980s onward, number of researchers proposes new ‘P’ into the marketing mix. Judd (1987) proposes a fifth P (people). Booms and Bitner (1980) add 3 Ps (participants, physical evidence and process) to the original 4 Ps to apply the marketing mix concept to service. Kotler (1986) adds political power and public opinion formation to the Ps concept. MaGrath (1986) suggests the addition of 3 Ps (personnel, physical facilities and process management). Baumgartner (1991) suggests the concept of 15 Ps. Vignalis and Davis (1994) suggests the addition of S (service) to the marketing mix. Goldsmith (1999) suggests that there should be 8 Ps (product, price, place, promotion, participants, physical evidence, process and personalization)


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Authenticity: Exploring Potential Synergy between Existentialism and Christian Leadership

Dr. David Robinson, Professor, Holmes Institute, Australia

Dr. Gordon Bauer, Academy of Business Acumen, South Africa



This article explores whether existentialism and Christian leadership can potentially be synthesized by the application of three stage theory, which has wide application in both philosophical and theological discourse. In this paper, the authors explicate and apply a model of bio-psycho-social behavior known as the Values Journey (Robinson, 2020). Their nexus for existentialism and Christian leadership is positioned at stage three of the Values Journey model and is centered around the concept of authenticity.  In this article, the authors seek to reconcile thinking and believing by employing a non-antagonistic approach. It is our contention that they need not be, and are naturally not inclined to be, in opposition to each other, and that they are certainly not mutually exclusive. In fact, we postulate that the two can be synergistic when experienced in combination.  Existentialism’s rise to popularity in the 1960s may be explained as an attempt to refresh the deep questions of humanness and purpose. The temptation to throw the baby out with the bath water, however, went unchecked and what resulted was a wholesale negation of the values and faith-bases that are foundational to rational and considerate social cooperation. Could the human race be facing a crisis of identity. For many, thinking - that rational and intellectual activity based on sound logical principles and generally accepted methods of reasoning, OR believing - the holding of a value or perspective, often associated with unverifiable assumptions, superstition or individualistic idiosyncrasies of prejudice, seem to have become mutually exclusive concepts. In an ever-changing world, there is a need to constantly re-assess how we lead others. In the words of Ford and Fowler (2007:422) ‘any attempt to define leadership in a prescriptive way will necessarily fail to capture the “essence” of leadership’. Thus, we begin, not with a definition of leadership, but rather with a model that we believe generously encapsulates the human journey of constant adaptation, incorporating within its constructs the tenets of other seminal and widely-accepted leadership development and theoretical models. We believe the Values Journey model provides an objective basis for our proposition, therefore, in view of the centrality of this model to our supposed nexus of existentialism and Christian-style leadership, we begin with an introduction to the Values Journey model, essentially defining its three stages and six value stations, explaining how transitioning occurs and the leadership challenges associated therewith.  Individuals and firms are engaged in a journey that is influenced by their responses to problems of existence. The journey typically follows a trajectory defined by three stages and six value stations. Transitioning between value stations occurs naturally but may be impeded by inertia and/or organizational pathologies. The Personal and Corporate Values Journey model (Robinson, 2020), depicting bio-psycho-social behavior among adults, holds as the essential principle that life is a journey of personal development in which each individual develops a set of values (as patterns of behaviour) which are forged by responses to their unique challenges of existence. Those responses are governed by two constructs, namely responsibility and freedom, the constant interaction of which gives rise to responses that are conditioned (imposed), acquired (through learning), and authentic (through synergy of experiences). The journey typically follows a trajectory defined by three consecutive stages, designated as pre-orderly (where one is unaware of the rules), orderly (learning the rules), and post-orderly (personal mastery). Each value station has a colour and shape, which give a clue to its associated characteristic behaviours, for example the ‘duty-complying’ station at the base of stage 2 is square and blue, signifying rigidity and officialdom, whilst peace-loving at the base of stage 3 is green and round, which signifies flexibility, equivalence, empathy, and harmony. The main salient points about the values journey are as follows: Firstly, each pair of stations represents a ‘stage’ of development, thus there are three distinct stages. Secondly, there is a diagonal line running from bottom left to top right designating a ‘dependency ravine’, which signifies that the value stations below that line are more submissive compared to those above it, which are more expressive. Thirdly, there is another dividing line running diagonally from top left to bottom right, which is designated as ‘absolutist divide’ and indicates that the value stations below it are inclined toward absolutist thinking and those above more inclined toward relativist. Fourthly, as human beings we are attempting to develop in two directions, along the X-axis by increasing our capacity for rational and considerate conduct, and up the Y-axis by improving our capacity for autonomous thought and action, there is a constant tension between the two forces. It is this tension that propels a person ever-forward and yielding the journey a step-wise progression, by which we advance along the X and Y plain, alternately – first vertically (within a stage), then horizontally in crossing a divide to the next stage. Fifthly, while advancement through the stages entails new paradigms, some previously held beliefs are purposefully carried forward and provide a continuing fall-back position, if not rejected. Finally, we note that there are divides between stages. When crossing from stage 1 to stage 2, we must traverse what is known as the ethical divide, i.e. some kind of discipline that must be mastered to give purpose and to bring consistency and allow control (whether this is by self-control or externally imposed). The divide between stages 2 and 3 is known as the holism divide, because crossing it requires a world view that is universal and all-inclusive. As a means of understanding where one is located in the values journey, our navigation mechanism is similar to how a ship sends out radar signals to find out the depth of the ocean bed, or the location of other ships in the area. We want to know where and how we fit into society and how we are positioned within our communities. If the person’s ideas are too far removed from the societal norm, the person may feel a sense of rejection. When an existential signal is sent, and an existential response is received, then one can experience the existential distance or closeness between the people communicating.


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Copyright: All rights reserved. No part of the material protected by this copyright notice may be reproduced or utilized in any form or by any means, including photocopying and recording, or by any information storage and retrieval system, without the written permission of the journal.  You are hereby notified that any disclosure, copying, distribution or use of any information (text; pictures; tables. etc..) from this web site or any other linked web pages is strictly prohibited. Request permission / Purchase this article:

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Index: The Library of Congress, Washington, DC:    ISSN: 1540 – 7780

Index: Online Computer Library Center, OH:   OCLC: 805078765 

Index: National Library of Australia: NLA: 42709473

Index: Cambridge Social Science Citation Index, CSSCI.

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