204 10 3494 https://omeka.ibu.edu.ba/files/original/4ff3225651fbcacccf7631b61523ff7c.pdf b2dc846f3e0c906ac526d0de461a0573 PDF Text Text 3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Yıldırım, Ş. (2003). Ticaret Egitimi Arastırması. T.C. Milli Eğitim Bakanlığı (MEB) Mesleki ve Teknik Egitim Arastırma ve Gelistirme Merkezi Baskanlıgı Yayını (Editör), Ankara Vanfossen, B.E., Jones, J.D., Spade, J.Z., (1987). Curriculum tracking and status maintenance. Sociology of Education 60, 104–122. Yıldırım, O. and Dalgeç, A. (1993). Küresellesme ve Muhasebe Egitimi, XIII, Türkiye Muhasebe Egitimi Sempozyumu, İzmir. Knowledge Maps & Knowledge Mapping: Literature Review Admir Čavalić, Erkan Ilguen International Burch University,Sarajevo, Bosnia and Herzegovina Abstract This study provides information about Knowledge Mapping as a tool of Knowledge Management, how it is used and how do we “occasionally” use it daily. Main part of this paper focuses on the relation among an organisation and knowledge mapping, and how kmaps are important and what’s their purpose. After a broad analysis of articles from nowadays significant researchers about knowledge mapping I was able to extract the main issues, statements and definitions on knowledge mapping and what would help an organisation in its strategic positioning and development in the manner of k-maps. Moreover, where to focus on, in the need of preparing a knowledge map. Also, which k-maps developed throughout the time and their difference among each other? Keywords: Knowledge Mapping, Knowledge Management, Organisation, Strategic Positioning 1. INTRODUCTION Knowledge is an accepted and significant base for competitive advantages and companies started to establish new smart information system. One of the key processes in Knowledge Management is Knowledge Mapping. The main use of knowledge maps is to get an outline about the available sources of information and to help in finding appropriate sources quickly. So therefore a source can be expertise, knowledge, a person, etc. In order to apply any knowledge mapping technique, an organization must be sure of its success and efficiency. A basis to identify the level of knowledge of an organisation could be the knowledge map which also can support the strategic positioning in terms of knowledge management. In an organisation one of the most important goals is the expertise location. In this expertise mapping the organisation’s knowledge needs to be inventoried as well as to map the organisation’s information flow. The common approached to achieve this are assessment of interviews, abilities records and extensive surveys and analysis. 373 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo "Knowledge mapping is a process by which organisations can identify and categorise knowledge assets within their organisation - people, processes, content, and technology. It allows an organisation to fully leverage the existing expertise resident in the organisation, as well as identify barriers and constraints to fulfilling strategic goals and objectives. It is constructing a roadmap to locate the information needed to make the best use of resources, independent of source or form".43 Knowledge Mapping in not a term that is new, in fact we all are practising knowledge mapping throughout our whole and everyday life. The only difference is that we are not writing/drawing it down and we are not doing it systematic. So basically knowledge mapping is having a record of information and knowledge we need like where we can get it from, who holds it, whose expertise is it, and so on. A good example would be our home. When we need to find something that we need and which is in our home it would be easy and fast to find it because we have almost all information and knowledge about “where is what” and “who knows what” at our home. This map which is about our home and which in our mind it is always updated, therefore we are able to act quickly and precised. But of course to have such a “mind” map about our organisation and organisational knowledge would be impossible. Since there is too much information and many individuals included. This is where knowledge mapping comes to action and shows us details of every knowledge that exist in the organization containing information about location, quality, and accessibility; and all the knowledge which is required to run the company smooth, means it enables us to find the knowledge we need easy and efficiently. It is important to note that the main aim of knowledge maps is not to create new knowledge but to structure and provide an easy access to knowledge which already available within the organisation. To find out and assess the knowledge assets of an organisation and make the organisation have maximum benefits from these assets. 2. Additional Definitions of Knowledge Mapping “Knowledge mapping is a process of surveying, assessing and linking the information, knowledge, competencies and proficiencies held by individuals and groups within an organization.”44 - Dr Ann Hylton, KeKma-Training 2002 “It's an ongoing quest within an organization (including its supply and customer chain) to help discover the location, ownership, value and use of knowledge artifacts, to learn the roles and expertise of people, to identify constraints to the flow of knowledge, and to highlight opportunities to leverage existing knowledge. Knowledge mapping is a important practice consisting of survey, audit, and synthesis. It aims to track the acquisition and loss of information and knowledge. It explores personal and group competencies and proficiencies. It illustrates or "maps" how knowledge flows throughout an organization. Knowledge mapping helps an organization to appreciate how the loss of staff influences intellectual 43 Vestal, Wesley. "Knowledge Mapping 101". Presentation at USAID Knowledge for Development Seminar September 22, 2003. http://pdf.usaid.gov/pdf_docs/PNADK308.pdf 44 "U.S. Agency for International Development." U.S. Agency for International Development. Web. 15 May 2012. <http://www.usaid.gov/>. 374 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo capital, to assist with the selection of teams, and to match technology to knowledge needs and processes.”45 - Knowledge Mapping: A Practical Overview by Denham Grey March, 1999 “Knowledge mapping is related to making knowledge that is available within an organisation translucent, and is about giving you the insights into it's quality.”46 - Willem-Olaf Huijsen, Samuel J. Driessen, Jan W. M. Jacobs “Knowledge mapping externalizes networks of cognitive relationships and renders them in graphic form. This pictorial approach to individual or group knowledge assists in the formation and maintenance of shared mental models and streamlines collaboration. Knowledge maps are commonly referred to as mind maps, semantic networks, and concept maps.”47 - Jonassen, D. H., & Carr, C. S. (2000) & Novak, J. D. (1998) “A knowledge map is a presentation of one or more aspects of the knowledge available within an organization that aims to fulfill a specific information need for one or more employee roles within the organization.“48 - Driessen, Huijsen and Grootveld To sum up all the definitions, knowledge mapping is a process and an approach to information that can be applied to any area that requires knowledge; it can also be used in specific circumstances such as implementing technological modification, preparation for an acquisition, introducing a new policy, or mapping intellectual capital. 3. Knowledge Mapping: Where to Focus? 3.1 Strategic 3.1.1 Enterprise-level Strategic business, technical, market knowledge Determine the organization’s “bench strength” Identify areas to focus KM efforts 45 "Knowledge Mapping: A Practical Overview." : Impact Alliance. Web. 15 May 2012. <http://www.impactalliance.org/ev_en.php?ID=2011_201>. 46 "Thoughts.com." Where Is the Map? 3 Easy Steps to Construct a Speech. Web. 15 May 2012. <http://www.thoughts.com/colbygross511/where-is-the-map-3-easy-steps-to-construct-a-speech>. 47 "Definition: Knowledge Mapping." Definition: Knowledge Mapping. Web. 15 May 2012. <http://technologysource.org/extra/83/definition/2/>. 48 "Mapping the People in Your Organisation." Mapping the People in Your Organisation. Web. 15 May 2012. <http://www.moxy.com.au/index.php/moxy-knowledge/18-articles/60-mapping-thepeople-in-your-organisation>. 375 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 3.1.2 Cross-functional between divisions/business groups Operational assessment of working knowledge 3.2 Tactical Working group/process Tactical and operational knowledge applied to process excellence, innovation, customer relationship - USAID, 2003 4. Classification of Knowledge Maps 4.1 Through classification of knowledge maps many advantages can be achieved: A descriptive overview (which can function as an inventory or repository) A problem solving heuristic (that relates possible mapping solutions) Reduces the complexity characteristic (in choosing a knowledge map format) Recognition of similarities and differences (among different types of knowledge maps) To compare (different knowledge maps) May reveal new forms of knowledge maps (which are not applied yet) 4.2 Through classification of knowledge maps many disadvantages may appear: - Focus on description, instead of explanation Reification (pretending that an ideal archetype does exist) Static (difficult to adjust as a domain changes and evolves) Due to these disadvantages it is recommended that the classification system should rely on more than just one classification principle and should suggest various, alternative classification criteria. A classification should minimize the differences within a group and maximize the differences between groups. Knowledge maps are classified by: - Purpose Graphic Form Content Application Level Creation Mode Furthermore, according to this it can be classified in questions forms: 1. Which knowledge management purpose do I want to achieve with the map? (The “why?” of the map.) 2. Which kind of content about knowledge do I want to represent in the map? (The “what?” of the map.) 3. Who should use the map in which context or situation and at what level? (The “for whom?” and “when?” of the map) 376 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 4. Which graphic form should be used and who can create the map in what way? (The “how?” and “who?” of the map) So basically knowledge maps differ themselves in the usage of why, what, for whom, how and who wants information and to whom we want to transfer it. Therefore, their limitation lies in that that we can’t mix them, even there are some possibilities. But they are limited by the purpose and how we want to transfer our information and knowledge throughout an organisation. In the next two pages you will be able to see 2 tables. Table 1 shows sample knowledge maps types based on these primary classifications. Table 2 deliberates on which kind of knowledge map may be useful for a given knowledge management process or challenge. Those two tables were taken from the research article from Martin J. Eppler, A process-Based Classification of Knowledge Maps and Application Examples. 5. Conclusion Since a knowledge map gives you information of knowledge and information within your organisation, IBU would benefit from a knowledge map. It would have fast access to many information about the students, professor, grades, etc and IBU in total. It would be an easy effort to see which students are visiting/joining IBU. Which nationality, age, previous education, gpa, etc they have; also the progress of the students throughout their education. As well as the satisfaction of students about the professors, grade overview of all of them, etc. We would be able to see which quality IBU is offering, what kind of professor they have. Who has a phd or master title, where they taught before, etc. All this would be beneficial to IBU but I think that every university should and must have a regularly updated knowledge map. But I think that IBU already have some kind of knowledge map due to its regularly surveys which are offered to students. Knowledge Map Classification A. Classifying knowledge maps by intended purpose or KM process (‘‘why?’’) 1. Knowledge creation maps: illustrate the planned steps to develop a certain (organizational) competence or create new knowledge (i.e., a technology road map) 2. Knowledge assessment or audit maps: illustrate the evaluation of certain knowledge assets graphically, for example, by a 2 x 2 matrix (axes: current ability and future importance) 3. Knowledge identification maps: provide a graphic overview on knowledge assets (experts, patents, practices) and points to their locations/coordinates 4. Knowledge development or acquisition maps/learning maps (a) Learning overview and learning path maps (b) Learning content structure maps (c) Learning reviewing/repetition maps 377 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 5. Knowledge transfer, sharing, or communication maps: show who transfers knowledge to whom 6. Knowledge application maps: show which knowledge is necessary for carrying out certain processes or steps in a single process 7. Knowledge marketing maps: can be used to signal competence to the public in a certain domain B. Classifying maps by their content (‘‘what?’’) I. By (digital and analog) content formats: 1. websites (incl. blogs, portals, homepages), 2. documents (incl. books), modules), 3. databases or repositories, 4. learning objects or online courses (or 5. other file formats (e.g., sketches, drawings) II. By content types: 1. methods, 2. processes, 3. experts (incl. groups), 4. organizations/departments/ institutions, 5. lessons learned/experiences, 6. skills and competencies, 7. concepts, 8. events, 9. patents, 10. knowledge or communication flows or relationships, 11. interests or knowledge needs C. Classifying maps by the application level (‘‘who?’’) 1. Personal knowledge maps (visualizing one’s own skills or expert contacts, see Eppler and Sukowksi, 2000 or Burnett et al., 2004) 2. Dyadic knowledge map (to support knowledge creation, transfer, or assessment between two people) 3. Team knowledge maps (visualize the skills present or needed in a project team, like the T-matrix, see Eppler and Sukowksi, 2000) 4. Departmental knowledge maps 5. Community knowledge maps 6. Organizational knowledge maps 7. Inter-organizational/network knowledge maps D. Classifying knowledge maps by graphic form (‘‘how?’’) I Table-based format (for an example see Heng, 2001) 1. Person by skills table 2. Skill area by people table 3. People by documents 4. Team by project experience table II. Diagrammatic format 1. Structure diagrams (a) Venn diagram, (b) concentric circles (with or without segments), (c) matrix (i.e., 2 x 2), (d) network diagram, (e) mind map, (f) concept map (Tergan and Keller, 2005), (g) cognitive map (Huff and Jenkins, 2002), (h) strategy map, (i) fishbone 378 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 2. Process diagrams (Galloway, 1994) (a) Timeline, (b) swim lane chart, (c) flow chart, (d) event chain, (e) critical path method, (f) Gantt chart, (g) cycle chart, (h) decision tree, (i) value chain, (j) flight plan (Eppler and Sukowksi, 2000) III. Cartographic format 1. Geographic map: globe/continent/land/island/region, 2. informational map: park, 3. tube/metro (Burkhard and Meier, 2005) map, 4. galaxy/stars, 5. sea/ocean, 6. building/ architectural map IV. Metaphoric format (a) From the natural realm: 1. tree, 2. iceberg, 3. canyon, 4. mountain, 5. river, 6... (b) Man made artifacts: 1. house, 2. temple structure, 3. radar screen, 4. bridge, 5. race track, 6... E. Classifying maps by their creation method (‘‘how?’’ and ‘‘who?’’) 1. Maps that are automatically and dynamically generated by the computer (such as selforganizing maps, see Kohonen, 2001) 2. Maps that are semi-automatically generated (automatically assembled and optimized by analysts) then 3. Maps that are designed once by domain and mapping experts and then used in the same way by all users 4. Maps that are iteratively created, modified, or extended by the map user(s) themselves (community generated maps) 379 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo REFERENCES 1. Vestal, Wesley. "Knowledge Mapping 101". Presentation at USAID Knowledge for Development Seminar September 22, 2003. http://pdf.usaid.gov/pdf_docs/PNADK308.pdf 2. "U.S. Agency for International Development." U.S. Agency for International Development. Web. 15 May 2012. <http://www.usaid.gov/>. 3. "Knowledge Mapping: A Practical Overview." : Impact Alliance. Web. 15 May 2012. <http://www.impactalliance.org/ev_en.php?ID=2011_201>. 4. "Thoughts.com." Where Is the Map? 3 Easy Steps to Construct a Speech. Web. 15 May 2012. <http://www.thoughts.com/colbygross511/where-is-the-map-3-easy-steps-to-constructa-speech>. 5. "Definition: Knowledge Mapping." Definition: Knowledge Mapping. Web. 15 May 2012. <http://technologysource.org/extra/83/definition/2/>. 6. "Mapping the People in Your Organisation." Mapping the People in Your Organisation. Web. 15 May 2012. <http://www.moxy.com.au/index.php/moxy-knowledge/18-articles/60mapping-the-people-in-your-organisation>. Links used: 1. http://lpis.csd.auth.gr/mtpx/km/material/knowledge%20maps.pdf 2. http://www.slideshare.net/dtandukar/KMap 3. http://it.toolbox.com/wiki/index.php/Knowledge_Map 4. http://pdf.usaid.gov/pdf_docs/PNADK308.pdf 5. http://www.moxy.com.au/index.php/moxy-knowledge/18-articles/46-knowledge-mapping 6. http://kmwiki.wikispaces.com/Knowledge+mapping 7. http://knowledge-mapping.blogspot.de/2006/11/concept-mapping-today.html 8. http://www.tlainc.com/articl180.htm 9. http://www.trainmor-knowmore.eu/AC44FB2A.en.aspx 10. http://ezinearticles.com/?Knowledge-Mapping&id=9077 11.http://www.moxy.com.au/index.php/moxy-knowledge/18-articles/60-mapping-the-peoplein-your-organisation 380 � Dublin Core The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/. Extent The size or duration of the resource. 1345 Title A name given to the resource Knowledge Maps & Knowledge Mapping: Literature Review Author Author Admir , Čavalić ILGÜN, Erkan Abstract A summary of the resource. This study provides information about Knowledge Mapping as a tool of Knowledge Management, how it is used and how do we “occasionally” use it daily. Main part of this paper focuses on the relation among an organisation and knowledge mapping, and how kmaps are important and what’s their purpose. After a broad analysis of articles from nowadays significant researchers about knowledge mapping I was able to extract the main issues, statements and definitions on knowledge mapping and what would help an organisation in its strategic positioning and development in the manner of k-maps. Moreover, where to focus on, in the need of preparing a knowledge map. Also, which k-maps developed throughout the time and their difference among each other? Keywords: Knowledge Mapping, Knowledge Management, Organisation, Strategic Positioning Date A point or period of time associated with an event in the lifecycle of the resource 2012-05-31 Keywords Keywords. Conference or Workshop Item PeerReviewed H Social Sciences (General),HB Economic Theory,HG Finance,HJ Public Finance https://omeka.ibu.edu.ba/files/original/2268314b6791eba122583d110eb58898.pdf 96f1653d31022a64527ce5255b406518 PDF Text Text 3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Does predefined ERP implementation methodology work for public companies in transitioning country? Adnan Kraljić, Denis Delismajlović, Tarik Kraljić Information Technology Department,International Burch University Sarajevo, Bosnia and Herzegovina E-mails: akraljic@ibu.edu.ba, tkraljic@ibu.edu.ba, ddelismajlovic@ibu.edu.ba Abstract The main objective of this paper is to answer a question “Does predefined ERP implementation methodology work for state owned companies in transitioning countries?” The focus will be on state owned companies from Bosnia and Herzegovina, as it is typical transitioning company. Paper will treat selected issues which could trouble ERP implementation trough predefined ERP implementation methodology for SAP ERP. This paper presents observations/remarks based on experience of authors in SAP ERP implementation projects in public sector in Bosnia and Herzegovina. Author’s goal is to provide useful insight into predefined ERP implementation methodology (in theory) and issues that arise in real life ERP projects. Also, it should provide structural knowledge for all stakeholders involved in the process of ERP implementation in public sector. Keywords: enterprise resource planning (ERP), implementation, state owned company, post socialist transitioning country, ASAP methodology 1.Challenge known as ERP implementation Enterprise resource planning (ERP) system is a business management system which comprises integrated sets of comprehensive software, which can be used, when successfully implemented, to manage and integrate all the business functions within an organization. These sets usually include a set of mature business applications and tools for financial and cost accounting, sales and distribution, materials management, human resource, production planning and computer integrated manufacturing, supply chain, and customer information.[1] References 1 Sheu, C., Yen, H.R., and Krumwiede D.W.: The effect of national differences on multinational ERP implementation: an exploratory study. TQM & Business Excellence, Vol.14, Issue 6, August, pp.641657. (2003) 130 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo So, the main feature of ERP is computer-based integration of the whole organization into one system and database. It provides higher efficiency and real time reporting. Data entered in one module of the system are immediately accessible for other organization’s functions. Figure 1. presents typical functional ERP architecture. Figure 1. Typical ERP system architecture People often contemplate ERP as software provided out of box. We consider ERP more as a concept. Target of any ERP implementation in organization is to provide benefits for all stakeholders by improving business operations and decision making process. It is important to state that ERP’s benefits are a direct result of effective preparation and implementation, and appropriate use of system. This seems obvious, but nine out of 10 companies don’t get it right the first time around. [2] Story about ERP implementation ERP implementation is set of activates, normally leading to the fully operating system. It mixes business, technical and clerks’ sides which should work harmonized during the implementation. Every employee in the company is involved in ERP implementation process; either they are technical support in company (IT department) or end users of information system. Obviously it is not easy to manage all of these project members. There are many examples of ERP implementation failures. The world of IT and business consulting is full of stories of ERP projects gone wrong. Companies such as Whirlpool, Hershey Foods, and Allied Waste Industries have had exposed 2 ( September 1998 issue of Midrange ERP “There Is No Magic in ERP Software: It’s in Preparation of the Process and People,” p. 8]). 131 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo court cases against ERP software vendors (such as SAP A.G. and Oracle) because of their unsuccessful implementations. It is interesting that according to a statement cited in an ITWorld.com article, Waste Management claims SAP deceived it by creating "fake software environments" for product demonstrations. The project went bad almost immediately after a sales agreement was signed in October of 2005. Though SAP promised a pilot version of the system would be up and running by Dec. 15, 2006, "it is not even close to being completed today." [3] Another famous story about SAP implementation failure is Shane Co. The family-owned jewelry retailer that sought bankruptcy told a U.S. judge the company’s decline was triggered partly by delays and cost overruns for a $36 million SAP AG inventory-management system. SAP, the world’s biggest maker of business-management software, took almost three years to install and implement the system instead of one year, while costs “ballooned” to $36 million from a projected maximum of $10 million, Shane said in papers filed in U.S. Bankruptcy Court in Denver. [4] In general an implementation is seen as successful if it is completed within budget and time frame; addressing all implementation deliverables measured by ROI, KPIs etc. Lots of variables are involved in ERP implementation such as; personnel (business side, technical side, support side, users), implementation partner (for example local integration software PeopleSoft, JD Edwards, Salesforce.com etc.), and implementation strategy. [5] With a number of issues that arise together, in a few months or year for implementation, it is important to address critical factors that shape an implementation. Also, as we mentioned, it is important not to underestimate the nature of public institution and all bureaucracy you have to cope with during the implementation. 2. No one is immune - country specific issues of public sector There is no industry or business activity that is not influenced by B&H’s social environment. Complex picture of transitioning post conflict country will be described in next few paragraphs. The stress will be on state owned companies. 3 Whos to blame for failed ERP project that prompted lawsuit, http://www.itbusinessedge.com/cm/blogs/all/whos-to-blame-for-failed-erp-project-that-promptedsap-lawsuit/?cs=11588 4 Shane Says SAP Costs Helped Cause Jeweler’s Decline, http://www.bloomberg.com/apps/news?pid=newsarchive&sid=awweg53wmmJw&refer=germany 5 Bhagwani, A.: Critical Success Factors In Implementing SAP ERP Software, An EMGT Field Project report submitted to the Engineering Management Program and the Faculty of the Graduate School of The University of Kansas, (2009) 132 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo In Bosnia and Herzegovina there are some big state owned companies that implemented an ERP or are in the process of implementation. According to SAP User Community in B&H SAP ERP is the main ERP vendor for big public companies. It could be useful information so we will name those companies: EPBiH, BH Telecom, JP EPHZ HB, HT Mostar and Clinical center University of Sarajevo. One of the issues of public sector in B&H is very complex stakeholder structure due to political system as a result of post conflict circumstances. (Dayton and Paris political agreement resulted in four different levels of government – 14 governments, 180 ministers; 1 prime minister per 300 000 people, one the most complex and expensive governmental body in the world). According to the 2005 CMI report, this bloated public sector accounts for 54% of the annual GDP - more than in any other European country. [6] Another issue is widely spread corruption as one of the common characteristics of post socialist developing country. After war in B&H and privatization, which was conducted doubtfully, hundreds of state owned companies finished in bankruptcy. However, still few state owned companies, mainly utility and telecom companies, are the backbone of country’s economy. Unfortunately, public sector in Bosnia and Herzegovina is very complex and due to the last surveys one of the most corrupted in Europe, especially in its employment policy. As mentioned previously 54% of GDP is consisted of public sector what implies the importance of this sector and long term consequences if fraud is part of it. Same report states that corruption pattern in B&H is characterized by (a) high level of public concern with corruption, (b) low level of public trust in the governments, (c) state capture and conflict of interest, (d) public administration inefficiencies reflected in widespread bribery in public offices, (e) distorted business environment and (f) a significant burden on poor households, exacerbating poverty and inequality. Public tenders (defined by public procurement law) could provide opportunity for corruption if they are done with a lack of transparency. [7] Also process of choosing the bid winner is complex with not strict definition of vendor selection criteria. According to the World Bank report, in the most cases in B&H, tender policy is based on price, which weights for more than 70% of possible points which vendor could earn in selection procedure. This leads to artificially low price offered. It ensures wining the bid, but do not ensure the quality of service. 3.How ERP vendors want to help implementations As mentioned in previous chapter, ERP software vendor is one to blame when expected results do not occur after ERP implementation. ERP vendors believe that tracking of tested implementation methodology is a prerequisite for successful ERP implementation. All implementation methodologies e.g. Oracle Application Implementation Methodology (AIM), Accelerated SAP (ASAP) etc suggest at least five 6 Corruption and Anti-Corruption in Bosnia and Herzegovina (B&H); www.u4.no/helpdesk/helpdesk/query.cfm?id=221 7 Bosnia and Herzegovina Diagnostic Surveys of Corruption, World Bank; http://www1.worldbank.org/publicsector/anticorrupt/Bosnianticorruption.pdf 133 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo phases of ERP implementation: Define; Design; Build; Transition; and Go Live & Support. [8] To avoid uncomfortable project situations ERP vendors developed predefined ERP implementation methodologies. One of the most famous is delivered by the biggest ERP vendor - SAP. It is ASAP methodology (ASAP – Accelerated SAP). In next few paragraphs we will describe ASAP methodology in details. Accelerated SAP (ASAP) is SAP’s standard implementation methodology. It is consisted of 6 phases, and those are: Project preparation, Blueprint, Realization, Final preparation, Go-Live Support and Run. It is serial relationship, so predecessor phase has to be completed in order to move on next phase. In figure 2. those phases are shown. This roadmap is a step-by-step guide that incorporates experience from many years of implementing R/3. Along with that, Accelerated SAP contains a multitude of tools, accelerators and useful information to assist all team members in implementing R/3. Quality checks are incorporated at the end of each phase to easily monitor deliverables and critical success factors. ASAP is delivered as a PC-based package, so that – if required – an implementation project can begin prior to having an R/3 System installed. [9] We will give more details regarding each phase. 3.1.Project Preparation Goal of this phase is to plan our project and lay the foundations for successful implementation. It is at this stage that we make the strategic decisions crucial to your project: define your project goals and objectives, clarify the scope of your implementation, define your project schedule, budget plan, and implementation sequence, establish the project organization and relevant committees and assign resources 3.2.Business Blueprint During this phase we create a blueprint using the Question & Answer database (Q&Adb), which documents your enterprise’s requirements and establishes how your business processes and organizational structure are to be represented in the SAP System. We also refine the original project goals and objectives and revise the overall project schedule in this phase. 3.3.Realization In this phase, we configure the requirements contained in the Business Blueprint. Baseline 8 Nazir, M. M.: ERP Implementation in Oil Refineries, Daily Business Recorder, Karachi (2005) 9 Miller, S.: Asap Implementation at the Speed of Business: Implementation at the Speed of Business, Computing Mcgraw-Hill (1998) 134 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo configuration (major scope) is followed by final configuration (remaining scope), which can consist of up to four cycles. Other key focal areas of this phase are conducting integration tests and drawing up end user documentation. 3.4.Final Preparation After project realization phase, we complete our preparations, including testing, end user training, system management, and cutover activities. We also need to resolve all open. At this stage we need to ensure that all the prerequisites for your system to go live have been fulfilled. 3.5. Go Live & Support In this phase we move from a pre-production environment to the live system. The most important elements include setting up production support, monitoring system transactions. [8] 3.6.Run Optimizing overall system performance and obtaining permanent business process optimization. Phase objectives shown in Figure 3. . Figure 3. Phase objectives 135 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo ERP implementation in transitioning country in state owned companies –It is shown in table 1. Expected objectives for each ASAP phase and constraints that occurs in practice Phase Excepted objectives Constraints in practice regarding the phase objects Project Preparation Defined your project goals and objectives Unskilled project managers Clarified the scope of your implementation Corruption in tendering procedure (inadequate tendering procedure) Defined your project schedule, budget plan, Poorly written tendering documentation and implementation sequence Leak of project management knowledge (no clear goals and objectives) Established the project organization and Poorly prepared project work break structure relevant committees and assign resources Employee does not care about resource spending - state money. Budget and project schedule planned with no serious approach Blueprint Created blueprints using the Question & Too much / little time spent on blueprint preparation due to lack of project Answer database (Q&Adb) management knowledge, and requirements set by political not business persons / reasons Mapped business processes Overview of all business process No localize ASAP documentation for smaller countries (example Bosnian language) Leak of business process mapping skills Leak of professional business environment in state owned companies, which support this extremely important phase Managers and supervisors mostly not centers of competence Realization 136 Configured the requirements contained in Leak of project management the Business Blueprint Leak of change management (Change management not consider as important) conducted unit tests Responsibility issue - “there is someone else who will do it” �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Go – Live Support Run Conducted integration tests Integration test not taken seriously from end users Prepared end users documentation Very slow internal knowledge and information transfer - several managers has to sign document to be approved . Moved from a pre-production environment Help desk not established by the company to the live system Defined communication channels not respected Includes setting up production support, Often, poor management decision made under huge pressureof Go Live phase monitoring system transactions Employees working habits- mistakes are there to be hidden Optimizing overall system performance No optimization and improvements Permanent business process optimization Lack of understanding that the ERP system is “live” system After project is finished all ERP story ends. Problems with tendering procedure for support No competent support in country as Bosnia and Herzegovina - low spending on consultant education 137 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 4. Most threatening constraints in practice regarding ASAP methodology In next few paragraphs we will discuss the most prominent constraints from the list above. Inadequate tendering procedure for state owned company - The Public Procurement Law adopted in 2004 generally complies with the main principles of the EU public procurement system. [10] However, in practice, procurement process for public companies still provides significant space for fraud. One of the most questionable aspects of public tendering law is determining price as the most important factor in bidding. So winning the bid is based significantly, if not exclusively on price. This leads to artificially decreased price by some bidders. Other companies are in the risk to become uncompetitive if the price is set according to the real market price for the project scope. This provide space for risky system integrators who are not skilled to provide ASAP methodology and cannot provide skilled SAP consultants who can implement ASAP methodology in SAP ERP implementation. No localization for ASAP documentation for smaller countries (example Bosnian language) – ASAP methodology provides dozen of documents well written in English language. It is profound help for consultants and substantially accelerates the process of implementation. Unfortunately, this documentation is not translated on local languages of small, transitioning B&H market. Time consuming decision making flow process (from bottom to top) – Decision process in big, public companies can be very slow. It clearly does not support name of SAP standard methodology – Accelerated SAP. One of the reasons could be very complex and complicated organization structure. Specific for some public companies is lack of modern information infrastructure, like e-mails. Working habits of management and employees – Probably someone would ask what communism has with ASAP. However, as former communist country, Bosnia and Herzegovina has kept some of the practices from that period (especially in state owned companies). These habits could include: no real authority of the management, work is not valuated by achievement but personal relations; there is no incentive by employees to make some effort and improve work environment. Also, salary is determinate by salary coefficients for each working position. Coefficient is provided by legislation. Public companies are short of qualified employees. Most of employees are with lack of knowledge and practice in business domain they are hired for. The reason for this could be 138 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo corruption in employment process (some public companies advocate publicly that they prefer daughters and sons of their current employees in hiring process. Leak of professional business environment in state owned companies – ASAP methodology requires business educated professionals who can follow ASAP predefined tasks. Very often employees in state owned companies do not have appropriate skills that can support ASAP activities. Even if the project managers deliver tasks to their employee the feedback is missing or is delivered in very poor manner. Leak of change management (Change management not consider as important) - Change management is a process which aim is to make easier implementation, as well as transition during ERP project. Since ERP project is usually very complex, change management can play significant role to improve employees to understand why the project has been implemented and to make organizational changes and BPR easier. These activities can be summed into 3 basic ones: education of employees, communication among stakeholders and involvement in project process. Lack of change management can affect quality of project implementation, and make results smaller. 5. CONCLUSION As it is stated in abstract the main objective of this paper is to answer a question “Does predefined ERP implementation methodology work for state owned companies in transitioning countries?” We tried to answer on this question with experience gained with several projects in state owned companies done in Bosnia and Herzegovina. We will call it “hands on” experience. As we are working as SAP consultants, we chose SAP Accelerated methodology as referent methodology for our paper. We found it relevant as it is provided by the biggest ERP vendor – SAP A.G. In general ASAP methodology is well developed with hundreds of well-structured documents which support all ERP implementation activities. Unfortunately, in practice, this ERP implementation methodology hardly works for state owned. As experienced SAP consultants we have impression that ASAP methodology is constructed for private companies with professional business environment. At the end we will state the most remarkable constrains we found during ASAP methodology implementation: Inadequate tendering procedure for state owned company No localization for ASAP documentation for smaller countries (example Bosnian language) Time consuming decision making flow process Working habits of management and employees 139 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Leak of professional business environment in state owned companies Leak of change management (Change management not consider as important) We hope that this paper will be useful in further ERP implementations and ERP research. A Cross – Sectional Analysis of Environmetal Sustainability Practices Toksari Murat1, Uçan Okyay2 1Nigde University, Department of Business, 2Nigde University, Department of Economics, E-mails: mtoksari@nigde.edu.tr, okyayu@hotmail.com Abstract In 1970s and 1980s the concept of sustainability developed as a process of protection for the elements that social, economic and eceological systems need. During the Environment and Development Summit held in 1992, decisions were made about the works to protect and improve the environmental sustainability with the help of objective policies. By revealing sustainability specifically focuses on the social, economic and ecological target, Brountland report states that meeting Socia-Economic needs is limited to the carrying capacity of ecosystem. Environmental sustainability is divided into three categories. They are resource management, energy management and product sustainability. While, solid waste and water conservation compose the resource managament, energy managament includes energy conservation, renewable energy, GHG emission reduction, energy sufficient. Finally, product sustainability involves product transportation, supply chain audit, product stewardship and Life Cycle Program. In this context, environmental sustainability index and environmental performance index were prepared by the universities of Yale and Colombia. With environmental sustainability index, it is intented to reach perfection in the current and future environmental qualities of the countries. This index, is a tool when aiming to be qualified and is an important mechanism for testing the environmental performance. As for environmental performance index, it has been developed by using result-oriented indicators. 140 � Dublin Core The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/. Extent The size or duration of the resource. 1162 Title A name given to the resource Does predefined ERP implementation methodology work for public companies in transitioning country? Author Author Adnan , Kraljić Abstract A summary of the resource. The main objective of this paper is to answer a question “Does predefined ERP implementation methodology work for state owned companies in transitioning countries?” The focus will be on state owned companies from Bosnia and Herzegovina, as it is typical transitioning company. Paper will treat selected issues which could trouble ERP implementation trough predefined ERP implementation methodology for SAP ERP. This paper presents observations/remarks based on experience of authors in SAP ERP implementation projects in public sector in Bosnia and Herzegovina. Author’s goal is to provide useful insight into predefined ERP implementation methodology (in theory) and issues that arise in real life ERP projects. Also, it should provide structural knowledge for all stakeholders involved in the process of ERP implementation in public sector. Keywords: enterprise resource planning (ERP), implementation, state owned company, post socialist transitioning country, ASAP methodology Date A point or period of time associated with an event in the lifecycle of the resource 2012-05-31 Keywords Keywords. Conference or Workshop Item PeerReviewed H Social Sciences (General) https://omeka.ibu.edu.ba/files/original/ac96afca7fe35742f70460e7604c4279.pdf 502ed757bc24c1fd2414f25e5167a1de PDF Text Text 3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Although, England who connected itself to the U.S. dollar in terms of financial and banking system and convert its system from Sterling into dollars as the world's second largest dollar reserves, being a member of the community, it didn’t obey the Community's common monetary policy especially, refused to use the euro came into force in 1999. Britain's entry into the agricultural policy would harm Commonwealth countries, which have an important place with Britain, both politically and commercially. Britain that has already been damaged by the Community's agricultural policy, is working to resolve this situation by regional development policies (Eraktan, 2006). If we look at in terms of the Common Monetary Policy, Britain’s which is so dependent to U.S. Dollar; inclusion to Euro will cause its damage in terms of economic, political and prestige. In the environment that the EUROZONE whose basis was constructed by The Hague Summit in 1969 and Werner Report, became a threat to the EU’s future by recently living a difficult test because of the crisis, it is a fact that it provided a significant advantage to England. Eu Economic Integration Process Of Macedonia Agim Mamuti International Balkan University (IBU),Skopje, Macedonia agim.mamuti@yahoo.com Abstract The purpose of this research is to provide a general overview of the accession process with a special reference to the economic integration and the challenges of the Republic of Macedonia in the road of joining the European Union. The European Council of December 2005 granted the status of candidate country to the Republic of Macedonia. The Stabilization and Association Agreement (SAA) between the Republic of Macedonia and the EU was signed in April 2001 and entered into force in April 2004. The Council adopted the Accession Partnership for the country, including key priorities for reform, in February 2008. In October 2009, the Commission recommended to the Council to open negotiations with the country, as well as to move to the second phase of SAA Implementation. These recommendations were reiterated in 2010. The Council has not yet concluded its deliberations on the Commission's proposals. Visa liberalization for citizens travelling to the Schengen area has been in force since 19 December 2009. The country has a small, open economy, with total trade in goods and services recovering to a level of 114% of GDP in 2010, following the 2009 recession. Trade integration with the EU is advanced, with about 63% of all exports currently going to and about 53% of imports originating from the EU. The CEFTA region is the country's second most important trading region, accounting for around 24% of exports and around 10% of imports. The export structure continues to be highly concentrated on a limited range of products, with textiles and clothing accounting for about 17% of total exports and manufactured iron products for 26% in 272 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 2010. The stock of FDI increased to about 51% of GDP, with the Netherlands, Slovenia and Austria being the biggest investors. In total, EU countries accounted for about 60% of total FDI inflows. Switzerland, Turkey and Serbia are the most important non-EU investors. The exchange rate against the euro has remained stable in nominal terms. Price competitiveness has remained largely unchanged. Overall, in the last years trade integration with the EU is well advanced, but exports remain concentrated on a few price-sensitive products. International price competitiveness remained largely unchanged.26 Keywords: EU, economic integration, Macedonia, Stabilization and Association Agreement (SAA), candidate-country, membership 1.EU ECONOMIC INTEGRATION PROCESS OF MACEDONIA Macedonia’s process to become a member of the European Union (EU) is an objective that enjoys broad national consensus. This process for EU membership thus must shape national policy, both foreign and domestic, the reform initiatives, and the economic agenda and business strategies. Macedonia’s EU aspiration provided the compass for the reforms that were implemented in the transition process, and it still anchors the social agreement among virtually all Macedonian citizens. It is important for this reason to review here what has been achieved and what is to come; bearing in mind that EU integration reaches into every aspect of the life. Economic growth is increasingly important for Macedonia for its own sake as well as for the country’s path toward the EU; equally important is the growth of its institutional and administrative capacity at all levels of government, from the local to the international. The main objectives and stepping stones in the next stages of Macedonia’s EU integration will be economic growth, economic and social opening to the EU and institutional preparedness. An important milestone in Macedonia’s path toward EU membership was the signing of the Stabilization and Association Agreement (SAA) in 2001. This agreement provided a strong motivation for the intensification of the adjustments necessary for the fulfillment of EU membership criteria. One positive outcome of the SAA was the establishment of an appropriate administrative structure and of an institutional framework for implementation of the Agreement as well as for monitoring of its implementation.27 The next important step occurred in December 2005, when Macedonia achieved the status of a candidate country. This was an important political recognition of the progress and reforms achieved; however, an important reservation to this positive assessment of Macedonia’s progress is the fact that a date for negotiations has not been set because the country is not yet ready. The acquisition of candidate status does not mean fulfillment of the strict EU criteria for membership. In fact, Macedonia has only reached the point at which the complex process 26 Official documents from the web-page of Ministry of Foreign Affairs of RM, http://www.mfa.gov.mk 27 Commission of the European Communities, The Republic of Macedonia 2011 Progress Report, Brussels, October 2011, p.25 273 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo of negotiation about the individual chapters of the Acquis Communautaire and of fulfillment of the membership criteria, especially the economic ones, begins. Fulfillment of the economic criteria for membership must be a top priority for Macedonia, not only in order to meet the standards of the EU, but also because they are crucial for Macedonia’s economic and social progress. Macedonia needs to fully develop a functioning market economy that will allow an even ground for competition and weed out all the oligarchic elements in the economy that stifle its overall growth. The Macedonian economy needs to be able to cope with the intense competitive pressures and market forces within the EU. Consequently, Macedonia needs to be aiming for where the EU economy will be at the end of the reporting period not where the EU economy is today.28 The capacity of Macedonian institutions to effectively manage the requirements implied by EU membership and, before membership, the administration of processes such as the implementation of laws and the management of funds, needs to be strengthened. Answering the European Commission Questionnaire revealed that Macedonia has the potential to meet the administrative requirements of EU membership, but this potential cannot remain latent and needs to become the norm. Firm political commitment and leadership, not only management, is needed to prepare these institutions and the Macedonian economy for European integration. Municipalities need to be able to administer funds effectively and transparently. They need to be able to effectively interact with EU organs and to formulate sound and comprehensive policies Public and civil servants from all levels of government need to be trained to work within European standards and processes, to effectively plan, budget and administer funds, to create projects and manage them ably and to be capable of being a positive and proactive member of the EU that can fully participate in European governance and in the formulation of EU policies. 29 The next step ahead is the negotiation process, which are both a great opportunity and a great threat. If Macedonia proceeds efficiently in this process, it will demonstrate to itself and to the world its institutional readiness for membership; if it fails to do so, its image as a modern state will suffer correspondingly. A successful negotiation will have important positive economic benefits and solidify a fragile national consensus; a negative outcome to the negotiation may nurture Euro skepticism and a general resistance to any further reform processes since these will be seen as having high costs and few benefits. Macedonia will not be in a position to negotiate parallel chapters at the same time, as other countries have done; it will need to do so sequentially. This may slow the overall process. Macedonia need not rush this process, but, rather, it should strategically adopt segments of the Acquis if it is to its benefit to do so and leave those segments that may be hardest for its economy and society to internalize for last. Furthermore, it is very important that there should be some continuity among Macedonia’s negotiators. They will also need to communicate intensively with the general public and explain the process so as to maintain the national consensus for EU membership. Consequently, the process of negotiating Macedonia’s entry into the EU must be as transparent as possible. 28 Official documents from the web-page of the Secretariat for European Affairs of RM, www.sep.gov.mk 29 Национална програма за усвојување на правото на ЕУ – ревизија 2011, Секретаријат за европски праша (Влада на Република Македонија), Скопје 274 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo The time between achieving candidate status and the negotiations leading to future membership will be challenging, both politically and economically. While issues of political stability and interethnic dialogue have dominated the discussions between European and Macedonian politicians thus far, economics will dominate the next stage leading toward EU membership. Macedonia needs to undertake a major overhaul of its laws and institutions to prepare for EU membership. Such a large revision of laws, regulations and institutions should, in the long term, be beneficial. However, there will be transition costs, and considerable thought must be given to the phasing in of various EU-related laws and regulations. Consequently, Macedonia must create the capacity to weigh the costs and benefits of adopting specific EU laws and regulations at any given time and to develop a comprehensive plan for doing so. Preparing for EU membership will be a major task for the Macedonian government and society, as well as for the business sector. While the experience of other countries suggests that the pace with which changes are implemented may accelerate over time, it is critical that Macedonia have a clear roadmap of the process, one that identifies costs and benefits of adopting specific measures and weighs them against Macedonia’s ability to absorb such changes as well as their congruence with Macedonia’s economic strategy at any period of time.30 Macedonia has an enormous potential market open to it because of the free trade agreements (FTAs) it has signed, including the one with the European Union. Overall, the FTA’s did not initially stimulate Macedonian exports very much, suggesting a weak supply response on the part of Macedonian exporters or ineffective implementation of the FTAs.31 Macedonian producers must pay greater attention to such factors as environmental standards, packaging, quality, marketing, management techniques and market study to prepare for the EU market. It is hence worthy of mention that one of the elements of the pre-accession process is access to EU funds which will be channeled through the new Instrument for Pre-Accession Assistance (IPA). The main goal of the pre-accession funds is to prepare the institutions of future member countries for the management and administration of the much larger Structural Funds that the country will have access to once it becomes a member of the EU. Indeed, in order to obtain the pre-accession funds, the country needs to define its development and investment priorities for the medium-term, as well as clearly define and organize the institutional mechanisms for using the funds. The IPA funds will have a positive effect on economic growth through creation of a more attractive business climate by contributing to investments in infrastructure, institution-building, human resources, agriculture, competitiveness of firms, all with a consideration for balanced internal regional development. Within the region, Macedonia has an advantage in bordering the EU, in the form of Greece, to the south. Indeed, the bulk of foreign investments that have come in the past years have been from Greece. However, the possibility of exporting to the rest of the EU is significantly hampered by the numerous borders that need to be crossed to reach the biggest part of the EU 30 Official documents from the web-page of the Ministry of Economy of RM, www.economy.gov.mk 31 EUROSTAT 275 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo market. For this reason, it is in Macedonia’s interest that the rest of the Western Balkan countries also enter the EU as soon as possible. The EU has a market of over 500 million people32, but there is a market of sixty million customers within this region that also can be tapped if unification of sorts occurs regardless of, or as a prelude to, Macedonia’s entry into the EU; indeed, regional cooperation of increasing intensity is an important aspect of the Stabilization and Association Agreement. An encouraging move in this direction is the recent political commitment to, and the start of in 2007, a single free trade agreement (FTA) for the countries of SEE. Improvement of land and air communication must be Macedonia’s top priority. The airport is Macedonia’s gateway to the world and is in dire need of investments, which will come most easily if it is fully privatized. Except for Greece, all EU countries are a considerable distance from Macedonia, and air connections are critical for trade and business. Nevertheless, this does not undermine the importance of Corridors 8 and 10, for both Macedonia’s regional and European perspectives. Corridor 10 has a greater perspective of realization and natural evolution, being also important to Greece. However, Corridor 8 will require more of a push by Albania, Macedonia and Bulgaria. Although corridors 8 and 10 were effectively taken off the European transport map, their importance is increasing as EU foreign policy progressively turns toward Asia. 2.CONCLUSION In the past ten years the Republic of Macedonia is legitimized as a reliable partner and true ally of the EU. Macedonia has not ignored any institutional stage in the development of relations with the EU - starting with the Cooperation Agreement, the Agreement on Stabilization and Association, applying for membership in the European Union, up to receiving a status as a candidate-country for membership. The decision of the European Council of December 17, 2005 granting the candidate status for EU membership is an event of historical importance for the Republic of Macedonia as deserved recognition for the efforts and results achieved in the way of achieving the strategic goal - EU membership. The economic results achieved by the Republic of Macedonia during the transition are far lower than the achievements in the South-eastern European countries. The numerous noneconomic events in the country and the region in the 1990’s and the beginning of the century also contributes to this. With a low inflation rate of 2.5% in last years and a stable exchange rate (with one devaluation of 16% in 1997), Macedonia was a leader among the transition countries in terms of the macroeconomic stability, but numerous non-economic events in the country and the region led to a low average growth in the entire transition period. In the recent years, the Republic of Macedonia generally meets most of the Maastricht criteria. The single bigger problem that our country is facing is the non-existence of a long term 10-year bond used as a reference instrument when defining the interest rate. In this period, the Maastricht criteria are not obligatory for the Republic of Macedonia but they still have great significance for approximation of our economy to the European Union. 32 McKinsey, Global investor Opinion survey on corporate Governance ( 2002 ) 276 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Having in mind the present situation within the EU, regarding the negative atmosphere for enlargement, the implementation of Copenhagen and Maastricht criteria will simply not be good enough for candidate countries such as Macedonia. Knowing that in the past a decision for accession was often made for geo-strategic reasons, obtaining political support is even more important factor for the Macedonian accession to the EU. Taking into consideration this fact, it is a need Macedonia to solve the name issue with Greece. REFERENCES Werner Weidenfeld & Wolfgang Wessels, Europa von A bis Z, Bonn, 2002 Вернер Вајденфелд, Волфганг Веселс, Европа од А до Ш, Издадено во Baden-Baden, 2009 Државен завод за статистика, Годишни извештаи 2006-20011 Ласкомбе, М.& Ванденриеш, Х., Јавни финансии, Скопје, 2006 година Мелита Трајковиќ, Цели и инструменти на монетарна политика: современи искуства, НБРМ, јуни 2006 година Народна банка на Република Македонија, Годишни извештаи 1999-2009 Национална програма за усвојување на правото на ЕУ – ревизија 2011, Секретаријат за европски праша (Влада на Република Македонија), Скопје Рен, Оли: Следните граници на Европа, Скопје, 2007 година Студија, Приближување кон Европската Унија: предизвици и можности, Скопје, 2009 година Трпески, Проф.д-р Љубе: Пари и банкарство, второ дополнето и изменето издание, Economy Press, Скопје, 2005 година Treaty of European Union, Maastricht, 07.02.1992 Европски совет од Луксембург, Резолуција за координација на економската политика во третата фаза од ЕМУ, 12-13.12.1997 TREATY establishing the European Economic Community, 29.07.1992 Internet sources: http://europa.eu/ http://ec.europa.eu http://www.delmkd.ec.europa.eu http://www.consilium.europa.eu http://ec.europa.eu/dgs_en.htm http://europa.eu.int/comm/economy_finance/index_en.htm http://eurotreaties.com http://ecb.int http://ec.europa.eu/eurostat http://europa.eu/abc/obj/treaties/index_en.htm 277 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo http://eur-lex.europa.eu/en/index.htm http://worldbank.org http://imf.org Corporate Governance Practices in Bosnia and Herzegovina Aida Nušinović International Burch University, Faculty of Economics, 71000, Sarajevo, Bosnia and Herzegovina. E-mail: aida.nusinovic@gmail.com Abstract The purpose of this paper is to present the state of corporate governance in Bosnia and Herzegovina, to determine the degree of its principle applications, and to emphasize the importance of good corporate governance practices for transition economies, such as Bosnia and Herzegovina. Corporate governance, by its simplest definition, presents a system of management and control over the company. Good corporate governance practice is important for the investment climate, because it provides greater security for investors and shareholders and leads to sustainable long-term economic development. Because of the reorganization of the still present economic system, developing countries are faced with many problems related to the implementation of corporate governance, such as insufficient use of existing legislation, underdeveloped capital markets and insufficient bussiness transparency of the company. Foreign investors do not wish to invest in companies that do not apply the principles of corporate governance and studies have shown that for making investment decisions, the application of good corporate governance practices plays an important role. The problems Bosnia and Herzegovina is facing are still a lack of business transparency of company operations, as well as the insufficient protection of minor shareholders. At the end of this paper certain guidelines are given in order to improve practices of corporate governance in Bosnia and Herzegovina, and also the importance of their application to the company and the country itself is highlighted. Keywords: corporate governance, transition economies, economic development, principles, business transparency 1. Definition of Corporate Governance The term of corporate governance is far more complex than thought of at first, and implies not only the way in which a company is governed, but a full range of internal and external relations, as well as legal regulations. According to the definition of the OECD (Organization for Economic Cooperation and Development), corporate governance involves a set of relationships between a company’s management, its board, its shareholders and other stakeholders. Good corporate governance should provide proper incentives for the board and management to pursue objectives that are in the interests of the company and its shareholders 278 � Dublin Core The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/. Extent The size or duration of the resource. 1334 Title A name given to the resource Eu Economic Integration Process Of Macedonia Author Author Agim , Mamuti Abstract A summary of the resource. The purpose of this research is to provide a general overview of the accession process with a special reference to the economic integration and the challenges of the Republic of Macedonia in the road of joining the European Union. The European Council of December 2005 granted the status of candidate country to the Republic of Macedonia. The Stabilization and Association Agreement (SAA) between the Republic of Macedonia and the EU was signed in April 2001 and entered into force in April 2004. The Council adopted the Accession Partnership for the country, including key priorities for reform, in February 2008. In October 2009, the Commission recommended to the Council to open negotiations with the country, as well as to move to the second phase of SAA Implementation. These recommendations were reiterated in 2010. The Council has not yet concluded its deliberations on the Commission's proposals. Visa liberalization for citizens travelling to the Schengen area has been in force since 19 December 2009. The country has a small, open economy, with total trade in goods and services recovering to a level of 114% of GDP in 2010, following the 2009 recession. Trade integration with the EU is advanced, with about 63% of all exports currently going to and about 53% of imports originating from the EU. The CEFTA region is the country's second most important trading region, accounting for around 24% of exports and around 10% of imports. The export structure continues to be highly concentrated on a limited range of products, with textiles and clothing accounting for about 17% of total exports and manufactured iron products for 26% in 2010. The stock of FDI increased to about 51% of GDP, with the Netherlands, Slovenia and Austria being the biggest investors. In total, EU countries accounted for about 60% of total FDI inflows. Switzerland, Turkey and Serbia are the most important non-EU investors. The exchange rate against the euro has remained stable in nominal terms. Price competitiveness has remained largely unchanged. Overall, in the last years trade integration with the EU is well advanced, but exports remain concentrated on a few price-sensitive products. International price competitiveness remained largely unchanged.26 Keywords: EU, economic integration, Macedonia, Stabilization and Association Agreement (SAA), candidate-country, membership Date A point or period of time associated with an event in the lifecycle of the resource 2012-05-31 Keywords Keywords. Conference or Workshop Item PeerReviewed H Social Sciences (General),HB Economic Theory,HG Finance,HJ Public Finance https://omeka.ibu.edu.ba/files/original/8071c078f55d3c1b374ad37669281da4.pdf 061133035726dceb3c9641705fb74f9a PDF Text Text 3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Romer, P. (1986) "Increasing Returns And Long Run Growth", Journal Of Political Economy, 94(5), 1002-1037. (1990) "Endogenous Technical Change", Journal Of Political Economy, 98, October, Ss. 71-102. (1994) "Perspectives On Growth Theory", Journal Of Economic Perspectives, 8(1), Winter. Sachs, J. D. Ve Warner, A. (1995) "Economic Reform And The Process Of Global Integration", Brooking Papers Of Economic Activity 0 (1), Ss. 195. Sinha, D., Ve Sinha, T. (1996) "Openness And Economic Growth: Time Series Evidence From India, Applied Economics, Ss.21-28. Seyidoğlu, H. (2003) "International Economy; Theory, Policy and Application", 15. Press, Güzem Publishing, March, İstanbul. Sims, C. A. (1980) "Macroeconomics And Reality", Econometrica, 48, Ss. 146. Vamvakidis, A. (2002) "How Robust Is The Growth-Openness Connection? Historical Evidence", Journal Of Economic Growth, 7, Ss. 57-80. Wu, Y. (2004) "Openness, Productivity And Growth In The Apec Economies", Empirical Economies, 29, Ss. 593-604. http://www.dtm.gov.tr/Ekonomi/Trkekon.htm, 2005. Foreign Capital Inflow and Sustainable Economic Development: A Case Study of Turkey Ahmet Cetin1, Murat Mustafa Kutluturk1, Birol Cetin2 1CankiriKaratekin University, Faculty of Economic and Administrative Sciences, 18100 Cankiri, Turkey. 2Turkish International Cooperation and Development Agency, VlahaBukovca, Podgoritsa. E-mails: akcetin@hotmail.com, mmkutluturk@gmail.com,bcetin@gop.edu.tr Abstract This study analyses the effect of foreign capital inflow (especially foreign direct investment) on the sustainable economic development of Turkey. The main objectives of the study are to analyses the long run relationship between foreign direct investment and sustainable economic development. Quarterly data were used from the period of 1992:Q1 to 2011:Q3. The Engle-Granger Methodology for cointegration was applied to estimate the long run relationship. The Augmented Dickey Fuller (ADF) unit root tests were used to check the stationarity of each variable in the model. The ADF tests of the differences of each variable indicate that all of the variables are integrated of the first order. Cointegration was applied to estimate the long run relationship. A stable long run relationship was found between foreign direct investment and the sustainable economic development. Even if error correction 173 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo coefficient was statistically significant, the short run regression model was statistically insignificant. It was conducted that foreign direct investment had positive impact on the sustainable economic development in the long run but not in the short run. Keywords: Capital Inflow, Foreign Direct Investment, Economic Development, EngleGranger, Cointegration 1. INTRODUCTION It has been considered capital as the central element of the process of economic development. Based on this view, the capital-deficient countries heavily resorted to foreign capital as the primary means to achieve rapid economic growth. In economic literature, it has been widely accepted that Foreign Capital Inflow (FCI) stimulates sustainable economic development via adoption of new (foreign) technology, which can happen via licensing agreements, beginning competition for resources, employee training and knowledge, and export spillovers. Because of these benefitsof foreign capital inflow, many developing and emerging countries have attracted and experienced large capital inflows during the past decades. However, foreign capital inflow can even adversely affect the development process. It exposes the recipient country to external shocks. That short-term capital flows can increase the fragility of the financial system and destabilize the economy. They not only pose a threat to the financial system but also undermine the economic progress of the developing nations. Additionally, it is more volatile than other categories of capital flows and its sudden reversal tends to have destabilizing effects on the host country. The growth experience of many of these countries has not been very satisfactory and, as a result, they accumulated a large external debt and are now facing serious debt servicing problems. Peterson Institute for International Economics reports that FDI possibly increase the level of productivity so that initiate a circle that in turn increase wage level, saving, so investment, and again productivity. According to report, FDI with higher technology transferred, new management skill implemented, and increasing skill of local workers may bring new dynamics to the economy beside spillover these new implementations into the local firms. In addition competition in the local market will rise efficiency, increase output, and also stimulate economic growth. Such developments may lead economies to increase not in the way of quantity but also quality of products. Growing economy demands new skilled labor should increase wages and so standards of livings like education and health23. Similar concerns were also reported by OECD. Countries on the track of the development consider FDI as a medium of economic development. To attract the FDI, countries liberalize their FDI regimes, hoping macroeconomic growth and enhance welfare. If countries hope to attract foreign investments some basic foreign investment friendly policies and some basic features like scale economies, labor supply, infrastructures, natural resources etc. and some level of economic development need to be available so that FDI may have effect on spillover of technology, human capital formation, integration with world through trade, competitive environment and so on. Such policies and its effects will help economic development like 23http://www.iie.com/publications/chapters_preview/53/1iie258x.pdf 174 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo reduction of poverty, environment friendly technologies and socially sensitive corporate policies24. According to Papanek (1973) FCI consist of three parts. Fist part is foreign aid that includes official borrowings and transfers that has no direct effect on the economy. Second part is foreign private investment that has two components: net foreign private direct investment and long term borrowing. Net Foreign Direct Investment (FDI) is physical capital that has effects on economy’s reel sectors by increasing physical capacity of product or services and prepares an environment for new economic opportunities and employment. Lastly all other inflows refer to net short term borrowings, net private transfers etc. that has little but unsustainable impacts on the economy. As in this paper development was being concerned, FDI as a most effective part of FCI on development was chosen as the main indicator. For these reasons, in case of such a scenario FDI may cause economic development which is our concern in this study. As proxy variable of sustainable development, the ratio of external depth to export was used. If this ratio gets higher, amount of GDP allocated for current and future payments increases that social spending such as poverty,, health and education could negatively be affected in the long run (Anwar, 2011). 2. LITERATURE REVIEW Even though there is a debate over FDI and its effects on economies at different stages for years, it is undeniable that countries suffer with shortage of saving require other nations savings to break the chain of being the member of so called less developed nations. FDI is one of the most important pillars of the economic growth and development for especially developing, transition and emerging economies. Lucas (1988) and Barro (1990)using endogenous growth model tried to investigate if any effect of FDI on economic growth through diffusion of technology and they show importance of technology on the economic development. The importance of liberalization at the financial sector and stable economy for FDI was emphasized by De Gregrioand Guidotti (1995). Similar points made by the World Bank (2002) that FDI improve productivity, growth and trade even though effects diversifies among countries and sectors according to host countries policies and characteristics. Qi (2007) discuses in the paper, that FDI may have direct and indirect effect on the economy. It may directlypromote economic growth but also it may help human capital development, strengthening completion related sectors and technology transfer indirectly. Aitken and Harrison (1997) reached a conclusion supports previous one that FDI increase the productivity not only for foreign firm but also domestic firms in the same sector. On the other hand De Backer and Sleuwagen (2003) and Carcovic and Levine (2005)discussed the subject that after FDI it may change the structure of the economy and may affect the trade, price, finance etc. so that it will affect resources allocation and slow the economy. FDI may improve economic conditions by increasing employment, productivity, export transferring technology and skills (UNCTAD 2008). According to Borensztein (1998) FDI through training and labor management are beneficiary not only for the economic growth but 24http://www.oecd.org/dataoecd/47/51/1959815.pdf 175 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo also oversee firms’ interaction with other local firms that may lead to increase production standards higher for production and improve management skills more. In the sectorial level Sekmen (2007) investigated Turkey’s tourism sector for 1980-2005 and didn’t find cointegration among variables but found unidirectional relationship between FDI and GDP and bidirectional relation between exchange rate and GDP and FDI. Ilhan and Huseyin (2007) searched for the impact of FDI on Turkey’s and Pakistan’s economic growth for the periods of 1975 and 2004. They concluded that there is bidirectional causality exists for the case of Turkey and unidirectional causality exist for the case of Pakistan from FDI to GDP. 3. DATA AND METHODOLOGY For this study quarterly data has been collected from Electronic Data Delivery System ofCentral Bank of the Republic of Turkeyfor the periods between 1992:Q1 and 2011:Q3. All variables namely external debt, export, and foreign direct investment (FDI) were measured in million US dollars. As a measurement of sustainable development the ratio of external debt to export (EDX) is used. Variables are used in the form of natural logarithm. In addition to taking logarithm form of variables,X11 seasonal adjustment methodology has implementedto variables. Griffith (2001) indicates that if time series are concern in a regression, two non-stationary variables may produce incorrect results. Time series are generally tends to show increasing or decreasing tendency. In order to catch the long and short run relationship between FDI and development cointegration technique is used. This technique, that was introduced by Granger in 1981 and developed by Engle and Granger 1987, gives us advantages to analyze the both short and long run relation together. Basically this approach indicates that even if economic time series exhibits non-stationary behaviors, a suitable linear combination between these variables may remove trend component so that time series variables become stationary. In such a case these time series variables are called as cointegrated which economically may be a good indicator of long run or steady state equilibrium if exist. Cointegration test can be conducted via Engle and Granger (1987) or Johansen (1988, 1991) and Johansen and Juselius (1990). Residual based Engle Granger (EG) test is implemented in two steps. OLS is being used on level variables for cointegration regression than residuals are acquired to test stationarity using Augmented Dickey-Fuller (ADF) unit root tests. But before implement the test statistics variables integrated order are needed to be identified. If both variables are integrated at the same level, say I(d) than linear combination of these variables will also be integrated at the same level, I(d). If not say I(d-r) where r<d than one may conclude that there is long run relationship between these variables or there is some cointegration.To implement EG test following regression is estimated and residuals are acquired: yt   0  1 xt   t . Obtained residuals are used for following models estimates:  t  yt   0  1 xt . EG test is used to test on error term and if it is, say, I(0) than residuals series are said stationary. In such a case Engel introduces Error Correction Mechanism (ECM). Unit root tests can be implemented on the level and first difference variables: pi y   1 yit 1    ij yit  j  xit.    t j 1 176 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo ADF, that test the unit root of concerned time series variables, consist of first difference of the series as dependent variable and lagged and lagged difference terms, constant and a time trend as independent variables. The test of unit root is to test coefficient of ( yt 1 ). As discussed by Loayaza (2002) the cointegration relationship between foreign direct investment and sustainable development following log-log form is used for estimation: LnEDX t   0  1 LnFDI t   t 4. EMPIRICAL RESULT AND DISCUSSION 4.1. Unit Root Test Prior to conducting the cointegration analysis, it is essential to check the Stationarity for each variable in the model.Unit root tests for stationarity are performed on both levels and first differences for both variables in the model. Three different modelswith varying deterministic components have been consideredwhile performing the tests. These are: (1) model with the intercept; (2) the model with a constant and atrend; and (3) a model that neither includes a constant,nor a trend in the long-run cointegration space. The results of the tests are reported in Table 1.The results of the unit root tests shows that all the variables are non-stationary at level. First differencing ofall variables yields acceptance of the null hypothesis ofstationarity. Based on these test results, it is, therefore,conclude that both variables are I(1) variables. Table 1: ADF Unit Root Test for Stationarity Test with intercept and trend at level None Intercept Trend&Intercept LnEDX -0.86 -1.04 -2.51 LnFDI 1.04 -0.47 -2.38 Test with intercept and trend at first difference level None Intercept Trend&Intercept D(LnEDX) -10.22* -10.28* -10.21* D(LnFDI) -10.32* -10.41* -10.39* Note: * indicated the stationary of the variables at 1% level of significance 4.2. Cointegration and Error Correction Model To implement Engel Granger procedure following model has been estimated and result summarized below: LnEDX = 3.155758 - 3.155758 Trend - 0.074408 LnFDI (t-stat) 177 (34.26) (-4.17) (-3.76) �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo R2 = 0.735 Adj. R2 = 0.728 DW = 0,486 F-Stat = 105,469 (Prob. 0.000) The above results indicate that in the long run equation the variables are cointegrated since the residuals of the regression are stationary with one lag length based on SIC at the 5 percent level of significance. Error Correction model has been formed as follows and test statistics given below. D(LnEDX) = -0.005804 + -0.007396 D(LnFDI) + -0.154757 ECM-1 (t-stat) (-0.757) R2 = 0.071 Adj. R2 = 0.046 (-0.647) DW = 2.09 (-2.405) F-Stat = 2.896 (Prob. 0.0614) FDI was found statistically insignificant in the short run. We may conclude that FDI has no impact over economic development in the short run. On the other hand ECM is negative and statistically significant as required. This means that there is a relationship between FDI and economic development in the long run. 15% of deviation from the long run relation is being correctedevery period. 5. CONCLUSION The aim of this study is toanalyses the long run relationship between foreign direct investment and sustainable economic development in Turkey with the application of an Engle-Granger approach using quarterly data from the period of 1992:Q1 to 2011:Q3.The date indicated that a stable long run relationship was found between foreign direct investment and the sustainable development. FDI would impact positively. Even if error correction coefficient was statistically significant, the short run regression model was statistically insignificant. It was conducted that foreign direct investment had positive impact on the sustainable economic development in the long run but not in the short run. In the long run, the model indicates that a 1 percent increase in FDI would support sustainable development by 0.074 percent. According to study, FDI has no effect in the short run and limited effect in the long run. REFERENCES Aitken, B. and Harrison, G.H. and Harrison, A.E. (1997) Spillover, Foreign Investment, And Export Behavior, Journal of international Economics, vol. 43, pp103-132 Anwar, S.,Shabir,G. andHussain,Z.(2011). Relationship between Financial Sector Development and SustainableEconomic Development: Time Series Analysis from Pakistan.International Journal of Economics and Finance Vol. 3, No. 1. www.ccsenet.org/ijef Barro, R. (1990), Government Spending in a Simple Model of Economic Growth, Journal of Political Economy, 98, pp.103-125. Borensztein, B., Gregorio, J. De and Lee, J-W, (1998). How does Foreign Direct Investment Affect Economic Growth? Journal of International Economics, pp. 115-135. http://dx.doi.org/10.1016/s0022-1996(97)00033-0 178 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Carcovic, M. and Levine, Ross (2005). Does Foreign Direct Investment Accelerate Economic Growth? In Moran, Graham, Blomstorm Edward and Magnus, Does Foreign Direct Investment Promote Development? De Backer, K. and Sleuwagen, L. (2003) Does Foreign Direct Investment Crown Out Domestic Entrepreneurship? Review of Industrial Organization, 22, p. 67-102. De Gregrio, J. and Guidotti, P.E. (1995), Financial Development and Economic Growth, World Development, 23, pp. 433-448. Engle, R. F. and Granger, C. W. J. (1987) Cointegrationand Error Correction: Representation, Estimation And Testing, Econometrica,55, 251-76. Granger, C. W. J. (1981) Some Properties Of Time Series Data And Their Use In Econometric Model Speciation, Journal of Econometrics,16, 121-30. Ilhan, O., Huseyin, K. (2007). Foreign Direct Investment and Growth: An Empirical Investigation Based on Cross-Country Comparison, Working paper, MPRA Paper No.9636. http://ideas.repec.org/p/pra/mprapa/9636.html Johansen, S. (1988), Statistical Analysis of Cointegration Vectors, Journal of Economic Dimension and Control, 12, 231-54. Johansen, S. (1991) Estimation and Hypothesis Testing of Cointegration Vectors in Gaussian Vector Autoregressive Models, Econometrica,59, 1551-80. Johansen, S. and Juselius, K. (1990). Maximum Likelihood Estimation and Inference on Cointegration With Applications to The Demand for Money, Oxford Bulletin of Econometrics and Statistics, 52, 169-210. Loayaza, R. and Ranciere, R. (2002) Financial development, Financial Fragility and Growth, CESifo Working Paper 684 (5) Lucas, R. E. (1988) On the Mechanics of Economic Development, Journal of Monetary Economics, 22, pp.3-42 Papanek, G.F. (1973) Aid, Foreign Private Investment, Savings and Growth in Less Developed Countries, Journal of Political Economy, Vol. 81, No. 1, pp. 120-30 OECD, 2002, Foreign Direct Investment for Development, Maximizing Benefits, Minimizing Costs: Overview, p. 5, OECD Publication Service, Paris Qi, Liangsui 2007, The Relationship between Growth, Total Investment and inward FDI: Evidence from Time Series Data, International Review of Applied Economies, vol. 21 no. 1, pp. 119-133. Sekmen, F.(2007), Co-integration and Causality among Foreign Direct Investment in Tourism Sector, GDP and Exchange rate Volatility in Turkey. The Empirical Economics Letters, Vol. 6, No. 1, ISSN 1681 8997, paper No: 8736. http://mpra.ub.unimuenchen.de/8736/1/ MPRA_paper_8736.pdf. United Nations, (2008) World Investment Report, Transnational Corporations and Infrastructure Challenge, United Nations Conference on Trade and Development. http://www.unctad.org. World Bank 2002, World Tables Oxford University Press 179 � Dublin Core The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/. Extent The size or duration of the resource. 1323 Title A name given to the resource Foreign Capital Inflow and Sustainable Economic Development: A Case Study of Turkey Author Author Ahmet , Cetin Abstract A summary of the resource. This study analyses the effect of foreign capital inflow (especially foreign direct investment) on the sustainable economic development of Turkey. The main objectives of the study are to analyses the long run relationship between foreign direct investment and sustainable economic development. Quarterly data were used from the period of 1992:Q1 to 2011:Q3. The Engle-Granger Methodology for cointegration was applied to estimate the long run relationship. The Augmented Dickey Fuller (ADF) unit root tests were used to check the stationarity of each variable in the model. The ADF tests of the differences of each variable indicate that all of the variables are integrated of the first order. Cointegration was applied to estimate the long run relationship. A stable long run relationship was found between foreign direct investment and the sustainable economic development. Even if error correction coefficient was statistically significant, the short run regression model was statistically insignificant. It was conducted that foreign direct investment had positive impact on the sustainable economic development in the long run but not in the short run. Keywords: Capital Inflow, Foreign Direct Investment, Economic Development, Engle- Granger, Cointegration Date A point or period of time associated with an event in the lifecycle of the resource 2012-05-31 Keywords Keywords. Conference or Workshop Item PeerReviewed H Social Sciences (General),HB Economic Theory,HG Finance,HJ Public Finance https://omeka.ibu.edu.ba/files/original/aae43b259a264d285b5f5712466b6e9e.pdf aa41aca642588975cc45247159810101 PDF Text Text 3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Dincer, I. and Rosen M.A. (1998) A worldwide perspective on energy, environment and sustainable development, International Journal of Energy Research, 15, 1305-1321. Ewing, B.T., Sari, R. and Soytas U. (2007) Disaggregate energy consumption and industrial output in the United States, Energy Policy, 35, 1274–1281. Hacker, R.S. and Hatemi-J A. (2006) Tests for causality between integrated variables using asymptotic and bootstrap distributions: theory and application, Applied Economics, 38, 1489500. Hannan, E. J. and Quinn B.G. (1979) The determination of the order of an autoregressive, Journal of the Royal Statistical Society, 41, 190-195. Hatemi-J, A. (2003) A new method to choose optimal lag order in stable and unstable VAR models, Applied Economics Letters, 10, 135-137. Kwiatkowski D., Phillips P.C.B., Schmidt P. and Shin. Y. (1992) Testing for the null of stationarity against the alternative of a unit root, Journal of Econometrics, 54, 159-178. Ozturk, I. (2010) A literatüre survey on energy-growth nexus, Energy Policy, 38, 340-349. Payne, J.E. (2009) On the dynamics of energy consumption and output in the US, Applied Energy, 86, 575–577. Phillips, P.C. and Perron P. (1988) Testing for a unit root in time series regression, Biometrika, 75, 335-346. Rosen, M.A. (1996) The role of energy efficiency in sustainable development, Technology and Society, 15(4), 21-26. Sadorsky, P. (2009) Renewable energy consumption and income in emerging economies, Energy Policy, 37, 4021-4028. Sarı, R. and Soytas U. (2004) Disaggregate energy consumption, employment, and income in Turkey, Energy Economics, 26, 335–344. Sarı, R., Ewing, B.T. and Soytas, U. (2008) The relationship between disaggregate energy consumption and industrial production in the United States: an ARDL approach, Energy Economics, 30, 2302–2313. Schwarz, G. (1978), Estimating the dimension of a model, Annals of Statistics, 6, 461-464. Toda, H.Y. and Yamamoto T. (1995), Statistical inference in vector autoregressions with possibly integrated processes, Journal of Econometrics, 66, 225-250. An Analysis of Theories on Stock Returns Ahmet Sekreter Abstract Objective in writing this article is to provide an overview of the theories that has been developed for stock returns which is an important area of financial markets’ researches. Since the researches in this field are very active for the past quarter, it is not possible to describe all works that has been done in this area. Most important researches will be discussed without going deeper in mathematical tools and theories. 15 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Empirical works have been showing that stock returns are predictable cross-sectional and by time. The discussions about prediction of stock price behavior started with Markowitz with his article –Portfolio Selection-. Markowitz won Nobel Prize in 1990 for his research about portfolio theory. However he criticized by many economists since implementation of the theory requires lots of effort to evaluate data and since it uses historical data the prediction will not be accurate. In addition the assumption that stock returns are normally distributed is not true in reality. Sharpe, Lintner, and Mossin independently developed a model which has come to be known CAPM (capital asset pricing model) in 1964, 1965, and 1966 respectively. Beta coefficient is a key parameter in CAPM world. Beta measures risk of an asset in relation to the market such as S&P500 or an alternative factor. Actually the CAPM is a simple model which is based on sound reasoning and some of the assumptions -all investors have the same information, information is costless, and there are no taxes transactions costs- are unrealistic in market. APT (arbitrage pricing theory) presented for a better estimation for stock returns than CAPM. CAPM is a modified theory while APT is a completely different model. APT’s multiple factors provide a better indication of asset risk and a better estimate of expected return. There are n-factors effecting stock returns in APT but the number of factors are unknown. Furthermore CAPM and APT are single-period models. To get multi-period aspects of market ICAPM was developed. After that CCAPM (consumption-oriented capital asset pricing model) was introduced. It tried to explain behavior of stock returns by a logical extension of APT. A long literature exist on prediction of stock market returns but especially after the latest financial crisis these theories must be analyzed and suggested new ideas for forecasting behavior of stock returns. Keywords: Stock Returns, Markowitz, CAPM, APT, ICAPM, CCAPM, Fama-French 3-factor model. 1.Theories 1.1.Markowitz Portfolio Selection Empirical studies in finance show that forecasting stock returns is possible by developing some models. Markowitz – as some people call Einstein of finance- developed an idea on stock returns under some assumptions. Although some assumptions like ‘no taxes’, ‘information is available for everybody and it is costless’, ‘no transaction cost’ do not exist in real world, the tools developed by him allow to measure the risk and return. An investor wants to maximize returns for a given level of risk or wants to minimize risk for a given level of return. According to Markowitz Portfolio theory investors choose the optimum portfolios which lie on this curve. An investor who can bear more risk choose portfolios that are on upper part of the curve and investor who is a risk-averse choose portfolios that are lower part of the curve. It was shown in Markowitz Portfolio selection that the variance of rate of returns is measure of risk of return under some assumptions. The formula developed by Markowitz proved that diversifying portfolio reduces the total risk. Capital Asset Pricing Model Capital Asset Pricing Model (CAPM) is based on Markowitz Portfolio Theory and it describes the relationship between the risk and return of a portfolio. The formula in CAPM is the equation of SML (Security Market Line). Ri: rate of a stock return 16 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Rm: rate of market return β: cov(Ri,Rm)/ var(Rm) Rf: risk-free rate When beta is equal to zero expected return is equal to risk-free rate (Rf) and when beta is equal to 1 it means that the expected return is equal to market return (Rm). By using simple math the equation of the line above is found as follow: Ri=Rf + β(Rm-Rf) So in CAPM the rate of a stock return is defined as risk-free rate plus product of beta and market risk premium (Rm-Rf). CAPM can be used for all stock after estimating beta. Estimation of beta and market risk premium is the critical point in CAPM. Beta can be calculated as daily, monthly or yearly and all give different betas. Calculation of different time intervals gives also different betas and market risk premium also changes over time. The required estimations can be found after collecting lots of historical data. Predicting future by calculating some past data is sometime not reliable. 2.Arbitrage Pricing Theory "The APT is derived from the premises that asset returns follow a linear return generating process, and that in well-functioning financial markets, there will be no arbitrage opportunities. On the basis of these assumptions, one can show that there is an equilibrium linear relationship between the returns on risky assets and a small set of economy-wide common factors. While several macroeconomic variables do have some relationship with different risky assets, the APT postulates that the pricing of risky assets depends only on the set of variables whose influence is felt significantly by all risky assets together. This set of variables is known as the common factors of the APT."( Otuteye, Eben) The basic assumption of APT is based on the absence of arbitrage in the market. The returns can be calculated if there is no arbitrage opportunity. Capital markets are perfectly competitive and trend of investors always prefers more wealth to less wealth. APT is less restrictive than CAPM in its assumptions. There is only factor in CAPM but in APT there are n factors which affect the expected rate of return. Expected rate of return is formulated as follow E[R]=Rf + b1f1+b2f2+…+bnfn bk: the sensitivity of the stock to the factor bk fk: the risk premium for factor k It is stated in APT that there are n factors however these factors are not defined and even the number of factors are unknown. However it is reasonable because every stock can have specific effects that affect the return rate. APT does not rely on stock market and it does not deal with measure of the performance of market, instead of market it focuses on factors that affecting price of stock. The factors in APT can be adapted to changes that influence stock price and from this aspect it brings advantages to the user but determining these factors is not easy since it requires great research. 17 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 3.Intertemporal CAPM CAPM was one of the most important developments in finance when it was introduced. It became basis of many research papers. However it was started to criticize that it is a singleperiod model. The Intertemporal CAPM was an alternative for CAPM introduced by Robert Merton which is a multi-period model. Merton claimed that since real interest rate, stock market returns, inflation and therefore investment opportunity set can be changed after that investors may want to hedge risks which they exposure. The demand on hedging causes a change in the asset pricing equation. Merton stated in his model that since the model is based on consumer-investor behavior it must be intertemporal, ICAPM is a linear model to state the shifts of investments over time and predict investment opportunity set. 3.1.Consumption-Oriented the Capital Asset Pricing Model Consumption-Oriented Capital Asset Pricing Model (CCAPM) is an extension of traditional CAPM. CAPM is based on market portfolio’s return and it used it to understand behavior of the return rate. In CAPM the prediction of future relies on market portfolio’s return. Beta in CAPM measures sensitivity of stock return to the expected market return. CCAPM has the same formula with CAPM only it differs from CAPM by explanation of beta. Beta in CCAPM is defined as follow: Consumption beta (βc)= And formula for CCAPM is restated as follow: Ri=Rf + βc(Rm-Rf) Ri= expected return on risky asset i Rf= implied risk-free rate Rm= implied expected market return βc= consumption beta of the risky asset i The investors’ consumption growth and risk aversion determines the expected return of risky asset and the risk premium. The consumption beta defined above provides the systematic risk in CCAPM world. In CCAPM, an asset is more risky if consumption is low or savings are high. The consumption beta can be found by empirical works and statistical methods like finding beta in CAPM. The CCAPM, like CAPM, is based on only one parameter and it has been criticized because of this issue. However the empirical works have shown that there are more than one affect that influence the stock prices and return rates. The empirical works also have shown that the CCAPM’s predictions are not supported by those results. 3.2.Fama and French Three Factor Model The CAPM and CCAPM are trying to explain stock returns based on only one factor. The APT and ICAPM are adding many factors that affecting stock returns but these factors are not stated. Empirical works have shown that after testing CAPM, beta in CAPM can explain 70% of the return in the market. Eugene Fama and Kenneth French tried to explain the rest of 30% unexplained stock return by expanding capital asset pricing model. Fama and French expand 18 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo CAPM by adding two more factors in the formula of traditional CAPM. In the empirical works Fama and French found that the two classes of stocks are better than the others. The value stocks have provided much better return than growth stocks that is stocks which have high book to market ratio and the small stocks have provided much better than large stocks in the market as a whole. After adding these two factors in capital asset pricing model the new formula is as follow: Ri=Rf+ β(Rm-Rf)+bs*SMB+bv*HML Ri= expected return rate on risky asset i β: the beta measure the sensitivity of stock return to the expected market return but this beta is not same as beta in capital asset pricing model since in Fama-French 3 factor model there are two more factors added into the formula. Rf=risk-free interest rate Rm= expected market return rate SMB= small market capitalization minus big market capitalization HML= high book to market ratio minus low bs and bv= the coefficients of SMB and HML respectively. These coefficients are determined by linear regression after defining SMB and HML. 4.Conclusion: Estimation of the Parameter Beta in Models Beta is the only explanatory power in the CAPM and CCAPM. Beta is the only factor that affecting the stock prices and return rates in these models. There are many factors in the models the APT and ICAMP. Fama and French 3-factor model contains three factors which influence the behavior of the return rates however beta is the factor that has the most explanatory power in this model. Estimation of the parameter beta in models is very important to get accuracy in predicting the stock prices and return rates. The chosen time interval causes getting a different beta, and since stock returns can be evaluated daily, weekly, monthly, or annually the chosen frequency also affects the accuracy of beta. Some empirical tests have shown that 3 years time interval and annually evaluated stock returns give better results. Most CAPM tests and et all have focused on cross sectional aspects of data. However the recent researches have shown that investigating the conditional relationship between beta and return gives better estimations under the assumption of time series analysis since beta is not stable over time. BIBLIOGRAPHY Anthony Kyereboah-Coleman, (2009), Portfolio Theory. Douglas T. Breeden, (1979), An Intertemporal Asset Pricing Model with Stochastic Consumption and Investment Opportunities. Eugene Fama, Kenneth French, (1995), Size and Book-to-Market Factors in Earnings and Returns. Graeme West, (2006), An Introduction to Modern Portfolio Theory: Markowitz, CAP-M, APT, and Black-Litterman. 19 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Gregory Cannor, Robert A. Korajczyk, (1992), The Arbitrage Pricing Theory and Multifactors Models of Asset Returns. Gur Huberman, Zhenyu Wang, (2005), Arbitrage Pricing Theory. Harry Markowitz, (1952), Portfolio Selection. James L. Davis, (2001), Explaining Stock Returns: A Literature Survey. John Y. Campbell, Motohiro Yogo, (2006), Efficient Tests of Stock Return Predictability. Jonathan W. Lewellen, (2000), On the Predictability of Stock Returns: Theory and Evidence. Robert C. Merton, (1973), An Intemporal Capital Asset Pricing Model. Internet Sources www.wkipedia.org www.portfoliosolutions.com/f-11.html http://www.investopedia.com http://www.bionicturtle.com/forum/threads/p1-t1-64-arbitrage-pricing-model-apt-versuscapm.5328/ The causal relationship between energy consumption and GDP in Turkey Huseyin Kalyoncu1, Ilhan Ozturk2, Muhittin Kaplan1 1Meliksah University, Faculty of Economics and Administrative Sciences, 38010, Kayseri, Turkey. 2Cag University, Faculty of Economics and Business,33800, Mersin, Turkey. Email: hkalyoncu@meliksah.edu.tr, ilhanozturk@cag.edu.tr, mkaplan@meliksah.edu.tr Abstract This paper attempts to investigate the short-run and long-run relationship and causality between energy consumption and economic growth during 1960-2006 period for Turkey. Johansen and Juselius cointegration method and vector error correction model (VECM) have been employed to examine this issue. After finding cointegration among variables, a VECM is estimated and the Granger causality tests were carried out based on a VECM. The results have shown that there is no short-run causality in both energy consumption and GDP models. The results also confirmed that there is unidirectional long-run causality among variables of interest and the direction of long-run causality is running from per capita GDP to per capita energy consumption. As a result, conservation hypothesis which postulates unidirectional causality from economic growth to energy consumption is confirmed for Turkey. Taken together, these empirical findings involve valuable information for policy makers. Keywords: Energy consumption, Economic growth, Causality, Turkey 20 � Dublin Core The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/. Extent The size or duration of the resource. 1308 Title A name given to the resource An Analysis of Theories on Stock Returns Author Author Ahmet , Sekreter Abstract A summary of the resource. Objective in writing this article is to provide an overview of the theories that has been developed for stock returns which is an important area of financial markets’ researches. Since the researches in this field are very active for the past quarter, it is not possible to describe all works that has been done in this area. Most important researches will be discussed without going deeper in mathematical tools and theories.Empirical works have been showing that stock returns are predictable cross-sectional and by time. The discussions about prediction of stock price behavior started with Markowitz with his article –Portfolio Selection-. Markowitz won Nobel Prize in 1990 for his research about portfolio theory. However he criticized by many economists since implementation of the theory requires lots of effort to evaluate data and since it uses historical data the prediction will not be accurate. In addition the assumption that stock returns are normally distributed is not true in reality. Sharpe, Lintner, and Mossin independently developed a model which has come to be known CAPM (capital asset pricing model) in 1964, 1965, and 1966 respectively. Beta coefficient is a key parameter in CAPM world. Beta measures risk of an asset in relation to the market such as S&P500 or an alternative factor. Actually the CAPM is a simple model which is based on sound reasoning and some of the assumptions -all investors have the same information, information is costless, and there are no taxes transactions costs- are unrealistic in market. APT (arbitrage pricing theory) presented for a better estimation for stock returns than CAPM. CAPM is a modified theory while APT is a completely different model. APT’s multiple factors provide a better indication of asset risk and a better estimate of expected return. There are n-factors effecting stock returns in APT but the number of factors are unknown. Furthermore CAPM and APT are single-period models. To get multi-period aspects of market ICAPM was developed. After that CCAPM (consumption-oriented capital asset pricing model) was introduced. It tried to explain behavior of stock returns by a logical extension of APT. A long literature exist on prediction of stock market returns but especially after the latest financial crisis these theories must be analyzed and suggested new ideas for forecasting behavior of stock returns. Keywords: Stock Returns, Markowitz, CAPM, APT, ICAPM, CCAPM, Fama-French 3-factor model. Date A point or period of time associated with an event in the lifecycle of the resource 2012-05-31 Keywords Keywords. Conference or Workshop Item PeerReviewed H Social Sciences (General),HB Economic Theory,HG Finance,HJ Public Finance https://omeka.ibu.edu.ba/files/original/8d1ef363d7039cd5f406fd199b382bba.pdf aeca84f0c8e1bcb67e0e841cd00474c4 PDF Text Text Olukunle, A.O and Falaye, A.E. (1998): Use of Sesame seed cake as replacement for fish meal in diets of catfish (Clariasgariepinus (Burchell, 1822)). Appl. Trop. Agric. 3(2): 86-91 Omitoyin, B.O. (2007): Introduction to Fish Farming in Nigeria, Ibadan University Press. Pp. 1-9 Omitoyin, B.O.(1995): Utilization of poultry by products (Feather and offal) in the diets ofAfrican catfish (Clariasgariepinus (Burchell, 1822)). Ph.D Thesis, University of Ibadan, Nigeria Raufu, M.O.; Adepoju, A.A.; Salau, A.S. and Adebiyi, O.A. (2009): Determinants of yield performance in small scale fish farming in Alimosho Local Government Area of Lagos state. Journal of Agricultural Economics and Rural Development -2(1):2009 Pp.10-14 Tidwell, J.H. and Allen, G.L. (2002): Fish as Food: Aquaculture‘s contribution, Ecological and Economic impacts and contribution of fish farming and capture Fisheries Tobor, J.G. (1990): The fishing industry in Nigeria. Status and potential for self sufficiency in fish production. NIOMR Tech. Paper No.54 Sustainable City Ahmetspahic Erna International Burch University, Faculty of Engineering and Information Technologies Architecture Department 71000, Sarajevo, Bosnia and Herzegovina E- mail : eahmetspahic@ibu.edu.ba Abstract On the beginning of 20th century, cities become synonymous for progress, wealth and increasing opportunities when compared with the rural regions. Based on some UN information‘s, 30% of world population was urban in 1950, this percentage increase to 47% in 2000, and expectations are that in 2030 60% of population will live in cities. If changes in space organization do not happen until 2030, total earth population will increase to 8,1 billion and 5 billion people will live in urban regions with the 2,67 billion that will not have place to live. This change of the world, from rural to predominantly urban is continuous and cannot convert again, so these changes affect using of water, energy, earth and other nature resources. In the same time cities are primary victims of climate changes. Half of the population lives in urban regions, but they consume 80% of global energy production. 272 �Urban theorists saying that city is dead. In the future we can talk about two models of the cities that are totally different: ecological conscious city that becomes sustainable with the own resources and „ slum city ― that is fighting for the healthier life. How to deal with challenges of the global age that are barrier for progress and sustainability, and in same time keep own identity and diversity? The cities are kind‘s social - ecological systems that have a wider range of articulation with ecology. How to produce positive results – results which enabling contribution of sustainability of environment in cities? Cities are complex systems of consumption and production and that complexity makes them essential for finding solutions. Differences of the cities come from different politics of the governments, basic economy, and ordinary cultural life of the citizen‘s. One of those facts is that whole energy flow and materials of the economy become pollution and waste of ecosphere just in different shape. Are the global ecological conditions result of the urban agglomeration and density, or are they result of specific urban system types? Long time ago cities become places for innovations, development and starting of complex physical and organization systems. It is important to find solution for the big number of ecological damage and formula for reconfiguration of social – ecological systems that are made because of urbanization. Keywords: Sustainable Urbanism , Eco – City , Ideal City , Sustainability , Brownfield , Re – Use , Urban recycling , Open Arhitecture , Green Buildings . 1.INTRODUCTION How we as architects and urban planners can contribute to sustainable development? By following caprices of technique and investors , taking in consideration economic profit all of projects , we all become main actors of global crisis. This paper presents review of city sustainability problem , the same city that is the main tissue of the physical existence of people. Framework of responsibility and spatial problems were the basic causes of the introducing of brownfield area as a potential space sustainability. Environment limits are decreasing every day. The goal of the research is to find possible solutions for existing problems of humanity, which will be starting point for sustainable development of city. Possible strategies, ways of acting and implementations that can be applied by architects and urban planners, are summarized in this work. The strategies are sequenced by the problems with a more than one sourced , and way of acting depends on this. 273 �2. URBAN VISION 2.1.Implementation The city can be viewed as an organism in which all parts must function properly. So the city does not exist independently of all its elements. The implementation should be defined by the zones, points that must be acted on. If we take into account the complexity of cities, historical context and contemporary spirit we need to know different predictable effects on each of these units. Striving for sustainable urban structures involve and sustainable development of the existing structure. Renovation is often associated with the term deportation. Renewal does not necessarily mean that it is sustainable. During the urban sprawling ,urban space becomes close to its resting partly on the old industrial areas, military areas, storage areas or rusty communal areas. These zones represent a break in physical functioning - black holes. Brownfield sites are then negative phenomena in the cities, because they contribute in creating a poor environment, with frequent pollution of soil and groundwater, the potential sources of infection etc. Brownfield locations are general threats of development and environmental loads. It is evident that because of their previous functions these places make huge untapped areas. Physical barriers also represent a certain psychological barrier. World cities reached very high level of solving brownfield problems, well known and unified methods and systems are established in there . The goal of brownfield revitalization is to convert these locations to places of public purpose of general interest. The increased risks and costs associated with their reconstruction and re-using discourage private capital from direct economic intervention. Ecological experts in the world want to introduce a circular logic in the function of cities, and the maximize re-use of waste, to reduce it. 3.Sustainable strategy One of the important questions for every strategy that must be asked , is where to start from? Should it be implemented from local or global level ? Taken scale that effects the space could have crucial significance. Cities are incarnation of urban crisis. Within the urban crisis , also society, economical, ecologic and politic cries are classified. Does it mean when we start to solve elements of other crises , we are on the good way to solve the urban crisis ? The mission of the architecture must be encouraging the society on changes , because architecture presents its values. Ideal city doesn‘t exist. There are only variations of idealization of certain cities as world powers , which brings us back to the political dimensions. Searching for sustainable planning of cities is future mission. 274 �Eco – city should talk to the eco- revolution. New urban planners as a base to every project should have a green line that will clearly accruable economic benefit or gain of the society. To achieve a positive result acting should be in the broader spatial and temporal scales , observing the effects of local activities on the macro – level , such as global warming , acid rain formation and global plunder of resource. Sustainability of cities is not only reflected in the ecological resources and techniques that it have , but also in saves and production of the energy. Buildings are responsible for around 40% of total energy consumption and 36% of CO2 emissions. By designing in accordance with climatic conditions , the proper organization of existing and open public spaces , we contribute to sustainability. Renewable energy, consumption reduction and energy conservation, need to become the standard of each space. The sustainability strategy must be based on NEEDS and FUTURE GENERATIONS. 3.1.Social dimension Develop an social action plan (education , multidisciplinary approach at national , regional and local level) Cooperation and exchange of information within sectors Remove vulnerability of space Marketing Carbon - neutral lifestyle 3.2. Ecological dimension Support in construction of green areas, greenfield should be merged with the renewal of zone brownfield Through the elements of connective tissue, streets, squares and parks connections will be established with other areas of brownfield zones Green Corridors - environmental arteries Design with Nature 3.3. Eco - political dimension Define each of brownfield location in cities and areas with critical parameters Create a law framework (government, parliament, the ministry) 275 �Set criteria for assessing the status and utilization of these zones Get rid question of ownership. Public and Private Develop a national policy for access to brownfield zones Brownfield zones as a priority investments (public investment projects) Each of these strategies can be presented through the urban recycling. Recycling is a concept that is very often practice in the world. In architecture it runs through all aspects, so we have a recycling of materials, recycling facilities and recycling of whole urban area. Recycling is closely associated with brownfield , or areas that have become the industrial crisis delays in the area, the black spots, the termination of all activities. Recycling of urban area is deeply into the core of the problem of addressing the issues of land use , materials and man in this area. A well designed concept of brownfield zone regeneration can change the image of the city and become a new catalyst within a space. Urban recycling and sustainable design are mutually supportive. Urban recycling is needed for visual quality. 4. CONCLUSION With the expansion and growth of cities the processes of transformation and reconstruction is occurring . The question remains is how to proceed , what is the purpose and by which methods and models. On the question of vision, in the not so distant future, 2050. years, many European cities will try to find the answer, and to prepare the development strategy or provide some alternative proposals. Focusing on sustainability priorities and stimulating urbanism rather than urbanism of obligations, new methods should be created and effective in the space of continuous change. Urban transformation as a result of globalization give many negative products in the further development of cities , as already noted in the social, economic and environmental direction of urban development. In this paper possible solutions are defined that lead to sustainability of the city. Proposed strategy, method of urban recycling and regeneration of brownfield area can be applied to any city. If sustainable urbanism becomes new form, is it the only way to build the city? How sustainability should be treated, and is sustainability in time of globalization becoming part of our lives or is it just word for the public? One thing is sure, urbanism and architecture of new age can be called by any name, but the result that must be produced cannot have bad influence on the citizens and their lives. REFERENCES Acioly, C. (2000) ‗Can Urban Management Deliver the Sustainable City?‘ In Compact Cities 276 �M.Jenks and R.Burgess , Sustainable Urban Forms for Developing Countries, Spon Press, London. Cliff Moughtin , Peter Shirley ,(2005)Urban design: Green dimensions. 2nd edition, Amsterdam Simon Guy, Steven A. Moore,(2005) Sustainable Architectures. Cultures and Natures in Europe and North America, New York Polese, M. and Stren, R. (2000) The social sustainability of cities: diversity and management of change, University of Toronto Press, Toronto Mike Jenks , Colin Jones (2010), Dimensions of the Sustainable City (Future City) ,2nd edition, New York Matthew E. Kahn,( 2006) Green cities : Urban Growth and the Environment, Washington Adam S. Weinberg, Allan Schnaiberg, David N. Pello , ( 2000 ) Urban Recycling and the Search for Sustainable Community Development , Princeton University Press Jon Lang, ( 2005 ) Urban design: a typology of procedures and products John Eade ,Christopher Mele ( 2002 ) Understanding the city. Contemporary and future perspectives Sallie Westwood ,John Williams ( 1997 ) Imagining cities: scripts, signs, memory, London Tio2 Reinforced Al2o3 Composites Gunhan Bayrak1, Ferit Ilgar2, Ediz Ercenk3, Senol Yilmaz3, Uğur Sen3, Volkan Gunay4 1Sakarya University, Arifiye Vocational School, 54580 Arifiye, Sakarya 2Alpha Foundry and Machine Industry Co., Organized Industrial Zone, Avar Street, No: 1 06935 Sincan / Ankara 3Sakarya University, Engineering Faculty, Department of Metallurgical and Materials Engineering, Esentepe Campus, 54187 Sakarya, Turkey, 4TUBITAK-MAM, Material Institute, 41470 Gebze, Kocaeli, Turkey Abstract In this study, the effect of TiO2 addition on properties of alumina ceramics was investigated. The prepared commercial Alcoa alumina reinforced 0-15 % TiO2 were ground in ball mill for 2 h by wet milling and then powders were shaped dry pressing. After shaping operations, the 277 � Dublin Core The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/. Extent The size or duration of the resource. 1256 Title A name given to the resource Sustainable City Author Author Ahmetspahic , Erna Abstract A summary of the resource. On the beginning of 20th century, cities become synonymous for progress, wealth and increasing opportunities when compared with the rural regions. Based on some UN information‘s, 30% of world population was urban in 1950, this percentage increase to 47% in 2000, and expectations are that in 2030 60% of population will live in cities. If changes in space organization do not happen until 2030, total earth population will increase to 8,1 billion and 5 billion people will live in urban regions with the 2,67 billion that will not have place to live. This change of the world, from rural to predominantly urban is continuous and cannot convert again, so these changes affect using of water, energy, earth and other nature resources. In the same time cities are primary victims of climate changes. Half of the population lives in urban regions, but they consume 80% of global energy production. Urban theorists saying that city is dead. In the future we can talk about two models of the cities that are totally different: ecological conscious city that becomes sustainable with the own resources and „ slum city ― that is fighting for the healthier life. How to deal with challenges of the global age that are barrier for progress and sustainability, and in same time keep own identity and diversity? The cities are kind‘s social - ecological systems that have a wider range of articulation with ecology. How to produce positive results – results which enabling contribution of sustainability of environment in cities? Cities are complex systems of consumption and production and that complexity makes them essential for finding solutions. Differences of the cities come from different politics of the governments, basic economy, and ordinary cultural life of the citizen‘s. One of those facts is that whole energy flow and materials of the economy become pollution and waste of ecosphere just in different shape. Are the global ecological conditions result of the urban agglomeration and density, or are they result of specific urban system types? Long time ago cities become places for innovations, development and starting of complex physical and organization systems. It is important to find solution for the big number of ecological damage and formula for reconfiguration of social – ecological systems that are made because of urbanization. Keywords: Sustainable Urbanism , Eco – City , Ideal City , Sustainability , Brownfield , Re – Use , Urban recycling , Open Arhitecture , Green Buildings . Date A point or period of time associated with an event in the lifecycle of the resource 2012-05-31 Keywords Keywords. Conference or Workshop Item PeerReviewed H Social Sciences (General),Q Science (General) https://omeka.ibu.edu.ba/files/original/51d8416382b015babc5ec6406c074b96.pdf 4e1eacd23fb9f63ded36041aeb632d15 PDF Text Text 3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Sustainability & Education - E-Learning Website Aida Bulbul, Mela Hadrović, Emil Knezović, Adi Fišević International Burch University, Faculty of Economics 71000, Sarajevo, Bosnia and Herzegovina E-mails: bulbul.aida@gmail.com, mela_hadrovic@hotmail.com, kinez88@hotmail.com, adifisevic@yahoo.com Abstract Taking into consideration that sustainability has become one of the crucial aspects of modern development due to scarcity of resources and intense globalization processes; we recognized a need to integrate it into education by development of an e-learning website. Throughout analysis we explained the rational need for education on sustainability since it has a great influence on every aspect of life. Prior, learning goals were introduced as guideline for further explanations. In the next part of the analysis we have defined potential solution based on Bersin’s six modes of learning which include: reading, seeing, hearing, watching, doing and teaching. For the benefit of development of our online course it was necessary to clearly set out and explain core tools divided into three groups: informational group, materials group and examination group. Finally, this paper offers a ready-to-implement solution on e-learning sustainability website applicable to any university. Keywords: E-learning, Sustainability, Discussion, Interactivity, Internet, Planning Tools, Software, Website, Organization, University. 1. INTRODUCTION Today, in the era of technology, internet, and change, e-learning has become a constituent part of university curriculums, a common tool for corporate training, and strategic change. On the other side, sustainable development an issue and challenge of today has an overall aim of meeting the needs of the present without compromising the ability of future generations to meet their needs. Taking into consideration main characteristics of e-learning which can be 207 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo described as teaching service provided to an individual that is not physically present brings us to the point where we combine these two issues into one. In order to understand the issue it is important to primarily explain and define e-learning and sustainable development as two important segments for development of e-learning website. Modern era imposed new standards related to usage of internet and high-tech gadgets where most of students need to adopt in order to engage more efficient processes of learning practices. Furthermore it is vital to determine how these two issues can be combined and brought into everyday life throughout education. To motivate and engage students in active learning processes calls for the use of student-centered concepts and the making of more interactive virtual learning environments that supports knowledge creation (Uhomoibhi, 2006). For the benefit of overall analysis we will present unique and simple solution (applicable to any university) of an e-learning sustainability course that has aim to introduce students to sustainability issues of today, give them opportunity to research, discuss and contribute to their solving, and to make them capable of applying this solutions to their organizations in the future. According to the general definition sustainable development can be explained as “the ability to make development sustainable and to ensure that it meets the needs of the present without compromising the ability of future generations to meet their own needs” (WCED, 1987). Taking into consideration scarcity of resources, intensity of development and global economic position, sustainability has become one of the crucial factors for further successful development of all planetary activities. It is possible to segregate three major aims of sustainable development and e-learning practices. First aim capitalizes on strength, prior academic, cultural and personal experiences and modes of an increasingly diverse students group. Second one facilitates effective engagement among sustainability practitioners with students in real and virtual earning environments. Third aim is focused on informed groups and individuals which allows them reflection on the strengths and limitations of sustainability and education (McEwen, 2006). After presenting all relevant theoretical principles and facts about e-learning in general, we will next focus on our own idea and product as the focal point of the analysis. Moreover, a solution for an e-learning sustainability website that can be utilized by universities as part of their education policy will be developed. This will be done by stressing out the learning goals and levels and by suggesting appropriate solutions for reaching those goals. As a result, this paper will give a comprehensive solution of a website ready for implementation. 208 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 2. E-LEARNING SUSTAINABILITY WABSITE 2.1. Rationale We choose to propose an e-learning solution for course on sustainability. The rationale behind this innovative program of study lies in the fact that education on sustainability is becoming a global trend and development and sustainability challenges in general are of great importance to every aspect of life. Moreover, Universities in BiH do not offer adequate solutions for this particular issue which demands much more attention in terms of research and proposing solutions. Taking this into account, and having in mind that today’s students are computer and digitally literate, the idea is to propose a solution for an e-learning sustainability website that would combine relevant materials, technology and internet resources to teach what sustainability and development really is, what are the current trends, and get students involved into case studies and projects that could benefit to the university and society in general. 2.1. Learning Goals The goal of any course should be to transfer knowledge to the students and provide a relevant knowledge basis for the future. Having in mind that an e-learning course is strengthened and supported by technology; the identified learning goals as follows: Teach people about relevant sustainability topics and challenges facing today’s society; Train them on how to apply SD solutions ad concepts in practice; With help of technology and internet, make the website as place where they will be thought about SD, be informed about current issues, and have appropriate database for research. 209 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 2.2. Solution In order to accomplish the goals set in previous section, it is necessary to combine and integrate different mediums and use appropriate instructional principles and techniques. Moreover, the website needs to be designed in such a way to be appealing to students (in terms of aesthetics and content), it needs to fulfill some basic requirements of a good website, and it needs to make people learn and understand the topic. Design of an e-learning website is highly dependent on the chosen learning strategy. Figure 1 (Bersin, 2004) displays six modes of learning, or a hierarchy of learning stages and ‘mastery’. It can be noticed that achieving the highest mastery level is a multi-step process and multitechnique approach highly dependent on technology and internet support needs to be used. Some examples of learning strategies include: storytelling, sequences, competency-basis, criterionreferencing, evaluation, cooperation, case studies, discovery or constructivism, role playing, simulation, games, experience, laboratory, etc. Figure 1 – Six Modes of Learning (McIntosh, 2008). In addition, it is necessary to keep in mind that the most effective learning occurs when learners are actively engaged and when level of interaction is high. Taking all this into consideration and in order to achieve learning goals and high level of mastery, the web site design will be explained through six modes of learning (Bersin, op.cit.): .Reading: In general, the easiest way to deliver a lesson is to give people things to read. In web form, however reading is less valuable because people will not and cannot read long texts on the web. Having in mind that sustainability should not be a theoretical subject, the web site should provide well-structured materials, balance it with image content, and give instructions in outline forms. Moreover, it should provide the download option for all of the documents and books. 210 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 2.Seeing: As stated previously, heavy texts are not suitable for this type of websites. It is necessary to enrich text by adding diagrams, photographs, and images. This is important in the SD terms, because students need to conceptualize, visualize and be aware of the different concepts and issues. For this purpose, website will offer assignments, presentations and case studies enriched by photos on related topics. 4.Hearing & 4. Watching: Next set of techniques includes sound, motion, and demonstrations. These techniques would include instructor lectures, demonstrations, videos of real-world examples, and scenarios. Besides hearing lectures, students will be offered with videos on sustainability issues and relevant case studies. 5.Doing: In everyday life, learning by doing or experiential learning creates the highest level of understanding, context, and retention. That is why e-learning should strive to create experiential activities. The biggest trend in experiential learning in web-based instruction is simulation (Bersin, op.cit.). Simulations are a special form of web-based training that put the learner in a real-world situation. For the purpose of learning sustainability, students will be able to select modules and topics according to their interests, for example sustainable development in relation with communities, climate change, politics, governance, etc. After choosing the area of interest, students will get to use their knowledge of the SD framework to apply it to an actual business, community or other project and produce a final project/work. Moreover, website will offer simulation exercises, workshops, and will inform students about occasional field trips. 6.Teaching: Certainly the most valuable way to master a subject is to teach it. With this idea in mind, students would be required to present their area of interest and show others what/how they approached a particular issue and what solutions they applied. Due to the nature of the topic, students will be required to employ ABCD analysis as follows (NBIS, 2008): A. Awareness - What they know about sustainability and why it matters for the chosen topic? B. Baseline Mapping - conduct sustainability ‘gap analysis’ related to the chosen organization/issue. C. Clear and Compelling Vision/ Creative Solutions - brainstorm potential solutions to the issues highlighted in the baseline analysis. D. Down to action - prioritize the measures that lead to offered solutions and sustainability. Develop a plan for implementation. 211 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 2.3. Tools & Design In order to develop online course we would use several core tools divided into three groups: 1. Informational group – our website would be the centre of the course. Information would be available there and we would use HTML (hypertext mark-up language) in order to provide quick, easy and concrete information. 2. Materials group – here, we refer to the section in which we would provide study material to our students. In the beginning, two ways would be used:   Live – In order to connect with our students and to have “personal touch” there must have live classes. So during the semester, there would be organized three to four live conferences in order to have mutual exchange of information between students and professors. On line lectures, discussions and advices from professors would be done through Microsoft Office Live Meeting program. Literature – In order to provide our student with material we would use following tools: o PowerPoint – Lectures would be delivered to students through e-mails or it could be downloaded directly from website. o PDF – Lectures that would support PowerPoint presentations, additional reading, homework and all other course related material would be delivered to students in PDF formats. As already said, we would use PDF in order to deliver homework material. We would have option to deliver scanned bills or invoices to our students, so they could feel what accounting is. o Windows Media Player – Lectures could be recorded on DVDs, practical things could be in video modes and all of this could be delivered to students. Ordinary video player such as Windows Media Player could be used in order to watch material o Excel – Numerical data would be provided in excel form. 3. Research studies – Since sustainability is an ongoing issue, debated each day, online research studies would be provided for students. The separate page would be consisted put of three parts: News – This section would provide latest news and actions on sustainability, summits, meeting, conferences and all other important events that are recently all will be done in the future. Additionally, it would provide articles on sustainability and several other reports done by individuals from different parts of the world. Library – Huge collection of online books and published papers has to be there in order for students to be able to easily access information from different topics related to sustainability (economical, environmental, social and other categories). 212 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Research programs – As main program there would be Microsoft Dynamics (Microsoft, 2009) that is customized for sustainable development process. This program could be used online while two or more people could be connected in separate room. In that “room” they would have communication ability and could do researches much efficiently. Another advantage for this usage would be that mentor could also be “on the other side” and give instructions and guidelines during the research process. Additionally, students could chat and share knowledge and experience with other students and work on several other projects all around the world. 4. Examination group – All types of examination (finals, midterms, quizzes and homework) would be done online. To examine students we would use:  Microsoft Word – This tool would be used for theoretical part of examination. Figure 2 – Course Matrix STUDENT Website (HTML) SUSTAINABILITY COURSE RESEARCH News Information, registration, announcements Live & recorded lectures Library Literature Research program EXAMS 2.4. Technical Issues In order to provide high quality education, we should be aware of several technical issues that we could face while providing this type of service. Among these issues we identify three most common:    Do our students have adequate equipment to follow our education? Is our course, materials and information easily accessible? Is our Technical Service good and how people with problems can contact them? So, in order to develop e-learning, organization has to take into consideration many things that could affect the process. From the questions we could see that organization should know if students have compatible equipment in order to apply for the course. Then they examine their self in order to see are they good enough to provide such service. Do they have enough 213 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo resource and capabilities? Even if they are strong, they should always try to find ways for improvement. 3. CONCLUSION After taking everything into consideration, it can be concluded that e-learning is surely becoming the education tool of today. The benefits and opportunities this kind of learning provides for the students/users are unquestionable. When it comes to the solution proposed in this paper, if properly designed, e-learning sustainability website can not only bring this topic closer to the students, but can also make them capable of proposing and creating solutions for sustainability issues of today’s. REFERENCES Bersin, J. (2004). The Blended Learning Book: “Best Practices, Proven Methodologies, and Lessons Learned”. Pfeiffer. Microsoft, 2009. Driving environmental sustainability practices with Microsoft Dynamics. [Online] Available at: http://www.microsoft.com/dynamics/en/gulf/environment.aspx [Accessed 25 April 2012]. McEwen, L., (2006). Education for sustainable development for taught postgraduates: Designing effective active co-learning environments for on-site and distance learning students. Pp.21-31 McIntosh. D. (2008). E-learning course design. <http://www.trimeritus.com/design.pdf> [accessed December 17, 2011] NBIS – Network for Business Innovation and Sustainability (2008), Sustainability using the Natural Step Framework, <http://nbis.org/nbisresources/sustainability_frameworks/naturalstep_duke_castle_nbis_prese ntation.pdf> [accessed March 15, 2012] Uhomoibhi, J., O. (2006). E-learning and Engineering Education for Sustainable Development. 9th International Conference on Engineering Education. University of Ulster, Northern Ireland, pp. 2 (WCED), (1987). World Commission on Environment and Development Our Common Future. New York: Oxford University Press 214 � Dublin Core The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/. Extent The size or duration of the resource. 1170 Title A name given to the resource Sustainability & Education - E-Learning Website Author Author Aida, Bulbul Abstract A summary of the resource. Taking into consideration that sustainability has become one of the crucial aspects of modern development due to scarcity of resources and intense globalization processes; we recognized a need to integrate it into education by development of an e-learning website. Throughout analysis we explained the rational need for education on sustainability since it has a great influence on every aspect of life. Prior, learning goals were introduced as guideline for further explanations. In the next part of the analysis we have defined potential solution based on Bersin’s six modes of learning which include: reading, seeing, hearing, watching, doing and teaching. For the benefit of development of our online course it was necessary to clearly set out and explain core tools divided into three groups: informational group, materials group and examination group. Finally, this paper offers a ready-to-implement solution on e-learning sustainability website applicable to any university. Keywords: E-learning, Sustainability, Discussion, Interactivity, Internet, Planning Tools, Software, Website, Organization, University. Date A point or period of time associated with an event in the lifecycle of the resource 2012-05-31 Keywords Keywords. Conference or Workshop Item PeerReviewed H Social Sciences (General) https://omeka.ibu.edu.ba/files/original/2152437067a737d4cc3305ec787225ad.pdf d5d234fe994221fe256dbb367e57a593 PDF Text Text 3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Raiffeisen Researh CEE Banking Sector Report http://www.rbinternational.com/eBusiness/services/resources/media/677012584775275435677012584775275436_677251119927032833-772104317120223179-1-9-DE.pdf Simon Jr, G. (2012) An Economic History of Socialist Yugoslvaia, Social Science Research Network, Rochester, New York, Available at : http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1983907 Stubos, G. and Tsikripis, I.(2004) Banking Sector Developments in South –Eastern Europe, Working Paper No.44, ELIAMEP, WP4,Regional Cooperation, ELIAMEP, Athens, Available at: http://balkan-observatory.net/archive/stubos.pdf Stubos, G. and Tsikripis, I.(2005) Regional Integration Challenges in South East Europe: Banking Sector Trends , Working Paper, Bank of Greece Available at: http://www.bankofgreece.gr/BogEkdoseis/Paper200524.pdf Basel II – Policy Implications and Implementation Challenges for Bosnia and Herzegovina Aida Bulbul, Ugur Ergun International Burch University, Faculty of Economics 71000 Sarajevo, Bosnia and Herzegovina E-mails: bulbul.aida@gmail.com, uergun@ibu.edu.ba Abstract The financial sector and international banking environment in particular has changed dramatically over the past years. In order to reach and maintain stability and sustainability in the global banking system, decrease risk of insolvency, and to cover unexpected losses, countries (EU in particular) have started implementing the new capital adequacy rules (Basel II) following the worldwide consensus among G-10 central bank Governors by which banks’ capital levels should be regulated to enhance global financial stability. Since Bosnia and Herzegovina is still in the beginning of its path towards Basel II legislation and implementation, using detailed literature review and an in-depth analysis this study conducts a comparative analysis on the implementation of Basel II in Bosnia and Herzegovina, Slovenia, Croatia, and Serbia, with regard to both the qualitative and quantitative implementation details and issues which include the implementation stages, progress, and timetables and particular challenges faced by the countries. Moreover, study reveals Bosnia and Herzegovina’s unique situation, challenges and obstacles on the path towards full implementation of Basel II standards and puts an emphasis on how implementation and adoption will affect its banking and economic stability, future and conditions. 74 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Keywords: Basel II, banking supervision, capital adequacy, Bosnia and Herzegovina, central bank, banking agency, risk, risk weight, challenge, adoption, implementation. 1. INTRODUCTION The ultimate goal of all economies is to reach financial stability and to improve key elements of living standards within that economy. Financial markets, in that regard, are supposed to be active, liquid and trusted regardless of the threats, changes and complexities in the economy. One of the crucial players of the whole economic growth and stability process are banks. Their function has traditionally been to help or mediate funds transfer between those who have a surplus of funds and those who have a fund deficit.. As a consequence of banks’ specific role for the society, their impact on the whole economy and their explicit functions, governments worldwide tend to regulate and supervise banks’ activities, operations, and risk management in particular, in order to protect banks’ customers, liquidity, themselves, but most importantly, to preserve economic stability. In addition to this, fast integration of global financial markets, innovations, and all other complexities highly affected banking sector and the way banks collect, measure and manage risks, and the way they regulate they capital requirements (Makwiramiti, 2008). In writing of this work the author relayed mostly on Basel Committee on Bank Supervision (BCBS) official publications, scientific articles on Basel II, benefits, weaknesses and challenges. For analysis of BiH in terms of harmonization with Basel II standards, author used publications of Central Bank of BiH (CBBH) and annual reports of Banking Agencies and key banks in BiH. For comparative purposes, data on Basel II implementation stages in Slovenia, Croatia and Serbia was used, mainly from aforementioned countries’ Central Banks, and available relevant publications. These literature resources combined with one year working experience at USAID/PARE project, provided the author with the knowledge base for completion of this work. Due to internal regulation on sensitive information within USAID/PARE project, no report or case study produced by the project could be included in this work. Nevertheless, a significant part of this work is based on knowledge and experience acquired at USAID/PARE project. 2. THE BASEL COMMITTEE AND REGULATIONS The Basel Committee (‘the Committee’), established in Basel (Switzerland), was founded in 1974 by the governors of G-10 group countries and today consists of senior representatives of bank supervisory authorities and central banks from Belgium, Canada, France, Germany, Italy, Japan, Luxembourg, Netherlands, Spain, Sweden, Switzerland, United Kingdom and the United States (Sarlija & Gerec Z, 2008). The Committee is an international body that has an aim to harmonize banking supervision, formulate financial regulation policy at the international level and to create preconditions for intensifying international competition of banks (Plochan, 2007). With increase of competition among banks and with continuing erosion of capital that happened in late 70s, regulators realized that approach to these problems on the international level and standardization of capital regulations was the only possible solution for securing the global banking system. As a result, a common framework for calculating the capital adequacy of banks was proposed. Although subject to implementation variations from one country to another, the Basel regulatory framework was and is being accepted and implemented in all major economies (CEPS Task Force Report, 2008) 75 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 2.1. Basel I Basel I represented a revolutionary agreement whose core was to develop a common riskadjusted capital standard that would be applied internationally, and by which banks would be obliged to put aside a certain percentage of its capital as reserve when providing loans. Basel I had two fundamental objectives: First, to “strengthen the soundness and stability of the international banking system” (by setting the minimum capital adequacy requirements); and Second that the “framework should be in fair and have a high degree of consistency in its application to banks in different countries” (BCBS, 1988) To achieve these goals, the Committee concluded that the minimum target standard ratio of capital to weighted risk assets should be set at 8% (of which the Tier 1 capital element will be at least 4%). This basically means that banks were to put aside 8% of the total amount of a loan in reserve when there is a 100% risk associated with that loan.. For simplicity purposes, the Committee decided that only five weights were to be used: 0, 10, 20, 50 and 100%. Even though it was only “morally, not legally binding, the provisions of the 1988 Basel Accord quickly became the reference point for regulation on credit risk, not just in the original G-10 member countries, but also eventually in over 100 countries throughout the globe” (Ong, 2007). 2.2. Basel II The Basel II framework is built on three mutually reinforcing pillars, which together should contribute to safety and soundness in the financial system. The first pillar, covering minimum capital requirements, offers novelties in terms of credit risk quantification (standardized and internal rating based (IRB) approach of measurement); and introduces category of operational risk measurement in the calculation of capital adequacy ratio. The second pillar concerns supervisory review process is intended not only to ensure that banks have adequate capital to support all the risks in their business, but also to encourage banks to develop and use better risk management techniques in monitoring and managing their risks. (BCBS, 2006) The third pillar concerning market discipline is to complement the minimum capital requirements (Pillar 1) and the supervisory review process (Pillar 2). While the Framework takes the form of an agreement among the BCBS members – and so the implementation is voluntary – in the EU, the framework is a part of legislation and is binding for all EU countries. EU, by the means of Capital Requirements Directive (CRD) required all financial institutions (regardless of size and geographic activity to fully implement the basic Basel II approaches by January 2008, which is when Basel II is compulsory for all approaches. (ECB, 2005) 76 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 3. BASEL II IMPLEMENTATION – COMPARATIVE ANALYSIS 3.1. Slovenia Lessons that can be learned from the case of Slovenia are: due to the fact that Basel II can adversely affect SMEs and can be extremely costly for low profile domestic banks, the government (and Central Bank in particular) should consider introducing slight changes into legislation (as compared to original Accord) in order to protect businesses and banks within country, but also to preserve financial stability and prosperity of the country. Moreover, in order to overcome the problem with lack of skilled staff for implementation of Basel II, timely trainings and capacity buildings should be organized, so that institutions have people that can cope with all of the tasks and challenges the implementation and understanding of Basel II brings. (Jagric, Jagric, & Podobnik, 2008) 3.2. Croatia Problems and challenges Croatia faced during Basel II implementations are similar to those already mentioned in the case of Slovenia. Nevertheless, Croatia can be used as an example of Country that managed to increase awareness of all benefits of Basel II through regular publications by National Bank that served as a “manual” for understanding Basel II theory, practice and all relevant surrounding issues. Moreover, it organized various workshops, seminars and trainings for banks even before adoption of Basel II, so that they were able to prepare for all of the challenges and tasks of it, and to be able to continue operating successfully. (Jakovcevic, 2003; CNB, 2008; CNB, 2011) 3.3. Serbia The biggest problems banks in Serbia faced during the implementation of Basel II standards were primarily the costs of staff training and building information systems, improvement of information technology - the development of models and databases, as well as the lack of qualified staff (NBS, 2009). To solve the IT problem, a group of banks purchased ready software, while some banks began creating and designing their own software to be used in meeting the Basel standards. Another solution for overcoming this problem is a domestic product developed by Serbia Center for Investment and Finance that could be a unique and less expensive solution for the introduction of Basel II standards. (http://www.cif.co.rs/). This is not only a less costly solution, but also an easier way for the banks to employ, adapt and get their staff experienced with IT systems and software. 4. BOSNIA AND HERZEGOVINA AND BASEL II Table 1 displays the total number of banks in Federation of Bosnia and Herzegovina and Republika Srpska over the period 2000 to 2011. 77 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Year FBiH CAR* RS** CAR* 2000 N/A 26,3% 18 36,1% 2001 N/A 22,4% 16 37,5% 2002 29 19,8% 11 24% 2003 27 19,6% 10 24% 2004 24 18,6% 9 19% 2005 24 17,5% 9 19% 2006 23 17,6% 9 18% 2007 22 17,3% 10 16% 2008 20 16,4% 10 15,7% 2009 20 16,1% 10 15,8% 2010 19 16,2% 10 16,19% 2011 19 15,3% 10 N/A *CAR – Capital Adequacy Ratio (calculated as ratio of net capital and risk weighted assets) ** + Organizational Units of Banks from Federation BH Table 1 - Compiled from FBiH and RS Banking Agencies’ annual reports Current regulations in BiH (in both entities) are in accordance with Basel I. Since there are differences in legislation across entities and due to complexity of political and economic situation in BiH, it would be extremely hard to harmonize this legislation on the state level. Competent people from both agencies agree however that harmonizing with EU Directives and Accord Rules is much simpler and “painless” process that would eventually result in harmonization on the state level. Since 2008 the activities on preparation and adoption of Basel II were initiated. It is important to emphasize that while BiH is working on introduction of Basel II, Basel III is in the process of adoption and entry into force across the EU. As of December 2008 in FBiH and February 2009 in RS, Banking Agencies adopted a strategy for introducing the Basel II standards. Both Agencies emphasized the fact that Bosnia and Herzegovina, as a country that strives to join the EU, is obliged to make preparations for full adoption of Basel II and EU Directives and that this is one of the conditions for becoming a candidate country. Furthermore, with a strong believe in positive impacts of implementation on banking sector, they concluded that transition is to be done cautiously, gradually and according to the principle “from simple to more complex”, with insuring that banks gradually develop their capacities and capabilities to apply new frameworks and that Agencies develop capacities to design and implement the supervisory procedure defined by Basel II. (FBA, 2008; ABRS, 2009) As of today, BiH is in the phase adopting legislation (draft legislation is prepared, but not published and adopted). Although all major banks (in accordance with parent bank requirements) in practice follow the EU requirements, they still create reports in accordance 78 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo with the domestic legislation and requirements, which without any doubt creates many complexities and increases uncertainty about banking sector of BiH. 4.1. Proposed Next Steps Having in mind lessons learned from previously analyzed countries, the following suggestions can be identified: In order to avoid resistance to change and further delays, educational component is very important. Besides regulators, a knowledge base for banks should also be created. This can be done either by organizing regular sessions and workshops, or by publishing manuals, as it was case in Croatia. Bring consultants to take one bank (preferably domestic), guide it throughout the whole process of implementation, promote new models and reporting system, teach its people how to interpret data using new approaches and make them aware that these changes will not bring additional risks. Processes and exercises made with this bank can eventually serve as a template for all other banks across country. Developing proper and common IT/MIS systems – since there will be need for ongoing coordination between the BSAs, CBBH and key regulatory institutions, and since it will be necessary to harmonize reporting formats and protocols, interactive IT systems will play a crucial role. As examples of Slovenia, Croatia and Serbia showed, this is a very expensive and challenging process, and it could be worth considering developing domestic IT solutions, as a less expensive solution. Finally, it is necessary to emphasize the need for undertaking all these activities without disturbing and interfering with banks’ everyday business. Customers should not be adversely affected by the transition period and should not bring into question the trustworthiness of the bank. 5. CONCLUSION Effects of the implementation of Basel II/III to the banking sector in BiH will surely cause the reorganization of banks, whose capital requirements would be significantly increased. Moreover, pressure on banks to increase the amount and quality of capital would impose costs and lead to increased interest rates to customers. Even though these conservative policies and increase in interest rates would in the short-term lead to decrease in the number of granted loans, in the long-term, the successful implementation would lead to greater stability of the banking system and increase the competitiveness of banks in BiH with the banks in the world. In the short term, the introduction of Basel II/III could endanger the competitiveness of weaker banks since the increase of the capital level is more expensive for them than for larger banks. When it comes to profits of the banks in general, they would also be decreased in the short-term, since a particular amount would be separated to meet the minimum credit requirements. Nevertheless, a successful implementation of Basel II/III in BiH would lead to safer and more stable banking system. Improved and more formalized risk management would result in better assessment, quantification and greater awareness of risks in general. Also, bringing BiH banking sector regulations closer to the policies of EU banking would take BiH a step closer to the EU. Successful implementation of Basel II will unquestionably contribute to a more resilient and stable banking system that is capable of not only being a good intermediary, but also promoting sustainable economic growth. (Caruana, 2006) 79 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo REFERENCES ABRS. (2009, February). Strategija za uvođenje "Međunarodnog sporazuma o mjerenju kapitala i standardima kapitala" BAZEL II. Retrieved February 08, 2012, from Banking Agency of RS website: http://www.abrs.ba/publikacije/StrategijaBaselII.pdf BCBS. (1988, June). International Convergence of Capital Measurement and Capital Standards. Retrieved February 01, 2012, from Bank For International Settlements website: http://www.bis.org/publ/bcbs04a.pdf BCBS. (2006, June). International Convergence of Capital Measurement and Capital Standards. Retrieved February 1, 2012, from Bank for International Settlements website: http://www.bis.org/publ/bcbs128.pdf Caruana, J. (2006). The implementation of Basel II. Retrieved April 15, 2012, from Bank for International Settlements website: http://www.bis.org/events/cbcd06f.pdf CEPS Task Force Report. (2008). Basel II Implementation in the Midst of Turbulence. Brussels: Centre for European Policy Studies. CNB. (2008, December). Bilten o Bankama 17. Retrieved March 15, 2012, from Croatian National Bank Website: http://www.hnb.hr/publikac/bilten-o-bankama/hbilten-o-bankama17.pdf CNB. (2011, December). Bilten o Bankama, 23. Retrieved March 15, 2012, from Croatian National Bank website: http://www.hnb.hr/publikac/bilten-o-bankama/hbilten-o-bankama23.pdf ECB. (2005, December). The New Basel Capital Framework and its Implementation in the European Union. Retrieved March 15, 2012, from European Central Bank website: http://www.ecb.int/pub/pdf/scpops/ecbocp42.pdf FBA. (2008, December). Strategy For introducing the «International Convergence for Capital Measurement and Capital Standards» adopted in 2006 - Basel II. Retrieved February 08, 2012, from Banking Agency of the FBiH website: http://www.fba.ba/index.php?page=17 Jagric, V., Jagric, T., & Podobnik, B. (2008). Implications and consequences of Basel II for banking sector of a small open transition economy – a case of Slovenia. Banks and Bank Systems, Volume 3, Issue 1 , 26-32. Jakovcevic, D. (2003, November). Izazovi i iskusenja usvajanja i primjene “Bazela II.” za hrvatski bankovni i gospodarski sustav. Racunovodstvo, Revizija i Financije , pp. 143-149. Makwiramiti, A. (2008). The Implementation of the New Capital Accord (Basel II): A Comparative Study of South Africa, Switzerland, Brazil and the United States. Grahamstown: Rhodes University. NBS. (2009). Summary of the Results of Questionnaire on the Implementation of Basel II. Retrieved March 16, 2012, from National Bank of Serbia: http://www.nbs.rs/export/sites/default/internet/english/55/55_2/55_2_2/55_2_2_1/summary_r esults_2009.pdf Ong, K. M. (2007). The Basel Handbook: A Guide for Financial Practitioners 2nd Edition. London: Risk Books. Plochan, P. (2007). Risk Management in Banking. Bratislava: University of Economics in Bratislava. 80 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Sarlija, N., & Gerec Z, A. (2008). Kratak pregled Basela 2. Retrieved March 20, 2012, from Economic Faculty of Osijek: http://oliver.efos.hr/nastavnici/nsarlija/projekti/doc/Kratak%20pregled%20Basela%202.pdf The Importance of Environmental Accounting in the Context of Sustainable Development and Within IFRS Evaluation Hasan Şenol, Hakan Özçelik Süleyman Demirel University, Isparta, Turkey E-mails: hasansenol@sdu.edu.tr, hakanozcelik@sdu.edu.tr Abstract Nowadays, companies cause a lot of environmental problems because of profit maximization, the endless needs, rapidly advancing technological developments, unconscious consumption of natural resources, as they execute their operations. At first glance, these efforts in order to remove environmental pollution means additional cost to companies in the short term nevertheless they can have a chance of cost minimization in medium and long term and even additional income in this process. To meet the needs of business management and related people about the enviroment, enviromental accounting has started up. The study of TAS/TFRS accounting in the context of the enterprises is focused on enviromental accounting and its importance, reflecting the financial progress on enviromental sensitivity reports and sharing those info with the community. There is no relevant TAS/TFRS on the accounting for and the reporting of environmental costs within the existing set of TAS/TFRS. Because, the accounting principles set out in the existing set of TAS/TFRS are already adequate to deal with the accounting for and the reporting of environmental costs. Also, in our study various suggestions were made for he healthy functioning of enviromental accounting. Keywords: Turkish Accounting Standards, Turkish Financial Reporting Standards, Environmental Accounting, 1.INTRODUCTION The main goal of economic development and welfare, environmental balance and sustainable development model has led to awareness of nature should be protected. Optimum use of resources being wasted, the effectiveness of natural resources, environmental protection and economic growth and environmental quality of the flood to provide a working model of integration. Sustainable development, social, ecological, economic, spatial and cultural dimensions of a concept (Yıldıztekin, 2009:368). When environmental problems that appeared together with industrialization process have reached serious levels round the world, preventative or decremental solutions for these problems have been sought by developed countries. These environmental problems experienced with industrialization caused a better understanding of importance of sustainable 81 � Dublin Core The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/. Extent The size or duration of the resource. 1281 Title A name given to the resource Evaluation of Financial Performance of Banking Sector: Evidence from Bosnia and Herzegovina, Croatia, Serbia and Slovenia Author Author Aida , Bulbul ERGÜN, Uğur Abstract A summary of the resource. The financial sector and international banking environment in particular has changed dramatically over the past years. In order to reach and maintain stability and sustainability in the global banking system, decrease risk of insolvency, and to cover unexpected losses, countries (EU in particular) have started implementing the new capital adequacy rules (Basel II) following the worldwide consensus among G-10 central bank Governors by which banks’ capital levels should be regulated to enhance global financial stability. Since Bosnia and Herzegovina is still in the beginning of its path towards Basel II legislation and implementation, using detailed literature review and an in-depth analysis this study conducts a comparative analysis on the implementation of Basel II in Bosnia and Herzegovina, Slovenia, Croatia, and Serbia, with regard to both the qualitative and quantitative implementation details and issues which include the implementation stages, progress, and timetables and particular challenges faced by the countries. Moreover, study reveals Bosnia and Herzegovina’s unique situation, challenges and obstacles on the path towards full implementation of Basel II standards and puts an emphasis on how implementation and adoption will affect its banking and economic stability, future and conditions. Keywords: Basel II, banking supervision, capital adequacy, Bosnia and Herzegovina, central bank, banking agency, risk, risk weight, challenge, adoption, implementation. Date A point or period of time associated with an event in the lifecycle of the resource 2012-05-31 Keywords Keywords. Conference or Workshop Item PeerReviewed H Social Sciences (General),HB Economic Theory,HG Finance,HJ Public Finance https://omeka.ibu.edu.ba/files/original/9557ae8b86b9c10032d8632a894e019f.pdf 7cc145f7818bc702d3ccf9e5a67ec071 PDF Text Text 3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo http://eur-lex.europa.eu/en/index.htm http://worldbank.org http://imf.org Corporate Governance Practices in Bosnia and Herzegovina Aida Nušinović International Burch University, Faculty of Economics, 71000, Sarajevo, Bosnia and Herzegovina. E-mail: aida.nusinovic@gmail.com Abstract The purpose of this paper is to present the state of corporate governance in Bosnia and Herzegovina, to determine the degree of its principle applications, and to emphasize the importance of good corporate governance practices for transition economies, such as Bosnia and Herzegovina. Corporate governance, by its simplest definition, presents a system of management and control over the company. Good corporate governance practice is important for the investment climate, because it provides greater security for investors and shareholders and leads to sustainable long-term economic development. Because of the reorganization of the still present economic system, developing countries are faced with many problems related to the implementation of corporate governance, such as insufficient use of existing legislation, underdeveloped capital markets and insufficient bussiness transparency of the company. Foreign investors do not wish to invest in companies that do not apply the principles of corporate governance and studies have shown that for making investment decisions, the application of good corporate governance practices plays an important role. The problems Bosnia and Herzegovina is facing are still a lack of business transparency of company operations, as well as the insufficient protection of minor shareholders. At the end of this paper certain guidelines are given in order to improve practices of corporate governance in Bosnia and Herzegovina, and also the importance of their application to the company and the country itself is highlighted. Keywords: corporate governance, transition economies, economic development, principles, business transparency 1. Definition of Corporate Governance The term of corporate governance is far more complex than thought of at first, and implies not only the way in which a company is governed, but a full range of internal and external relations, as well as legal regulations. According to the definition of the OECD (Organization for Economic Cooperation and Development), corporate governance involves a set of relationships between a company’s management, its board, its shareholders and other stakeholders. Good corporate governance should provide proper incentives for the board and management to pursue objectives that are in the interests of the company and its shareholders 278 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo and should facilitate effective monitoring. The presence of an effective corporate governance system, within an individual company and across an economy as a whole, helps to provide a degree of confidence that is necessary for the proper functioning of a market economy. With good corporate governance practice, values as justice, responsibility and transparency of business are promoted. In economic societies in which a clear separation exists between ownership and governance, conflicts of interest appear amongst interested participants in the process of corporate governance, the influence of institutional investors, stockholders, creditors, the administration, and employees. It is necessary that all of these relationships be regulated in the aim of the successful running of the company. According to who has the crucial position and role as concerns the relationships in a company, that is, which interest groups affect decision-making, and in which way do these interest groups participate in corporate governance, we differentiate between two types of corporate governance: - The open corporate governance system The closed corporate governance system The open system of corporate governance is called also the market, outsider, and Anglo American system of corporate governance, and is characteristic for corporations in the countries of the USA, Great Britain, Australia, and New Zealand. In the open system of corporate governance the supervision of management and the company is not in the hands of any influential interest group, while the main role falls to the capital market and the actions of the investors who invest in it. Managers have a key role in governing the company. The closed system of corporate governance is also called the internal (insider) and the European system of corporate governance, and is characteristic for the countries of Europe as well as for countries which have harmonized their corporate governance principles with OECD recommendations which refer to corporate governance. A closed system of corporate governance is often used in countries with a poorly developed capital market and a concentrated ownership structure. It is characteristic of this system for a group of stockholders to hold a large percentage of the total number of stocks, that is, they are the owners of a significant package of stocks, and in this way actively govern the company. In this system, the capital market has a secondary meaning as opposed to the open system of corporate governance. Bosnia and Herzegovina is closer to a closed system of corporate governance, considering its poorly developed capital market, but also due to the other characteristics of the closed system of corporate governance. 2. Corporate governance in developing and transition economies Developing countries are still reorganizing their economic systems, so that they face numerous problems tied to the application of corporate governance, such as the insufficient application of existing legal regulations, lack of personnel for corporate governance, an undeveloped capital market, the still great presence of the state in company ownership, as well as other problems which impede upon the application of corporate governance principles. Good corporate governance practice is extremely important for countries in transition, and has influence on the optimization and growth of the country's economy. A lack of corporate governance practice leads to a negative investment climate, negatively influences the capital market, and impedes upon the further economic growth of the country. Good corporate governance leads towards long-term, sustainable survival of an economy. Developing 279 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo countries need new, fresh capital and due to higher risk, foreign investors do not wish to invest in companies who do not apply the principles of corporate governance, which reduces the chances of the flow of direct foreign investments. 33McKinsey's study has shown that foreign investors are ready to invest 30% more of their resources into shares of companies from Eastern Europe with good corporate governance practice, while 40% of investors stated that corporate governance is a more important factor in deciding whether they will invest in a company in Eastern Europe than growth potential or profit. It is important that a company itself realize that corporate governance improves its economy's competitiveness on the international market. A company with a good corporate governance practice is a transparent and responsible company and as such has greater chances for access to international sources of financing. 3. OECD principles of Corporate Governance OECD principles (Organization for Economic Cooperation and Development) were adopted in the year 1999 and revised in 2004, and they represent elements of good corporate governance and contain recommendations for policy makers, law regulation makers, investors, and companies for OECD countries, as well as in countries outside of the OECD. The principles represent non-binding standards, good customs and instructions for use, and may be adjusted to specific conditions in certain countries. The principles help companies in defining their own corporate governance practices. OECD principles cover six key areas of action: 1) construction of the frame of corporate governance, 2) rights of shareholders and key ownership functions, 3) equal treatment of shareholders, 4) the role of interest groups in corporate governance, 5) publishing of data and transparency, and 6) the board's responsibility. In the aim of promoting the application of OECD principles of corporate governance in countries which are not OECD members, such as Bosnia and Herzegovina, regional round tables were held, in collaboration with the World Bank, in which the policies of corporate governance were discussed. In the year 2002, the Regional Round Table result was the White Paper document - a recommendation on corporate governance in southeastern Europe, which was officially adopted in Sarajevo in the year 2003. White Paper provides a list of practical recommendations, guidelines, and suggestions to policy creators, stock markets, companies, and others who have interest in the application of good corporate governance practices, and helps SEE countries in the promotion of corporate governance practices. This document is primarily focused on companies whose stocks are publically traded, but can also be applied to companies whose stocks are not listed on the stock market. OECD principles as well as recommendations within White Paper help in the development of national codex of corporate governance. One such codex is the corporate governance Codex for companies listed on the Sarajevo Stock Exchange (SASE) which represents a group of the best company leadership practices in the world, adapted to a transitional market such as Bosnia and Herzegovina. The codex includes the following areas: transparency in business, relationships with investors and interest carriers, assemblies, the supervisory board, the administration, auditing and mechanisms of internal control, as well as social responsibility. Accepting the corporate governance codex is a requirement for companies in quotation (A list companies), while the application of the codex is not required of the companies listed and included on the free 33 Christ College Institute of Management, Hosur Road, Bangalore 560 029 280 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo market. A company which has accepted the corporate governance codex is obliged to abide by the provisions of the codex, and if it is unable to implement certain provisions, it is obliged to, within the questionnaire, which is a constituent part of the codex, state why it is not implementing the enclosed recommendations. In this way, investors can decide whether they wish to invest in a certain company on the Sarajevo Stock Exchange. In 2011 also Banja Luka Stock Exchange has adopted the Standards of Corporate Governance with the aim to improve corporate governance practices in companies which are listed on this stock exchange. 4. Corporate governance practices in Bosnia and Herzegovina In order to analyze the application of corporate governance principles in Bosnia and Herzegovina, the World Bank, for the first time in the year 2006, made a Report on the Observance of Standards and the Codes ( ROSC ). An analysis of the following adherence to OECD principles was conducted: Table 1. OECD Principles Section I: Ensuring the basis for an effective corporate governance framework Principles: Overall corporate governance framework; Legal framework enforceable/ transparent; Clear division of regulatory responsibilities; and Regulatory authority, integrity, resources Section II: The right of shareholders and key ownership functions Principles: Basic shareholder rights; Rights to part. in fundamental decisions, Shareholders GMS (general meeting shareholders) rights; Disproportionate control disclosure; Control arrangements allowed to function; Exercise of ownership rights facilitated; and Shareholders allowed to consult each other Section III: Equitable treatment of shareholders Principles: All shareholders should be treated equally; Prohibit insider trading; and Board/Managers disclose interests Section IV: Role of stakeholders in corporate governance Principles: Legal rights of stakeholders respected; Stakeholder redress; Performance-enhancing mechanisms, Stakeholder disclosure; Whistleblower protection; and Creditor rights law and enforcement Section V: Disclosure and transparency Principles: Disclosure standards; Standards of accounting & audit; Independent audit annually; External auditors should be accountable; Fair & timely dissemination; and Research conflicts of interests Section VI: Responsibilities of the board Principles: Acts with due diligence, care; Treat all shareholders fairly; Apply high ethical standards; The board should fulfill certain key functions, Exercise objective judgment, and Access to information 281 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo To adhere to certain principles, the assigned grades were “observed”, “largely observed”, “partially observed”, “materially not observed” and “not observed”. The results of the study are represented in the following table: Table 2. Frequency of Each Category – Compliance with Corporate Governance Principles Principles % Observed 0 0 Largely observed 4 12,5 Partially observed 22 68,8 Materially not observed 6 18,7 Not observed 0 0 Total 32 100 % For adhering to the majority of principles, Bosnia and Herzegovina received the grade “partially observed”. For adhering to the principles of the basic stockholders right, the shareholders GMS rights, the principle stakeholder redress, and the creditor rights law and enforcement, B&H received a poorer grade, namely “largely observed”. The grade “materially not observed”, B&H received for not adhering to the following principles: the rights of shareholders to participate in fundamental decisions, Board/Managers disclosure of interests, stakeholder disclosure, whistleblower protection, disclosure standards and acting with due diligence, care. In no case did Bosnia and Herzegovina receive the grades “observed” or “not observed”. 4.1. Application of Corporate Governance Principles by companies in Federation of BiH In 2011 the independent consulting firm SEE Business Solutions d.o.o. Sarajevo has conducted an analysis of the application of corporate governance principles by companies in Federation of Bosnia and Herzegovina. The study processed 55 joint stock companies. The results according to the analyzed areas were the following: The Management and Supervisory board: in more than 50 % of the analyzed companies the supervisory board consists of only 3 members and only 11% of companies board members are independent, while 38 % members are either stockholders or employees in the company. In 38 companies the compensations for supervisory board members are fixed, and 12 companies don’t pay compensation to the board members. Only 8 companies have formed Commissions of the Supervisory/Management board. Control environment: of the 55 analyzed companies, 43 have established a system of internal control, while the position of internal auditor exists in 28 companies. 31 companies have established a risk management system. Publications: in 23 companies financial reports are available on the web site, which is less then 50% of analyzed companies. Independent auditor’s reports can be found at only 21 web 282 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo sites. Regarding the publishing of transaction with concerned parties and information on materially significant events, 28 companies publish these information. Stockholders' rights and protection: payment of dividends in the past 3 years did only 10 companies, while 45 companies did not pay their dividends. On 38 % companies web sites the information about the general assemblies can not be found. Of the 55 of analyzed companies, 41 companies stated that they formally incorporate social responsibility through internal documents. Based on recommendations given in the OECD report from year 2006 and accordance to the newest researches, we can single out some key courses for corporate governance development in Bosnia and Herzegovina:  The companies should strengthen the supervisory board, increase the number of members, insist upon the independence of members, form commissions for the naming of supervisory board members, as well as define compensation policy for the members of the supervisory board  It is necessary for more companies to organize their own control environment in accordance with their own level of risk exposure and to manage risk more intensively  According to OECD principles, companies should publish all significant information such as financial and business company results, the goals of the company, the ownership structure, data on board members and their compensations, as well as their corporate governance policies  Greater the protection of interests of minor shareholders. Shareholders very often do not have at their disposal important information on the business of the company and this impedes upon their security  The access to relevant information has to be simple and timely, and the publishing of data on transactions of connected parties should be strengthened. This research has shown that joint stockholder companies in the Federation of Bosnia and Herzegovina, and the situation being similar in companies in the smaller Bosnian and Herzegovina entity, the Republika Srpska, have not attained significant improvement in the past few years. The reason for the stated problem can be in the misunderstanding of corporate governance principles and the importance of incorporating good corporate governance practices. 5. Conclusion Good corporate governance practice decreases the risk for investors, increases the performance of the company, improves access to capital markets, increases transparency and social responsibility in business. Since the goal of Bosnia and Herzegovina is to get closer to the European Union, companies will have to incorporate corporate governance principles in their business transactions if they wish to be competitive on the international market. Spreading good corporate governance practice implies recognizing the significance and the usefulness of corporate governance for the company as well as for the country itself. Corporate governance is important, for the country, the companies, as well as for society as a whole. Corporate governance leads to the achievement of social wealth, increases competitiveness on the international capital market, leads towards a positive investment climate, and to the long-term development of the economy. Good corporate governance 283 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo practice contributes to the greater transparency of business, better supervision of the company, and therefore its better reputation. For the aim of further promotion of corporate governance, special care should be taken of the greater promotion of good corporate governance practice, greater protection of the interests of minor shareholders, strengthening the role of the supervisory board, greater compliance of entity laws, as well as greater transparency in company's business transactions. In the past years, corporate governance gained more importance, and many studies have shown that the application of good corporate governance practices leads to the greater value of the company and a smaller risk of financing. REFERENCES Ana Bobirca, and Paul-Gabriel Miclaus (2007), Extensiveness and Effectiveness of Corporate, Governance Regulations in South-Eastern Europe. Corporate Governance Country Assessment, Bosnia and Herzegovina, June 2006 , http://www.worldbank.org/ifa/rosc_cg_bih_eng.pdf. Corporate Governance in FBiH – the results of research in 2011., SEE Business Solution d.o.o. Sarajevo , http://conference.capitalmarket.ba/6/prezentacije/Sanja%20Jokic.pdf Corporate Governance Codex SASE ( 2009. ), http:/www.sase.ba and Standards of Corporate Governance BLSE ( 2011 ) http://www.blberza.com Corporate Governance, News in international standards, legislation and practice in Bosnia and Herzegovina (2008 ), Revicon. Dr. Hubertus G. Tschopp ( 2002 ), Corporate governance, The Key to Success of Failure, Boardroom, Magazine of Corporate Governance, Leadership and Quality of Life. Mc Kinsey ( 2000 ), Global investor Opinion Survey on corporate Governance. OECD Principles of corporate governance ( 2001 Edition ). Robert W. McGee ( 2008 ), Corporate Governance in Transition Economies, Springer. White paper on Corporate Governance in South East Europe (2003.), OECD 2003 www.stabilitypackt.org Economic Diplomacy and Business Negotiation- managerial approach Amra Nušinović, Erkan İlgun International Burch University, Faculty of Management, 71000, Sarajevo, Bosnia and Herzegovina. E-mail: amra.nus@gmail.com Abstract Economic Diplomacy explains how states conduct their external economic relations in the 21st century: how they make decisions domestically; how they negotiate internationally; and 284 � Dublin Core The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/. Extent The size or duration of the resource. 1335 Title A name given to the resource Corporate Governance Practices in Bosnia and Herzegovina Author Author Aida , Nušinović Abstract A summary of the resource. The purpose of this paper is to present the state of corporate governance in Bosnia and Herzegovina, to determine the degree of its principle applications, and to emphasize the importance of good corporate governance practices for transition economies, such as Bosnia and Herzegovina. Corporate governance, by its simplest definition, presents a system of management and control over the company. Good corporate governance practice is important for the investment climate, because it provides greater security for investors and shareholders and leads to sustainable long-term economic development. Because of the reorganization of the still present economic system, developing countries are faced with many problems related to the implementation of corporate governance, such as insufficient use of existing legislation, underdeveloped capital markets and insufficient bussiness transparency of the company. Foreign investors do not wish to invest in companies that do not apply the principles of corporate governance and studies have shown that for making investment decisions, the application of good corporate governance practices plays an important role. The problems Bosnia and Herzegovina is facing are still a lack of business transparency of company operations, as well as the insufficient protection of minor shareholders. At the end of this paper certain guidelines are given in order to improve practices of corporate governance in Bosnia and Herzegovina, and also the importance of their application to the company and the country itself is highlighted. Keywords: corporate governance, transition economies, economic development, principles, business transparency Date A point or period of time associated with an event in the lifecycle of the resource 2012-05-31 Keywords Keywords. Conference or Workshop Item PeerReviewed H Social Sciences (General),HB Economic Theory,HG Finance,HJ Public Finance https://omeka.ibu.edu.ba/files/original/790acea8b5889fc8a21f4d5073f010a1.pdf 534a7caff2f5e3a66e428c5e1686c29b PDF Text Text 3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Facilitating Competitiveness and Change in the Global Environment Proceedings. Global Business and Technology Association, pp. 838–844. Available at: http://sari_r2.web.ibu.edu.tr/yayinlarim/Energy%20Soytas_Sari_Ozdemir.pdf. Soytas, U., Sari, R., 2009. Energy consumption, economic growth, and carbon emissions: challenges faced by an EU candidate member. Ecological Economics 68(6), 1667-1675. ''Sustainable Development Projects as Opportunity for Economic Development of Bosnia and Herzegovina'' Ajdin Perčo, Erkan Ilgun International Burch University, Faculty of Economics 71000, Sarajevo, Bosnia and Herzegovina. E-mails: ajdin_tesanj@hotmail.com Abstract The global climate changes as a worldwide phenomena are on the top of the agenda of most states and international organizations. The adverse effects we currently feel and even worst things to come are stressing the need for action and firm resolution of this problem. In this sense, the need for ‘’environment friendly’’ energy is becoming top priority and renewable energy sources are in high demand. Furthermore, many countries are noticing this as a development potential and are investing in this sector. One of these countries is Bosnia and Herzegovina with its unlimited natural resources including wind, water etc. This paper will analyze ongoing and planed projects in the area of renewable energy and economic benefits Bosnia and Herzegovina will experience from it. Furthermore, after the adoption of Kyoto Protocol and creation of state agency Bosnia and Herzegovina is now eligible to apply for CDM (Clean Development Projects). These projects are financed by developed countries and are to be implemented in developing countries. It goes without saying that this is enormous opportunity for Bosnian companies and agencies to apply for these projects and bring foreign investments that will boost domestic economy. Besides this, the journey of Bosnia and Herzegovina towards European Union is requiring various laws to be adopted and implemented. One of these laws are rules and regulations related to the various aspects of climate changes and ways on how to combat climate changes. Financial incentives that European Union is providing to ‘’green energy’’ companies and renewable energy sources are additional motivation for Bosnia and Herzegovina to develop this are furthermore. Thereby in this paper I will address the current issue of climate changes and the need for renewable energy sources. Special focus will be on Bosnia and Herzegovina and the opportunities for economic development available through investing and working on ‘’green energy’’ and renewable energy projects. I will analyze current projects and future planned projects and their impact on economic development of Bosnia and Herzegovina. The focus of the research will be on various documents, projects and analysis currently available for this purpose. The main finding is that Bosnia and Herzegovina is truly a country with great potential for investments in renewable energy projects and the research paper will provide abundance of arguments for this statement. 27 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo Keywords: sustainable development, developing countries, Bosnia and Herzegovina, renewable energy, ‘’green energy’’ projects, economic development, CDM (Clean Development Mechanisms) 1. INTRODUCTION Global climate changes are a long term changes in weather conditions including temperature, rain, wind, level of water etc. According to many scientists and organizations including United Nations Intergovernmental Panel on Climate Change (IPCC) these changes are mainly caused by human actions that include increased level of greenhouse gas emissions. Furthermore, scientists are predicting temperature increase in the range of 1.1 to 6.4 ºC depending on the extent of the current greenhouse gas emission (The Carbon Neutral Company, 2012). Main sources of greenhouse gas emission are fossil fuel burn, industrial processes, waste disposal, and traffic. The emitted gas is contained within Earth’s atmosphere and that way the temperature is increasing and producing adverse effects. At the next stage, these adverse effects will result in the extreme weather conditions, destruction of biodiversity, expansion of desert area, rising sea level, spread of diseases, and possible disappearance of Gulf Stream. It is obvious that the dramatic events will occur unless humanity find new ways to combat climate change problems. One of the solutions offered is the concept of ‘’environment friendly’’ energy that will provide new sources of energy. In the following part, we will briefly examine the various sources of this type of energy. 2. Concept of ‘’Environment Friendly’’ Energy ‘’Environment friendly’’ energy or ‘’green energy’’ is usually considered to be made of the following technologies and processes: biomass, solar energy, hydropower etc. Biomass as a renewable energy source is biological material from living, or recently living organisms (Biomass Energy Centre, 2011). Biomass energy derived from organic substances has been used for thousands of years as from the moment when people started to use wood for cooking and heating. Even today the wood is most important source of biomass energy. However, many other materials including plants, wood industry waste and organic component of industrial scrap are usable for production of biomass energy. Next technology is solar energy has been used since the ancient times through the application of evolving technologies. Solar energy technologies include solar heating, solar photovoltaic, solar thermal electricity and solar architecture, which can make considerable contributions to solving some of the most urgent problems the world now faces (Solar Energy Perspectives: Executive Summary, 2011). Hydropower is mostly associated with the production of electricity through use of energy of falling water. Energy produced this way is called hydroelectricity and it is being produced with the use of dams. Bosnia and Herzegovina did not use its entire hydropower potential since it is using only 40% of available capacity which is low level compare to some other countries. In year 1991 there was 11 small dams which represented only 4,4% of available capacities. However in the last few years there is rapid expansion in building of small dams with hundreds of projects being constructed or waiting for approval. In year 2008, Bosnia and Herzegovina operated with 14 big dams and with several of small dams that generate total 28,3 MW of electricity (Energis, 2010). Finally, wind power is the process of conversion of wind energy into a practical form of energy. This can be done in several ways but mostly used are wind turbines for production of electricity, windmills for mechanical power, and wind pumps for drainage. 28 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo 3. Global Trends in Sustainable Development Projects Investments Sustainable development projects are attracting interests of investors and there has been a steady rise in the funding of these types of projects. The projects being financed include biomass, geothermal and wind generation projects, hydro projects, solar projects, marine energy projects, and biofuel projects. According to analysis conducted by Bloomberg, year 2010 was record setting in the amount of money of $211 billion being invested into sustainable development (Bloomberg New Energy Finance, 2011). These funding were used into various areas including: technology research and development, manufacturing scale up, production etc. Furthermore, striking feature occurring in the couple of last years is the fact that developing countries overtook developed countries in terms of investments. This has been mostly due to China heavily investing into various projects amounting up to $48.9 billion (Bloomberg New Energy Finance, 2011). As time goes on, the interest for sustainable development projects can only increase and attract more investors from both governmental and private sector. 4. THE OVERVIEW OF RENEWABLE DEVELOPMENT PROJECTS IN BIH ENERGY AND SUSTAINABLE 4.1. Hydropower Potential Small dams, along with biomass energy, are currently the most significant source of renewable energy in BiH, and their development should be a priority when defining strategy and policy for the sector of renewable energy. There are various evaluations about the potential of small dams but there are no major differences between them. In the past studies of JP EPBIH (conducted prior to year 1992) the hydro potential of BiH is evaluated around 99.256 HWh/year, technical potential of 23.395 GWh/year, and of which 2.599 GWh/year is related to small dams with installed power of 700 MW that could be achieved by building around 800 small dams with average capacity of 700 MW (Aleksandar Knezevic and Martin Tais ,2007). According to study of EPBiH, technical potential of rivers eligible for small dams construction is around 100 MW or 12.64% of total hydro potential of BiH. According to ADEG, the potential for small dams construction is estimated on 1,004.63 MW or 3.519,74 GWh. Out of this, Federacija of BiH posses 2.090 GWh, and Republika Srpska 1.430 GWh. Also, according to ADEG, a study has been conducted for around 160 locations for small dams, and estimated capacities of those facilities were around 122 MW, which is 552 GWh of electric power (Aleksandar Knezevic and Martin Tais ,2007). 4.2. Biomass energy potential The most significant source of biomass for the purpose of energy production is a wood and related waste produced in lumber industry. However, remaining of biomass from agriculture also represent a substantial energy potential especially in the regions of northern, central, and southern Bosnia and Herzegovina. Prior to year 1991, big companies from lumber industry used wooden waste to produce steam within their own facilities and using available technology. However, these facilities are now outdated and they run business creating huge losses, or are completely shut down. The most detailed analysis has been done through EU/FP6/INCO/ADEG project, and in the table below we can see the results (57% of the potential is related to Federacija BiH, while 43% to Republika Srpska). Besides this evaluation, it is worth of noting that assessment for the waste solely from lumber industry are around 4,45 mil.m3 (Aleksandar Knezevic and Martin Tais ,2007). However it must be noted 29 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo that none of the evaluations clearly defined what kind of potential is being described, whether it is theoretical, technical, economic, or ecological potential. 4.3. Solar energy potential Bosnia and Herzegovina on average has around 1840.9 solar hours, while on the south that value is even higher and is around 2352.5 h/y. Theoretical potential for solar energy in BiH is around 74.65 PWh which is 1.25 greater than the total of primary energy necessary for Federacija BiH. Bosnia and Herzegovina is country with favorable conditions when it comes to radiation of sun heating. According to available data, the sun is annually transmitting 1,250 kWh of energy in northern Bosnia, and 1,600 kWh energy in southern Bosnia. It is reasonable to claim, considering the declining costs, that number of installed solar panels in BiH by ear 2015 could reach the area of 50 000 m2. This capacity could annually produce around 33 GWh of solar energy. 5. CDM Projects in Bosnia and Herzegovina The view that human activities have resulted in global climate changes is supported by current scientific thinking (NRC, 2011). From the onset of industrial revolution till the present days of mass production, the damage to environment that industry caused has been immense. Since the level of climate change has reached dangerous level, it was of utmost importance to address issue on a global scale. At this point, The United Nations Framework Convention on Climate Change has been produced in 1992, and Kyoto Protocol subsequently adopted in 1997. Beside national laws, Kyoto Protocol established market based mechanisms to combat the climate changes. Those measures include the following: Emission trading Clean Development Mechanism (CDM) Joint Implementation (JI) We will focus on Clean Development Mechanism which is allowing Annex I countries to meet their target by investing globally into emission reduction projects. Through this mechanism the Kyoto Protocol is offering industrialized countries cost-effective way of reducing their emission and it benefits developing countries with new investments, and thereby CDM is ‘’important instrument in fight against climate change’’(Schneider, 2007) CDM projects can earn credits, so called CER (Certified Emission Reduction), where each credit is equivalent to one tone of CO2. Credits can then be sold to contracted parties within Annex B of Kyoto Protocol. In order for project to earn CER, it must present verified analysis that will prove that the carbon emission reduction occurred, its proven and that the project is solely responsible for that reduction. Bosnia and Herzegovina ratified UNFCCC on May 17, 2000. The Kyoto Protocol was ratified on April 22, 2007, after lengthy procedure that included ratification of agreement by various state levels. But due to complicated procedures, BiH constituted Designated National Authority only in September, 2011. Because of this delay the country missed investments worth in millions of Euros that were part of Clean Development Mechanism (CDM). Head of UNDP Regional Office in Banja Luka stated that ‘’the establishment of the DNA enabled Bosnia and Herzegovina to start implementing the CDM projects of about EUR 400 million 30 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo worth investments’’ (UNDP, 2011). Since Bosnia is non-Annex I country it is thereby eligible to receive investments that are to reduce carbon emission, but has no any obligations to reduce level of emission. The economic benefits would be worthy as it would boost economy and create additional jobs. Furthermore, Bosnia has a great potential in renewable energy sources including wing and solar energy. The region of Hercegovina is especially favorable to renewable energy projects and by developing high quality CDM projects, Bosnian companies have chance of attracting foreign investments. 6. Activities of EU and other international organizations The biggest challenge of the modern era both globally and more profoundly in EU is the issue of climate change, growing dependence on energy import, and restriction on free access to energy resources. European Union prepared and is currently implementing ambitions energy policy – the one that includes full spectrum of energy sources ranging from fossil fuel, nuclear energy, and renewable energy (solar, wind power, biomass, geothermal energy, hydro power)aimed at starting new industrial revolution that will create economy with lower energy needs. Bosnia and Herzegovina is clearly oriented toward EU integration. Led mostly by its participation in The Energy Community Treaty for South Eastern Europe, BiH made some important steps in adjusting its energy system and market mechanisms to the international standards listed in international treaties, policies and best practices. Beside ECT SEE which also includes signing certain EU rules for energy sector, BiH signed Stabilization and Association Agreement (SAA) with EU, Energy Charter Treaty (ECT) and Protocol on Energy Efficiency and Related Environmental Aspects (PEEREA), ratified Kyoto Protocol, as well as many other international treaties. Those other treaties and projects include cooperation with Instrument for Pre-Accession Assistance (IPA) funds, UNDP, World Bank, EBRD, KfW, bilateral projects of technical assistance etc. Another influential international organization that is playing its part in BiH when it comes to sustainable development and renewable energy projects is GEF (Global Environmental Facility). GEF has been founded in 1991 as a international financial mechanism for financial and technical help to the developing countries with the aim of helping them achieve international treaties they signed. Bosnia and Herzegovina is also participating in GEF, and the following projects are currently being implemented: ''National Capacity Self Assessment for Global Environmental Management’’, ‘’Promoting Energy Efficiency in Buildings’’, ‘’BiH Biomass Energy for Employment and Energy Security Project’’, and ‘’Preparation of the Initial National Communication the United Nations Framework Convention on Climate Change – UNFCCC’’. 7. CONCLUSION As presented through this paper, the renewable energy projects and sustainable developments have truly a great potential for economic development of Bosnia and Herzegovina. Through the development of different kind of green energy, participation in CDM Projects, and partnership with EU, Bosnia and Herzegovina can truly develop its economy and create new jobs. Nevertheless, it is important to note that the country still did not use even the smallest available potential in this area and there is still a long way ahead. But the prospects for the future are good and look promising. In the coming period there will be a need for greater involvement of state in this sector. The modern laws harmonized with EU regulations will be 31 �3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo key in enabling Bosnia to attract foreign investments in this sector. Furthermore, NGOs and governmental agencies will need to educate themselves in order to be able to apply for various funds available in EU. Hundreds of millions of euros are available, but the projects proposal must be of high quality and skillful people are key in bidding for these funds. Overall, Bosnia and Herzegovina must continue the same way but should accelerate reforms and adjust its market to more easily accommodate foreign investments in green energy and sustainable development sector. REFERENCES 1. NRC (2001). Climate Change Science: An Analysis of Some Key Questions, National Academy Press, Washington, D.C., U.S.A. 2. Aleksandar Knezevic and Martin Tais (2007) Energetska efikasnost i obnovljivi izvori energije, Prioriteti energetske strategije u BiH, Fondacija Heinrich Boll, p 91,92,93. URL http://www.boell.ba/downloads/energetska_efikasnost_i_obnovljivi_izvori_energije_final.pdf , retrieved on April 23, 2012 3. Schneider, L. (2007), An evaluation of the CDM and options for improvement, URL http://wwf.panda.org/what_we_do/footprint/climate_carbon_energy/energy_solutions/resourc es/?118000/An-evaluation-of-the-CDM-and-options-for-improvement , retrieved on February 12, 2012 4. Energis (2010) Hydropower, URL http://energis.ba/?lang=bh&n1=3&n2=17&n3=0&c=16 , retrieved on February 2, 2012 5. Biomass Energy Centre (2011) What is biomass?, URL http://www.biomassenergycentre.org.uk/portal/page?_pageid=76,15049&_dad=portal&_sche ma=PORTAL retrieved on March 10, 2012 6. International Energy Agency (2011) Solar Energy Perspectives: Executive Summary, URL http://www.webcitation.org/63fIHKr1S , retrieved on January 15, 2012 7. Bloomberg New Energy Finance (2011) Global Trends in Renewable Energy Investment, 5, ISBN: 978-92-807-3183-5 8. UNDP (2011), Clean Development Mechanism Projects – Pathway to New Investments in BiH, URL http://www.undp.ba/index.aspx?PID=7&RID=723 , retrieved on January 18, 2012 9. The Carbon Neutral Company (2012) Climate change summary, URL http://www.carbonneutral.com/knowledge-centre/climate-change-summary/ , retrieved on February 25, 2012 The Relationship Between Tax Revenue And Economic Growth In Turkey: The Period Of 1975-2011 Yeşim Helhel,Yakup Demir Akdeniz University, Tourism Faculty, Antalya, TR Abstract In the study, the relationship between tax revenues and economic growth for the Turkish economy has been examined in the period of 1975-2011. Johansen Juselious cointegration test 32 � Dublin Core The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/. Extent The size or duration of the resource. 1310 Title A name given to the resource Sustainable Development Projects as Opportunity for Economic Development of Bosnia and Herzegovina Author Author Ajdin , Perčo ERGÜN, Uğur Abstract A summary of the resource. The global climate changes as a worldwide phenomena are on the top of the agenda of most states and international organizations. The adverse effects we currently feel and even worst things to come are stressing the need for action and firm resolution of this problem. In this sense, the need for ‘’environment friendly’’ energy is becoming top priority and renewable energy sources are in high demand. Furthermore, many countries are noticing this as a development potential and are investing in this sector. One of these countries is Bosnia and Herzegovina with its unlimited natural resources including wind, water etc. This paper will analyze ongoing and planed projects in the area of renewable energy and economic benefits Bosnia and Herzegovina will experience from it. Furthermore, after the adoption of Kyoto Protocol and creation of state agency Bosnia and Herzegovina is now eligible to apply for CDM (Clean Development Projects). These projects are financed by developed countries and are to be implemented in developing countries. It goes without saying that this is enormous opportunity for Bosnian companies and agencies to apply for these projects and bring foreign investments that will boost domestic economy. Besides this, the journey of Bosnia and Herzegovina towards European Union is requiring various laws to be adopted and implemented. One of these laws are rules and regulations related to the various aspects of climate changes and ways on how to combat climate changes. Financial incentives that European Union is providing to ‘’green energy’’ companies and renewable energy sources are additional motivation for Bosnia and Herzegovina to develop this are furthermore. Thereby in this paper I will address the current issue of climate changes and the need for renewable energy sources. Special focus will be on Bosnia and Herzegovina and the opportunities for economic development available through investing and working on ‘’green energy’’ and renewable energy projects. I will analyze current projects and future planned projects and their impact on economic development of Bosnia and Herzegovina. The focus of the research will be on various documents, projects and analysis currently available for this purpose. The main finding is that Bosnia and Herzegovina is truly a country with great potential for investments in renewable energy projects and the research paper will provide abundance of arguments for this statement. Date A point or period of time associated with an event in the lifecycle of the resource 2012-05-31 Keywords Keywords. Conference or Workshop Item PeerReviewed H Social Sciences (General),HB Economic Theory,HG Finance,HJ Public Finance