Journal articles on the topic 'Firms'
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Min, Heechul. "Importing and Firm Productivity: Evidence from Korean Manufacturing Firms." Journal of Korea Trade 26, no. 3 (May 30, 2022): 102–16. http://dx.doi.org/10.35611/jkt.2022.26.3.102.
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Purpose - This paper empirically investigates the relationship between firm productivity and importing intermediate inputs in the Korean manufacturing sector.
Design/methodology - This paper tests the two related hypotheses on the relationship between importing and productivity for a sample of Korean manufacturing firms. We test the self-selection hypothesis by comparing pre-entry levels of productivity between importers and non-importers. We test the learning-by-importing hypothesis by employing propensity score matching with differencein- differences approach.
Findings - Future importers are more productive than future non-importers years before they start to import, which supports the self-selection hypothesis. In contrast, there is no strong evidence for learning-by-importing.
Originality/value - This paper is the first study to explore the relationship between importing and firm-level productivity for Korean firms. The results have an important implication on trade policies to lower or raise trade barriers in imported inputs.
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Verdu, Fabiane Cortez, and Fabio Aurélio De Mario. "Análise do Modelo ECD na Indústria de Oficinas Mecânicas em Foz do Iguaçu." Revista de Ciências Jurídicas e Empresariais 19, no. 2 (December 30, 2018): 124–31. http://dx.doi.org/10.17921/2448-2129.2018v19n2p124-131.
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O objetivo deste artigo é caracterizar a conduta estratégica das oficinas mecânicas, dado o contexto de estrutura de mercado em que estão inseridas sob a ótica do Paradigma Estrutura-Conduta-Desempenho (ECD). Para tanto, a metodologia empregada foi qualitativa, por meio de estudo de caso e o método de coleta ocorreu por entrevista com roteiro semiestruturado com um proprietário de uma firma em Foz do Iguaçu. Os resultados demonstram que, na percepção do proprietário da firma, existe uma competição no segmento, em alguns casos esta competição chega a ser desleal com as demais firmas do setor, uma vez que os incentivos do governo, praticamente, são nulos, enquanto que suas ações como redução de impostos e incentivos são prejudiciais às firmas do setor, pois possibilitam a troca de veículos de forma mais fácil ao consumidor, diminuindo a demanda das oficinas mecânicas. A mudança tecnológica dos componentes dos veículos também afeta a estrutura de mercado e, assim, exige com que as firmas se atualizem, comprometendo consequentemente o desempenho de oficinas, especialmente, das menores. Palavras-chave:Organização Industrial. Paradigma ECD. Estrutura de Mercado. Estratégias. Oficinas.AbstractThe purpose of this article is to characterize the strategic conduct of garages, given the market structure of the context in which they operate from the perspective of Paradigm Structure-Conduct-Performance (SCP). Therefore, the methodology used was qualitative, through case study and the collection method occurred with semi-structured interview script with an owner of a firm in Foz do Iguaçu. The results show that under the perception of the firm's owner, there is competition in the segment, in some cases even being unfair to other firms in the sector; government incentives, are practically void, while their actions as tax cuts and incentives are harmful to firms in the sector, as they allow the exchange of easier consumer form of vehicles, reducing the demand for garages. Technological change of vehicle components also affects the market structure and thus influences how firms also update thus compromising the firm’s performance, especially the smallest ones. Keywords: Industrial Organization. Paradigm SCP. Market Structure. Strategies. Garages.
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Mohamad, Shafi, Abdurrahman Adamu Pantamee, Ooi Chee Keong, and Kwong Wing Chong Garrett. "Corporate Governance and Firm Performance: Evidence from Listed Malaysian Firms." International Journal of Psychosocial Rehabilitation 24, no. 02 (February 13, 2020): 3668–78. http://dx.doi.org/10.37200/ijpr/v24i2/pr200690.
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Agyemang-Mintah, Peter. "Remuneration Committee governance and firm performance in UK financial firms." Investment Management and Financial Innovations 13, no. 1 (April 8, 2016): 176–90. http://dx.doi.org/10.21511/imfi.13(1-1).2016.05.
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This paper investigates the association between the Remuneration Committee (RC) on firm performance. The research uses a data span of 63 financial institutions for a period of 12 years. Ordinary Least Square (OLS) and Random Effects (RE) regression estimations are used. The ascertained empirical results indicate that the establishment of remuneration committee by the board is positively correlated to its performance, as measured by its Return on Assets (ROA), and is also statistically significant on the Market Value (MV) of the firm. Subsequent tests conducted show that presence of an RC had a positive and statistically significant correlation during the pre/post global financial crisis on the ROA of the firm. The MV measure during the pre-crisis indicates a positive and statistically significant impact, but only positive during the post-crisis. The findings are robust across econometric models that control for different types of endogeneity. The outcome indicates that the establishment of an RC by the board assisted in achieving a positive impact on the profitability of UK financial institutions
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Hoang, Nguyen. "EVALUATING FIRM PERFORMANCE: EVIDENCE FROM FOOD FIRMS LISTED ON THE HANOI STOCK EXCHANGE." International Journal of Economics Finance & Management Science 08, no. 06 (June 1, 2023): 01–05. http://dx.doi.org/10.55640/ijefms-9125.
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This article aims to evaluate the performance of food firms listed on the Hanoi Stock Exchange. By examining various financial indicators and performance measures, the study provides valuable insights into the financial health and operational efficiency of these firms. The analysis utilizes a sample of food firms over a specified time period and employs statistical techniques to assess their performance. The findings shed light on the strengths, weaknesses, and overall performance of food firms in the Hanoi Stock Exchange, offering valuable information for investors, policymakers, and stakeholders in the food industry.
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Mitani, Hidetaka. "Predation risk, market power and cash policy." Managerial Finance 46, no. 7 (May 22, 2020): 897–911. http://dx.doi.org/10.1108/mf-05-2019-0222.
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PurposeThe purpose of the present study is to discuss the combined effect of predation risk and firms' market power on cash holdings.Design/methodology/approachThe authors tested hypotheses by using consolidated financial data in Japanese firms.FindingsThe authors find that firms' cash holdings increase with a rise in predation risk faced by firms. However, the higher the firm's market power, the weaker the above interplay becomes. Moreover, the authors find that even when firms' investments are decreased at the industry level, firms with larger cash holdings seek to mitigate predation risk by funding strategic investments with the potential to steal rivals' market share.Originality/valueThe authors recognize the importance of a firm's market power. Take a firm's market power into consideration to analyze the mechanism of a firm's cash holdings, there is a possibility that the mechanism of a firm's cash holdings as presented by the previous studies will be changed.
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Cho, Hyunkwon, and Volkan Muslu. "How Do Firms Change Investments Based on MD&A Disclosures of Peer Firms?" Accounting Review 96, no. 2 (May 22, 2020): 177–204. http://dx.doi.org/10.2308/tar-2017-0646.
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ABSTRACT We show that a firm's one-year-ahead capital investments and inventory increase (decrease) when peer firms' Management Discussion and Analysis (MD&A) narratives become more optimistic (pessimistic). This finding is driven by firms that access peer firms' 10-K filings within seven days of their filing date, and remains after controlling for other determinants of a firm's investments as well as economic connections between the firm and peer firms. Moreover, a firm's investment response varies based on content in peer firms' MD&A narratives. For instance, a firm makes more (less) capital investments when peer firms become more optimistic in their narratives that discuss the industry and investments (competition). Our findings provide broad insights on the information content and proprietary costs of MD&A disclosures. Data Availability: All non-textual data are available from sources identified in the text. Textual data generated by this study are available upon request. JEL Classifications: L1; D25.
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Novita, Santi, Bambang Tjahjadi, and Andry Irwanto. "Industry and Financial Crises in Fragile and Zombie Firms: Does Leverage Matter?" Journal of Business and Economics Review (JBER) Vol.3(3) Jul-Sep 2018 3, no. 3 (September 30, 2018): 51–58. http://dx.doi.org/10.35609/jber.2018.3.3(2).
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Objective - This paper shows how leverage affects firm's fragility and financial soundness during financial and industry crises. Methodology/Technique - Long term inefficient and zombie firms are explored through the effects of leverage in additional tests. Findings - There are two main results obtained from the sample of Indonesian non-financial firms from 2007 to 2016. First, leverage has a statistically significant correlation with firm's fragility. Second, leverage has an effect on firm's financial soundness during industry crisis. Novelty - Unlike the previous paper, this paper demonstrates a significant implication on the need to differentiate fragile firms and firms that are persistently inefficient, such as zombie firms. Type of Paper: Empirical. Keywords: Fragility; Zombie; Financial Soundness; Leverage; Industry Crisis; Financial Crisis. JEL Classification: M20, M41.
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Chen, Changling, Jee-Hae Lim, and Theophanis C. Stratopoulos. "IT Capability and a Firm's Ability to Recover from Losses: Evidence from the Economic Downturn of the Early 2000s." Journal of Information Systems 25, no. 2 (November 1, 2011): 117–44. http://dx.doi.org/10.2308/isys-10108.
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ABSTRACT Prior literature shows that during an economic downturn firms have difficulty sustaining superior performance, and a larger percentage of firms report losses. Motivated by this literature, we explore the role of sustainability of organizational IT capability (ITC) on a firm's performance during an economic downturn. Specifically, we examine how ITC sustainability contributes to a firm's ability to recover from losses. ITC sustainability reflects a firm's ability to resist competitors' attempts to imitate or improve on its ITC. We use ITC sustainability to classify firms as sustainable (Systematic ITC), as non-sustainable (Occasional ITC), and as having no ITC (Non-ITC). Using a sample of large U.S. firms during the economic downturn of the early 2000s, we show that Systematic ITC firms achieve higher levels of firm-specific abnormal earnings and are capable of faster recovery when compared to all competitors (Occasional ITC and Non-ITC firms) and competitors with only Occasional ITC.
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Srinivasan, Suraj, Aida Sijamic Wahid, and Gwen Yu. "Admitting Mistakes: Home Country Effect on the Reliability of Restatement Reporting." Accounting Review 90, no. 3 (August 1, 2014): 1201–40. http://dx.doi.org/10.2308/accr-50887.
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ABSTRACT We study the frequency of restatements by foreign firms listed on U.S. exchanges. We find that the restatement rate of U.S.-listed foreign firms is significantly lower than that of comparable U.S. firms and that the difference depends on the firm's home country characteristics. Foreign firms from countries with a weak rule of law are less likely to restate than are firms from strong rule of law countries. While the lower rate of restatements can represent an absence of errors, it can also indicate a lack of detection and disclosure of errors and irregularities. We infer the effect of detection and disclosure by associating the frequency of restatements with the quality of the firm's internal control system. We find that only U.S. firms and foreign firms from strong rule of law countries show a positive association between restatement frequency and internal control weaknesses. Firms from weak rule of law countries show no significant association. We interpret these findings as home country enforcement affecting firms' likelihood of detecting and reporting existing accounting misstatements. This suggests that for U.S.-listed foreign firms, less frequent restatements can be a signal of opportunistic reporting rather than a lack of accounting errors and irregularities.
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Neely, Andy, and Jasper Hii. "The Innovative Capacity of Firms." Nang Yan Business Journal 1, no. 1 (November 20, 2014): 47–53. http://dx.doi.org/10.2478/nybj-2014-0007.
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Abstract Innovation is widely accepted as a crucial competitive weapon in today's global market place. Yet the levels of innovation achieved by different firms, even within the same industry, can vary widely. The key question raised by this observation is why. Why are some firms more innovative than others? What are the factors that determine a firm's capacity to innovate and how can these be managed to enhance the firm's innovative potential? This paper sets out to address these and related issues. It reports the results of a study of competitiveness and innovation of firms in the East of England. In the paper it is argued that the innovative capacity of a firm is a function of the firm's culture, resources, competences and networks. Justification for this framework is provided by a review of the relevant literature and a series of case studies examining the capacity to innovate of a sample of firms in the East of England.
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Chen, Miao-Ling, Chi-Lu Peng, and An-Pin Wei. "ADVERTISING, RESEARCH AND DEVELOPMENT, AND CAPITAL MARKET RISK: HIGHER RISK FIRMS VERSUS LOWER RISK FIRMS." Journal of Business Economics and Management 13, no. 4 (September 17, 2012): 724–44. http://dx.doi.org/10.3846/16111699.2012.666998.
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This study examines how a firm's advertising and R&D affects the firm's β-risk and idiosyncratic risk, which are metrics of interest to both finance executives and senior management. Due to the existence of a non-normal and heteroscedasticity dataset, we use quantile regression to analyze the sample to understand the full behavior of our non-normally distributed datapoints. The evidence of this study shows that: (1) Advertising is significantly associated with lower β-risk for firms with lower, median and higher β-risk. (2) R&D significantly increases β-risk for firms with median and higher β-risk firms. (3) Advertising is significantly associated with lower idiosyncratic risk for firms with higher idiosyncratic risk. (4) R&D is significantly associated with higher idiosyncratic risk for firms with median and higher idiosyncratic risk. In summary, our evidence shows that both advertising and R&D have a stronger effect on firms with higher β- and idiosyncratic risk than on those with lower β- and idiosyncratic risk, respectively. Our findings are useful to help both management executives and investors. Firm managers can allocate limited resources more efficiently to reduce their firm risk; investors could exert their influence on firm's senior executives to make decisions that are beneficial to stock returns.
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Park, Sang Cheol, Gee-Woo BocK, Won Jun Lee, and Cheng Zhang. "Organizational and Relational Resources in IOS Diffusion." Journal of Global Information Management 22, no. 3 (July 2014): 1–31. http://dx.doi.org/10.4018/jgim.2014070101.
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This research addresses the theoretically neglected question of how the internal diffusion of inter-organizational systems (IOS) into a firm's activities and its external diffusion into the supply chain partners influence performance improvement. Drawing on the resource-based view, our research model posits that organizational and relational resources affect both internal and external diffusion, which in turn, influence performance improvement. Survey results from 187 managers in Korean and Chinese firms showed that while the impact of organizational resources on a firm's performance improvement was fully mediated by IOS diffusion, the diffusion partially mediates the impact of relational resources on performance improvement. This study also revealed a significantly different pattern of diffusion between Korean and Chinese firms, i.e. showing the impact of organizational and relational resources on a firm's performance through external diffusion of IOS are significantly greater in Korean firms, while the impact of internal diffusion was significantly greater in Chinese firms. In other words, Korean firms tend to externally diffuse IOS toward their business partners, while Chinese firms tend to internally diffuse IOS by deploying IOS from their partners. The implications of these findings for both research and practice are discussed.
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Vidya Bai, G., Daniel Frank, and K. Sudhir Prabhu. "Does ESG disclosure enhance firm performance during COVID-19? Evidence from Nifty 500 firms." Investment Management and Financial Innovations 21, no. 3 (July 19, 2024): 74–83. http://dx.doi.org/10.21511/imfi.21(3).2024.07.
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Market turmoil caused by COVID-19 has weakened firms’ financial performance, highlighting the prominence of sustainable business practices by incorporating Environmental, Social, and Governance performance and their disclosure. Though past studies investigated COVID-19’s impact on firm performance, there is consensus on the role of firms’ Environmental, Social, and Governance disclosures between firm performance and the pandemic. With this view, the study aims to examine the impact of COVID-19 on firms’ financial performance with the moderating role of Environmental, Social, and Governance performance disclosure. To do so, the study retrieved data of Nifty 500 index companies from the Bloomberg database for a sample period ranging from 2016 to 2022. To this end, the study performed the fixed-effect regression and GMM model. The findings reveal a significant negative impact of the pandemic on Return on Assets (β =-4.812), Return on Equity (β =–.675), and Earnings Per Share (β = –2.875), highlighting the unfavorable effect of the pandemic on firm performance. Further results showed that firms’ Environmental, Social, and Governance performance disclosure positively moderates the connection between COVID-19 and Return on Assets (β = 3.231), Return on Equity (β = 0.032), and Earnings Per Share (β = 1.523), respectively. This indicates that companies actively involved in Environmental, Social, and Governance disclosure are less likely to suffer during the pandemic in terms of financial performance due to their ESG disclosures.
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Lin, Bingxuan, and Chen-Miao Lin. "Asymmetric Information and Corporate Risk Management by Using Foreign Currency Derivatives." Review of Pacific Basin Financial Markets and Policies 15, no. 01 (March 2012): 1250004. http://dx.doi.org/10.1142/s0219091511500068.
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We examine how information asymmetry affects a firm's incentive to hedge versus speculate by using foreign currency derivatives. We find a quadratic relation between asymmetric information and a firm's risk management activities. In particular, we find that the firms facing medium level of information asymmetry are more likely to hedge, while firms with very high and low levels of asymmetric information tend to speculate. Moreover, we find that our results hold primary for firms operating in highly competitive industries.
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Chen, Huipeng. "ESG and Leverage Adjustment: Based on Stakeholder Theory and Signaling Theory." Advances in Economics, Management and Political Sciences 72, no. 1 (May 24, 2024): 82–91. http://dx.doi.org/10.54254/2754-1169/72/20240689.
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Many of today's firms are suffering from leverage imbalance. A company's debt can negatively impact its performance when it deviates from its target leverage. Thus, this paper discusses adjusting the firm's capital structure to an optimal one. Combining stakeholder theory and signaling theory, this paper discusses how and under what circumstances ESG may have an impact on capital structure, from which the paper proposes the following conjectures: whether ESG can have a significant impact on a firm's target leverage; how ESG can affect a firm's capital structure when the firm has an asymmetry of information; and whether ESG can be tailored to economic environments that can have an impact on a firm's capital structure changes have an effect. After the inference of this paper, ESG can effectively influence firms' capital structure and accelerate the adjustment speed of firms' leverage to target leverage under the state of firms' information transparency. ESG will be more effective in regulating firms' target leverage in the downturn of the economic environment. The analytical framework of this paper may also be effectively applied to other research directions, such as corporate investment decisions, cash holdings, and dividend policies.
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Singh, Shaili, and Mahua Guha. "Peer Effect on Corporate Social Responsibility." International Journal of Strategic Decision Sciences 10, no. 3 (July 2019): 114–30. http://dx.doi.org/10.4018/ijsds.2019070107.
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This study explores a firm's response to institutional pressure from industry peers on their Social community spending. Social community spending is symbolic of the fulfillment of a firm's corporate social responsibility (CSR). The authors hypothesize that mimetic isomorphism occurs among firms in an industry and organizational characteristics, i.e., business group affiliation, ownership status (state-owned versus private), and firm size strengthen or weaken the influence of industry peers. The authors test the propositions on a pooled time-series cross-sectional data of firms in India, with 3,307 observations from 2009-2017 using Generalized Least Squares (GLS) random-effects model. The findings suggest industry peers have a positive influence on a firm's SCS, and this effect is stronger for state-owned enterprises and large firms and weaker for a business group affiliated firms which further aggravates with group size. This article establishes the positive role of the industry association in driving its member firm's SCS and offers an understanding of the contingencies in the above relationship.
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Amir, Eli, and Elizabeth A. Gordon. "Firms' Choice of Estimation Parameters: Empirical Evidence from SFAS No. 106." Journal of Accounting, Auditing & Finance 11, no. 3 (July 1996): 427–48. http://dx.doi.org/10.1177/0148558x9601100311.
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This study explains the cross-sectional variation in firms' selected assumptions (discount rates and health care cost trend rates) used to measure the obligation for postretirement benefits other than pensions (PRB) under SFAS No. 106. Our aim is to examine whether managements manage the reported PRB by choosing either too conservative or too aggressive estimation parameters. In addition, we examine whether investors value the firm's equity based on the cross-section median parameters or based on each firm's selected parameters. We find that firms with relatively larger PRB obligation and more leverage tend to select more aggressive (obligation-reducing) estimation parameters. We also find that firms that amended their PRB plans and firms with extreme earnings-price ratios tend to select more conservative (obligation-increasing) estimation parameters. Finally, we find that investors value the firm's equity using reported rather than adjusted estimation parameters.
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Puffal, Daniel Pedro, and Rafael Teixeira. "Effects of University-Industry Interaction on Firm’s Innovation: Empirical Evidence from Brazilian Firms." Revista Ibero-Americana de Estratégia 13, no. 01 (March 1, 2014): 07–21. http://dx.doi.org/10.5585/riae.v13i1.1884.
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Ramadan, Imad Zeyad. "Panel Data Approach of the Firm’s Value Determinants: Evidence from the Jordanian Industrial Firms." Modern Applied Science 10, no. 5 (April 2, 2016): 163. http://dx.doi.org/10.5539/mas.v10n5p163.
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<p class="zhengwen">This study aimed to investigate the main determinants of the industrial firms' value in developing countries namely Jordan. To achieve this goal all 77 ASE listed industrial firms for the period from 2000 to 2014 were utilized resulting in 974 firm-year observations. Twelve firm specific variables, namely, firm's size; firm's age; firm's risk level; firm's sales revenue; firm's operating cost; firm's tax rate; firm's net margin; firm's capital expenditure; firm's book value; firm's earning per share; firm's dividend per share and firm's pay-out ratio, were tested as a possible determinates of the firm's value. After testing for Multicollinearity and Heteroscedasticity the result of the unbalanced panel data Multi-regression model approach shows that the joint effect of the twelve potential determinants interprets about 37% of the variation in the value of the Jordanian industrial firms listed at ASE (R-squares = 0.3682), therefore, firm's in developing countries like Jordan should concentrate on these specific variables of the firms in order to improve the value and thus the wealth of the shareholders<strong>. </strong></p>Another finding of the study is that the firm's risk level and tax rate are not statistically significant drivers of the Jordanian industrial firm's value. The findings of the effect of firm's risk level and tax rate on the firm's value were contrary with Tiwari Ranjit et al (2015) and Rappaport (1998) respectively.
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Alves, Juliana Dias, and Mauro Sayar Ferreira. "Multiproduct Firms, Firm Dynamics, and the Productive Mix of Brazilian Manufacturing Firms." Estudos Econômicos (São Paulo) 48, no. 3 (September 2018): 349–89. http://dx.doi.org/10.1590/0101-41614831jam.
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Abstract This paper studies the Brazilian manufacturing sector in line with the literature on heterogeneous firm. We focus i) on the characteristics of firms that are multi-product (MP), multi-sector and multi-industry; and ii) on the analysis of their scope, including the determinants of product switching, behavior over business cycle, and relation with several firm's characteristics. MP corresponds to 37% of all manufacturing firms, but generates 81% of the output. They employ more workers, are more likely to be exporters, have higher labor productivity and higher TFP. The extensive margin due to adding and retirement of products contributes more to output growth than entry and exit of firms. All margins are positive correlated to GDP growth: the intensive margin has an almost perfect correlation, followed by the product margin, with values around 0.91, and then by firm's margin, with correlations around 0.60. When restricting the study to continuing firms, it was found that half of the annual output growth (from 2005 to 2009) was originated by firms that switched products. Those that have net added (dropped) items had higher (smaller) increase in output, in employees, and in the TFP. Having higher TFP, more employees, or being an exporter increase the probability of only adding or only dropping items in the future.
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Xu, Howard, Savannah (Yuanyaun) Guo, Jacob Z. Haislip, and Robert E. Pinsker. "Earnings Management in Firms with Data Security Breaches." Journal of Information Systems 33, no. 3 (July 1, 2019): 267–84. http://dx.doi.org/10.2308/isys-52480.
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ABSTRACT Anecdotal research suggests that management is concerned about how Data Security Breaches (DSBs) impact a firm's financial performance. We investigate: whether managers in DSB firms manipulate earnings through real earnings management (REM) and/or accrual-based earnings management (AEM); how breach type, disclosure delay, and external monitoring impact earnings management activities; and how earnings management activities influence a DSB firm's performance. Using a propensity score matched sample, results suggest that DSB firms are more likely to manipulate earnings via REM, but not AEM. Additionally, we find that DSB firms engage in REM through cutting discretionary expenses, decreasing discretionary cash spending, and reducing the cost of goods sold through overproduction. We find some evidence that firms are more likely to increase REM when DSBs involve financial information or when firms delay the DSB disclosure or have low analyst coverage. We provide evidence that REM activities lead to lower subsequent performance in DSB firms. Data Availability: The data used are publicly available from the sources cited in the text.
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Kafchehi, Parviz, Kaveh Hasani, and Arman Gholami. "The Relationship between Innovation Orientation and Strategic Typology in Business Firms." International Journal of Knowledge-Based Organizations 6, no. 2 (April 2016): 1–20. http://dx.doi.org/10.4018/ijkbo.2016040101.
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The aim of this study is to investigate the relationship between innovation orientation and strategic typology in firms such a way that a classification on the organization's orientation toward innovation and strategy could be obtained. The statistical population includes high executive managers of firms who have been acting in 4 industries of banking (B), food (F), insurance (I), and pharmacy (P), and have been the five pioneering firms in these industries. To test the hypothesis, the mean test analysis, the Goodness- of- Fit- Test, Chi- square test, and cross- tables were used and tested by SPSS18 software. The results show that there is a significant relationship between the firm's orientation toward innovation and competitive strategy; the more firm's orientation toward innovation, the firms uses more Prospector strategy, and their strategies have a more aggressive state. This paper provides a richer understanding of innovation orientation and strategic typology formation for similar firms.
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Han, Kyuhong, Vikas Mittal, and Yan Zhang. "Relative Strategic Emphasis and Firm-Idiosyncratic Risk: The Moderating Role of Relative Performance and Demand Instability." Journal of Marketing 81, no. 4 (July 2017): 25–44. http://dx.doi.org/10.1509/jm.15.0509.
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Firms may allocate scarce resources to two fundamental strategic processes: value creation and value appropriation. The relative investment in these processes (i.e., a firm's relative strategic emphasis) may be associated with firm-idiosyncratic risk. Empirically, a firm's relative strategic emphasis is represented by the difference between its advertising expenditure and its research-and-development expenditure. Using data from 2,403 firms over the period of 2000–2014, the authors find that firms’ relative strategic emphasis on value appropriation versus value creation reduces firm risk, though in a contingent manner. This association is weaker when firms have larger positive or negative relative performance. Furthermore, these contingent associations are stronger when demand instability in an industry is higher. Overall, the results demonstrate that a firm's strategic emphasis should be examined in light of its relative performance, as well as in the context of current market conditions, when making judicious resource allocation decisions.
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Simpson, Dayna, and Robert Sroufe. "Stakeholders, reward expectations and firms’ use of the ISO14001 management standard." International Journal of Operations & Production Management 34, no. 7 (July 1, 2014): 830–52. http://dx.doi.org/10.1108/ijopm-02-2012-0063.
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Purpose – An ongoing challenge for managers is to define and benefit from their firm's environmental management practices. Firms that seek stakeholder recognition of their practices, or face stakeholder pressure for evidence of improvement, increasingly use management standards such as ISO14001. Such standards, however, may encourage firms to use more reportable rather than embedded environmental management practices. Why some firms use environmental management standards to improve practices relative to firms that use them to deflect attention, is an important research question. As paper proposes, stakeholder pressure on firms for improved practices can interact with firms’ expectations of related rewards to influence environmental management outcomes. The paper aims to discuss these issues. Design/methodology/approach – The intention was to identify significant differences in stakeholder focus and each firm's environmental management practices, between ISO14001 certified and non-certified firms. The paper explored the propositions with a sample of US manufacturers. The paper used a PLS modeling approach. Findings – The paper identified links between firms with a greater regulative stakeholder focus, to greater use of reportable practices (pollution reduction). Firms with a greater normative stakeholder focus were linked to greater use of embedded practices (policies and pollution prevention). Originality/value – This study is one of the first to assess differences that distinguish between both stakeholder type and choice of environmental management practices. Further, the paper grouped firms’ practices according to their emphasis on either rewards of stakeholder recognition or internal operational benefit. As other studies have identified, firms do not necessarily adopt environmental management standards for their goals of practice improvement. The study contributes to use of stakeholder theories to understand firm level adoption of and benefit from environmental management practices.
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Nkurunziza, Janvier D. "The Distribution of Firm Size in Africa's Manufacturing Sector and Its Implication for Industrial Policy." Journal of African Development 17, no. 2 (October 1, 2015): 45–66. http://dx.doi.org/10.5325/jafrideve.17.2.0045.
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This paper analyzes the distribution of Kenyan firms into four size categories: micro, small, medium and large size. Four questions are investigated. First, do small firms grow faster than large ones or is firm growth independent of size as stipulated by Gibrat's “Law of Proportionate Effect” Second, what is the steady state size of firms? Third, how long does it take to reach the steady state size? Fourth, does the use of bank credit affect a firm's growth and the process of firm size convergence? On the basis of ergodic probability distributions, we derive information on firms' steady state growth and convergence. Using data on Kenya's manufacturing sector, empirical results suggest that firm growth is associated with overall economic performance. Before the early 1990s, firms had a high growth potential. In equilibrium, 70 percent of surviving firms converged to large size. In contrast, growth and convergence in the 1990s reflected the economic crisis that hit the Kenyan economy: the steady state distribution of firm size was concentrated in the first two quartiles, with suggestive evidence that smaller firms recorded the highest rates of failure. Also, the use of credit increased the growth of surviving firms but appears to have contributed to precipitating firm failure. These results suggest that support policies such as special credit schemes are not a panacea for a firm's survival and growth.
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Gao, Pingyang, and Gaoqing Zhang. "Accounting Manipulation, Peer Pressure, and Internal Control." Accounting Review 94, no. 1 (March 1, 2018): 127–51. http://dx.doi.org/10.2308/accr-52078.
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ABSTRACT We study firms' investment in internal controls to reduce accounting manipulation. We first show that peer managers' manipulation decisions are strategic complements: one manager manipulates more if he believes that reports of peer firms are more likely to be manipulated. As a result, one firm's investment in internal controls has a positive externality on peer firms. It reduces its own manager's manipulation, which, in turn, mitigates the manipulation pressure on managers at peer firms. Firms do not internalize this positive externality and, thus, underinvest in their internal controls over financial reporting. The problem of underinvestment provides one justification for regulatory intervention in firms' internal controls choices. JEL Classifications: G18; M41; M48; K22.
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Bogodistov, Yevgen, André Presse, Oleksandr P. Krupskyi, and Sergii Sardak. "GENDERING DYNAMIC CAPABILITIES IN MICRO FIRMS." Revista de Administração de Empresas 57, no. 3 (June 2017): 273–82. http://dx.doi.org/10.1590/s0034-759020170308.
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ABSTRACT Gender issues are well-researched in the general management literature, particular in studies on new ventures. Unfortunately, gender issues have been largely ignored in the dynamic capabilities literature. We address this gap by analyzing the effects of gender diversity on dynamic capabilities among micro firms. We consider the gender of managers and personnel in 124 Ukrainian tourism micro firms. We examine how a manager's gender affects the firm's sensing capacities and investigate how it moderates team gender diversity's impact on sensing capacities. We also investigate how personnel composition impacts seizing and reconfiguration capacities. We find that female managers have several shortcomings concerning a firm's sensing capacity but that personnel gender diversity increases this capacity. Team gender diversity has positive effects on a firm's seizing and reconfiguration abilities. Our study advances research on gender diversity and its impact on firm capabilities and illustrates its relevance for staffing practices in micro firms.
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Becker, Brian E., and Craig A. Olson. "Unionization and Shareholder Interests." ILR Review 42, no. 2 (January 1989): 246–61. http://dx.doi.org/10.1177/001979398904200206.
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Drawing on agency theory, this study examines union-nonunion differences in the allocation of both firm profits and business risk to employees and shareholders. Using a sample of more than 1,000 large private sector firms, the authors find that over the period 1970–81 shareholders in unionized firms assumed less of the firm's business risk than shareholders in nonunion firms. This finding is interpreted as evidence that managers of unionized firms attempted to minimize agency costs by capitalizing on the incentive effects of risksharing. In addition, risk-adjusted returns to shareholders were lower in unionized firms than in nonunion firms. The authors view the relatively poor performance of union firms as a primary motivating factor behind the restructuring of the American industrial relations system during the period studied.
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Al-Absy, Mujeeb, and Mustafa Hasan. "Impact of the board of directors’ characteristics on firm performance: A case of Bahraini listed firms." Problems and Perspectives in Management 21, no. 1 (March 1, 2023): 291–301. http://dx.doi.org/10.21511/ppm.21(1).2023.25.
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This study aims to examine the impact of the characteristics of the board of directors (BOD), namely board independence, board size, frequency of board meetings, and board gender diversity, on firm performance. This quantitative study uses data from all firms listed in the Bahrain Bourse for 2019 and 2020. Data on BODs were taken from the companies’ governance reports, while data on firm performance, namely return on assets (ROA), return on equity (ROE), and earnings per share (EPS), were taken from annual reports. Based on the ordinary least squares (OLS) approach, the results show insignificant relationships between BOD characteristics and firm performance. Board independence, size, frequency of meetings, and gender diversity insignificantly enhance Bahraini firms’ performance. The results indicate that firms may need to effectively implement BOD mechanisms. Moreover, other factors may moderate the impact of BOD mechanisms on firm performance. Hence, the study suggests a need for more regulations and policies to increase the effectiveness of board members. This study alerts policymakers, firms’ shareholders and stakeholders, and researchers to the need to increase directors’ roles in boosting company performance, especially in developing countries, where it is complicated to force business to follow best governance practices.
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Ancarani, Alessandro, Calogero Guccio, and Ilde Rizzo. "The role of firms' qualification in public contracts execution: An empirical assessment." Journal of Public Procurement 16, no. 4 (April 1, 2017): 554–82. http://dx.doi.org/10.1108/jopp-16-04-2016-b006.
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According to the Italian regulation firms must qualify to bid in auctions for public work contracts worth more than 150,000 euros. In this paper, we investigate the link between the efficiency of infrastructure provision, and the Italian regulation concerning the firm's entry and qualification system, employing a large dataset on Italian public works contracts for roads and highways. First, firm's efficiency in public contracts' execution is estimated using a smoothed data envelopment analysis (DEA) bootstrap procedure. Then, the effects of the qualification system on firm's efficiency is evaluated using a semi-parametric technique that produces a robust inference for an unknown serial correlation between efficiency scores. Our analysis shows that fully qualified firms perform better than partially qualified firms.
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Albaum, Gerald, and David K. Tse. "Adaptation of International Marketing Strategy Components, Competitive Advantage, and Firm Performance: A Study of Hong Kong Exporters." Journal of International Marketing 9, no. 4 (December 2001): 59–81. http://dx.doi.org/10.1509/jimk.9.4.59.19943.
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The authors examine how firms adapt different components of their marketing strategies in foreign markets compared with their domestic market and how such adaptation decisions influence the firms' competitive positions and performance in foreign markets. The authors conceptualize that adaptation of a marketing-mix component is a purposeful process that is influenced by a firm's past adaptation strategy, and they investigate the importance of that marketing-mix component to the firm's success. The authors propose that the adaptation process helps define a firm's competitive advantage, which in turn affects its performance in the foreign market. The authors develop hypotheses and propositions and test them with a sample of 183 export firms in Hong Kong.
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Rock, Juan, and Sadrudin A. Ahmed. "Resources, capabilities and export performance: multidimensional evidence of Chile." Academia Revista Latinoamericana de Administración 27, no. 1 (May 27, 2014): 108–37. http://dx.doi.org/10.1108/arla-08-2013-0108.
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Purpose The purpose of this paper is to study the relation between to export performance measures; growth exports and export intensity with the resources, capabilities and characteristics of the firms as factors determining its success. Design/methodology/approach The study used a questionnaire, answered by 133 firms from a random sample of 480 Chilean firms. Findings The two performance measures of the study, export intensity and growth of the exports resulted equally predictive of the export success, but with a different set of variables. The export growth was strongly related with the firms that had recently started, that have executive staff with an overseas education and a long term commitment to export, did research and development, followed market developing strategies and strategic alliances. The export intensity shows a strong relation with smaller firms, more experienced and involved in foreign markets. The successful companies in the foreign markets are very opportune and flexible in satisfying the needs of their clients and innovate their products. Research limitations The biggest limitation of this research is that it was conducted only in one South American country with a limited sample size. Originality/value Smaller firms require support from the State, to finance market studies, to access international fairs and financial sources. The findings are innovative for the export management in developing countries, intensive in natural resources, especially those of small size such as the case of Chile. Propósito Estudiar la relación entre dos medidas del desempeño exportador, crecimiento de exportaciones e intensidad de exportaciones, con los recursos, capacidades y características de la firma como factores determinantes de su éxito. Diseño/metodología/enfoque Un estudio basado en un cuestionario, respondido por 133 firmas de una muestra aleatoria de 480 firmas chilenas, representativa de las firmas exportadoras, seleccionadas aleatoriamente. Hallazgos Las dos medidas de desempeño exportador del estudio, intensidad de exportaciones y crecimiento de las exportaciones resultaron igualmente predictivas del éxito exportador, pero con diferentes conjuntos de variables predictivas. Limitaciones de la investigación/implicaciones La mayor limitante de esta investigación es que fue realizada en sólo un país de Sudamérica con un tamaño de muestra algo limitado. Implicaciones prácticas El crecimiento de exportaciones estuvo fuertemente relacionado con las firmas que se iniciaron recientemente, que poseen personal ejecutivo educado en el extranjero y un compromiso de largo plazo a exportar, realizan investigación y desarrollo, siguen estrategias de desarrollo de mercados. La intensidad de exportación expresa una relación fuerte con las firmas más pequeñas, más experimentadas e involucradas en los mercados extranjeros. Las compañías exitosas en los mercados de exportación son muy oportunas y flexibles en satisfacer las necesidades de sus clientes, innovan en sus productos y siguen estrategias de alianzas cooperativas y redes. Implicaciones socials Los gobiernos deberían apoyar a las firmas pequeñas, financiando estudios de mercado, apoyando su acceso a ferias internacionales y financiamiento. Originalidad/valor Los hallazgos son originales para la gestión de exportaciones en países en desarrollo, intensivos en recursos naturales, especialmente aquéllos de un pequeño tamaño, como Chile.
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Ponikvar, Nina, and Melita Rant. "FIRM SPECIFIC DETERMINANTS OF MARKUP ‐ THE CASE OF SLOVENIAN MANUFACTURING FIRMS." Journal of Business Economics and Management 8, no. 3 (September 30, 2007): 203–12. http://dx.doi.org/10.3846/16111699.2007.9636170.
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Investigations of firms’ pricing decisions and performances have been twofold. While within the industrial organisation framework stress is placed on industry‐specific factors and the market power of firms within industries, various organisational theories emphasise the role of ‘soft’ factors in the determination of firms’ performance. The main thesis of our paper is that the size of a firm's markup can mostly be explained by the firm's productivity, capital and labour costs, as well as the firm's market power and organisational structure characteristics, when the external environment and industry membership is controlled for. Our objective is thus to explain firm‐level markups by a set of firm‐specific factors. The empirical analysis of markup determinants is based on a sample of Slovenian manufacturing firms (NACE 15–37) in the 1994–2003 period, applying panel data regression GLS model and ANOVA analyses. We find that, besides market share and cost factors, organisational structure change occurring after some threshold significantly increases markups.
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Ballester, Marta, Joshua Livnat, and Chandrakanth Seethamraju. "Individual-Firm Style Loadings, Unrecorded Economic Assets, and Systematic Risk." Journal of Accounting, Auditing & Finance 13, no. 3 (July 1998): 275–96. http://dx.doi.org/10.1177/0148558x9801300307.
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This study estimates individual-firm style loadings for classification of individual securities into growth (glamour) and value groups. Style loadings are similar to betas, measuring the comovement of a firm's return with the return on a particular style index. The study examines this classification by comparing the extent of unrecorded economic assets for growth and value firms. The study also examines the systematic-risk characteristics associated with this classification. Using Ohlson's (1995) valuation model, this study estimates the persistence of abnormal earnings for individual firms using time-series analysis. Growth firms are shown to have higher levels of abnormal earnings persistence than value firms, probably due to their greater levels of unrecorded economic assets than value firms. Indeed, the study finds that growth firms have greater levels of R&D and advertising intensity than value firms. The study also shows that growth and value firms differ in their systematic risk. Possibly due to the greater uncertainty associated with unrecorded economic assets, the systematic risks of growth firms are larger than those of value firms.
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Kahya, Evrim Hilal, Hüseyin Yiğit Ersen, Cumhur Ekinci, Oktay Taş, and Koray D. Simsek. "Determinants of capital structure for firms in an Islamic equity index: comparing developed and developing countries." Journal of Capital Markets Studies 4, no. 2 (November 9, 2020): 167–91. http://dx.doi.org/10.1108/jcms-07-2020-0023.
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PurposeThe paper aims to identify the differences between developed and developing country firms with respect to firm-specific and country-level determinants of their capital structure. For this purpose, all constituent firms in one of the oldest Islamic equity indices, Dow Jones Islamic Market World Index (DJIM), are considered and the Muslim-majority status of each firm's domicile country is recognized.Design/methodology/approachThe study employs Hausman–Taylor random effects regression with endogenous covariates to explain the debt ratios of firms in DJIM by separating them into developed and developing country subsamples in an unbalanced panel data setting. Developing country subsample is further split into two based on the Muslim-majority status of each firm's domicile country.FindingsConsistent with the previous literature, this study finds that firm-specific characteristics are the main determinants of their capital structure. Additionally, the paper shows that country-level characteristics have an impact on the debt ratio, however, the types of factors vary across developed and developing countries. Debt ratios in developing country firms are lower than those in developed country firms, largely due to the significantly smaller leverage ratios of firms in Muslim-majority countries. Although the debt ratios of DJIM firms are higher in “non-Muslim” countries, the set of firm-level capital structure determinants are not statistically explained by operating in a “Muslim” country. The study also documents that, before the global financial crisis of 2008, companies in developing countries have gradually become less leveraged worldwide.Originality/valueThis paper provides a new perspective into the differences between developed and developing country firms' capital structures by focusing on a relatively homogeneous data set restricted by leverage screening rules of an Islamic equity index and recognizing the Muslim-majority status of each firm's domicile country.
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Gu, Yiwen (Jenny), Greg Bell, Abdul A. Rasheed, and Sri Beldona. "Commitment to values: Examining the role of ethical and responsible business practices on short and long‐term value." Business and Society Review 129, no. 1 (March 2024): 96–129. http://dx.doi.org/10.1111/basr.12344.
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AbstractFirms are under increasing pressure from external forces to do what is right and behave ethically. However, we have only a limited understanding of how ethical and responsible business practices impact the value of the firm, both in the short and the long term. In this study, we examine 196 firms that were recognized as the world's most ethical firms from 20 countries over a 14‐year span. Results show that ethical behavior may have little effect on a firm's profitability in the short term. However, it has a positive effect on a firm's market value, reflecting the market's positive assessment of its long‐term performance. We also find that firms frequently listed among the world's most ethical companies tend to have higher market value than firms listed only once.
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Hamouri, Basem, Mahmoud Al-Rdaydeh, and Anas Ghazalat. "Effect of financial leverage on firm growth: empirical evidence from listed firms in Amman stock exchange." Investment Management and Financial Innovations 15, no. 2 (May 22, 2018): 154–64. http://dx.doi.org/10.21511/imfi.15(2).2018.14.
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Past studies have mostly investigated the significance of financial attributes in trade affairs of developed countries, while dismissing such importance among developing nations. As such, this study looked into the influence of financial leverage upon the growth of Jordanian firms. For that purpose, a sample of 91 firms from Jordan had been analyzed via panel data regression method for the period between 2006 and 2015. As a result, the findings portrayed the irrelevance between financial leverage and growth of assets, but a significantly positive correlation with the growth of sales and employment. On top of that, this study revealed that growth of sales and employment had been significantly and positively correlated with firm size. In short, this study dismissed the speculation the constraint Jordanian firms were in, but on the contrary, displayed the ability to gain external financing to ascertain successful progress.
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Cheng, Ming-Chang, and Zuwei-Ching Tzeng. "Effect of Leverage on Firm Market Value and How Contextual Variables Influence this Relationship." Review of Pacific Basin Financial Markets and Policies 17, no. 01 (March 2014): 1450004. http://dx.doi.org/10.1142/s0219091514500040.
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Using the financial data from 645 companies that were listed in the Taiwan Stock Exchange (TSE) between 2000 and 2009, this paper applied a least square dummy variable (LSDV) model to estimate the effect of leverage on firm market values and examine how contextual variables influence this relationship. The empirical results are as follows. First, the values of leveraged firms are greater than the values of unleveraged firms if we do not consider the probability of bankruptcy. If we simultaneously consider the benefits and costs of debt, we find that leverage is positively related to the firm value until a firm has issued sufficient debt to attain its optimal capital structure. Second, the positive influence of leverage on the firm value tends to be stronger for firms of higher financial quality (firms with greater Z-scores), firms with greater growth opportunities and firms with higher corporate tax rates. Third, the negative influence of leverage on firm value tends to be strengthened if increases occur in a firm's free cash flow, a firm's non-debt tax rate, or the inflation rate it experiences. Finally, leverage may also have a positive effect on firm value provided that a firm with a higher free cash flow, a higher corporate rate or a higher inflation, is able to properly capitalize on the resultant opportunities. These findings provide insight into firms' debt financing decisions, helping firms to maximize their values.
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Graciosa, Amelia, Gracia Gracia, and Rita Juliana. "Firm Life Cycle and Investment Inefficiency." Journal of Accounting and Strategic Finance 3, no. 2 (November 30, 2020): 169–84. http://dx.doi.org/10.33005/jasf.v3i2.86.
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This paper investigates whether the firm's life cycle stages carry out free cash flow efficiently or not before their investment performance. We utilize cash flow patterns to classify firms into five several life cycles stages. Our data consists of non-financial firms listed in Indonesia Stock Exchange from 2008-2018. We find evidence that Indonesian firms in the introduction, growth, and shakeout stage are underinvesting. This paper also shows that firms in decline stage are overinvested. The characteristic of the mature firm includes that firms with high cash flow will tend to overinvest. However, contrasting with mature firms' common characteristics, our results show that Indonesian firms in maturity stage tend to underinvest. The results also imply that the government should acknowledge the existence of Indonesian firms' investment inefficiency problem. Overall, this paper contributes to the literature by providing empirical evidence on Indonesia's investment inefficiency phenomena. It is suggested that further research may select a different method in calculating growth opportunities and may also study private firms since it tends to have higher financial constraints.
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Majumdar, Sumit K. "R&D Spending and the Rewards to Human Capital in India's IT Sector." Vikalpa: The Journal for Decision Makers 38, no. 4 (October 2013): 37–48. http://dx.doi.org/10.1177/0256090920130403.
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Firms organize heterogeneous resources developed to create capabilities sustaining the provision of services or the production of output, and they engage in research and development (R&D) activities. R&D is an extremely human capital-intensive effort and the intangible assets are embodied in human capital. Firms engaging in R&D activities also devote attention to human capital issues and may be progressive in human relations and compensation policies. Such progressive firms would have a higher wage share, signalling financial commitment to people assets. That is the expectation. Paradoxically, R&D spending is discretionary, held low in priorities, and is the first expenditure cut in a downturn. Not much is known of this relationship in spite of it being an important relationship in contemporary theories of economic growth and corporate development. This article examines the links between the R&D spending of Indian information technology and software sector firms and their wage share. The extent of a firm's wage share measures the share of a firm's product accruing to its human capital pool. When a firm's wage share is larger, the quantum of value generated by its activities used to reward employees is larger. The relationship between R&D spending and wage share captures an important aspect of the behaviour, related to wealth sharing, of innovative versus not so innovative firms. The information technology and software sector is critical in India's growth. Its presence has had domestic consequences in terms of employment and exports. The dynamic R&D spending and wage share relationship is examined for a large panel of firms in the Indian information technology and software industry from the period 2000-01 to 2005-06. Whether India technology and software firms' employees benefit from their own firms' practices is an important issue in engendering the future performance of the information technology and software sector. The results show that the firm R&D spending and wage share relationship is negative and significant. A short-term cost minimizing approach, where firms compete by balancing expenditures, so that an increase in one type of expenditure by firms is counterbalanced by a decline in another type of expenditure, rather than a long-term oriented dynamic capabilities enhancement approach, best describes Indian information technology and software firms' behaviour. The negative relationship noted in this analysis does not augur well for Indian firms' efforts to develop into globally competitive firms, as rewards to human capital are not forthcoming for activities related to R&D efforts.
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Sawarni, Kumar Sanjay, Sivasankaran Narayanasamy, and Kanagaraj Ayyalusamy. "Working capital management, firm performance and nature of business." International Journal of Productivity and Performance Management 70, no. 1 (March 7, 2020): 179–200. http://dx.doi.org/10.1108/ijppm-10-2019-0468.
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PurposeThis paper aims to investigate the impact of the efficiency of working capital management (WCM) on the performance of a sample of Indian companies and explore how the nature of the firm's business influences the significance and direction of this impact.Design/methodology/approachThe data for this study were collected for the period of 2012–2018 for 414 non-financial firms listed on the Bombay Stock exchange. Fixed-effect regression models were run by taking Tobin's Q and return on equity (ROE) as dependent variables, and net trade cycle (NTC) and its components as explanatory variables in the presence of liquidity, leverage, size, age and growth as control variables. Sample firms were segregated into manufacturing, trading and service groups, and regression models were used for all the groups to understand the effect of the nature of a firm's business.FindingsWCM efficiency has a significant impact on the performance of the sample firms. Non-financial Indian firms deliver better financial performance by maintaining lower NTC. Like NTC, its components also impact firm value and profitability. The results report that the significance of the relationship varies depending upon the nature of the firm's business.Originality/valueThe previous research studies had not used a sample of large number of Indian firms. Unlike previous studies, this study reports the influence of the nature of business on the relationship between WCM and firm performance. Further, this paper also examines how the individual components of working capital influence the performance of Indian firms.
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Farizal Mohammed, Nor, Sazalina Ahmad Puat, Mira Susanti Amirrudin, and Afizah Hashim. "LEVERAGE, LIQUIDITY AND PROFITABILITY RATIOS: ACCOUNTABILITY OF MALAYSIAN LISTED OIL AND GAS FIRMS." Humanities & Social Sciences Reviews 8, no. 2 (September 29, 2020): 941–47. http://dx.doi.org/10.18510/hssr.2020.82104.
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Purpose: This study examines the impact of leverage and liquidity on the profitability among the listed O&G firms in Malaysia.
Methodology: Data were gained from the audited financial statements of 22listed O&G firms for a period of ten years (2008 – 2017) and a quantitative data methodology was utilized to analyze the study.
Main Findings: The findings demonstrated that leverage in terms of debt-equity ratio has a significant negative association on a firm's profitability. Nevertheless, liquidity ratios are found to be insignificantly related to the profitability of the O&G industry in Malaysia.
Implications: This study contributes to raising awareness amongst the top management of firms, the analysts, and the investors in monitoring and forecasting for the firm's profitability and the value of the firms, thus contributing to the better investment decision making.
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Baek, Youngmin, and Shujiro Urata. "Does global value chain participation improve firm productivity? A study of selected ASEAN developing countries." Asian Economic Journal 37, no. 2 (June 2023): 232–60. http://dx.doi.org/10.1111/asej.12304.
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AbstractThis paper examines the impact of local firms’ participation in global value chains (GVCs) on productivity by considering three different patterns of GVC participation. We conducted a DID‐PSM estimation involving three countries, Indonesia, the Philippines, and Vietnam, and 17 manufacturing sectors in 2009 and 2015 in a panel framework. We found an endogenous relationship between firm productivity and GVC participation: firms that enter GVCs have high productivity before participating in the GVCs (selection effect), and only Indonesian firms that entered GVCs had high productivity growth after joining GVCs (learning effect). These two effects were only found for firms that both import intermediate goods and export output and not for firms that only either import or export. We also found that indirect exporting does not improve a local firm's productivity. Several recommendations are made to help firms and governments facilitate the participation of firms in GVCs.
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Westhead, Paul, Marc Cowling, and Carole Howorth. "The Development of Family Companies: Management and Ownership Imperatives." Family Business Review 14, no. 4 (December 2001): 369–85. http://dx.doi.org/10.1111/j.1741-6248.2001.00369.x.
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This study explores management and ownership imperatives facing 427 independent unquoted (i.e., nonpublic) companies in the United Kingdom. To detect real rather than sample differences, the study used a matched pairs methodology. Chi-square and student's T-tests confirmed several similarities among the 73 family companies and the comparable 73 nonfamily companies. The tenure periods of CEOs in both groups of firms before being appointed to the CEO position were similar. CEOs in family firms had not remained in this position for significantly longer periods than CEOs in nonfamily firms, and the majority of directors in family and nonfamily firms did not hold outside directorships in other companies. Several significant differences were also detected. CEOs from the kinship group owning the family business had been in the CEO position for much longer than “outside” CEOs in family firms. Furthermore, the proportion of total shares owned by directors in family firms was significantly more than the proportion owned by directors in nonfamily firms. A significantly larger proportion of nonfamily rather than family firms had employed a nonexecutive director. In concluding, it is highlighted that a firm's identification of itself as a family firm is important in defining family firms and that firms that do not currently perceive themselves to be family firms may in the future.
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Quoc Thinh, Tran. "The impact of firm characteristics on the voluntary disclosure – evidence on the top 50 listed firms of Forbes Vietnam." Investment Management and Financial Innovations 18, no. 1 (March 9, 2021): 215–22. http://dx.doi.org/10.21511/imfi.18(1).2021.18.
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Disclosure plays an important role for information users. Voluntary disclosure is more meaningful for stakeholders in order to make appropriate decisions. The article researches the impact of firm characteristics on the voluntary disclosure of the top 50 listed firms in Forbes Vietnam (50 listed firms) from 2015 to 2019. It uses the ordinary least squares of time-series data to test the regression model. The signaling and agency theory is used to explain the relationship between firm characteristics on voluntary disclosure. The research results show three variables of firm characteristics that positively impact the voluntary disclosure of 50 listed firms, including firm size, growth rate of market share value to book value, and audit type, in which audit type has the strongest influence. Accordingly, the state agencies of Vietnam should encourage 50 listed firms to improve the Vietnamese listed firms’ voluntary disclosure and meet international economic integration. AcknowledgmentWe would like to thank Assoc. Prof. Ngoc Thach Nguyen (Phd), Assoc. Prof. Hoang Anh Ly (Phd) and Assoc. Prof. Thi Loan Nguyen (PhD), as well as some experts of the State Securities Commission of Vietnam and some leaders of 50 listed firms for their advice and support the project.
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Yeh, I.-Jan, Ching-Liang Chang, Joe Ueng, and Vinita Ramaswamy. "Reducing Risk through Governance." International Journal of Risk and Contingency Management 3, no. 2 (April 2014): 43–53. http://dx.doi.org/10.4018/ijrcm.2014040104.
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The main purpose of this study is to investigate the determinants of formal governance policy. Many firms have a formal governance policy. Others, however, have no such a policy. This study examines what kind of firm's characteristics that encourage companies to adopt a formal governance policy. Data were collected from Corporate Library. A sample of 3,068 firms from the database of 2010 Corporate Library was analyzed. Results show that when firms have a better financial performance and better corporate governance practice, they are more likely to have a formal governance policy. Specifically, when firms have a better board rating, compensation policy, takeover defense strategy, and accounting practice, firms are more likely to have a formal governance policy.
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Wang, Lihua, Zhiyu Cui, and Xiaoya Liang. "Does It Pay to Be Green? Financial Benefits of Environmental Labeling among Chinese Firms, 2000–2005." Management and Organization Review 11, no. 3 (July 15, 2015): 493–519. http://dx.doi.org/10.1017/mor.2014.8.
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ABSTRACTDrawing on economic, sociological, and strategic perspectives, we use data of a large sample of 936 Chinese manufacturing firms in the period from 2000 to 2005 to examine how environmental labeling may affect a firm's financial performance. We argue that reducing information asymmetry, increasing legitimacy, and differentiating strategically through environmental labeling may prompt customers to patronize the firm, thereby enhancing firm performance. However, not all firms benefit equally; environmental labeling conveys fewer benefits for larger firms and for firms listed in a stock market, because they are less threatened by information asymmetry or insufficient organizational legitimacy. Our findings suggest that environmental labeling has generally limited influence on financial performance, but for small and unlisted firms, environmental labeling increases sales.
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Dai, Narisa Tianjing, Fei Du, S. Mark Young, and Guliang Tang. "Seeking Legitimacy through CSR Reporting: Evidence from China." Journal of Management Accounting Research 30, no. 1 (October 1, 2016): 1–29. http://dx.doi.org/10.2308/jmar-51627.
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ABSTRACT This study finds that Chinese firms that issue high-quality corporate social responsibility (CSR) reports are perceived as having greater legitimacy (operationalized by government endorsement and media endorsement) by the Chinese government and media. Chinese firms that issue higher-quality CSR reports subsequently receive higher levels of government endorsement and media endorsement, which in turn lead to better financial performance. The positive relationship between the quality of a firm's CSR disclosure and subsequent financial performance is mediated by the firm's perceived level of legitimacy. The mediating role of government endorsement is stronger for firms based in underdeveloped regions. JEL Classifications: G14; G18; G30.
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Chen, Long, Yashu Dong, Jeff Ng, and Albert Tsang. "Cross-Listings and Voluntary Disclosure: International Evidence." Journal of Financial Reporting 4, no. 2 (September 2019): 89–113. http://dx.doi.org/10.2308/jfir-52576.
Full textAbstract:
This paper examines changes in firms' disclosure behavior around cross-listings. Using an international setting, we find significant differences in management forecast likelihood and frequency between cross-listed firms and firms with similar characteristics but that are not cross-listed; particularly when differences in accounting standards between a cross-listed firm's home and target countries are larger. Further, we find that firms choosing to cross-list in target countries with larger accounting standards differences tend to provide more voluntary disclosure during the two years preceding a new cross-listing, rather than during the earlier time periods or the period after cross-listing, and such voluntary disclosure helps firms attract more foreign institutional ownership in their cross-listing target countries. Collectively, our evidence suggests that although differences in accounting standards across countries deter firms' cross-listing activities, cross-listed firms, by providing more management forecasts voluntarily, preemptively alleviate the information disadvantage faced by foreign institutional investors.