Corporate Resilience and Financial Flexibility in Times of Crisis – Case of Poland

Abstract

Research Background

Poland was coined a ‘green island’ during the Global Financial Crisis (GFC) of 2007–2009 with a stable growth in Gross Domestic Product (GDP), while other countries experienced a dramatic drop in the GDP growth. We assumed that this is due to the stronger resilience of Polish economy and Polish companies.

Purpose of this Chapter

The aim of the research is to identify the companies' stability (resilience) in the crisis situations (especially the GFC and COVID-19 crisis). We also wonder whether corporate resilience is accompanied by the financial flexibility.

Methodology

We use GDP growth rate and Profitability as the measures of the resilience. Additionally, we include in our research financial flexibility measured by debt and cash ratio as factors affecting corporate resilience. Our research covers the period 2000–2021. Our data refer to three European countries: France and Germany as the leading European countries and Poland as the leader of changes in Central and Eastern Europe.

Findings

We found that Polish economy – against German and French – have higher GDP growth and profitability ratio over the 2000–2021 period. These ratios also show lower volatility around the trend. We proved that higher corporate resilience is accompanied by higher financial flexibility of Polish companies.

Citation

Bukalska, E. and Pietrzak, M.B. (2023), "Corporate Resilience and Financial Flexibility in Times of Crisis – Case of Poland", Bukalska, E., Kijek, T. and Sergi, B.S. (Ed.) Modeling Economic Growth in Contemporary Poland (Entrepreneurship and Global Economic Growth), Emerald Publishing Limited, Leeds, pp. 267-279. https://doi.org/10.1108/978-1-83753-654-220231024