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Article
Publication date: 6 March 2019

Sri Mangesti Rahayu

The purpose of this paper is to measure the effects of corporate financial performance toward the influences of corporate growth and company asset utilization on the…

Abstract

Purpose

The purpose of this paper is to measure the effects of corporate financial performance toward the influences of corporate growth and company asset utilization on the corporate market value.

Design/methodology/approach

This research is an explanatory research that describes the influences of one or more variables on other variables based on secondary data. This research took place in Indonesia and was carried out from 2011 to 2016.

Findings

The findings of this study are corporate growth has a significant influence on the corporate market value, implying that companies should consider the short-term and long-term profitabilities before making any investment decision; asset utilization has been confirmed to have a positive and significant influence on financial performance. Insights into asset utilization effectiveness and efficiency are important for company managers to consider in making strategic decisions upon operational activities of the company. Also, financial performance has a positive and significant influence on the corporate market value.

Originality/value

Research originality offered in this research is in the form of empirical evidence upon the influence of company asset utilization on the financial performance and corporate market value of a company. The finding of this research is expected to provide a better understanding on the role of company asset utilization in determining corporate financial performance which is known to be certain.

Details

International Journal of Productivity and Performance Management, vol. 68 no. 5
Type: Research Article
ISSN: 1741-0401

Keywords

Article
Publication date: 1 April 2003

Georgios I. Zekos

Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination…

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Abstract

Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination of some legal aspects concerning MNEs, cyberspace and e‐commerce as the means of expression of the digital economy. The whole effort of the author is focused on the examination of various aspects of MNEs and their impact upon globalisation and vice versa and how and if we are moving towards a global digital economy.

Details

Managerial Law, vol. 45 no. 1/2
Type: Research Article
ISSN: 0309-0558

Keywords

Article
Publication date: 1 July 2004

Bostjan Antoncic and Robert D. Hisrich

Despite the recognized importance of entrepreneurship for organizational wealth creation, research has devoted minimal attention to investigating this area. This study…

8239

Abstract

Despite the recognized importance of entrepreneurship for organizational wealth creation, research has devoted minimal attention to investigating this area. This study contributes to a better understanding of the relationship between corporate entrepreneurship and wealth creation by developing and testing a normative model, which clarifies the nature of the influences of corporate entrepreneurship and its environmental and organizational antecedents on organizational performance. The findings of structural equation modeling, based on mail survey data from 477 Slovenian firms, demonstrate that corporate entrepreneurship and some its contingencies make a difference in organizational wealth creation, growth and profitability.

Details

Journal of Management Development, vol. 23 no. 6
Type: Research Article
ISSN: 0262-1711

Keywords

Book part
Publication date: 18 January 2022

Gareth Anderson and Mehdi Raissi

Productivity growth in Italy has been persistently anemic and lagged that of the euro area over the period 1999–2015, while the indebtedness of its corporate sector…

Abstract

Productivity growth in Italy has been persistently anemic and lagged that of the euro area over the period 1999–2015, while the indebtedness of its corporate sector increased. Using the ORBIS firm-level database, this chapter studies the long-term impact of persistent corporate-debt accumulation on the productivity growth of Italian firms, and investigates whether total factor productivity (TFP) growth varies with the level of corporate indebtedness. The authors employ a novel estimation technique proposed by Chudik, Mohaddes, Pesaran, & Raissi (2017) to account for dynamics, bi-directional feedback effects, cross-firm heterogeneity, and cross-sectional dependence arising from unobserved common factors (e.g., oil price shocks, labor and product market frictions, and the stance of the global financial cycle). Filtering out the effects of unobserved common factors and controlling for firm-specific characteristics, the authors find significant negative effects of persistent corporate-debt build-up on firms’ TFP growth on average, and weak evidence of a threshold level of corporate debt, beyond which productivity growth drops off significantly. The results have strong policy implications, for example the design of the tax system should discourage persistent corporate-debt accumulation, and effective and timely frameworks to reduce corporate-debt overhangs are essential.

Details

Essays in Honor of M. Hashem Pesaran: Panel Modeling, Micro Applications, and Econometric Methodology
Type: Book
ISBN: 978-1-80262-065-8

Keywords

Article
Publication date: 24 May 2021

Abdul Rashid and Mahir Ahmed Hersi

The paper examines the differential effect of liquidity constraints on corporate growth using unbalanced panel data for 457 Pakistani firms over the period 2010–2017.

Abstract

Purpose

The paper examines the differential effect of liquidity constraints on corporate growth using unbalanced panel data for 457 Pakistani firms over the period 2010–2017.

Design/methodology/approach

The study uses the probability of a financial unconstrained index constructed by estimating the endogenous regression model. This approach provides a time-varying measure of financial position for all firm-year observations and takes into account the different degrees of liquidity constraints that a company faces in attaining funds from external markets. It is derived from a multivariate selection equation that simultaneously accounts for all-important features of the underlying company identified in the literature. The cash flow variable has then interacted with various groups of dummy variables for financial constraint, which allows the coefficient of cash flow to vary across firm-year observations in the different liquidity constraint categories. The two-step system-GMM estimator is applied to estimate the main empirical model.

Findings

The results of the study provide evidence of the heterogeneity in firms' growth sensitivity to internal funds, depending on the degree of liquidity constraints. Financing growth through internal funds is found to be essential for both liquidity unconstrained and constrained corporates. However, it is observed that the coefficient of cash flow is greater for firms that do not have access to external financing and it eventually decreases with reductions in the magnitude of liquidity constraints, making the least constrained corporates' growth less responsive to internal funds. The results further indicate that smaller and younger firms show higher responsiveness of growth to internal funds. This finding is mainly attributed to financial market imperfections that make external funding difficult for them.

Practical implications

The results suggest that financially constrained firms should expand their corporate size more than the magnitude of positive income shocks they encounter. The study also suggests important policy implications for liquidity-constrained firms to carefully concentrate on their financing strategies to enhance their growth. By improving the corporate's capacity for production, corporates can achieve a faster effect of a potential positive income shock on their growth.

Originality/value

This paper contributes to the literature by constructing a financial constraint index by running the endogenous regression model. It also contributes by investigating the differential impact of credit constraints on firms' growth in Pakistan and how corporate size and age affect firm growth when financial constraints and investment opportunities are controlled.

Details

International Journal of Managerial Finance, vol. 18 no. 2
Type: Research Article
ISSN: 1743-9132

Keywords

Article
Publication date: 8 October 2018

Tarik Dogru and Ercan Sirakaya-Turk

The purpose of this study is to examine the extent to which the quality of corporate governance mechanisms and growth opportunities affect agency problems in hotel firms.

Abstract

Purpose

The purpose of this study is to examine the extent to which the quality of corporate governance mechanisms and growth opportunities affect agency problems in hotel firms.

Design/methodology/approach

The effects of cash flows on investments and cash holdings were analyzed using three-stage least square analysis to determine the extent to which agency problems are due to the quality of corporate governance in hotel firms.

Findings

The findings showed that the effects of cash flows on investments and cash holdings were greater in well-governed hotel firms than in poorly governed hotel firms. These effects were also greater in low-growth hotel firms than in high-growth hotel firms. However, the results from a concurrent examination of the quality of corporate governance and growth opportunities showed that poorly governed hotel firms with low-growth opportunities are exposed to agency problems.

Research limitations/implications

These results suggest that neither corporate governance mechanisms nor growth opportunities alone indicate agency problems. Theoretical implications are discussed within the realms of free cash flow theory and growth hypothesis.

Practical implications

High-growth hotel firms should retain all of their cash and cash flows to undertake value-increasing projects when they become available. Shareholders’ wealth is more likely to be maximized in high-growth firms regardless of the quality of corporate governance.

Originality/value

Although various aspects of corporate governance have been investigated in hospitality literature, previous studies did not examine the concurrent effects of corporate governance and growth opportunities on agency problems.

Details

International Journal of Contemporary Hospitality Management, vol. 30 no. 10
Type: Research Article
ISSN: 0959-6119

Keywords

Article
Publication date: 5 September 2016

Trevor Alexander Smith

The purpose of this paper is to advance a model for identifying the superior customer value proposition that evolves through a process of corporate transformation while…

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Abstract

Purpose

The purpose of this paper is to advance a model for identifying the superior customer value proposition that evolves through a process of corporate transformation while simultaneously seeking to align this value proposition with regional expansion and growth of Caribbean financial firms.

Design/methodology/approach

The study utilizes a cross-sectional design. Telephone surveys were used to collect data from 80 financial firms and 243 customers across ten Caribbean countries. Structural equations modeling was employed for data analysis.

Findings

The main findings are that corporate transformation of financial firms was a significant driver of customer orientation, consumer confidence, quality, flexibility, branding, and firm capability while lower prices (such as interest rates, fees, and charges), consumer confidence, and branding were the key drivers of regional expansion and growth.

Practical implications

The study identified six value-added dimensions along with price as the superior customer value proposition of financial firms. These dimensions should be incorporated in the business model for transformation and growth of these firms.

Originality/value

The study extended the literature through development of a customer value proposition model that was primarily built on Levitt’s (1965) product life cycle conceptualization and augmented by Porter’s generic strategies.

Details

International Journal of Bank Marketing, vol. 34 no. 6
Type: Research Article
ISSN: 0265-2323

Keywords

Book part
Publication date: 29 March 2016

Chris Akroyd, Sharlene Sheetal Narayan Biswas and Sharon Chuang

This paper examines how the management control practices of organization members enable the alignment of product development projects with potentially conflicting corporate

Abstract

Purpose

This paper examines how the management control practices of organization members enable the alignment of product development projects with potentially conflicting corporate strategies during the product development process.

Methodology/approach

Using an ethnomethodology informed research approach, we carry out a case study of an innovative New Zealand food company. Case study data included an internal company document, interviews with organization members, and an external market analysis document.

Findings

Our case study company had both sales growth and profit growth corporate strategies which have been argued to cause tensions. We found that four management control practices enabled the alignment of product development projects to these strategies. The first management control practice was having the NPD and marketing functions responsible for different corporate strategies. Other management control practices included the involvement of organization members from across multiple functions, the activities they carried out, and the measures used to evaluate project performance during the product development process.

Research limitations/implications

These findings add new insights to the management accounting literature by showing how a combination of management control practices can be used by organization members to align projects with potentially conflicting corporate strategies during the product development process.

Practical implications

While the alignment of product development projects to corporate strategy is not easy this study shows how it can be enabled through a number of management control practices.

Originality/value

We contribute to the management accounting research in this area by extending our understanding of the management control practices used during the product development process.

Open Access
Article
Publication date: 3 August 2021

Rexford Abaidoo and Elvis Kwame Agyapong

This study examines how specific micro-level macroeconomic indicators influence corporate performance volatility among US corporate bodies in the short run.

Abstract

Purpose

This study examines how specific micro-level macroeconomic indicators influence corporate performance volatility among US corporate bodies in the short run.

Design/methodology/approach

The study employs error correction autoregressive distributed lagged (ARDL) model (ECM) to examine how micro-level variables influence volatility associated with corporate performance in the short run.

Findings

This paper finds that disaggregated or micro-level variables examined, tend to exhibit features that are not readily apparent from the aggregate variable from which such variables are derived. For instance, reported empirical estimate suggests that, growth in expenditures on services and nondurable goods tend to lower volatility associated with corporate performance, whereas government expenditures and expenditures on durable goods rather worsens volatility associated with corporate performance, all things being equal. Additionally, presented empirical estimates further provide evidence suggesting that macroeconomic uncertainty and inflation uncertainty significantly moderate or influence the extent to which disaggregated variables impact corporate performance volatility.

Originality/value

Compared to related studies in the reviewed literature, this study rather examines volatility associated with corporate performance instead of the corporate performance indicator itself. Additionally, this paper also examines how disaggregated variable instead of aggregate variables impact such volatility. Finally, the moderating role of key macroeconomic conditions in such a relationship is also examined.

Article
Publication date: 25 January 2011

Charles Amo Yartey

This paper aims to examine how unlisted companies in Ghana finance their growth and to what extent do they rely on internal finance relative to external sources of…

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Abstract

Purpose

This paper aims to examine how unlisted companies in Ghana finance their growth and to what extent do they rely on internal finance relative to external sources of finance. Additionally, the paper seeks to investigate the determinants of the capital structure of unlisted companies in Ghana.

Design/methodology/approach

The paper uses the Singh‐Hamid methodology as well as panel data techniques to evaluate the financing decisions of unlisted companies in Ghana.

Findings

The analysis shows that unlisted firms in Ghana finance most of their growth from external debt and they are also characterized by shorter debt maturity. The results also show that the dominant factors affecting the debt equity ratios of unlisted firms in Ghana are size, firm growth, tangibility, profit margin, and financial development.

Research limitations/implications

Overall, the evidence in this paper suggests that standard models of corporate finance can be applicable to unlisted companies in Ghana.

Practical implications

Informative when planning for future development of the small business sector of the Ghanaian economy.

Originality/value

Provides empirical evidence on how unlisted companies in Ghana finance their growth and what determines their capital structure.

Details

Management Research Review, vol. 34 no. 2
Type: Research Article
ISSN: 2040-8269

Keywords

1 – 10 of over 81000