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The purpose of this paper is to investigate and examine whether there is any significant relationship between the extent of business diversification and the performance of construction firms in South Africa. The rationale for the examination stems from the view that the relationship between diversification and the performance of construction firms raises important issues in strategic management and cross‐border business. In contractors' growth however, there is a dearth of empirical research and theoretical arguments regarding the effects of business diversification on construction company performance in South Africa.

The study employed the use of a case study and archival approaches using semi‐structured interviews to elicit primary qualitative and quantitative data over a period of five years for large construction companies listed in Grade 7‐9 on the Construction Industry Development Board (cidb) contractor register. The scope of services and geographic diversification are computed from the sourced data. Dependent variables are the measure of performance using Return on Total Asset (ROTA), Return on Capital Employed (ROCE) and Profit Margin (PM); independent variables used are service/Product Diversification (PD) and Geographic Diversification (GD); while control variables used are size, age, technical capability and capital structure of the construction firms.

It emerged that established construction companies on the cidb contractor registers perform and diversify more in their service/product better than the newly upgraded contractors and this was evident in their performance with respect to profit margin. The results also indicated that there are no statistically significant differences in the performance of diversified and undiversified firms, although diversification was found to have a positive impact on the corporate performance of construction companies.

The outcomes of the research are useful to decision makers and managers of construction companies, as they will help in making viable corporate strategic diversification decisions. The study also engenders a better understanding of the effect of both product and geographic diversification on the performance of contractors.

Executives are often faced with the challenge of making sound decisions regarding the product and geographic markets into which the company should diversify. This situation is even more glaring with respect to construction companies, owing to the volatile nature of the construction market. The purpose of this paper is to present empirical results on the impact of geographic diversification on the performance and risk profiles of construction firms in the UK.

Published financial data of construction firms covering the period 1995‐2004 are employed in the paper. From this data, extent of geographic diversification, performance, and risk are computed. Firms are grouped based on the extent of diversification into undiversified, moderately diversified, and highly diversified. Performance of these groups is then compared using the t‐statistic based on return on equity (ROE), return on total asset (ROTA), return on capital employed (ROCE), and profit margin (PM).

The results show that firms that remain focused within the UK market outperform those that expand into international markets on PM only. There is no significant difference in performance based on ROE, ROTA, and ROCE. However, as expected, highly diversified firms are found to exhibit the best risk profile.

These results are invaluable to managers in strategic decision making. They also provide a first step to understanding the nature of the relationship between geographic spread and performance of UK construction firms.

The paper aims to measure the nature and extent of international diversification followed by Indian companies over the period 2009–10 to 2017–18. The study also aims to assess the pattern of transition of companies to various strategies of international diversification.

Jacquemin and Berry’s (1979) entropy approach has been applied to measure the extent and assess the nature of international diversification. Further, the study deploys two-dimensional categorical framework advocated by Vachani (1991) and categorizes the firms into four international diversification strategies.

Larger proportion of companies in internationally low diversification (ILD) strategy reveals low extent of international diversification of Indian companies. The pattern of diversification depicts that the trend of moving forward is speeding up sequentially toward higher strategies of growth. Both the extent and pattern depict that the nature of diversification is shifting from relatedness to un-relatedness with transitions from intra-regions to inter-regions. The study confirms the applicability of eclectic theory and psychic distance Uppsala model in determining the preference of international diversification strategies and process of internationalization respectively in Indian firms.

The paper is first of its kind on account of several reasons. First, such a comprehensive evaluation of preferences for international diversification strategies has never been taken up with reference to emerging economies, especially India. Second, the paper is not static and does not limit itself only to the identification of favored strategies of Indian companies but also gauges the transitional behavior of Indian companies across different strategies at different points of time. In fact it is the first study to statistically research the applicability of psychic distance model in firms in emerging economy. Third, the results not only measure the quantum of international diversification but also assess the extent of relatedness and un-relatedness followed by Indian companies.

The manufacturing sector plays an important role in any economy. The sector opts for diversification techniques and CSR initiatives in a competitive business environment for growth, survival and reputation. This study examined the impact of corporate diversification and CSR on the financial performance of South Asian manufacturing firms.

Data is obtained from the financial statements of 350 listed South Asian manufacturing firms as well as the respective stock exchanges of these countries. The data for research analysis ranges from 2010 to 2020. Diversification is measured using product diversification and geographic diversification. CSR is quantified in terms of social contribution value. Accounting measurements (ROA and ROE) are also used to capture corporate performance. For hypothesis testing, the study also uses fixed effect panel regression, and for assessing the robustness of the findings, the two-step dynamic panel system-GMM regression approach is used.

Findings of study indicate a positive impact of product and geographic diversification on financial performance measured with ROA. However, geographic diversification is insignificantly linked with ROA and ROE. Further, CSR positively impacts the performance of firms in South Asia with both performance measures.

The study has several policy implications based on the findings, including the need for the manufacturing sector to practice and implement appropriate diversification approaches and CSR initiatives to improve its financial performance and reputation.

The purpose of this study is to provide an integrated framework that conceptualizes multifaceted antecedents pertaining to international expansion of emerging market businesses in relation to firm performance. This paper develops multiple-item measures of multiple dimensions to clarify ownership structure and three diversification strategy relationships to performance. We test how ownership structure and diversification strategy affect emerging market multinational enterprises’ financial performance. The result shows that the relationship between ownership structure and firm performance is a nonlinear relationship (S shape). We also found that excessive international diversification, product diversification, and geographic scope of the expansion process negatively moderate the impact of Asia Pacific multinational enterprises’ performance.

The relative benefit of sector and regional diversification is a topic of continuing interest to academics, however, the issue has not previously been investigated in Italy. Additionally, previous studies have used geographically defined regions, rather than economically functional areas, when performing the analysis even though most would argue that it is the economic structure of the area that will lead to differences in demand and hence property performance. Therefore the purpose of this paper is to use the economically defined regions of Italy to test the relative benefits of regional diversification versus sector diversification within the Italian real estate portfolio.

The paper uses the dummy variable methodology of Heston and Rouwenhorst on the sector and regional affiliation of 27 cities in Italy using annual data over the period 1989 to 2007 for three property‐type: residential, retail and offices and four economically defined regions: the North West, the North East, the Centre of Italy and the South and Islands.

In contrast, to previous studies it is found that the sector and regional factors effect the returns of properties in Italy in almost equal measure, which is probably a result of using the diverse economic regions of Italy rather than arbitrary geographically locations. Nonetheless, the results show that the sector factor has started to dominate the regional effect in Italy since 1997.

This is the first paper to study the relative benefits of sector and regional diversification in Italy. Additionally, this is the first paper to use regions which are defined on an economic functional basis rather than a geographical basis. The results suggest that, unlike managers in other countries, Italian real estate managers need to monitor both the regional and sector composition of their portfolios.

This paper aims to investigate the moderating effects of a board of directors on foreign direct investment (FDI)’s international diversification in Turkey.

A sample of Turkish multinational firms with FDI was used. Two different aspects of international diversification were considered: the relationship between international diversification and financial performance and the moderating effect of board composition on the relationship between international diversification and the firm’s financial performance. Firm-level data were obtained from the Istanbul Stock Exchange in Turkey.

The findings reveal that international diversification leads to better financial performance according to market-based measures. On the other hand, this study indicates that the board characteristics have a moderating effect on international diversification and financial performance.

The study is based on a sample of publicly listed firms in Turkey, and this restriction limits the generalizability of the findings.

The internalization efforts of Turkish FDI have led to better financial performance in terms of market-based measures. The results have stated that the interest of independent outside directors is aligned with lower-risk investment decisions. Independence of independent outside directors in Turkey is interrogated by practitioners or the Capital Markets Board of Turkey. The larger board size which a moderator variable is provided, the wider shareholder value in Turkey is.

One can understand that the development of market-supporting institutions provides the support for entry to an emerging economy which is inefficient or incomplete markets and highly concentrated family ownership.

These findings provide important implications for corporate governance and highlight the need for further research on the role of governance in firm internationalization. This study not only helps to understand how board characteristics affect the choice of international diversification decisions, but the results also allow to assess the performance implications of these choices for a particular period.

The aim of this study is to investigate the effect of income and geographic diversification on the double bottom line of microfinance institutions (MFIs) in Middle East and North Africa (MENA) countries where conventional and Islamic MFIs coexist. The idea is to explore whether diversification impacts MFIs' financial performance and outreach differ for Islamic microfinance.

The authors test the effect of diversification and business models of MFIs on their performance and poverty outreach. The authors’ data set is an unbalanced panel sample of 81 (Islamic and conventional) MFIs in MENA countries covering 1999–2018, comprising 743 MFI-year observations.

The authors find that increasing income diversification in microfinance and focusing on rural areas decreases the financial performance of MFIs in MENA countries. Islamic MFIs benefit from income diversification by increasing their financial performance. The results provide evidence of a nonlinear relationship between income diversification and the financial performance of MFIs. Although conventional MFIs improve their depth of outreach by diversifying their income, Islamic MFIs have a lower breadth of outreach because they show a higher degree of income diversification.

This research contributes to the ongoing debate of whether MFIs should focus on or diversify their services to Islamic microfinance. Therefore, the findings of this study are practically crucial for MFIs' stakeholders to understand the contribution of diversification strategies in improving the Islamic MFIs to achieve both financial and social objectives.

To the best of the authors’ knowledge, it is the first research that addresses the impact of diversification strategies in Islamic microfinance. Additionally, using a panel data set of conventional and Islamic MFIs in MENA countries spanning 1999–2018, this study provides empirical evidence on the diversification versus focus issue from the microfinance industry and the subset of Islamic microfinance.

Few countries have sufficiently long and detailed returns data for real estate to permit sophisticated analysis. This paper aims to examine the potential diversification of private real estate investments using returns data for major regional centres in Ireland and the UK.

Optimal real estate‐only portfolios are constructed using total returns, income returns and appreciation returns for office and retail real estate in ten cities within Ireland and the UK. The analysis uses IPD data for the period 1984 to 2002. Total return, income return and appreciation returns are treated as separate asset streams in the modelling of portfolios.

The results show different risk levels; in particular the income stream carries low risk, whereas the capital appreciation element is much more volatile and risky. Optimal portfolios, office or retail, whether income, appreciation or total returns, indicate that provincial markets perform well and are capable of pushing London out of the optimised portfolios.

Limitations stem from the optimal portfolios being based on return series without a consideration of market depth. Future research will seek to construct weighted portfolios.

The paper constructs optimal portfolios for three scenarios: low return; medium return; and high return across sectors, return streams and major regional centres in Ireland and the UK. The results show that regional centres perform well and can exclude London real estate from optimal portfolios.

The purpose of this paper is to explore the relationship between international diversification strategy and corporate social responsibility (CSR) for firms from emerging economies.

This paper is based on an empirical study of a sample of Chinese firms listed in Engineering News Record top contractors from 2010 to 2014. A moderated analysis is employed in order to test the hypotheses and examine how the scale and scope of international diversification affect CSR.

The empirical results show that degree of internationalization (DOI), as the scale, is positively related to firms’ CSR scores. Furthermore, two scopes, geographic diversification (GD) and project diversification (PD), have different effects on CSR scores. GD negatively moderates the relationship between DOI and CSR scores, while PD has a positive direct impact on CSR scores.

This paper focusses on firms from emerging economies; therefore, the findings may not hold for firms from developed markets.

The results of this paper provide strategical advice regarding international business, for firms from emerging economies to meet the managerial challenges regarding CSR in global markets.

As the relationship between international diversification and financial performance has been thoroughly discussed in previous studies, this paper extends the literature on international diversification’s effects on CSR.