Search results

The purpose of this paper is to provide new insights about investment-cash flow sensitivities (ICFS) as a representative of financial constraints, by examining panel data consisting of 288 listed firms in Pakistan.

This study uses a panel data methodology and first difference generalized method of moments to control the problems of heterogeneity and endogeneity. By five different criteria, estimations are made for full and pre-classified sub-samples. Sargan test and Arellano-Bond serial correlation statistic are used for identification and validation of instruments and model.

According to the results, the ICFS has increased monotonically with the level of financial constraints. Further, the results depict that ICFS for the constrained group is much higher as compared to the unconstrained group. Overall, the result illustrates positively significant ICFS.

This study confirms signs of imperfections in the capital market, which leads to financial markets inaccessibility preceded by high under-investment costs and low social and economic development. Thus, proper policy designing and instigation are necessary for the subsidies, taxation, and foreign direct investment and later for financial market development and promotion of private corporate investment.

Previous studies have mostly focused on developed countries where large listed companies work in well-developed financial markets and do not face severe financial constraints because of the greater market integration (Bekaert et al., 2011, 2013) and superior investor protection laws (Djankov et al., 2008; La porta et al., 1998). However, this study focuses on listed companies from the emerging Pakistani market, which will bring forth the interesting aspects of ICFS and will enhance the existing literature effectively.

Using self-determination theory as the theoretical framework, the study examines the role of workplace spirituality in motivating internal whistleblowing in an organization and whether it gets enhanced by ethical leadership and moral courage of an employee.

The study was administered to 312 employees belonging to the hotel industry in north India. A three-waves study with a gap of one month each was used for data collection. The study used AMOS and PROCESS Macro to examine the hypothesized relationship.

The study found a positive association between workplace spirituality and internal whistleblowing, and a parallel mediating impact of employee’s moral courage and ethical leadership on workplace spirituality and internal whistleblowing relationship.

The work suggests that by recognizing and enforcing the motivating factors that encourage an employee to blow the whistle and reveal illegal, immoral or illegitimate organizational practices, an organization may be able to maintain an ethical stance and create a positive image of itself.

The unique contributions of this study include determining the role of workplace spirituality in supporting internal whistleblowing, especially in the Indian context. Keeping in view the huge losses incurred by hospitality sector during pandemic, internal whistleblowing by employees will create a positive image for the organizations and help in revival.