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Firm efficiency and corporate performance : The moderating role of controlling shareholders

This study analyses the effects of firm efficiency on firm performance and how controlling shareholders moderate the link between the two variables. Design/methodology/approach: This study employs data envelopment analysis to estimate firm efficiency and the panel regression method to assess the hyp...

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Main Authors: Nguyen, Thien Huu, Asif, Jawad, Kweh, Qian Long, Ting, Irene Wei Kiong
Format: Article
Language:English
English
Published: Emerald Publishing 2023
Subjects:
HD28 Management. Industrial Management
Online Access:http://umpir.ump.edu.my/id/eprint/40519/1/Firm%20efficiency%20and%20corporate%20performance_The%20moderating.pdf
http://umpir.ump.edu.my/id/eprint/40519/2/Firm%20efficiency%20and%20corporate%20performance_The%20moderating%20role%20of%20controlling%20shareholders_ABS.pdf
http://umpir.ump.edu.my/id/eprint/40519/
https://doi.org/10.1108/BIJ-04-2022-0253
https://doi.org/10.1108/BIJ-04-2022-0253
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spelling my.ump.umpir.405192024-04-30T06:28:07Z http://umpir.ump.edu.my/id/eprint/40519/ Firm efficiency and corporate performance : The moderating role of controlling shareholders Nguyen, Thien Huu Asif, Jawad Kweh, Qian Long Ting, Irene Wei Kiong HD28 Management. Industrial Management This study analyses the effects of firm efficiency on firm performance and how controlling shareholders moderate the link between the two variables. Design/methodology/approach: This study employs data envelopment analysis to estimate firm efficiency and the panel regression method to assess the hypothesised relationships among 1,295 firm-year observations of publicly listed firms in Malaysia from 2015 to 2019. Findings: The results indicate that firm efficiency (technical efficiency, pure technical efficiency and scale efficiency) has mixed relationships with firm performance (return on assets, market-to-book ratio and operating cash flows), all of which are being moderated by controlling shareholdings. Practical implications: This study highlights the importance of assessing firm efficiency as the key success factor for improving firm performance. Industrial managers should manage efficiently their resources or operating costs in achieving their corporate financial goals. Moreover, this study notes the presence of controlling shareholders, who can be either self-interested or company goal aligned. Originality/value: This study suggests becoming efficient in transforming inputs into outputs is a prerequisite before investigating accrual-based and cash-based firm performance measures, and the presence of controlling shareholders matters in these regards. Emerald Publishing 2023 Article PeerReviewed pdf en http://umpir.ump.edu.my/id/eprint/40519/1/Firm%20efficiency%20and%20corporate%20performance_The%20moderating.pdf pdf en http://umpir.ump.edu.my/id/eprint/40519/2/Firm%20efficiency%20and%20corporate%20performance_The%20moderating%20role%20of%20controlling%20shareholders_ABS.pdf Nguyen, Thien Huu and Asif, Jawad and Kweh, Qian Long and Ting, Irene Wei Kiong (2023) Firm efficiency and corporate performance : The moderating role of controlling shareholders. Benchmarking: An International Journal. pp. 1-22. ISSN 1463-5771. (Published) https://doi.org/10.1108/BIJ-04-2022-0253 https://doi.org/10.1108/BIJ-04-2022-0253
institution Universiti Malaysia Pahang Al-Sultan Abdullah
building UMPSA Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Malaysia Pahang Al-Sultan Abdullah
content_source UMPSA Institutional Repository
url_provider http://umpir.ump.edu.my/
language English
English
topic HD28 Management. Industrial Management
spellingShingle HD28 Management. Industrial Management
Nguyen, Thien Huu
Asif, Jawad
Kweh, Qian Long
Ting, Irene Wei Kiong
Firm efficiency and corporate performance : The moderating role of controlling shareholders
description This study analyses the effects of firm efficiency on firm performance and how controlling shareholders moderate the link between the two variables. Design/methodology/approach: This study employs data envelopment analysis to estimate firm efficiency and the panel regression method to assess the hypothesised relationships among 1,295 firm-year observations of publicly listed firms in Malaysia from 2015 to 2019. Findings: The results indicate that firm efficiency (technical efficiency, pure technical efficiency and scale efficiency) has mixed relationships with firm performance (return on assets, market-to-book ratio and operating cash flows), all of which are being moderated by controlling shareholdings. Practical implications: This study highlights the importance of assessing firm efficiency as the key success factor for improving firm performance. Industrial managers should manage efficiently their resources or operating costs in achieving their corporate financial goals. Moreover, this study notes the presence of controlling shareholders, who can be either self-interested or company goal aligned. Originality/value: This study suggests becoming efficient in transforming inputs into outputs is a prerequisite before investigating accrual-based and cash-based firm performance measures, and the presence of controlling shareholders matters in these regards.
format Article
author Nguyen, Thien Huu
Asif, Jawad
Kweh, Qian Long
Ting, Irene Wei Kiong
author_facet Nguyen, Thien Huu
Asif, Jawad
Kweh, Qian Long
Ting, Irene Wei Kiong
author_sort Nguyen, Thien Huu
title Firm efficiency and corporate performance : The moderating role of controlling shareholders
title_short Firm efficiency and corporate performance : The moderating role of controlling shareholders
title_full Firm efficiency and corporate performance : The moderating role of controlling shareholders
title_fullStr Firm efficiency and corporate performance : The moderating role of controlling shareholders
title_full_unstemmed Firm efficiency and corporate performance : The moderating role of controlling shareholders
title_sort firm efficiency and corporate performance : the moderating role of controlling shareholders
publisher Emerald Publishing
publishDate 2023
url http://umpir.ump.edu.my/id/eprint/40519/1/Firm%20efficiency%20and%20corporate%20performance_The%20moderating.pdf
http://umpir.ump.edu.my/id/eprint/40519/2/Firm%20efficiency%20and%20corporate%20performance_The%20moderating%20role%20of%20controlling%20shareholders_ABS.pdf
http://umpir.ump.edu.my/id/eprint/40519/
https://doi.org/10.1108/BIJ-04-2022-0253
https://doi.org/10.1108/BIJ-04-2022-0253
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score 13.232414

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