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Do firm's organisational slacks influence the relationship between corporate lobbying and corporate financial performance? More is not always better

A political involvement in any organisation has often proved to be profitable for such firms that are seeking support and favourable regulatory conditions. Though many studies have investigated the effect of the corporate lobbying activities on the organisations, no clear results have been achieved....

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Main Author: Lin, Woon Leong
Format: Article
Language:English
Published: MDPI 2019
Online Access:http://psasir.upm.edu.my/id/eprint/77900/1/77900.pdf
http://psasir.upm.edu.my/id/eprint/77900/
https://www.mdpi.com/2227-7072/7/1/2
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spelling my.upm.eprints.779002020-05-04T17:38:07Z http://psasir.upm.edu.my/id/eprint/77900/ Do firm's organisational slacks influence the relationship between corporate lobbying and corporate financial performance? More is not always better Lin, Woon Leong A political involvement in any organisation has often proved to be profitable for such firms that are seeking support and favourable regulatory conditions. Though many studies have investigated the effect of the corporate lobbying activities on the organisations, no clear results have been achieved. In this study, we have investigated the lobbying expenditure of some of the most famous United States (US)-based companies, which support the U.S. government during 2007–2016. Primarily, we tested the relationship between the corporate lobbying and the Corporate Financial Performance (CFP), with the help of a dynamic panel data analysis, which is based on the System Generalised Methods of the Moment (SYS-GMM). The results of this study indicated that the corporate lobbying did not increase the probability of gaining more support from the government in comparison to the firms that did not use any lobbying techniques. Furthermore, the findings showed that corporate lobbying is a component of the zero-sum political agenda that cannot be accurately evaluated and does not contribute towards the improvement of the CFP. This study introduced the important component of organisational slack and noted that the corporate lobbying could significantly destroy the CFP if the organisational slack was high. MDPI 2019 Article PeerReviewed text en http://psasir.upm.edu.my/id/eprint/77900/1/77900.pdf Lin, Woon Leong (2019) Do firm's organisational slacks influence the relationship between corporate lobbying and corporate financial performance? More is not always better. International Journal of Financial Studies, 7 (1). art. no. 2. pp. 1-23. ISSN 2227-7072 https://www.mdpi.com/2227-7072/7/1/2 10.3390/ijfs7010002
institution Universiti Putra Malaysia
building UPM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Putra Malaysia
content_source UPM Institutional Repository
url_provider http://psasir.upm.edu.my/
language English
description A political involvement in any organisation has often proved to be profitable for such firms that are seeking support and favourable regulatory conditions. Though many studies have investigated the effect of the corporate lobbying activities on the organisations, no clear results have been achieved. In this study, we have investigated the lobbying expenditure of some of the most famous United States (US)-based companies, which support the U.S. government during 2007–2016. Primarily, we tested the relationship between the corporate lobbying and the Corporate Financial Performance (CFP), with the help of a dynamic panel data analysis, which is based on the System Generalised Methods of the Moment (SYS-GMM). The results of this study indicated that the corporate lobbying did not increase the probability of gaining more support from the government in comparison to the firms that did not use any lobbying techniques. Furthermore, the findings showed that corporate lobbying is a component of the zero-sum political agenda that cannot be accurately evaluated and does not contribute towards the improvement of the CFP. This study introduced the important component of organisational slack and noted that the corporate lobbying could significantly destroy the CFP if the organisational slack was high.
format Article
author Lin, Woon Leong
spellingShingle Lin, Woon Leong
Do firm's organisational slacks influence the relationship between corporate lobbying and corporate financial performance? More is not always better
author_facet Lin, Woon Leong
author_sort Lin, Woon Leong
title Do firm's organisational slacks influence the relationship between corporate lobbying and corporate financial performance? More is not always better
title_short Do firm's organisational slacks influence the relationship between corporate lobbying and corporate financial performance? More is not always better
title_full Do firm's organisational slacks influence the relationship between corporate lobbying and corporate financial performance? More is not always better
title_fullStr Do firm's organisational slacks influence the relationship between corporate lobbying and corporate financial performance? More is not always better
title_full_unstemmed Do firm's organisational slacks influence the relationship between corporate lobbying and corporate financial performance? More is not always better
title_sort do firm's organisational slacks influence the relationship between corporate lobbying and corporate financial performance? more is not always better
publisher MDPI
publishDate 2019
url http://psasir.upm.edu.my/id/eprint/77900/1/77900.pdf
http://psasir.upm.edu.my/id/eprint/77900/
https://www.mdpi.com/2227-7072/7/1/2
_version_ 1665896046950088704
score 13.211869

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