Capital Firms Research Articles

The Employment Trilemma in the European Union: Linking Academia, Industry, and Sustainability Through Dynamic Panel Evidence

Amid growing concern about labour market resilience in an era of digital and green transitions, this study carries out an investigation on how academic innovation and industrial transformation jointly shape sustainable employment outcomes across EU-27 member states. We frame this inquiry within the emerging concept of the “employment trilemma”, which posits inherent tension between competitiveness, innovation, and social inclusiveness in modern economies. Drawing on a dynamic panel dataset (2005–2023) and employing System SMM estimations, we test the hypothesis that the alignment of academic innovation systems and industrial transformation strategies enhances long-term employment sustainability. Our results reveal a nuanced relationship: academic innovation significantly supports employment in countries with high knowledge absorption capacity, whereas industrial transformation contributes positively only when embedded in cohesive, inclusive economic frameworks. Thus, these findings provide valuable insights for international business due to their emphasis on the importance of cross-sectoral collaboration, policy synchronisation, and investment in human capital for firms navigating increasingly volatile labour markets. Likewise, the study offers actionable insights for business leaders, policymakers, and universities striving to balance innovation with equitable labour market outcomes in an integrated European economy.

Empirical Analysis of Executive Capital, Innovation, and Risk-Taking in A-Share Tech Firms

This research aims to explore the impact of executive human capital (SMHC) on the performance of Chinese A-share technology listed companies, with a focus on the mediating roles of technological innovation and risk-taking. Using 13,733 data points from 2,796 A-share technology listed companies from 2014 to 2022 sourced from the CSMAR Database, the OLS regression method was employed for analysis. The research findings indicate that SMHC, including its stock, flow, and investment, significantly improves enterprise performance. Among them, investment has the most significant impact, enhancing both economic benefits and market value. Moreover, technological innovation and risk-taking play mediating roles, with positive and significant coefficients. This research enriches the understanding of the relationship between SMHC, technological innovation, risk-taking, and enterprise performance, providing new insights for enterprises to optimize their human capital management and enhance competitiveness.

Equity Share Capital and Market Capitalization of Non-Financial Firms Listed at the Nairobi Securities Exchange, Kenya

Purpose: The diminishing growth of many of the non-financial enterprises listed at the Nairobi Securities Exchange (NSE) discourage investors from investing in these firms. Concerning the question of whether there is an ideal financial structure that maximizes the firm's value, academics, business managers, investors, and other stakeholders face a significant challenge in ascertaining the ideal financial structure of these firms. The study general objective was to study the effect of equity share capital on market capitalization of non-financial firms listed at the Nairobi Securities Exchange. Methodology: The target population of the study comprised of 45 non-financial firms listed at the NSE for a period of seven years. A descriptive research design was adopted with a census method focusing on 45 non-financial firms listed at the NSE, Kenya. Data was encoded and processed using statistics software (STATA version 18). Inferential statistics was adopted using the panel regression model. A data collection sheet was used to collect data of the listed non-financial firms and the outcome presented in tables using statistics such as means, standard deviation, frequencies, and percentages. The findings indicated the presence of a weak and positive correlation between equity financing and market capitalization. Panel regression model was applied for data analysis. Findings: The findings of the panel regression model indicated a positive and significant effect between equity financing and market capitalization of non-financial firms listed at the NSE, Kenya. Unique Contribution to Theory, Practice and Policy: The study was guided by the Market Timing Theory. The study recommended to managers to have equity shares leveraged by stakeholders in order to increase market capitalization and build resilience in the face of unstable market conditions.

How Do Segment Disclosure and Cost of Capital Impact the Investment Efficiency of Listed Firms in Nigeria?

The demand for improved segment disclosure is driven by the need to address investment inefficiencies and boost investors’ confidence in listed companies around the world. Transparency in corporate activities is essential for investors to determine the parameters of their stock return and investment efficiency across various segments of firms. Previous studies have primarily focused on a broader investment landscape in Nigeria, without paying adequate attention to the impacts of segment disclosure and cost of capital on the investment efficiency of listed firms. Against this backdrop, this study represents the first empirical research to examine the joint impact of segment disclosure and cost of capital on the investment efficiency of listed firms in Nigeria. Using a longitudinal research design, secondary data from 2015 to 2022 were extracted from the annual reports of 85 listed firms on the Nigerian Exchange Group (NGX). The data were analysed through descriptive and inferential statistical methods. Firms that reported their business or geographic segments were purposively selected for this study. The findings show that the cost of capital of the examined firms has a negative and significant impact on their investment efficiency (coefficient = −0.0268, p-value = 0.03079). On the other hand, the segment disclosure of the firms has a positive impact on their investment efficiency (coefficient = 0.0119, p-value = 0.0303). Lastly, total segment disclosure and cost of capital jointly have positive and significant effects (coefficient = 0.0192, p-value = 0.0030) on the investment efficiency of the firms. This study contributes to the growing research on segment disclosure by providing evidence that increased segment disclosure and a lower cost of capital can improve the investment efficiency of listed firms in Nigeria. Thus, this study recommends that the management of firms in Nigeria should disclose more segment information in their annual reports. This could consequently boost investors’ confidence in the reporting practices of firms, reduce the cost of capital of firms, and improve firms’ investment efficiency.

Research on the Impact of Top Management Team Human Capital on Firms' R&D Internationalization

Based on Upper Echelons Theory and Imprinting Theory, this paper examines the role of top management team (TMT) human capital in firms' R&D interna-tionalization strategies. The research findings indicate that a higher average age of the TMT is detrimental to the advancement of firms' R&D internationaliza-tion. Conversely, the overseas experience of TMT members is positively corre-lated with firms' R&D internationalization, and so is the educational attainment of the TMT. This paper deepens the understanding of the relationship between board human capital and firms' R&D internationalization, providing valuable management insights for the construction of corporate TMTs.

IPOs, Human Capital, and Labor Reallocation

Abstract How does access to public equity markets affect the human capital of IPO filing firms? While IPO filing firms have high average wages and limited industrial diversification, a successful IPO increases departures of high-wage employees to startups and triggers industrial diversification through employment growth in non-core industries. Surprisingly, IPOs do not significantly affect the earnings growth of pre-IPO workers. Instead, post-IPO hires receive larger earnings increases upon joining. Overall, going public has a significant effect on a firm’s workforce and labor reallocation across firms.

FDI Determinants in Developing Countries: A Firm‐Level Analysis

ABSTRACTForeign direct investment (FDI) has been an important driver of economic growth in developing countries. Between 2005 and 2017, FDI grew significantly in developing countries as the corresponding global growth rate of FDI inflows is around 32 percentage points higher than the world growth rate. The purpose of this paper is to analyze FDI determinants at the firm level in developing countries. Using a sample of 96,826 firms from 125 countries between 2005 and 2017, we adopt a fractional probit regression with endogenous covariates, a more suitable estimation method for addressing the FDI variable. The micro‐level results show that exports, investment, and human capital have a statistically positive impact on FDI inflows, while credit barriers and taxes have a negative effect. Also, market size and resources foster FDI, whereas inflation and environmental emissions lower foreign investment levels. This study demonstrates that governments wishing to attract FDI should adopt a variety of policies, including the promotion of international trade and measures that boost investment and human capital in firms and ease the access to credit.

XBRL extensions and cost of equity capital in Chinese firms: a natural experiment

ABSTRACT This study investigates whether XBRL (eXtensible Business Reporting Language) extensions affect cost of equity capital in Chinese firms during the historical sample period of 2015–2016. We find that the additional information in XBRL extensions is positively associated with cost of equity capital in Chinese firms. These findings suggest that the excess information in XBRL extensions reduces the reliability and comparability of financial reporting, leading to an increase in information processing cost and exacerbating the quality of information environment in Chinese capital market. We also find that the positive association between XBRL extensions and cost of capital is stronger in the firms with higher information asymmetry of lower institutional ownership and lower analyst coverage. Furthermore, XBRL extensions associated with specific financial statement items play a significant role in raising cost of equity capital. Our findings indicate that the redundancy of information in XBRL extensions complicates information processing for financial statement users, thus adding value to the XBRL standard makers.

Relationship Between Venture Capital, Financial Innovation, And Operating Performance In Nigerian Fintech Firms

Abstract Research Purpose. The research aimed to assess the interrelationships among venture capital funding, financial innovation, and operating performance within Nigerian fintech firms. It sought to investigate both the direct associations between these variables and the potential mediating role of financial innovation on the connection between venture capital funding and operating performance, with a focus on understanding their collective impact on the Nigerian fintech landscape. This is essential because the way business is done could be transformed by encouraging fintech innovations which will increase productivity and efficiency. Design / Methodology / Approach. To accomplish this, the study employed a primary data collection method via a questionnaire distributed to senior management personnel in two hundred FinTech companies. 220 senior management participants were purposively selected, and the gathered data underwent meticulous analysis using Partial Least Squares-Structural Equation Modeling (PLS-SEM) alongside various methodologies, including weighted mean scores, Heterotrait-Monotrait Ratio (HTMT), Fornell-Larcker square’s average variance extracted, Cronbach alpha, composite reliability (CR), and percentage variance. Findings. The findings revealed that the direct influence of venture capital funding on financial innovation yielded non-significant results (R2=0.220, β=0.274, t=1.116, p=0.264). Conversely, the direct impact of financial innovation (FI) on operating performance (OP) exhibited significant results (R2=0.401, β=0.559, t=5.989, p=0.000). Notably, the study discovered that venture capital funding (VC) was statistically insignificant (β=0.274, t=0.3913, p=0.362) in predicting the operating performance of fintech firms in Nigeria. Originality / Value / Practical Implications. The research established that financial innovation plays a pivotal role in augmenting the operating performance of fintech firms in Nigeria. This study addresses a gap in the literature by investigating the impact of venture capital funding and financial innovation on Nigerian fintech firms’ operational performance. It concludes that financial innovation significantly drives operational excellence, while venture capital funding has an insignificant impact, with financial innovation not substantially mediating its influence on performance. The findings underscore the significance of introducing innovative financial products and services, fostering the adoption of a cashless economy, harnessing emerging technologies such as blockchain and Artificial Intelligence, and enhancing financial literacy and awareness. These factors collectively contribute to bolstering the operating performance of fintech enterprises.

Decoding Sustainability Reporting: Insights from Text Mining and Classification Models for SDGs

Objective: This study aims to investigate the signaling effects of Sustainability Reporting (SR) in listed Singapore firms, particularly in demonstrating firm capitalization and sustainability performance. The research focuses on identifying distinct SR signals using advanced text mining and classification techniques, and their alignment with the United Nations' Sustainable Development Goals (SDGs). Theoretical Framework: The study is grounded in signaling theory, which posits that firms communicate observable characteristics (SR content) to signal unobservable attributes (firm capabilities and sustainability performance). By applying this framework, we analyze how SR may act as a signaling mechanism for large-cap firms and sustainability leaders. Method: This research collects 1,844 sustainability reports from listed Singapore firms between 2016 and 2022. Using a combination of Structural Topic Modeling (STM) and Random Forest (RF) classification models, we extracted and analyzed the key SR signals that differentiate firms by size and sustainability performance. Results: The results indicate that SR signals such as community engagement, climate risk, and compliance are effective in distinguishing between large firms and firms with strong sustainability performance. The Random Forest models achieved high accuracy in identifying these groups. Community engagement, compliance with the Global Reporting Initiative (GRI), and sustainable construction were among the most impactful topics, with large firms focusing more on scope and governance, while sustainability leaders emphasized environmental risks and compliance. Research Implications: The findings provide insights into the practical and theoretical implications of SR as a signaling tool. Key SR topics are identified as critical signals for firms with large capitalization and high sustainability performance, guiding firms in utilizing SR in the context of SDGs. Originality/Value: The findings show that SR topics such as community engagement, climate risk, and compliance serve as key signals for differentiating firms by size and sustainability performance. Firms can strategically emphasize these areas to enhance their SR practices while contributing to broader SDGs.The findings provide insights into the practical and theoretical implications of SR as a signaling tool. Key SR topics are identified as critical signals for firms with large capitalization and high sustainability performance, guiding firms in enhancing their SR strategies.

Measuring ESG risk premia with contingent claims

We propose a contingent claims approach for estimating ESG risk premia from market information and market participants' decisions. To this end, we infer the asset value dynamics via the structural model of Merton [1974, “On the Pricing of Corporate Debt: The Risk Structure of Interest Rates.” Journal of Finance 29: 449–470.] for a large panel of S&P 500 firms using an estimation algorithm that utilizes the information embedded in stock market prices, CDS spreads, and default probabilities. We find a statistically significant relationship between the ESG score and the volatility and drift terms of the asset value process, suggesting that ESG factors are structurally connected to the value of the firm. We establish a mapping between ESG scores and the cost of equity and debt as implied by firm's contingent claims, and derive estimates of the ESG risk premium across different ESG and leverage profiles. In addition, we break down the ESG risk premia by industry, and demonstrate how practitioners can adjust the weighed average cost of capital of ESG laggard firms for valuation and decision making purposes.

The Effect of Operational Efficiency on Firm Capital Structure. Applied on the Real Estate Sector

The study examines the impact of operational efficiency (OE) on the firm's capital structure (CS) through some moderating variables applied to the Real Estate sector in Egypt. A panel data has been conducted to analyze and test 28 most active real estate companies in the Egyptian stock exchange (EGX) during the period 2016 to 2022 using descriptive, correlation and regression methods. The study findings showed that there is a significant negative effect of fixed asset turnover (FAT) on debt-to-assets through the operating cash flow (OCF). Furthermore, there is a significant negative effect of Rec. turnover on debt-to-assets. And a negatively significant effect of TAT on debt-to-capital occurred as well. On the contrary, there is a positive effect of OCF on debt-to-assets. While the effect of all activity measures of operational efficiency on debt-to-equity, equity multiplier, and proprietary ratios found insignificant. The board of directors should establish a proper agreement with the shareholders about the firm's financing methods before applying any efficiency processes. Also, to avoid spending money anonymously before checking the country's rules and regulations first. The study recommends further investigation on the effect of operational efficiency on firms' capital structure on different sectors, also should include more variables such as; liquidity, profitability, firm size, and firm performance.

Green Accounting and Firm Value of Healthcare Firms in Nigeria

In this study, the researcher examined green accounting and the firm value of healthcare companies in Nigeria. The study's objective was to investigate the effect of greenhouse gas emission accounting and renewable energy accounting sources on the earnings per share and market capitalization of healthcare firms in Nigeria. The descriptive research design was adopted. Data on six (6) healthcare firms listed on the Nigerian Exchange Limited (NGX) were used in the study with variables cost associated with the reduction of greenhouse gas emissions and investments in renewable energy used as proxies for green accounting, and Earnings per Share (EPS), and market capitalization used as indicators of firm value. The data was collected from the annual reports and financial statements of the listed healthcare firms in Nigeria. The data covered 14 years (2010-2023). The data was analyzed using descriptive and inferential statistical techniques. The findings revealed that costs associated with greenhouse gas emissions have a positive effect on earnings per share (EPS) and market capitalization of healthcare firms in Nigeria. Also, investments in renewable energy have a positive effect on earnings per share (EPS) and market capitalization of healthcare firms in Nigeria. It was concluded that green accounting has a positive effect on the value of healthcare firms in Nigeria. Recommendations made include the need for healthcare firms to sustain their green accounting practices in Nigeria and for the relevant supervisory institutions to sustain the enforcement of this practice to enhance the value of healthcare firms in Nigeria.

Selective industrial policy and innovation resource misallocation

Selective industrial policy and innovation resource misallocation

Economic Value Added Break Even Point of Commercial Banks

Economic value added (EVA) is an estimate of a firm’s economic profit, or the value created in excess of the required return of the company’s shareholders. Economic Value Added is the net profit, less the equity cost of the firm capital. The idea is that value is created when the return of the firm’s economic capital employed exceeds the cost of the capital. The amount can be determined by making adjustments to Generally Accepted Accounting Principle accounting. This article aims to measure the Economic Value Added breakeven point of commercial banks in India.

Leader Social Capital in Real Estate Firms Via Colleague Ingredients

Objective: The following were the objectives of this study: (i) analysis and measurement of leader social capital in real estate firms in Hanoi and neighboring provinces, Vietnam, via colleague ingredients; (ii) comparison of assessments of the leader social capital in real estate firms in Hanoi and neighboring provinces, Vietnam, via colleague ingredients, between respondents. Method: The data used in this study are primary, including survey data obtained from the respondents. We designed a questionnaire related to the leader's social capital via colleague ingredients in real estate firms in Hanoi and neighboring provinces, Vietnam. We determined the observed variables (scales) of the leader's social capital via colleague ingredients in real estate firms in Hanoi and neighboring provinces, Vietnam, based on previous studies and expert interview results. We use both qualitative and quantitative research methods, including descriptive statistics, the independent T test, and ANOVA analysis. Results: According to the findings of this study, three attributes of the leader's social capital via colleague ingredients in real estate firms in Hanoi and neighboring provinces, Vietnam, were quite high. All the attributes of the variables are statistically significant. There is no statistically significant difference in the leader's social capital via colleague ingredients in real estate firms in Hanoi and neighboring provinces, Vietnam, between these different genders, marital statuses, and ages. Conclusions: It was found that, although still difficult, the current real estate market has more opportunities than challenges. Because macroeconomics, the world economy, and Vietnam are showing signs of recovery, inflation and interest rates are no longer increasing and are gradually decreasing; legal and institutional problems are also gradually being resolved and implemented; planning at all levels is being completed; and public investment and infrastructure development have been promoted. This article is an academic contribution that enables understanding of the research developed and focuses on leaders' social capital via colleague ingredients in real estate firms in Hanoi and neighboring provinces, Vietnam, considering data from several reference research databases and survey results.

Leader Social Capital in Real Estate Firms: Evaluation of Respondents

Objective: This article argues that leader social capital in real estate firms in Hanoi and neighboring provinces of Vietnam via colleague ingredients needs to be researched. Based on a survey of relevant academic and policy literature, the study presenting assessments of survey subjects for leader social capital in real estate firms in Hanoi and neighboring provinces, Vietnam, via colleague ingredients may contribute to improving the business performance of real estate firms. Method: This study used a mix of methods for gathering qualitative and quantitative data. SPSS software is used for quantitative research methods, including assessing the reliability coefficient of the scales through the Cronbach alpha coefficient, EFA analysis, independent T-tests, and ANOVA analysis. Results: Based on our findings, we argue that a leader's social capital via colleague ingredients in real estate firms in Hanoi and neighboring provinces, Vietnam, is reliable and meaningful. Additionally, there is no statistically significant difference in the leader's social capital via colleague ingredients in real estate firms in Hanoi and neighboring provinces, Vietnam, between respondents with these different family platforms and job positions. Conclusions: Real estate firms should have solutions to enhance leaders' social capital through colleague ingredients, thereby contributing to improving business performance. This study sheds light on the social capital information gaps that, when filled, could help real estate firms reach their full potential by improving leaders' social capital through colleague ingredients.

The role of shifts in the effective tax rate on the cost of equity

The role of shifts in the effective tax rate on the cost of equity

Board human capital in high-tech firms: assessing the effect on financial and innovation outcomes

Board human capital in high-tech firms: assessing the effect on financial and innovation outcomes

Board human capital in high-tech firms: assessing the effect on financial and innovation outcomes

Board human capital in high-tech firms: assessing the effect on financial and innovation outcomes