Corporate Market Performance Research Articles

Organizational inclusion and sustainable development: An empirical evidence from the context of Eastern culture

AbstractThis study offers new insights into organizational inclusion and corporate sustainable development in the Japanese context. Specifically, we aim to explore organizational inclusion in the antecedents of Lesbian, Gay, Bisexual, and Transgender (LGBT) inclusion and its effects on corporate outcomes, such as corporate market performance (CMP) and corporate environmental performance (CEP). Drawing upon legitimacy theory, we propose a conceptual model to uncover how operational diversity encourages organizational inclusion, such as supportive policies and practices. Moreover, grounded in stakeholder theory, we explore how organizational inclusion affects corporate outcomes, including CMP and CEP. Using a large sample of 1456 Japan‐listed firms with detailed organizational inclusive practices and corporate outcomes. Results indicate that operational diversity has positive effects on organizational inclusion. Moreover, the results indicate that organizational inclusion strengthens CMP and CEP. The empirical results are consistent after performing robustness checks based on subsampling. Our study contributes to the global discussion on business ethics, corporate market responses, and sustainable development.

The Influence of Enterprise Risk Management on Corporate Performance with The moderating Effect of Intellectual Capital

The purpose of this study is to examine the effect of the application of ERM on the corporate financial performance and corporate market performance. Furthermore, this study also examines the influence of intellectual capital in moderating the relationship of ERM to corporate financial performance and corporate market performance. The sample in this study is banking companies listed on the Indonesia Stock Exchange with the period 2018-2022. The results of this study show that ROI-based ERM has an influence on the corporate financial performance and the corporate market performance. ROA-based ERM has an influence on the corporate financial performance, but it has no influence on market performance. Intellectual capital has a moderator effect on the relationship between ROI-based ERM on a corporate financial performance and a corporate market performance. Intellectual capital has a moderator effect on the relationship between ROA-based ERM and a corporate financial performance, but it does not have a moderator effect on the relationship between ROA-based ERM on a corporate market performance.

Sustainable entrepreneurship: When does environmental compliance improve corporate performance?

AbstractConcerted effort to reduce ecological damages requires that the role of enterprises should be extended to incorporate environmental issues into their core business objectives. Despite huge developments in sustainable entrepreneurship research, outcomes of sustainable entrepreneurship uptake remain largely unclear. Drawing on data of Chinese firms, and utilizing fixed effects regression, our paper evaluates the conditions under which compliance with environmental regulation may enable or constrain corporate performance. We find that environmental compliance lowers corporate market performance and improves financial performance at the same time. We also find that the decline in market performance is reversed for large and privately owned enterprises, highlighting the role of firm size and ownership in corporate performance. When distinguishing between market‐ and financial performance, our evidence shows that environmental compliance will most likely improve market performance when enterprise carbon intensity level is low and improve financial performance when enterprise carbon intensity level is high. As we have discussed in our paper, these results have several implications from the point of view of managers, firm stakeholders, and policymakers.

Effect of enterprise risk management and corporate governance mechanisms on firm performance: Evidence from listed companies in Indonesia

This study aims to assess the influence of enterprise risk management and corporate governance mechanisms on companies’ financial and market performance. This study’s population is all companies registered on the Indonesia Stock Exchange in 2019. The purposive sampling method was used to select 664 listed companies to obtain a total sample of 242 companies. This study used a quantitative approach and analyzed data using Partial Least Square (PLS). The results showed that enterprise risk management (p < 0.01; β = 0.28) and corporate governance mechanisms (p = 0.01; β = 0.14) affect company financial performance. Enterprise risk management (p < 0.01; β = 0.16) affects company market performance, but corporate governance mechanisms (p = 0.24; β = 0.05) do not affect company market performance. This paper gives stakeholders a better understanding of the relationship between enterprise risk management, corporate governance, financial performance, and corporate market performance; consequently, it can serve as a resource for decision-making. For management, these results can be used as a guideline for taking appropriate steps in managing risk and implementing corporate governance to improve the company’s financial and market performance.

Inertia of Original Country’s CSR Impact on Corporate Financial and Market Performance: Evidence of Multinational Corporations in China

After entering the host country, multinational corporations often adopt a series of localization strategies in order to overcome the maladjustment caused by the inertia of some corporations when operating in the host country. This paper selects the corporate social responsibility inertia, which is most easily ignored in the corporate organizational inertia, as the analysis point to explore the impact of corporate social responsibility inertia on corporate performance and market. This paper analyzes three inertia dimensions through the combination of stakeholder theory and corporate social responsibility: structural inertia, environmental protection inertia and moral inertia. And use fixed effects mode in econometrics to empirically test the market performance data of multinational corporations in China from 2017 to 2022. The research finds that the structural inertia of corporate social responsibility negatively affects corporate performance. The moral inertia and environmental protection inertia of corporate social responsibility effects on corporation market performance is shown as a Kuznets curve. Through the improvement of localization strategy, corporations can overcome the inertia of the original country.

Embedding sustainability in risk management: The impact of environmental, social, and governance ratings on corporate financial risk

AbstractThis study investigates the effect of corporate social and environmental evaluation on investors' risk perception to explore the potential market risk for public companies that adopt a sustainable and responsible corporate strategy. We referred to the triple corporate assessment according to environmental, social, and governance (ESG) criteria to check whether ESG factors—meant to direct firms toward social and environmental needs—improve corporate market performance or trigger, among investors, a perception of “window dressing.” In doing so, we tested the impact of corporate social performance—proxied by an ESG assessment—on corporate financial risk using double risk measurement. We conducted a five‐year longitudinal study (fiscal years 2014–2018) of 222 companies listed on the Standard & Poor's index. The empirical findings show higher investor uncertainty regarding corporate sustainability performance, probably due to the misalignment of objectives between investors and investees. Indeed, an overall ESG assessment corresponds to higher systematic risk for firms, and a corporate environmental rating has an upward effect on the same risk dimension.

Strategic motives and performance implications of proactive versus reactive environmental strategies in corporate sustainable development

AbstractThis study proposes and empirically tests a model delineating how different environmental motives would affect the practice of proactive and reactive environmental strategies, and ultimately corporate market performance. It also explores the moderating role of competitive intensity for the motive−strategy and strategy−performance relationships. By surveying manufacturing firms operating in the Pearl River Delta region of China, the study has derived several important findings. To summarize, the findings reveal that while performance‐based motivation drives the practice of proactive environmental strategy, it curtails the practice of reactive environmental strategy. Conversely, regulation‐based motive exerts exactly opposite influences on these two strategies. The findings further highlight that proactive environmental strategy directly enhances corporate market performance, and this enhancing effect will be strengthened as competitive intensity increases. However, reactive environmental strategy is found not to exert any significant direct influence on such performance, and competitive intensity does not moderate this influence too. Last, while competitive intensity does not moderate the positive influence of promotion‐based motive on proactive environmental strategy, it strengthens the negative influence of this motive on reactive environmental strategy. These findings furnish several significant academic and practical implications for pursuing corporate sustainable development.

How Does the Market React to Corporate Philanthropic Behavior? —evidence from the COVID-19 Pandemic Shock

ABSTRACT Based on 1,130 listed Chinese firms’ charitable donation data during the COVID-19, this paper used the Event Study to examine market reactions to the epidemic and utilized OLS and Heckman two-stage models to investigate the impact of charitable donations on corporate market performance. Results show that greater corporate charitable material and medical donations result in more favorable short-term market reaction but weaker in the long term. Moreover, the low-leveraged, non-pharmaceutical, and non-SOEs can obtain better short-term performance through philanthropic donations. Findings suggest that the negative market sentiment from the COVID-19 cannot be offset by the short-term positive effects of corporate donations.

Influencing mechanism of strategic flexibility on corporate performance: the mediating role of business model innovation

ABSTRACT This paper explores the internal mechanism of corporate strategic flexibility on corporate performance. Through the empirical test of 197 Chinese enterprises, the empirical test is performed on the statistical hypothesis using the statistical method of SEM and linear regression. We find that the corporate strategic flexibility has a significant positive impact on its financial performance and market performance, and business model innovation has a significant positive impact on corporate financial performance and market performance, and efficiency-centred business model innovation plays a partial mediating role between strategic flexibility (resource flexibility and coordination flexibility) and corporate financial concentration; novelty-centred business model innovation plays a fully mediating role between resource flexibility and corporate market performance, and a partial mediating role between coordination flexibility and corporate market performance.

Financial Architecture and Corporate Performance: Evidence from Russia

Authors: Kokoreva Maria Sergeevna - assistant professor, lecturer, HSE Higher School of Economics, deputy head of the school of finance, researcher of the scientific and educational laboratory of corporate finance, director of the joint educational program for the preparation of bachelors in the direction of "Economics" USU and HSE. E-mail: maria_kokoreva@mail.ru.
 Anastasia N. Stepanova National Research University The Higher School of Economics, anstepanova@hse.ru
 In this paper we study the performance effects of capital structure, ownership structure choices and corporate governance mechanisms of Russian companies. To address the lack of research in corporate performance modeling in emerging markets we contribute to the literature by introducing cluster analysis of financial architecture and market performance of Russian companies. Our idea is to find out the efficient and inefficient types of financial architecture in emerging markets. On the sample of 50+ largest Russian nonfinancial companies within the period of 2005-2010 years we demonstrate the existence of three sustainable types of financial architecture in Russia. Using cluster analysis we form the cluster of companies in pre-crisis period and then demonstrate the relationship between the financial architecture type and the level of corporate market performance.

Does Corporate Market Performance Affect Environmental Information Disclosure? The Case of the Chinese Chemical Industry

Does Corporate Market Performance Affect Environmental Information Disclosure? The Case of the Chinese Chemical Industry

The UK Truck Market: An Investigation into Truck Purchasing Behaviour and Changing Market Shares

THE empirical analysis of market performance within industrial economics is still predominantly focused on market structure-performance relations. When applied to cross-section industrial studies, this approach implicitly assumes that industries are insignificantly dispersed from their respective short-run equilibrium positions and that each industry (or market) is homogeneous in terms of the behaviour of buyers and sellers. However, these assumptions will not be appropriate in the case of markets experiencing market share instability to the extent that the relative positions of competitors are changing. Structural adjustments towards new equilibrium positions resulting from competitors having different degrees of market success suggests that corporate market behaviour has an effect on market performance independent of any market structure variable. Recently, there has been a small, but growing, recognition of the importance of the behavioural mechanism in determining corporate market performance which is reflected in the work of Hatten and Schendel [6], Dorward [3], [4] and Caves and Porter [1]. These studies suggest that corporate behaviour has an independent effect on short-run market performance. Such an effect is particularly likely in the case of product differentiated industries where the market performance of competing manufacturers is affected by their relative success in matching planned product characteristics to buyer preferences. The importance of heterogeneous buyer preferences in explaining the variation of such variables as market share and profitability between firms means that detailed buyer requirements must be analysed in addition to the different competitive strategies of manufacturers. Thus, rather than assuming the complete structural dependence of the behavioural mechanism, empirical research needs to investigate the role of buyer and seller behaviour in affecting market performance. This paper focuses on the relationship between the purchasing behaviour of truck operators and the changing market performances of UK medium and heavy truck manufacturers between 1976-79. While this is a relatively short period for the analysis of structural change, there have been substantial changes in fortune for some of the leading manufikturers. In the 7.5-20 tonne gross vehicle weight (gvw) sector, Bedford, the market leader, had a decline in market share from 39.7 to 29.7 percent and in the over 20 tonne s'ector Leyland, the market leader, saw its share fall from 27 to