Organizational Financial Performance Research Articles

Meeting Stakeholder Needs: Who Should Managers Pay Close Attention To? Evidence from Listed Chinese Manufacturing Companies

Meeting the needs of stakeholders, as an element of CSR, requires a delicate balance of meeting these needs and ensuring profitability. Guided by the legitimacy theory and the stakeholder theory, this paper assesses the significance of meeting stakeholder needs and examines the types of stakeholders that managers pay close attention to. Using a fixed-effects model on 859 Chinese manufacturing firms and a regression analysis, the results show a positive link between corporate social responsibility (CSR) activities and organisational financial performance via both accounting and market measures in the Chinese manufacturing market. Furthermore, the primary objective of companies is to maximise shareholder returns while also meeting societal needs. The results also indicate that responsibility to shareholders and employees and growth potential have significant positive impacts on a company’s market value. This research demonstrates the need for companies to engage in CSR activities, as this can establish an elevated level of financial performance. Furthermore, attention needs to be paid to other stakeholders in corporate CSR activities to engage them and sustain their commitments towards an organisation’s productivity, growth, and sustainability. This is the first study to examine the power of influence from different stakeholders using legitimacy theory. Secondly, it is the first study to evaluate this influence using the Chinese manufacturing industry, which is, arguably, one of the largest in its field.

Study on Impact of Audit Committee on Organization Financial Performance

Abstract: As of late, the job of review panels inside associations has acquired expanding consideration because of their urgent job in guaranteeing straightforwardness, responsibility, and powerful administration. This study means to investigate and examine the effect of review advisory groups on hierarchical execution, zeroing in on their capabilities, synthesis, and viability.

Influence of Innovation Approach on Competitive Structure of Tier 1 Commercial Banks in Kenya

In today's volatile business landscape, companies must continuously innovate to remain competitive. Innovation, encompassing the creation and implementation of new concepts across products, services, and technologies, is essential for meeting evolving market demands. Both radical and incremental innovation contribute to organizational financial performance (Abiodun, 2017). However, traditional banks often exhibit technological inertia, hindering their ability to adopt new methods efficiently. This reluctance presents an opportunity for challenger banks to pioneer technological advancements, diversify risk management strategies, and optimize resource utilization, leveraging instruments like asset securitization. This study investigates the impact of innovation approaches on the competitive structure of Tier 1 Commercial Banks in Kenya. Employing descriptive and correlational research designs, the study surveyed 182 respondents selected via stratified random sampling from a target population of 334 individuals across Tier 1 Commercial Banks. Quantitative data analysis utilized descriptive statistics, correlation, and regression analysis with SPSS version 26. Findings indicate a positive correlation between innovation and competitive structure, underscoring innovation's significance in sustaining competitive advantage. Technology adoption, including mobile banking and remote service delivery, also enhances competitive structure. Furthermore, the study highlights the contribution of risk diversification through new financial instruments and incremental innovations to financial success. Overall, the research emphasizes the critical role of innovation and technology in driving competitive advantage within the banking industry. It recommends that top management continuously expand their offerings of innovative products to remain competitive.

The role of corporate environmental ethics in shaping environmental management accounting adoption under the institutional theory

This study aims to investigate the complex association between institutional pressure, adoption of environmental management accounting (EMA), and financial performance, with corporate environmental ethics as a moderating component. It explains why and how firms adopt EMA in response to institutional demand to factor environmental factors into their strategic decision-making processes. Quantitative information is gathered using a structured questionnaire from 256 manufacturing companies’ environmental managers and executives who monitor environmental practices and policies and decision-makers who shape business environmental ethics and strategy in the Indian state of Karnataka. Data are analyzed using SmartPLS 4, and PLS-SEM tests the hypotheses. The results show that coercive pressure (β = 0.244, p = 0.000), mimetic pressure (β = 0.221, p = 0.000), and normative pressure (β = 0.209, p = 0.000) have a major role in determining the rate of EMA adoption. It is further identified that EMA adoption (β = 0.217, p = 0.000) positively influences the organization's financial performance. Furthermore, EMA adoption mediates the relationship between coercive pressure (β = 0.053, p = 0.000), normative pressure (β = 0.045, p = 0.000), mimetic pressure (β = 0.048, p = 0.000), and firm’s financial performance. Coercive pressure is associated with higher EMA adoption, although the impact of this link is moderated by corporate environmental ethics (β = 0.069, p = 0.000).

How does big data affect organizational financial performance in turbulent markets? The role of customer-linking and selling capabilities

The information age provides vast opportunities for organizations to improve their efficiencies by relying on big data-AI empowered analytics (BDA). The purpose of this study is to address the critical question of how BDA-fit affects organizational financial performance, taking into consideration differences between markets and customer change caused by technology turbulence. Using data collected at the firm level and building on Task-Technology Fit Theory and Dynamic Capabilities Theory, empirical results indicate that BDA-fit is important to drive organizational financial performance through the development of customer-linking and selling capabilities. These results vary across markets, with BDA-fit having stronger effects on selling capabilities and organizational financial performance in highly turbulent markets. BDA allows organizations to upturn challenges and hindrances caused by market turbulence into opportunities to increase sales revenues. Based on the findings, theoretical contributions and managerial implications are provided.

Green Emerging Digital Technologies, Green Supply Chains, and the Performance of Environmentally Friendly Firms: The Underpinning Role of Human Resources

Anchored in the resource-based view, this research analyzes the relationships between green information systems (Green IS), green human resource management (GHRM), and green supply chains (GSCM). It then examines the effects of these relationships on the environmental and financial performance of organizations. To meet the proposed objectives, a survey was carried out with 211 Brazilian companies, with the data analysis stage employing the structural equation modeling technique. The main findings include that green information systems play an important role in supporting green supply chain practices, and indirectly contribute to environmental and financial performance by facilitating organizational processes. Furthermore, our results reveal that human resources partially mediate the relationship between information systems and green supply chains, through employee engagement in environmental management and rewards based on environmental performance. This study also brings a number of theoretical and practical contributions. In terms of theory, it highlights a previously unexplored relationship between the prevailing concepts of Green IS, GSCM, and GHRM, and their impacts on firm performance, which enriches the body of knowledge in the IS, HR, and engineering management fields. For practitioners, this study reveals how they can strategically articulate HR, IS, and supply chain functions to support sustainability strategies. The findings clarify that blending technical (IS) and soft (HR) skills is pivotal to developing valuable GSCM capabilities to support and improve companies’ performance.

The Impact of Corporate Social Responsibility on Financial Performance in a Selected Medium-Sized Clothing Manufacturing Organization in South Africa

Corporate Social responsibilities (CSR) is an established idea that urges corporations to incorporate environmental and social responsibilities into their operations. It enables businesses to be socially responsible to stakeholders and the public. Small and medium-sized enterprises (SMEs) have received international recognition for their contributions to social and economic development. This study investigates the impact of CSR on financial performance at a medium-sized clothing manufacturing company in the eThekwini District Municipality of KwaZulu Natal, South Africa. The study was designed to be conclusive. It employs a quantitative approach, examining the experiences of an organization that has implemented CSR. The study's objective was met by gathering pre- and post-quarterly data on profitability and production costs. The data was analysed using the Ordinary Least Squares (OLS) model and the Statistical Package for the Social Sciences (SPSS). The findings show that CSR can boost financial performance by minimising business-related risks and compliance expenses, which leads to increased profitability and lower production costs. Any rise in profitability boosts the organization's financial performance, while any drop in production costs improves the company's financial performance. This study identifies the strengths and weaknesses of CSR in relation to financial performance in the selected medium-sized manufacturing business in South Africa.

Does Corporate Social Responsibility Affect Organizational Financial Performance in Nigeria?

The financial performance of multinational firms is usually affected by the business environment in which they operate. This environment brings challenges especially socio-culturally related factors. This study aims at examining the effect of corporate social responsibilities on organizational financial performance in Nigeria. The study adopts ex post facto research design and purposive sampling methods. 30 quoted firms actively trading between 2018 and 2022 are selected and data were collected from their financial statements. Panel least square was used as method of data analysis. The t-test was used as test of hypotheses and was measured against a standard z-score value of 1.96. The results of the study show that corporate social responsibility positively affect organizational financial performance in Nigeria. The study therefore recommends that multinational organizations should make efforts to create a close relationship with its immediate environment by investing in its environment and use strong corporate governance policy to strengthen continuity.

SOFT SKILLS AS A KEY IN THE TECHNICAL ASSISTANCE SECTOR

This study presents a service model based on socio-emotional skills for the after-sales department of a specific organization. The research, conducted over a year, aimed to demonstrate the importance of these skills in creating a supportive and motivating work environment and their direct impact on generating income and profits. The model was implemented in the technical assistance sector of a company located in the northern plateau of Santa Catarina, serving as a case study. To support the theoretical framework, a Systematic Bibliographic Review (RBS) was conducted between 2017 and 2022, focusing on the most relevant themes related to the study. The research involved various activities, including daily practices of active listening to provide comfort to customers in need of technical assistance. Additionally, specialized lectures on communication were organized to address theoretical aspects of socio-emotional skills. The results of the study were measured through customer feedback and cost savings. The implementation of the model led to increased customer satisfaction and more efficient resource allocation. Overall, this research highlights the significance of socio-emotional skills in improving both the work environment and the financial performance of organizations

When commitment isn’t enough: The cross-cultural interactive effects of commitment-inducement and compliance-enforcement on performance

The current study contributes to the ongoing discourse in the extant literature concerning the performance effects of the commitment-inducement and the compliance-enforcement approaches to the management of people and work. We expand on two research studies conducted in China to assess if the finding that commitment-inducement and compliance-enforcement result in higher organization financial and operational performance generalizes to corporate social responsibility performance and to countries and cultures across the globe. Using the current study’s large global multi-source sample, our findings illuminate that compliance-enforcement explained significant incremental variance in both organization financial and operational performance and organization corporate social responsibility performance beyond that of the commitment-inducement approach alone. Moreover, the highest levels of both performance outcomes were obtained by organizations that simultaneously used both commitment-inducement and compliance-enforcement; that is, hybrid governance. Compliance-enforcement was also found to have a more substantive relative effect on organization financial and operational performance while commitment-inducement was found to have a more substantive relative effect on organization corporate social responsibility performance. Furthermore, as hypothesized, at the between country-level, the relationship between the commitment-inducement approach of managing people and work and corporate social responsibility performance was found to be more negative both for a high individualism than a low individualism culture and for a high uncertainty avoidance than a low uncertainty avoidance culture, respectively. Whereas, the relationship between the compliance-enforcement approach and corporate social responsibility performance was found to be more positive for a high uncertainty avoidance than a low uncertainty avoidance culture. Finally, as hypothesized, at the between country-level, commitment-inducement and compliance-enforcement were found to be substitutes and have a negative synergistic effect on corporate social responsibility performance. Implications, limitations, and avenues for future research are discussed.

Effect of Procurement Practices and Performance of Non-governmental Organizations in Rwanda a Case of SOS (Save Our Souls) Children’s Villages

The general objective of this study was to assess the effect of procurement practices on the performance of NGOs in Rwanda, a case study of SOS Children’s Villages. The study was guided by the following specific objectives: To examine effect of procurement planning and performance of SOS Children’s Villages, Rwanda, to assess the effect of vendor selection and performance of SOS Children’s Villages, Rwanda, to assess the effect of procurement negotiations and performance of SOS Children’s Villages, Rwanda, to examine the effect of procurement contract control and performance of SOS Children’s Villages, Rwanda. The results of this study provided information to the non-governmental organization how procurement practices optimize their performance since effective procurement practices is tremendous practices making organization to achieve on objective. The results of this research are beneficial to the managers of the procurement department in the Non-governmental organization as this study provided insight on how procurement practices contribute to the institution’s performance. This study applied descriptive design to get results related to the study, the target population as well sample size was 64 respondents. Researcher utilized census as sampling technique. The source of data was primary and secondary methods. Questionnaires were adopted to collect primary data and documentary review applied for collecting secondary data. The data was obtained using descriptive statistical analysis with use of frequency, percentage, mean and standard deviation, and inferential statistics by the use of Pearson correlation (r) and multiple linear regression analysis. The presentation of results was presented using tables, the pilot test was determined to ensure the validity and reliability of instrument used in data collection. After data collection the following results were observed, basing on the Pearson correlation, procurement planning influences performance of Save Our Souls children’s villages r= 0.835 while vendor selection influence performance of Save Our Souls children’ villages at correlation coefficient of .812. On the other hand, procurement negotiations influences performance of SOS Children’s Villages in Rwanda at r=0.764 and procurement contract control effects performance of Save Our Souls children’s village at .79, the study concluded that all variables considered by researcher including procurement planning, vendor selection, procurement negotiation and procurement contract controls contribute to the performance of Save Our Souls children’s villages in different corners. The study recommended that that effective control of supplied product is needed to ensure the suppliers are supplied the quality product as planned by management. The future researchers are recommended to make research about the contribution of effective procurement practices on financial performance of organization in Rwanda using government institutions.

The Impact of Production and Operations Management Practices in Improving Organizational Performance: The Mediating Role of Supply Chain Integration

While prior research has consistently established a significant link between production and operations management (POM) practices and organizational financial performance (OFP) across various contexts, the mechanisms driving this connection remain unclear. This study addresses this gap by examining the mediating role of supply chain management (SCM) integration in the relationship between POM practices and OFP within manufacturing firms. Drawing on established theories and concepts such as the resource-based view (RBV) of firm and operation strategies, this study employed a quantitative research design. Survey data were collected from 209 managers in Jordanian manufacturing firms and analyzed using structural equation modeling (SEM). The results confirmed a positive and significant association between POM practices and both SCM integration and OFP. Furthermore, SCM integration partially mediated the impact of POM practices on OFP, thereby underscoring its role in transmitting positive effects to financial performance. This research contributes to the field by integrating POM practices with SCM integration and by elucidating the mechanisms through which these practices influence financial performance in Jordanian manufacturing firms. Through this, our understanding of these relationships for practitioners and researchers alike is enhanced.

Impact of Social Media Usage on Financial and Non-Financial Performance of Organization through Social CRM

Social media usage improves Social Customer Relationship Management (CRM) is highly important for modern firms to create value for business after the rapid growth of technology adoption by customers. Studies on social media and organizational performance are limited so the present study has to extend this topic for a brief analysis of this domain. Hence, the current study aims to investigate further how social media usage benefits both financial and non-financial aspects of organizational performance through social CRM. A quantitative cross-sectional research design was carried out to collect the primary information using a structured questionnaire using two separate surveys; one was filled out by the top management of the organizations while the other was filled out by the respective customer of the organizations from different sectors of Pakistan which were also active on Facebook and lastly each 209 participants in both surveys were selected for data analysis. AMOS and Smart PLS were employed to test this proposed model. All findings of this study are found significantly positive and the social CRM acts as a positive mediator between the direct association of social media usage and organizational performance. Furthermore, the present study offers marketers and businessmen to explain the linkage of CRM with advancing social media technologies to improve organizational performance either financial or non-financial performance.

Comparative Analysis of Pre and Post merger: Effect on the Financial Performance of Microfinance Institution in Nepal

There are no specific studies available on the impact of mergers and acquisitions on the financial performance of Microfinance Institutions in Nepal. 
 Other studies available on the impact of funds and investments on the financial performance of organizations However, these studies are not directly related to the impact of mergers and acquisitions on the financial performance of Microfinance Institutions in Nepal. 
 This study aims to analyze the effect of pre and post-merger financial performance of Microfinance Institutions (MFIs) in Nepal. The study has taken four merged Microfinance Institutions of Nepal as the sample. The study has used paired sample t-tests to analyze the data. The findings of the study showed that after the merger, the financial performance of the Microfinance Institutions in Nepal has not improved. The study found that there were no changes in the Earning per Share, Return on Equity, Return on Asset, Net profit Margin, Current Ratio, Net interest Margin and Price to Earnings Ratio. However, the study has found out that the Debt to Equity ratio has increased after the merger process. There are several studies available on the impact of mergers and acquisitions on the financial performance of banks in Nepal.

Involving HRM Indicators on Firm Financial Performance: Correlation Study Between Social Factors, Work Environment, and Job Satisfaction

The purpose of this paper is to explore the relationship between factors such as job satisfaction, social factors, and work environment, and their impact on an organization's financial performance. This paper is based on a review of existing literature on the relationship between employee happiness and satisfaction and financial performance. Various theories, such as Expectancy Theory, Locke and Latham's Job Satisfaction Theory, and Fredrick Herzberg's Job Satisfaction Theory, are used to support our findings and analyze based quantitative with SMART-PLS to answer the hypothesis. The study results show that Job satisfaction has a positive impact on financial performance. Increased job satisfaction can reduce employee turnover, increase productivity, and reduce recruitment and training costs. Social factors, such as a positive organizational culture, effective communication, social support, and team diversity, also affect financial performance by creating a more dedicated and motivated workforce. Social factors also have a positive and significant effect on job satisfaction. Positive relationships with coworkers and superiors, good communication, and social support contribute to higher job satisfaction. A good work environment, including a comfortable physical environment, a positive work atmosphere, healthy employee relations, supportive company policies, and a positive work culture, contributes to employee motivation and company performance. This paper highlights the importance of factors related to employee happiness and satisfaction in achieving better financial performance. It provides managers with insights on how to improve employee satisfaction, build a positive organizational culture, improve communication, and create a supportive work environment. The findings also contribute to the existing organizational and management theories by emphasizing the significance of psychological and social factors in predicting financial performance.

The influence of managerial competence on the relationship between cost accounting systems and financial performance: A quantitative study of social welfare organizations

This study was conducted to examine how the abilities of business managers affect the relationship between cost accounting systems and financial performance. The data has been obtained from social welfare organizations. Multiple regression analysis without an interaction term was first conducted as the base model followed by hierarchical multiple regression analysis to verify the increase in explanatory power by adding an interaction term. All independent variables, adjustment variables   and control variables except dummy variables were centralized to facilitate the interpretation of the interaction term. A regression diagnosis was conducted after the exclusion of outliers. The statistical analysis environment R was used for the analysis. The findings of the study suggest that among the four functionalities of cost accounting systems, detailed cost ascertainment and reporting frequency may affect organizational performance through interactions with the abilities of business managers. This study may be viewed as a first step in examining the effects of the interaction between the functionality of cost accounting systems and the abilities of business managers on the financial performance of organizations.

Work-life balance policies and organizational financial performance: a scoping review

PurposeWork-life balance (WLB) policies have become a popular topic in both academic literature and organizations. However, previous studies in this area have provided mixed results, and the impact of WLB policies on various indicators of organizational financial performance remains unclear. There has been no comprehensive review that synthesizes the current state of knowledge and indicates future research directions. This review addresses this gap and provides a systematic review of published papers investigating the relationship between WLB policies and organizational financial performance.Design/methodology/approachThe review follows the PRISMA-ScR guidelines for scoping reviews. An analysis of 421 relevant records in Web of Science and Scopus databases identified 22 original empirical studies that focused on the relationship between WLB policies and financial performance at the level of the organization.FindingsMost reviewed studies indicated a weak positive relationship between WLB policies and financial performance. There was the strongest support for the effectiveness of flexible working hours and job sharing, while there was mixed support for the policy of working from home. There were a higher proportion of positive results in studies conducted in Western countries compared to Asian countries, which indicates a potential moderating effect of culture. This review also describes the primary limitations of previous studies, namely, low test power and insufficient evidence about causality.Originality/valueThis review summarizes the growing body of quantitative research on the relationship between WLB policies and organizational financial performance. It presents a model that includes moderators and mediators of this relationship and indicates potentially fruitful areas for future research.

Corporate reputation and shareholder investment: a study of Egypt's tourism listed companies

PurposeThis study aims to investigate the impact of corporate reputation on investors and whether it influences company investment returns. While previous research has focused on specific components of reputation, neglected risks associated with the analyzed firms, and relied on accounting performance metrics, this study takes into account both return and risk factors to examine how they affect corporate reputation and investment decision-making.Design/methodology/approachData were collected from 300 active investors in the Egyptian exchange stock market, and the seven-paradigm RepTrak model was used to assess reputation structures and expected return and risk. Structural equation modeling was employed to confirm the theories.FindingsThe findings highlight that investors demonstrate a primary focus on the financial performance of organizations when making stock market decisions, while also considering non-financial factors such as products, innovation, citizenship, governance, and emotional appeal. Their prioritization of investment returns and risks takes precedence over evaluating workplace practices.Originality/valueThis study's originality lies in its incorporation of return and risk measurements as crucial investment choice variables, contributing to the financial markets’ research on corporate reputation. By managing their reputation, corporations can enhance investors’ demand for their stocks and optimize their investment opportunities.

Aspects Regarding the Influence of Recent Crises on the Performance of Tourism Companies - Empirical Evidence

The COVID-19 pandemic has triggered an economic crisis with a global impact, affecting entities from many fields of activity, but particularly those from the production, transport, tourism, technological services sectors (Donthu & Gustafsson, 2020). Most countries have responded to this pandemic with travel bans, restrictions, and a series of health regulations aimed at managing the pandemic situation (Jones & Nguyen, 2021). The study aims to explore how and to what extent the capital structure and other financial characteristics of tourism organizations (one of the most affected sectors) influenced their financial performance during the 2007- 2008 global financial crisis and the COVID-19 pandemic. In this sense, a sample represented by 15 organizations in the field of tourism, listed on the Bucharest Stock Exchange (BSE), was subjected to analysis, the analysis period being 2007-2021. Ten independent variables were included in the study (cash ratio, current ratio, financial stability coefficient, debt-to-assets ratio, degree of coverage, total assets turnover, current assets turnover, accounts receivables turnover, cost to income ratio, and gross profit margin) from 2007-2021, for the evaluation of the capital structure and other financial characteristics of tourism organizations. After processing the data, it was found that the financial performance of organizations in the field of tourism is significantly influenced by the indicators of total asset turnover, debt-to-assets ratio, cash ratio, and financial stability coefficient.

Digital Revolution and Digitization Process to Promote AIS as a Vector of Financial Performance

Nowadays, many businesses recognize the importance of digitization as a strategic advantage to maintain competitiveness. As a result, current research aims to investigate three significant factors that influence digital transformation: digital innovation (DI), digital orientation (DO), and the accounting information system (AIS). These factors are supposed to impact the financial success and performance of firms. The objective of this study is to examine the positive association between digital orientation and financial performance (FP) and to explore how the AIS mediates this relationship. Additionally, this paper investigates the moderating role of digital innovation in the relationship between digital orientation and financial performance. To collect data, a quantitative method was employed using a random sampling technique. Data were collected via a questionnaire survey from small and medium-sized enterprises (SMEs) in China, with a sample size of 550. Structural equation modeling (SEM) and a bootstrapping technique with 5000 iterations were used to test the study hypotheses. The findings of this study indicate a positive link between digital orientation and the financial performance of organizations. Furthermore, the results confirm that the AIS acts as a mediator between digital orientation and financial performance. The outcomes also demonstrate that digital innovation plays a moderating role in the relationship between DO and financial performance. This paper contributes to the existing literature on digital transformation by providing a deeper understanding of the aforementioned antecedents of the digital revolution (DO, AIS, and financial performance) and how they should be integrated within digitalization settings to achieve financial performance.