This study aims to examine the effect of firm size, net profit margin, earnings per share, and market value added on stock returns. The population used is 91 energy sector companies listed on the Indonesia Stock Exchange (IDX) for the 2020 -2024 period. This study uses a quantitative research method with a sampling technique using purposive sampling, a sampling technique with certain criteria. Based on these criteria, 13 companies were obtained as samples. In this study, the researchers used data analysis techniques including descriptive statistical analysis, classical assumption tests, multiple linear regression tests, and hypothesis testing using the SPSS version 26 application. The results of the study indicate that firm size has a negative and significant effect on stock returns, net profit margin and earnings per share have a positive but insignificant effect on stock returns, while market value added has a positive and significant effect on stock returns. Finally, together, firm size, net profit margin, earnings per share, and market value added have a significant effect on stock returns. The policy implications of this research are that energy sector companies need to increase shareholder value through investment management and business strategies that can generate high MVA. Furthermore, investors are advised to consider MVA indicators and company size when making investment decisions, while capital market regulators can encourage increased transparency of information related to corporate value creation to support market efficiency and investor protection.

Shareholders Value Creation in Indian Corporate Sector: Evidence from Banking, FMCG, Pharmaceutical and Automobile Industries

Economic Value Added (EVA) has emerged as a robust financial performance metric that captures true economic profit by incorporating the cost of capital into performance evaluation. Unlike traditional accounting measures such as net profit or return on investment, EVA provides a value-based perspective by assessing whether a firm generates returns above its cost of capital. This study explores EVA as a comprehensive indicator of financial performance and examines its relationship with firm profitability, shareholder value creation, and operational efficiency. Using regression analysis and ANOVA, the study evaluates the impact of key financial variables on EVA. The findings suggest that EVA is significantly influenced by capital structure, operating profit, and cost of capital, reinforcing its relevance as a superior performance metric. The study contributes to financial literature by integrating hypothesis testing and empirical modeling to validate EVA's effectiveness in strategic financial decision-making.

We examine how the presence of bank representatives on a firm's board of directors influences the firm's risk, debt, and ultimately, shareholder value. Our theoretical model uses a firm undertaking a debt-financed investment project, where the board determines the risk level after the debt has been arranged. The board's inability to commit to the project risk ex ante incentivises shareholder representatives to exploit financial leverage, leading to higher risk than is optimal and resulting in diminished shareholder value. By appointing bank representatives—who prefer lower risk—shareholders of firms with risky debt counteract excessive risk-taking, thereby enhancing shareholder value. Notably, reputation costs faced by shareholder representatives when associated with project failure make the shareholders worse off under a board that can commit to project risk, as these costs lead to more conservative risk choices. In contrast, a board that cannot commit but includes bank representatives allows for balanced risk management. Our findings demonstrate that shareholders benefit from this latter arrangement. Unlike previous studies, we find that balanced risk management is a potential benefit for shareholders when bank representatives are board members. Thus, our findings underscore that it is shareholders, not the lending bank, who desire bank representatives on their boards.

Purpose This study examines the determinants and consequences of payout initiation among initial public offering (IPO) firms. We investigate how external and institutional factors, including industry peer behavior, economic policy uncertainty and venture capital involvement, influence post-IPO payout decisions and the choice between dividends and share repurchases. We further analyze the implications of payout initiation for firms' innovation activity and long-term stock performance. Design/methodology/approach Using a sample of 2,003 US IPOs from 2000 to 2020, we employ probit regression models to analyze the determinants of payout initiation, payout choice and magnitude. Cox proportional hazard models are used to examine the timing of first payouts. OLS regression with fixed effects assesses innovation outcomes, while long-term performance is evaluated through calendar-time portfolios based on the Fama-French five-factor model. Findings Payout decisions, including initiation, payout form (dividends versus share repurchases), timing and size, are systematically associated with peer payout behavior, macroeconomic conditions and venture capital backing. We identify significant differences in innovation outcomes and long-term performance across payout types. Firms that initiate dividends experience sharper declines in innovation intensity and more negative long-term abnormal returns than those that initiate repurchases, highlighting important trade-offs among payout commitments, financial flexibility, and growth in the post-IPO period. Research limitations/implications The analysis focuses exclusively on US IPOs, which may limit generalizability to other institutional settings. Innovation is proxied by R&D intensity, which may not fully capture qualitative innovation outcomes. Future research could explore cross-country differences and dynamic adjustments in payout policies over the firm life cycle. Practical implications For managers of newly public firms, the results highlight the trade-off between signaling maturity through payouts and preserving financial flexibility for innovation. Dividend initiation, in particular, may constrain long-term growth. Venture capital investors appear to favor flexibility, influencing payout timing and form. For investors, peer behavior and macroeconomic conditions provide useful signals in anticipating payout decisions and evaluating their long-term implications. Policymakers and market participants should recognize that payout initiation in the post-IPO phase reflects broader strategic positioning rather than merely excess cash distribution. Social implications Payout decisions by IPO firms influence investment in innovation, with broader implications for economic growth, employment, and technological advancement. Commitment-based payouts that reduce innovation intensity may affect long-term productivity and competitiveness. Understanding the conditions under which firms preserve investment capacity versus distribute cash contributes to broader debates about short-termism in public markets. By clarifying how governance structures and macroeconomic uncertainty affect corporate resource allocation, the study informs discussions on sustaining innovation-driven growth in capital markets. Originality/value This study contributes to the literature by simultaneously examining the determinants, innovation effects and long-term performance implications of payout initiation among IPO firms. We present new evidence that peer effects, economic stability, and venture capital involvement all influence the likelihood and the form of payout initiation, and show that the flexibility of share repurchases, compared to dividends, and has significant implications for post-IPO innovation paths and shareholder value creation.

ABSTRACT Marketing research has increasingly examined marketing’s representation in firms’ upper echelons, yet the governance origins and value implications of marketing expertise in the boardroom remain underexamined. This study develops and tests a cross-level framework in which MEBMs shape firm value directly through governance and indirectly by influencing marketing leadership architecture in the top management team. Using an unbalanced panel of 193 U.S. Fortune 500 firms observed from 2013 to 2017, results indicate that MEBM representation is positively associated with Tobin’s q, a forward-looking measure of firm valuation. MEBMs are also positively associated with the likelihood of employing a marketing-experienced CEO (MECEO) and with chief marketing officer (CMO) presence in the top management team. Mediation analyses further indicate positive indirect effects of MEBMs on Tobin’s q through MECEO and CMO presence, consistent with partial mediation. These findings extend upper-echelon research in marketing by identifying board composition as a governance-level antecedent of marketing leadership and by clarifying when marketing expertise at the board level is reflected in shareholder value.

This study examines the post-merger wealth effects and strategic entrepreneurial behaviour in Indian corporations, with special reference to the merger between HDFC Bank and HDFC Ltd. Mergers and acquisitions are widely used as strategic tools to enhance financial performance, improve market competitiveness, and create shareholder value. The study analyses the impact of the HDFC merger on profitability indicators such as Earnings Per Share (EPS), Return on Assets (ROA), Return on Equity (ROE), Return on Capital Employed (ROCE), and Net Profit Margin (NPM) to evaluate shareholder wealth effects. In addition, the study explores how the merger influences strategic entrepreneurial behaviour by improving operational efficiency, innovation capability, and strategic flexibility. Using comparative financial analysis, trend analysis, and statistical tools, the study identifies the financial and strategic outcomes of the merger. The findings highlight that the merger strengthens long-term value creation and enhances the strategic capabilities of the merged entity in the competitive Indian financial sector. Keywords:- Mergers and Acquisitions, Shareholder Wealth, Strategic Entrepreneurial Behaviour, Profitability Ratios, HDFC Bank, HDFC Ltd, Financial Performance

This paper examines the trends, determinants, and impact of dividend policy decisions on firm value. Dividend policies, which reflect how companies distribute profits to shareholders, have been a critical area of research due to their potential influence on shareholder value, market perceptions, and corporate performance. This study explores the various factors affecting dividend decisions, such as profitability, liquidity, market conditions, and agency costs. Furthermore, it discusses the effects of these policies on firm value, considering the signaling theory and agency theory. Through a comprehensive literature review and data analysis, this paper presents an understanding of how dividend policies evolve in different economic environments and their implications for firm performance.

ABSTRACT Profitability analysis is one of the most important tools used to measure the financial strength, operating efficiency, and long-term sustainability of any business organization. In the highly competitive automobile industry, profitability determines the ability of a company to survive market fluctuations, changing consumer preferences, rising raw material costs, and technological transformation. Maruti Suzuki India Limited has established itself as one of the leading passenger vehicle manufacturers in India through strong brand value, wide product portfolio, extensive dealer network, cost efficiency, and customer trust. Various accounting ratios, income statement trends, operational performance indicators, and the company's market position are the primary focus of this study. The analysis aids in comprehending the company's efficient resource utilization for profit and shareholder value. The study also examines the relationship between sales growth, production efficiency, operating margin, net profit margin, return on assets, and return on equity of the company over a period of years. It highlights the impact of economic conditions, fuel prices, inflation, taxation policies, and consumer demand on company profitability. The findings reveal that Maruti Suzuki India Limited has maintained a strong market presence through innovation, fuel-efficient vehicles, strategic pricing, and effective cost control measures. The business has demonstrated resilience and consistent financial performance despite obstacles like competition, shortages of semiconductors, and shifting environmental regulations. Investors, researchers, management students, and policymakers can all benefit from this study's understanding of automotive sector profitability trends. Keywords: Profitability Analysis, Automobile Industry, Net Profit, Operating Margin, Return on Equity, Financial Performance, Maruti Suzuki.

Benefit corporations have emerged as a hybrid corporate form that seeks to reconcile profit-making with legally mandated social and environmental objectives. Unlike traditional corporations that prioritize shareholder value, benefit corporations broaden fiduciary responsibilities to include stakeholders such as employees, communities, and the environment. This paper examines the central question of how benefit corporations balance financial sustainability with their public benefit missions in a market environment where profit is often treated as imperative. Drawing on scholarship in corporate governance, business ethics, and sustainability studies, the analysis identifies four major structural challenges facing benefit corporations: high certification and re-certification costs, investor skepticism and profitability pressures, consumer confusion driven by green-washing, and the absence of standardized ESG metrics. To illustrate how these tensions operate in practice, the paper presents two contrasting case studies. Etsy demonstrates how capital market expectations and public-company constraints can contribute to mission drift and the abandonment of B Corp certification, while Patagonia illustrates how deeply embedded sustainability practices can strengthen brand legitimacy and reinforce long-term profitability. The findings suggest that the benefit corporation model remains viable but highly conditional: success depends on credible measurement systems, supportive legal and policy frameworks, and the ability to translate mission into competitive advantage.

ABSTRACT The voluntary adoption of Integrated Reporting (IR) is expected to grow as firms seek to demonstrate their financial strength and operational resilience. However, the higher compliance and implementation costs associated with IR can make its adoption challenging, particularly for financially constrained firms. This makes it important to establish whether the benefits of IR outweigh its costs. Against this backdrop, the present study empirically examines the impact of Integrated Reporting Quality (IRQ) on firm’s financial performance. The analysis is based on a sample of 32 listed Indian companies over the period 2019–2024. In addition, and as a novel contribution, the study investigates the moderating role of Institutional Ownership (IO), given that institutional investors can reduce agency costs through stronger monitoring and encourage greater transparency through higher-quality reporting. The findings reveal that IRQ is positively associated with ROA, ROE, and EPS; however, the relationship is statistically significant only for EPS, suggesting that equity markets place greater value on higher disclosure quality. Institutional ownership strengthens the positive relationship between IRQ and EPS, indicating that institutional investors play an important role in translating high-quality disclosures into enhanced shareholder value.

ABSTRACT This paper examines how firms’ payout and investment policies respond to exogenous cash windfalls from litigation settlements, focusing on the moderating role of corporate governance. We compare the behaviour of windfall firms – those receiving large litigation settlements – to matched control firms, accounting for cross-sectional heterogeneity in board independence, CEO duality, CEO equity ownership, and blockholder ownership. Our findings indicate that windfall firms with strong governance are more likely to increase shareholder distributions and research and development (R&D) investments. In contrast, firms with weaker governance exhibit signs of the free cash flow problem, allocating windfalls to potentially inefficient capital investments. Market valuation analyses reveal that increases in payouts and R&D by windfall firms enhance future shareholder value, while increases in capital expenditures are penalized by the market. This study provides new evidence on the real effects of legal outcomes on corporate policies, highlighting the role of corporate governance in shaping post-litigation corporate behaviour and ensuring that windfalls are used to enhance shareholder value.

Backgrounds: Corporate governance mechanisms and firm financial characteristics are key determinants of corporate performance, with profitability proxounded by Return on Equity (ROE). Corporate performance is shaped by a constellation of governance attributes, encompassing board architecture, ownership configuration, the robustness of internal control frameworks, and the firm’s leverage. Objectives: This study examines the effect of corporate governance mechanisms and financial characteristics on profitability. Specifically, it investigates the roles of Non-Compliance Index, Director Share Ownership, Remuneration, Internal Controls, Extra Committees, Board Independence, Board Size, Leverage, and Liquidity in shaping ROE. Methodology: A quantitatively oriented research design was implemented, utilizing archival financial disclosures as secondary data sources. The empirical estimation relied on multiple linear regression performed on a balanced panel dataset encompassing 500 firm-year observations, with classical assumption tests and hypothesis testing ensuring model robustness. Findings: Simultaneously, governance mechanisms and financial characteristics significantly affect ROE. Partially, Director Share Ownership and Board Size positively influence ROE, while Board Independence has a negative effect. Non-Compliance Index, Remuneration, Extra Committees, Leverage, and Liquidity were not significant. Internal Controls could not be analyzed due to lack of data variation. Conclusions: Not all governance mechanisms directly enhance profitability. Excessive board independence may constrain managerial flexibility, while effective board size and managerial ownership can improve performance. Limitations include a low R² and the use of ROE as the sole performance metric. Future studies should explore alternative performance measures and additional governance variables. Findings provide guidance for designing governance structures that promote profitability, investor confidence, and sustainable business practices.

This study investigated the relationship between sustainability reporting and shareholders value creation in construction firms listed in Nigeria. The study employed an ex-post facto research design, utilising secondary data obtained from annual reports and published financial statements of seven construction firms listed on the Nigerian Exchange Group over a fourteen-year period (2010-2023). Sustainability reporting was operationalised through three dimensions: environmental sustainability reporting, social sustainability reporting, and governance sustainability reporting. Shareholders value creation was measured using dividend payments and share appreciation. Panel data regression analysis with fixed effects estimation and robust standard errors was employed. The findings revealed that sustainability reporting significantly affects shareholder value creation (R² = 0.301, F-stat = 13.46, p < 0.05). Governance sustainability demonstrated a strong positive effect (β = 0.554, p < 0.001), while social sustainability exhibited a significant negative effect (β = -0.639, p < 0.001). Environmental sustainability showed no significant individual effect (β = 0.057, p = 0.666). The study concluded that sustainability reporting, particularly governance disclosure, significantly enhances shareholder value creation in Nigerian construction firms. The study recommends that management prioritise robust governance structures and transparent reporting to build investor confidence, while regulators should mandate standardised sustainability disclosure frameworks aligned with international standards.

The rapid growth of e - commerce has brought about a great structural change in the global retail industry, making traditional physical stores face greater competitive pressure. This paper analyzed the strategies for optimizing the capital structure of Bed Bath & Beyond (BBBY) by looking back at its past financial choices and examining three imaginary restructuring plans: one with a high level of debt, one with no debt but keeping a large amount of cash, and one with a moderate amount of debt. The method combined the study of capital structure theory with a detailed look at BBBY's operations and finances to evaluate how these plans might affect important financial figures. The results showed that the plan with a moderate amount of debt was the best because it made use of the tax advantages of debt while reducing the costs related to financial trouble, thus increasing shareholder value without taking too much risk. If this approach had been adopted, it might have prevented the company's financial decline caused by competition from e - commerce and poor capital allocation, which contributed to its bankruptcy in 2023. These conclusions provide a useful guide for other traditional retailers to develop flexible capital strategies.

The authors of the study investigate institution of independent directors in BRICS state members (Brazil, Russia, India, China, South Africa) as a transplanted element of Anglo-American corporate governance. A goal of exploration is to test the widespread assumption that increasing a number of “independent” directors automatically improves corporate oversight in jurisdictions with concentrated ownership and strong state participation. Methodologically the research relies on comparative doctrinal analysis of legislation, stock exchange rules and soft law codes, complemented by a critical review of empirical studies and statistics on corporate board composition and liability trends. The argument develops in three main parts. First, the legal framework section maps how independence requirements are formulated and enforced in BRICS, highlighting differences in the level, form and strictness of regulation. Second, the “fundamental issues” section links the independent director to contested corporate governance goals (shareholder value versus stakeholder welfare) and to the agency problem under capital concentration, showing why the classic U.S rationale does not straightforwardly apply here. Third, “contemporary challenges” section examines a gap between formal and real independence, specific tensions of independent directors in state-owned or state-influenced companies, incentive structures shaped by reputation, remuneration and liability insurance, and Russia’s anti-sanctions regime as an experimental suspension of board level independence. The authors conclude formal independence criteria and numerical quotas are neither sufficient nor context neutral. In the field of BRICS members the performance of independent directors depends on clarifying whose interests they are meant to protect and on aligning incentives so that genuinely autonomous judgment is possible despite concentrated ownership, state influence and rising personal liability risks.

Type of the article: Research ArticleAbstractThis study examines whether Environmental, Social, and Governance (ESG) performance enhances stock returns directly or indirectly through firm fundamentals in an emerging market context. The analysis focuses on non-financial firms listed on the Indonesian Stock Exchange (IDX) over the period 2014–2023, following the expansion of sustainability reporting regulations in Indonesia. The final sample comprises 4,037 firm-year observations, of which 477 contain available ESG scores obtained from a third-party rating database. Panel data regression models with firm-level controls and mediation analysis are employed to test both direct and indirect relationships. The empirical results indicate that ESG performance has a positive and statistically significant effect on total factor productivity (TFP) and return on assets (ROA), suggesting that sustainability practices are associated with improvements in operational efficiency and profitability. In turn, both TFP and ROA exhibit positive and significant effects on stock returns. However, ESG does not demonstrate a statistically significant direct effect on stock returns after controlling for firm fundamentals. Mediation analysis confirms that ESG influences stock returns indirectly through productivity and profitability channels, with productivity emerging as the stronger transmission mechanism. These findings suggest that, in the Indonesian capital market, ESG operates primarily as a fundamental value-enhancing mechanism rather than as an independent pricing signal. Sustainability performance contributes to shareholder value when it strengthens firms’ internal efficiency and financial resilience, highlighting the importance of fundamental performance channels in emerging markets.

This study examines the influence of firm-specific characteristics namely profitability, asset tangibility, firm size, and growth opportunities on leverage among non-financial firms listed on the Dar es Salaam Stock Exchange (DSE) in Tanzania. Grounded in the trade-off and pecking order theories, the research explores how these internal firm attributes shape leverage decisions in an underexplored emerging market context. Leverage, the dependent variable, was measured using short-term debt, long-term debt, and total debt ratios. The studyemployed secondary data obtained from the audited financial statements of 11 non-financial firms listed on the DSE for the period 2016–2023, resulting in a balanced panel dataset of 88 firm-year observations. Hypotheses were tested using a combination of robust random-effects and robust fixed-effects panel regression models. The findings reveal that profitability exerts a significant negative effect on all measures of leverage, while growth opportunities significantly increase total debt. Firm size was found to have no significant impact on leverage, whereas asset tangibility positively affects long-term and total debt but does not significantly influence short-term debt. These results indicate that firm-specific characteristics are critical determinants of leverage in Tanzanian non-financial firms. Based on these findings, the study recommends that managers consider profitability when evaluating financing decisions, and investors prioritize appropriate debt levels to mitigate bankruptcy risk. Additionally, firms should strive for a balanced and sustainable debt structure to enhance shareholder value and investor confidence. The study further suggests that future research investigate other potential determinants of leverage, including tax shields, ownership structure, business risk, liquidity, and dividend payout policies, to deepen understanding of leverage dynamics in emerging markets.

This study investigates whether the implementation of International Financial Reporting Standards (IFRS) has an impact on shareholder value and foreign institutional participation in the Indian domestic stock market. The study specifically exploits the setting of regulatory demarcation in IFRS implementation based on a firm's net worth threshold and employs an event study approach coupled with difference‐in‐difference design to elucidate the effects of IFRS. The findings reveal a positive market reaction to IFRS‐related announcements, leading to a notable 4.26% increase in stock price for firms mandated to adhere to IFRS reporting. Notably, in terms of shareholder value, a sustained long‐term increase is observed only for firms that transitioned to IFRS. This increment accentuates the value enhancement brought about by IFRS in the Indian market. Additionally, the study also uncovers compelling evidence of a significant increase in foreign institutional investors’ ownership in IFRS‐compliant firms after the implementation. Overall, the study emphasizes the importance of IFRS frameworks for both domestic and foreign investors and yields relevant implications for diverse stakeholders engaged in the corporate reporting process, including firms, regulatory bodies, and standard setters.

This study views RSUs (Restricted Stock Units) as a strategic tool to achieve sustainable growth, shareholder value enhancement, and key talent retention, and proposes RSUs introduction and operation framework for Korean companies. To this end, a three-round Delphi survey was conducted with 31 experts (11 from the legal and accounting group and 20 from the strategy, HR, and IR group), to derive key decision-making items for each stage of 'strategy setting, execution, evaluation and control'. The panel size fits the appropriate range of existing research, and the content validity and level of agreement were statistically verified using CVR (Content Validity Ratio) and Kendall's W (Kendall's coefficient of concordance (W)). Subsequently, based on the industrial classification system GICS (Global Industry Classification Standard), four industries were classified (consumer goods, resources and energy, industry and infrastructure, technology and communications) and a total of 48 leaders, including C-level, executives, and team leaders, were selected across the four industry groups (12 per group) as panelists and the relative importance and priorities of each item were calculated based on the criterion of a CR(Consistency Ratio below 0.1. The AHP (Analytic Hierarchy Process) results of the legal and accounting groups showed that 'Compliance with relevant standards' and 'Preparation for audit and supervision response' were the top factors, suggesting that the stability of RSUs operations is dependent on regulatory compliance and external supervision response capabilities. In the areas of strategy, HR, and IR, the importance of the strategy execution stage was higher than the strategy setting, evaluation, and control stage in all industries. Consumer goods, technology and communications industries evaluated 'Core talent incentives' and 'Incentive model diversification' as key priorities, while resource/energy and industrial/infrastructure industries evaluated 'RSUs retention period' and 'Short and long-term performance evaluation model' as key priorities. This study contributes by addressing the limitations of previous studies that only derived the relationship between variables such as RSUs introduction or vesting period and scale and financial performance and analyzing RSUs introduction and operation from the perspective of the process of 'strategic setting-execution-evaluation and control'. It also demonstrated empirically that a strategy that reflects the characteristics of each industry is needed rather than a uniform introduction of RSUs, provides policy and practical implications for preparing Korea's RSU guidelines, and can serve as a strategic benchmark for countries or companies with similar environments. Unfortunately, this study does not include the financial and healthcare industries, so further research is needed. Additionally, although Delphi-AHP presents priorities, it cannot verify the causal relationship of RSUs on financial performance or shareholder value, so the results of this study can be extended to follow-up verification studies applied to actual data.