Types Of Firms Research Articles

IMPACTS OF DIGITAL TRANSFORMATION ON FINANCIAL PERFORMANCE: EVIDENCE FROM VIETNAM

Today, with the Industrial Revolution 4.0, digital transformation is taking place strongly in many different fields. Digital transformation can bring a competitive advantage to enterprises. However, enterprises also spend a lot of money to implement digital transformation. Therefore, whether or not digital transformation increases company performance is always of concern to company leaders. This paper aims to analyse the impact of Digital Transformation on Financial Performance, including Revenue, Profit and ROA in Vietnam. Digital Transformation is represented by the variables Cloud Computing, Big Data Analytics, Artificial Intelligence, and the Internet of Things. We used Google Forms to survey 314 leaders of enterprises in Vietnam. Then, we used descriptive statistics, correlation and regression analysis to analyse the data. Research results show that Cloud Computing, Big Data Analytics, and Artificial Intelligence positively impact financial performance. Enterprises that apply digital transformation have better financial performance than other enterprises. In contrast, there is no connection between the Internet of Things and financial performance. In addition, Firm type and Firm size also affect financial performance. FDI enterprises have higher performance than others, and more giant-sized enterprises have higher performance than others.

Bribery Transfer Among Foreign‐Invested Firms in Vietnam

ABSTRACTBribery in international business is an important field of study, but lack of research examines which types of firms are more likely to pursue bribery transfer, or subcontracting bribery‐related transactions to the third party or intermediaries, instead of handling themselves. We conduct an empirical investigation into this issue using rich data from the PCI survey, which has been conducted annually in Vietnam during the period 2017–2020. The empirical results show that, in dealing with risks associated with bribery engagement, foreign‐invested firms in Vietnam pursue two different types of risk self‐controlling and risk transferring. Investors from OECD countries, subsidiaries of multi‐national corporations, and firms with larger bribery amount are more likely to pursue risk transferring strategy by subcontracting bribery‐related transactions to intermediaries, compared to the other firms' cohorts. Firms operating a longer time in Vietnam and bigger sized ones are more likely to follow risk self‐controlling strategy by handling bribery‐related transactions themselves. These results are robust while controlling for firms' legal status, year‐fixed effects, and, especially, nonresponse and selection biases, which are inherent in the bribery decision process. This study thus contributes greatly to international business in emerging economies where foreign‐invested firms exhibit heterogenous motives in dealing with risks associated with bribery‐related transactions.

Effect of Technological Innovation, Servitisation and Human Capital Structure on Performance in Manufacturing Enterprises

ABSTRACTTo analyse the relationships amongst technology innovation, servitisation, human capital structure and performance in manufacturing firms, a sample of 1247 manufacturing firms listed on the A‐share market in China from 2013 to 2020 were collected. The conclusions are as follows. (1) Technological innovation has positive effect on performance. (2) Service transformation can mediate the effect of technological innovation on performance. (3) Advanced human capital skills can positively moderate the effect of service transformation on performance, whereas advanced human capital education can positively moderate the effect of technological innovation on performance. (4) The effect differs by firm type and location.

Winners and losers in Africa: a longitudinal examination of market-share gains by advanced and emerging market multinationals versus local firms

Purpose Market share gain is one of the key objectives for all firms for seeking growth. It is also a fundamental aspect of competitive rivalry. The extant review of the literature points to a gap among market share performances of emerging market multinationals (EMNEs) firms, advanced economy multinationals (AMNEs) and local firms. The purpose of this study is to delineate and contrast the market share performance of EMNEs, AMNEs and local firms in Africa. Design/methodology/approach The study used available longitudinal data (2013–2022) of six industries across four African countries from Euromonitor Passport, a rich, proprietary database. Findings Applying contingency theory, the study shows that, over time, there is no clear-cut winner in all markets and industries. Rather, market share gain is contingent on country and industry settings in Africa. Empirical analysis demonstrates that high-tech EMNE firms operating in Africa will exceed those of high-tech AMNEs and local firms. The findings also show that local firms generally performed better during the pandemic. Originality/value As Africa is a region of interest for scholars and practitioners, critical international business (IB) research contributions in Africa have predominantly focused on foreign investments from a particular nation. The present study enriches the literature by comparing the market share performance of AMNEs, EMNEs and local firms in this important region – during and prepandemic. The study offers theoretical and managerial implications for understanding the long-term performance of these three types of firms.

From death to birth: Do logistics parks help local renewals in logistics industry?

In the era of E-commerce and globalization, the logistics industry has become a new driving force for local economic development, with government-led logistics parks planned and constructed as a powerful policy instrument. Skeptical about whether logistics parks really take effect as expected, this paper investigates the local process of creative destruction in the logistics industry, focusing on how government-led logistics parks bridge between firm exit and firm entry during industrial renewal. Using firm-level data of third-party logistics firms in China from 2003 to 2021 and adopting system GMM estimator method, we verify that previous exit contributes to future entry but varies by the firm type and the city's importance in the regional transport network. Furthermore, we find two major roles of government-led logistics parks: (1) accelerating this process by providing the platform where various resources can be reused and reorganized into high-quality new logistics firms; and (2) prioritizing the rebirths from local existing firms over arrivals from other cities, though with some level of local protectionism. Government policies and planning decisions should maintain such function without inhibiting regional market integration.

The Shock of US-China trade war and the job Market: Downstream shrinkage and upstream employment

Using the 2018 US-China trade war as a quasi-natural experiment, we investigate how downstream shrinkage affects upstream employment. Utilizing a difference-in-differences (DID) approach, we reveal a negative effect of downstream shrinkage on upstream firm employment. Our mechanism analysis indicates that trade wars increase the tax burden, inventories, and accounts payable for downstream firms while reducing their employment. This shrinkage of downstream firms limits the scale of investment and operations for upstream firms through supply chain transmission, thereby decreasing employment of upstream firms. Moreover, our finding is more pronounced for specific types of firms, such as non-state-owned firms, firms operating across multiple industries. Our study provides an essential reference for firms in building resilient supply chain networks to better cope with potential negative shocks.

The impact of intelligent investment on corporate green innovation: Moderating effects of executive green perception and environmental regulation

As firms increasingly invest in intelligent technologies while facing environmental pressures, it is crucial to understand the relationship between these investments and green innovation. This study aims to investigate how intelligent investment influences corporate green innovation, as well as the moderating roles of executive green perception and environmental regulation. Multiple regression analyses are employed to test our hypotheses through the use of panel data from Chinese A-share listed companies (2007–2022). According to the research findings, intelligent investment has a significant positive impact on green innovation, and this effect is further amplified by stronger executive green perception and more stringent environmental regulations. It is noteworthy that various types of firms are affected differently by this effect. State-owned enterprises and pollution-intensive industries exhibit stronger positive relationships, while non-high-tech sectors show more pronounced impacts. These findings enhance our understanding of how firms leverage technology to drive sustainable innovation, offering valuable insights for managers seeking to align tech investments with their goals of sustainability, and for legislators and administrators designing effective environmental regulations. It is recommended that policymakers take into account the establishment of regulatory frameworks that are conducive to intelligent investments, thereby fostering green innovation across various industries.

The Impact of Changing External Auditors, Auditor Tenure, and Audit Firm Type on the Quality of Financial Reports on the Saudi Stock Exchange

The purpose of this study is to examine the influences of external auditor firm type, auditor tenure, and external auditor changes on the quality of Saudi Arabian financial reports. In particular, this study examines the quality of financial reports of companies listed on the Saudi Stock Exchange using a widely accepted evaluation model modified by JonesThis study aims to determine whether Big Four and non-Big Four audit firms, auditor tenures of three or more years, and external auditor changes have any impact on the quality of financial reports of Saudi-listed companies. This study uses 175 firm-year observations of 35 companies listed on the Tadawul Saudi Stock Exchange between 2017 and 2021. Using discretionary accruals (DACC) as modified by Jones to measure the quality of financial reports, the findings illustrate that there is a significant negative relationship between Big Four audit firms and DACC. However, the study also shows a significant positive correlation between auditor tenure and DACC. The research revealed that there is no significant relationship between auditor change and DACC. These results have practical implications for policy development. According to the outcomes of this research, there are numerous ramifications for both companies and the government in Saudi Arabia in terms of enhancing the relationship between companies and audit firms and determining the most suitable auditor tenure to improve the quality of financial reports.

Competition for ‘Top 25 Companies’ Award’s Criterion of PSX: An Evaluation of the Financial Aspects

A company's performance is a complex phenomenon because of a variety of aspects to quantify it, however, a competitive criterion has been established by Pakistan Stock Exchange (PSX) in terms of "Top 25 Companies". Those firms qualifying this criterion over the last two decades need to be compared with those who have yet to achieve it. The main objective of the study is to evaluate the financial stability and extra-ordinary performance based on PSX quantitative criteria of those firms maintaining top 25 position over last 24 years. The financial aspects of 18 firms out of more than40 has been selected by taking last 24 years' data. These firms are classified into two different samples, the sample from companies successfully qualify the criterion for "Top 25 Companies" award, while the second sample consist of other renowned ones that yet to qualify for this criterion. The performance evaluation of both types of firms has been done through financial statements available on the website of PSX through their annual reports to calculate the ratios. In addition to these financial ratios other relevant indicators considered for evaluation purposes are, equity premium as a difference in returns between stocks and less risky instruments (bonds), firm size measured through sales, and market performance measured through total assets. The impact of these ratios on the stock returns has also been evaluated through regression analyses which allowed to identify those specific advantages the ‘top-25 qualifier’ firms may have over the ‘other non- qualifier’ firms. The findings suggest that ‘top 25 qualifier’ firms mainly beat the ‘others non- qualifier’ based on equity-related measures including dividend payout ratios, market premium and the equity premium. Therefore ‘other non-qualifier’ should improve equity-related context to successfully qualify for this criterion in future.

The Effect of Firm Type on the Relationship between Accounting Quality and Trade Credit in Iraqi listed firms

The Effect of Firm Type on the Relationship between Accounting Quality and Trade Credit in Iraqi listed firms

Who gains favor with green investors amidst climate risk?

PurposeThis study aims to investigate the impact of climate risk disclosure by listed companies on the entry of green investors. It seeks to understand how proactive climate risk disclosure can attract green investment and the underlying mechanisms that facilitate this process.Design/methodology/approachTextual analysis is employed to assess the extent of climate risk disclosure in annual reports. The research constructs indicators for green investor entry and applies regression analysis to examine the relationship between climate risk disclosure and green investment, considering various mediating variables such as positive online news coverage, ESG scores, and corporate reputation.FindingsGreen investors are more likely to invest in companies with higher levels of climate risk disclosure. This relationship is robust across different types of firms, with non-state-owned, non-high-tech, large-scale firms, and those in the Eastern region showing a stronger attraction to green investors. Climate risk disclosure promotes green investment through the “signal transmission” mechanism, enhancing corporate reputation and ESG performance.Originality/valueThis paper extends the traditional theory of external incentives for corporate green development to include autonomous incentives through active climate risk disclosure. It provides new insights into the theory of corporate sustainable development and offers practical recommendations for enhancing corporate green development pathways. The study’s comprehensive approach and use of extensive data contribute valuable knowledge to the field of green investment and corporate sustainability.

When Digitalization Meets Regulation across Borders: An Explainer with Actionable Insights

A flurry of regulations has emerged across the world to govern the use, transfer and storage of data, affecting digital and traditional firms, of all sizes. To guide business practitioners and educators, this article provides insights into key components of digital laws and what they mean for different types of firms. We take the European Union as starting point, given its prominent and extra-territorial rule-setting, but also reflect on other cross-border (future) digital regulations. Our analysis of relevant details reveals a need for practitioners to be prepared and forward-looking, considering firms’ specifics, internationally converging ethical principles and (future) digitally-aware generations.

Exploring the first impression of a company: an empirical analysis of IPO prospectuses applying the impression formation model

PurposeThe present study aims to identify how firms positioned their corporate reputation (i.e. impressiveness vs respectability) in their initial public offering (IPO) communication based on the impression formation model. Further, the study examined whether this presentation of corporate reputation was related to IPO success (i.e. stock price and volume of trading).Design/methodology/approachThe present study analyzed 248 IPO prospectuses that were submitted to the major US stock markets. Specifically, various substantive and symbolic information and cues in IPO prospectuses were content analyzed.FindingsThe results suggest that bigger (in terms of revenue) IPO companies featured more “impressiveness” in their IPO prospectus, leading to greater IPO success. Bigger (in terms of both revenue and number of employees) IPO companies featured more “respectability” impressions in the IPO prospectus, although they did not achieve direct IPO success on the first day of IPO. Different types of industry used different information cues to feature “impressiveness” and/or “respectability,” suggesting that different types of firms view different cues to be important to IPO communication.Practical implicationsThe results also suggest some practical guidelines for the strategic use of contents, tables and illustrations. Using more charts, tables and illustrations in IPO prospectus summaries was associated with a higher volume of trading on the first day. The more illustrations included in the IPO prospectus summaries, the less investors were willing to pay for initial stock prices.Originality/valueIPO communication is a generally understudied area in corporate communication and strategic communication scholarship. The results should help to explain which communicative aspects and PR strategies effectively manage the firm’s impression to maximize the chances of an IPO success as well as initially build the financial reputation of a company. By doing so, the findings contribute to the broader advancement of financial communication within the strategic communications domain.

Direct search or remote search? Export market expansion path for firms in underdeveloped areas - evidence from the five cities of the Hexi Corridor, China

ABSTRACT The expansion of firms’ export markets is crucial for their own growth and local economic growth. Studies suggest two market expansion modes: direct search and remote search. However, research often overlooks underdeveloped areas and the influence of firm heterogeneity. Using data from China Customs Database and CEPII Database, this article investigates the export market expansion patterns of firms in underdeveloped regions. The study focuses on five specific cities in the Hexi Corridor, a representative underdeveloped region in western China. The results show that firms in underdeveloped areas mainly follow the remote search path during their export market expansion. The likelihood of success in entering new target markets is significantly influenced by the similarity between the target market and their existing markets, while the geographical distance between trade partners has little effect. Additionally, there are significant differences in the market expansion path of different types of firms. Private-owned enterprises demonstrated a greater reliance on the remote search mode than state-owned enterprises, collective-owned enterprises and Sino-foreign joint ventures. It may stem from their limited ability to access resources and policy support.

Human Capital Portability and Careers in Finance

Abstract How does firm-specific human capital shape careers in the finance industry? We build a dynamic model where workers accumulate portable and nonportable (firm-specific) human capital and learn about their match quality with employers. Estimating the model using granular data on M&A advisory bankers, we show that a large fraction of bankers’ human capital is nonportable, ranging from 12% to 46% across different firm types. Bankers make a dynamic trade-off between portability and returns on human capital, leading to time-varying job preferences over their life cycle. Our results have broad implications for careers in finance and the provision of financial services.

Corporate ESG Performance and Corporate Value

In the context of China's green development transformation and high-quality development, it is of great significance to actively promote enterprises to practice the concept of ESG development. In order to study the impact of ESG on enterprise value, this paper empirically examines the impact of ESG performance on enterprise value and its mechanism of action, taking listed companies of enterprises from 2013 to 2023 as the research sample. The research results show that ESG performance can significantly increase enterprise value. The study of the mechanism of action shows that corporate ESG enhances corporate value through digital transformation, promoting corporate innovation, and enhancing financial asset allocation. Heterogeneity analyses find that the positive effect of ESG on firm value shows differences among different types of firms, especially among state-owned enterprises and high-tech firms, where the positive effect of ESG performance on firm value is more significant. The research in this paper enriches the impact of ESG on enterprise value, which is of theoretical and practical significance for enterprises, investors and government to complete.

How does internet finance affect firm exports? Evidence from China

Internet finance, which can be accessed and delivered through internet technology, has become increasingly important in financial markets. This study examines how internet finance affects the extensive and intensive margins of firm exports. We find that internet finance increases both the extensive and intensive margins of firm exports, with the results varying according to firm type. Specifically, internet finance (i) enhances the extensive margin for high-tech firms more than for low- and medium-tech firms; (ii) improves the extensive margin for large firms rather than for small firms; and (iii) benefits the intensive and extensive margins for high government subsidies firms more than for low government subsidies. Moreover, internet finance promotes exports by alleviating financial constraints and reducing the fixed costs of firm exports.

Revamping the Role of SMEs’ Digital Financial Management Through Islamic Fin-Tech in Borama

Abstract Small and Medium-sized Enterprises (SMEs) play a vital role in economic growth, particularly in developing countries like Somalia. However, SMEs often encounter financial obstacles due to limited access to conventional banking services adhering to Islamic principles. This study aims to examinate the potential of Islamic Fin-Tech in bolstering Digital Financial Management among SMEs in Borama. Methodologically, the study utilizes quantitative data analysis methods, specifically multiple regression, to examine survey data gathered through purposive sampling. The data is obtained from a total of 2254 small and medium enterprises (SMEs) situated in Borama. Demographic data, including gender, education, occupation, and firm types, are examined alongside the duration of utilizing Islamic fintech solutions. Assumption tests such as normality and multicollinearity tests are conducted to ensure the reliability of the regression model employed. The results indicate a significant adoption of Islamic fintech solutions among SMEs, particularly in recent years. While variables such as Service Accessibility and Digital Banking do not show significant impacts on Digital Financial Management (DFM) due to the internet shortage, SMS Banking and E-Wallet emerge as influential factors that positively affect SMEs' digital financial management performances. Hypotheses testing confirms the significance of SMS Banking and E-Wallet in predicting DFM. The implications of these findings highlight the importance of E-Wallet services and SMS banking in enhancing SMEs' digital financial management. These insights offer valuable implications for financial institutions and policymakers to develop strategies aimed at improving SMEs' digital financial management practices. The study requires for further research to explore additional variables and deepen the understanding of factors that influence SMEs' digital financial management. By understanding the transformative potential of Islamic Fin-Tech, stakeholders can collaborate on designing and implementing measures supporting SMEs, driving economic growth, and aligning with Islamic finance principles. Embracing technological advancements like digital banking and SMS banking can help SMEs overcome financial hurdles and amplify their contributions to economic development. Keywords: SMEs, Digital Financial Management, Islamic Fin-Tech, Borama, Economic development, Fintech, Financial adaptation

How and when does gamification level up mobile app effectiveness? Meta-analytics review

PurposeGamification in mobile apps has emerged as a compelling strategy to foster firm’s relationships with their customers through mobile applications. This study utilizes a meta-analytic review to demonstrate how gamification shapes consumer responses and how moderator variables play a role in this process.Design/methodology/approachThe study employed a meta-analytic review to combine and synthesize data from 62 studies, including 71 independent samples and a sample size of 20,510 to test the research model and examine the role of moderators in this model.FindingsFindings reveal that gamification, through the customer experience components (cognitive, hedonic, pragmatic and social elements), leads to customer engagement, resulting in word-of-mouth and loyalty. However, privacy concerns play a destructive role in this process, deteriorating customer–firm relationships. Moderator analysis indicates that gamification design elements, such as rewards, progression and customization systems, along with product and service benefit, involvement, familiarity and firm type moderate the relationship between gamification and customer response.Research limitations/implicationsThe meta-analysis main and moderator analysis results provide several insights for marketing managers that assist them in developing an effective gamification in mobile app strategy.Originality/valueThe findings reveal novel insights, encompassing both the bright and dark sides of the influence of gamification on customer response, while also examining the moderating roles of gamification, product and service and firm characteristics.

How to overcome rent seeking in Tanzania’s skills sector? Exploring feasible reforms through discrete choice experiments

Skills gaps and mismatches are widely documented as a hindrance to inclusive structural transformation across developing countries, especially in Africa. What is often overlooked, however, is the fact that skills development is a complex political economy process challenged by institutional and financing problems on the supply side, and inadequate demand, that is, a shortage of firms that can organise skilled labour and provide on-the-job training effectively. In such adverse contexts, rent seeking and corruption may arise from conflicting objectives, trade-offs and mis-aligned incentives among stakeholders – public sector skills providers and firms. With a focus on Tanzania, we (i) analyse the incentive structures underlying such rule-breaking behaviours and processes, and (ii) empirically test alternative institutional design strategies that would better align the interests of different stakeholders towards improved skills development outcomes. Building on over 30 in-depth stakeholder interviews in 2018, we conducted three Discrete Choice Experiments with over 200 firms to test the feasibility of different incentive packages in 2019. Our main hypothesis is that the successful re-alignment of stakeholders’ incentives must consider both the different and potentially conflicting objectives of public training institutions and the heterogeneity in skills needs and capabilities of different types of firms. We uncover latent preference structures differentiated by observable firm characteristics, most strongly by differences in technical capabilities, existing training provision and firm size. We conclude advancing an evidence-based tailored skills policy reform.