Purpose The purpose of this study is to examine the impact of profitability and leverage on the relationship between eco-efficiency and firm value. Design/methodology/approach The study extends the Ohlson’s model on value relevance using the hierarchical regression analysis to establish the moderating effects of the firm-specific variables. The sample includes 667 non-financial firms from the Bursa Malaysia, as of 2013. The data for eco-efficiency were extracted from content analysis of the annual report, whereas the financial data were retrieved from the data stream. Findings The study provides support for the stakeholder theory that purports that managers must develop a relationship with stakeholders by embarking on environmental friendly practices to maintain a positive firm value. The study shows a positive association between eco-efficiency and the value of the firm and provides support for a positive moderating relationship for profitability in the relationship between eco-efficiency and firm value, whereas there was no significant effect for leverage in the relationship. Research limitations/implications It should be noted that, first, the data comprised exclusively Malaysian companies. Including firms from similar developing countries with varying institutional make-up and culture would enhance the understanding of the subject. Second, considering that the data for this study is cross-sectional, it may not be sufficient to draw strong causal influences. The study is the first to the best of the researcher’s knowledge to provide evidence that profitability positively moderates the relationship between eco-efficiency and firm value. Practical implications The result shows the management and potential investors that an investment in eco-efficiency will lead to a higher firm value, irrespective of the debt profile of the firm and that profitable firms are more likely to embark on an eco-efficient policy. Originality/value This study contributes to the literature by providing evidence from a developing country’s perspective, as well as extending prior studies that merely examined the direct relationship, to now explore the moderating relationship of profitability and leverage in the relationship between eco-efficiency and firm value using a large sample.
The poor environmental performance and by extension low level of environmental disclosure evident in the annual reports of quoted Nigerian companies have aroused stakeholders concern about the condition of the environment. The main objective of this study is to x-ray the relationship between political connection, board characteristics and environmental disclosure. The quantitative approach will be adopted using data from the annual reports of the sampled companies. The theoretical framework is built on the legitimacy theory with support from the agency and managerial power theory. It is envisaged that the study will engage corporate organizations to adequately provide for environmental information in their internal policies. The study will facilitate environmental cost reporting responsiveness and disclosure to investors and environmental regulatory bodies.
This study examines the relationship between political connection, board characteristics and firm performance in Nigerian quoted firms. The model of the study is built based on the agency theory. It utilises a cross-sectional data of 116 firms for the year 2013, obtained from the annual reports of the firms. The robust corrected standard error regression was used in estimating the model. The study provides partial support for the proposition of the agency theory. The study finds board gender positively related to firm performance, while political connections and CEO incentives were negatively related with firm performance. The findings of this study should interest organisational stakeholders. Particularly, the negative association of political connection with firm performance has implication for auditors, shareholders and management. Furthermore, the study recommends more females to be considered into directorship positions, since they play a significant role in shaping the transparency of the board for better performance.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.
hi@scite.ai
10624 S. Eastern Ave., Ste. A-614
Henderson, NV 89052, USA
Copyright © 2024 scite LLC. All rights reserved.
Made with 💙 for researchers
Part of the Research Solutions Family.