Financial Flexibility and Health Sector Firm Performance in ASEAN-5 Countries: Moderate Role of Directors with MD Degree

Abstract

Under uncertain circumstances, Financial flexibility plays a crucial role in strategic adjustment for businesses and is also vital for firms in developing countries with high volatility stock markets. With increasing public attention to the health sector as the pandemic progresses, the question arises whether healthcare companies should be led by directors with medical backgrounds or not. This study investigates the impact of financial flexibility on the performance of enterprises in the health sector in ASEAN-5 countries with the moderating role of directors with medical doctor (MD) degrees. Data for 2015-2020 from health sector firms listed on the stock exchange of five ASEAN countries (Indonesia, Malaysia, Philippines, Thailand, and Singapore) were collected and analyzed using the timeseries regression technique. Analysis was conducted using Stata software. The study finds that financial flexibility has no influence on health sector firms' performance in ASEAN-5 countries, and directors with MD degree has no moderating effect.