Performance Evaluation Model of Romanian Manufacturing Listed Companies by Fuzzy Ahp and Topsis

Abstract

We are interested in the hierarchy of the main Romanian companies in the manufacturing industry by considering eight financial and seven non-financial indicators. Thirty three listed companies, that are non-financial institutions, were selected for the study and in order to control the reliability of the data we used the Bucharest Stock Exchange database, official data published by the Romanian Ministry of Public Finance, and the annual reports released by the companies on their websites, collecting information for the years 2011–2015. Because the human thinking is subjective and ambiguous we prefer linguistic variables, converted afterwards in triangular fuzzy numbers, to represent the importance of indicators. Our method involves the calculation of the weights of individual or categories of indicators based on Fuzzy Analytic Hierarchy Process. Then, the level of performance for each company, separately for financial, non-financial and all indicators is obtained by TOPSIS method. We deduce an objective hierarchy of the companies on a rigorous basis, which is however dependent from the choice of indicators and the conversion scale of linguistic variables into triangular fuzzy numbers. Also, following the obtained results we concluded that the overall performance of companies for the analyzed period is significantly influenced by non-financial indicators.

Pro-Environmental Behaviour in the European Union Countries

“…Calculation of Euclidean distances of the analysed objects from the ideal solution (benchmark) and the anti-ideal solution (anti-benchmark) according to the formulas below [87]:…”

Financial Performance Evaluation of Turkish Basic Metal Industry: Combining Ahp and Topsis

“…Fuzzy AHP was utilized for determining the weights of the criteria and TOPSIS was applied to rank the firms. Another study that combines Fuzzy AHP and TOPSIS was conducted by Ban et al (2020) for manufacturing companies listed in Bucharest Stock Exchange. They not only used financial indicators to rank the companies but also considered non-financial indicators and concluded that overall performance of companies significantly influenced by nonfinancial indicators.…”

Topsis Ve Gri̇ İli̇şki̇sel Anali̇z Yöntemleri̇ İle Oluşturulan Portföyleri̇n Performanslarinin Pandemi̇ Süreci̇nde Değerlendi̇ri̇lmesi̇

“…The results showed that HSL was the top stock with the highest ranking, and the GRA, MOORA and TOPSIS rankings had strong correlation values of 0.78-1. Ban et al (2020) ranked Romanian companies operating in the manufacturing industry according to their performance using eight financial and seven nonfinancial indicators. In their studies covering the period of 2011-2015, the weights of individual or indicator categories were calculated with the Fuzzy Analytical Hierarchy Process.…”