Business Administration and Business Economics

SOH WEI NI · ANNUAR MD NASSIR · CHENG FAN FAH ·International Journal of Economics and Management ·2018 ·JEL: M42; M41

A corporate cash holding is significant element in the cash and liquidity management. Corporations with higher excessive cash reserves will benefit when high liquidity makes it easier for managers to transfer funds among several of the corporations’ expenses and debts, and allows for more flexibility in managing daily operational activities. However, it raise some issue as firm with higher cash holdings tend to explore to higher agency cost due to the conflict of interest between ownership and management. This study employs data envelopment analysis (DEA) estimation and two-stage regressions model. The findings conclude that the firm size, firm growth, and gross domestic product (GDP) are statistically significant for firm efficiency in both markets. The cash holdings help improve firm efficiency as the adjusted R-square is significantly increased for all models. However, the cash holdings are not related to the efficiency of high-cash holding firms for these two stock exchanges. The contribution of cash holdings to firm efficiency is higher, and even double for a developed market compared with a developing market (Bursa Malaysia), which shows that the development stage of a country impacts on cash holdings’ contribution to firm efficiency.

Qian Long Kweh · Norazlin Ahmad · Irene Wei Kiong Ting · Cheng Zhang · Hasahudin Hassan ·Institutions and Economies ·2019 ·JEL: G34; L21

This study investigates the influences of board gender diversity and board independence on firm performance. Ordinary least squares, two-stage least squares and generalised method of moments are employed to test the relationships among board gender diversity, board independence, and firm performance in firms listed on Bursa Malaysia between 2010 and 2015. The regression results indicate that female directors and independent directors significantly and negatively affect firm performance, respectively. However, the interaction term of board gender diversity and board independence is statistically insignificant. Overall, managers must consider that board gender diversity and board independence may not have an interactive effect on improving the performance of their firms.

Lim Boon-Leong (Tunku Abdul Rahman · University College) · Foong Swee-Sim ·International Journal of Economics and Management ·2020 ·JEL: G32, G34

We examine whether managerial ability is an essential factor that determine CEO remuneration, and as means in resolving both Type I and Type II agency conflicts. Our sample is based on Malaysian family listed companies over 2009-2015, and our results show that, apart from being a crucial determinant of professional CEO remuneration, managerial ability also plays an important role in enhancing the pay-performance sensitivity of outsider manager of Malaysian family firms. Our results also show that the positive association between managerial ability and remuneration of family CEO only helps to mitigate the risk of Type II agency conflict. This agency risk is further heightened by the existence of a significant negative effect of managerial ability on CEO payperformance sensitivity in firms which appoint family CEO as board chairman; and firms with CEO who serves on the remuneration committee. These results are robust to alternative measures of firm performance as well as tests of endogeneity

Haniruzila Hanifah · Hasliza Abdul Halim · Noor Hazlina Ahmad · Ali Vafaei-Zadeh ·Journal of Asia Business Studies ·2019

Purpose Innovation has become an approach to create value for the customer to remain competitive in the market. However, previous research on innovation performance particularly among Bumiputera small and medium-sized enterprises (SMEs) had received little intention. Hence, Bumiputera SMEs need to inculcate the innovation culture to generate innovation performance. As such, the purpose of this study is to examine the ambidextrous orientation and innovation strategy on innovation culture, and how innovation culture could mediate the relationship between ambidextrous orientation and innovation strategy and innovation performance. In addition, this study also examines the role of government support as the moderator between innovation culture and innovation performance. Design/methodology/approach Data were collected from 140 Bumiputera SMEs and analyzed using partial least square-structural equation modeling via Smart PLS. Findings Findings indicated that ambidextrous orientation (alignment and adaptability) and innovation strategy (proactive creativity strategy and growth risk orientation strategy) had a significant impact on innovation culture. Besides, innovation culture mediated the relationship between alignment, proactive creativity strategy, growth risk orientation strategy and innovation performance. Surprisingly, innovation culture does not significantly mediate the relationship between adaptability and innovation performance. However, government support plays an important role to support innovation culture and innovation performance in Bumiputera SMEs. Originality/value This study makes both theoretical and practical contributions, especially in identifying the significant role of Bumiputera SMEs in creating an innovation culture. Besides, it explained government support as an important role in strengthening the relationship between innovation culture and innovation performance. The findings of the study will provide great help to Bumiputera entrepreneurs in formulating innovation culture in Malaysian SMEs.

Fazal Akhbar · Rao Aamir Khan · Fazli Wadood · Abdul Talib Bin Bon ·Entrepreneurial Business and Economics Review ·2020 ·JEL: L20

The main objective of this study is to verify the impact of entrepreneurial orientation dimension on firm performance of furniture industry in Malaysia. In this study, we used a quantitative research method and collected data through a questionnaire from 391 furniture manufacturing company owners and managers, while following purposive sampling approach. The collected data was analysed using structural equation (Partial Least Square). To measure five entrepreneurial orientation dimensions, we adopted specific measuring instruments. The study shows that the three dimensions of entrepreneurial orientation – i.e. innovation, risk-taking, and competitive aggressiveness – make unique statistical contributions to the considered model. Findings indicate low levels of autonomy and proactiveness. However, the entrepreneurial orientation and FP models significantly influence the unique contribution of individual entrepreneurial activities in the Malaysian furniture industry.

Filzah Md Isa · Nik Maheran Nik Muhammad · Azizah Ahmad · Shaista Noor ·Journal of Economics and Business ·2021

Women entrepreneur has gained utmost importance in the past few decades in Malaysia due to their significant contribution to the country's economic development. However, few business challenges create a constant obstruction for many women entrepreneurs such as lack of ICT knowledge, time constraint to learn ICT, lack of technological expertise, etc. The present study aims to identify the effect of ICT adoption on business performance and examine how ICT usage helped them handle operational business matters. The present study adopted the qualitative research strategy, and researchers interviewed ten (10) women entrepreneurs for this study. A semistructured interview technique was applied, and six Malay and four Chinese entrepreneurs made the study population. The result highlights that Malay and Chinese entrepreneurs use ICT in their business operation such as warehousing system, purchasing system, HRM software and accounting system, purchase order system, production system, internal communication, and AutoCAD. The present study may support the prospective entrepreneurs in considering the ICT usage to embark on technology and innovation and provide inputs to policymakers to design a proper support system for Malaysian women entrepreneurs, particularly those new entrepreneurs who are mostly young and inexperienced.

Mohammad Shahansha Molla · Mohammad Tariq Hasan · Mahadi Hasan Miraz · Mohammad Tahlil Azim · Md. Kaium Hossain ·Journal of Asian Finance, Economics and Business ·2021 ·JEL: M1, M4, M48, Q56

This study aims to examine the relationship between directors’ diversity (DIRDIV) and financial performance (FP) with a particular focus on the moderating effect of corporate sustainability practices (CSP). The study analyzes a sample of 104 firms listed on the Bursa Malaysia for the period from 2015 to 2017. Directors’ diversity is measured by the Blau index, and Tobin’s Q is used as a proxy of FP of the firms while the content analysis method is adopted to measure CSP. The study also employs three control variables, namely, board size, firm size, and leverage. Panel corrected standard errors (PCSE) estimator model has been used to test the hypotheses by STATA software. It is found that directors’ diversity in terms of independent and non-independent directors significantly and positively affect the financial performance of the firms. Furthermore, this study reveals that CSP significantly moderates the relationship between directors’ diversity and financial performance. This study suggests that the government and regulatory bodies should put more emphasis on diversifying the board and follow up the mandatory CSP to enhance financial performance of the firms, which is likely to ensure their long-term survival and to reduce the risk of collapse in the future.

Fazli Wadood · Mohammed Emad Alshaikh · Fazal Akbar · Maqsood Mahmud ·Entrepreneurial Business and Economics Review ·2022

The main objective of this research is to integrate the resource-based view (RBV) to analyse how the relationship between firm performance and entrepreneurial orientation is mediated by outbound innovation among furniture firms in Malaysia.

Sitraselvi Chandren · Ayoib Che Ahmad · Zaimah Abdullah ·International Journal of Supply Chain Management ·2018

The purpose of this conceptual paper is to address the link between corporate governance and operating performance during and after GST implementation. With the support of agency theory, this paper develops five propositions for the relationship between corporate governance and operating performance (sales growth and current ratio) during and after GST implementation. The nature of their relationship shall contribute to all stakeholders on the impact of corporate governance to operating performance. This displays on the governance effectiveness in discharging their roles to strengthen operating performance particularly during a new financial or tax policy implementation that requires necessary changes in business processes. It uncovers the transparency of Malaysian corporate governance commitment and acceptance to GST for firm and country sustainable development. In sum, for business friendly GST requires effective governance to support the firm operating system.

Jayalakshmy Ramachandran · Khoo Kok Chen · Ramaiyer Subramanian · Ken Kyid Yeoh · Kok Wei Khong ·Managerial Auditing Journal ·2018

Purpose This study aims to investigate the relationship between corporate governance (CG) and performance of Real Estate Investment Trust (REITs) in Singapore and Malaysia. Design/methodology/approach The CG attributes that contribute best toward R-Index scores are tested followed by analysis of whether R-Index scores contribute toward better performance of the REITs when controlled for growth, firm size and leverage. Regression analysis using structured equation modeling (SEM) is instituted. Findings All attributes in the R-Index except management ownership are significantly correlated to R-Index. Regression analysis using SEM reveals that all the three measures of performance are significant. When controlled for growth and firm size, CG mechanisms reduce the impact of losses. However, highly levered firms could be risky for investors despite strong CG mechanisms. Research limitations/implications All S-REITs and M-REIT sampled were grouped as one regardless of the country differences, which may have limited the results and findings. The R-Index used to score the CG practices for Asia is still very new. Practical implications Findings of the study will help REIT policymakers to update scorecards frequently. Loss-making REITs must emphasize on specific CG attributes to enhance their overall CG scores to gain market confidence and procure financial assistance through better disclosure. Originality/value Due to research scarcity on CG effectiveness associated with performance of Asian REITs after the global financial crisis, this study comes as a timely contribution in understanding the relationship between CG and performance of REITs.

Suharnomo Suharnomo · Fathyah Hashim ·Journal of Asia Business Studies ·2019

Purpose This paper aims to examine the effect of job motivation and commitment on organizational citizenship behavior (OCB) of Indonesian and Malaysian employees. Organizational and national cultures are introduced as moderators and OCB as a mediator to investigate their relationships in the context of job performance. Design/methodology/approach The sample was drawn from employees using a purposive sampling method. A total of 264 valid questionnaires were obtained from employees. The data were analyzed using regression analysis. Findings The results show that job commitment and job motivation positively affect OCB in Indonesia but not Malaysia. The results also reveal that job motivation affects OCB in both countries. In Indonesia, organizational culture and national culture partially moderate the influence of job commitment and motivation on OCB, except the commitment to the organization's culture. However, roles of these moderators in job commitment and motivation are not evident in Malaysia. The result of this study also shows that OCB affects performance in Malaysia but not Indonesia. Practical implications The results of this study can be used to explore Indonesian and Malaysian employees. Although the culture of these two countries is originated from the same roots which cause many similarities among them, there are differences in terms of OCB and employee’s performance that can affect organizational performance and also ways in dealing business with Indonesian and Malaysian companies. Originality/value This study is one of the first studies to examine cross-cultural dimensions in two Southeast Asian countries. The findings contribute to the current OCB literature by confirming the roles of OCB and culture in the effects of job motivation and commitment on job performance.