Carbon Performance, Company Financial Performance, Financial Value And Transmission Channel: An Analysis of South African Listed Companies

2021 ◽  
Author(s):  
Fortune Ganda
Keyword(s):  
Financial Performance ◽  
South African ◽  
Firm Value ◽  
Transmission Channel ◽  
Tobin’S Q ◽  
Return On Assets ◽  
Tobin's Q ◽  
Long Run ◽  
Short Run ◽  
Carbon Performance

Abstract This article examines the influence of carbon performance on corporate financial performance and company financial value among South African listed firms for the period 2014 to 2018 using a two-step GMM panel process. The short-run findings show that carbon performance develops a positive and significant association with return on assets, firm value and Tobin’s Q. In the long run, the relationship between carbon performance and return on assets as well as firm value is significantly negative; however, the link with Tobin’s Q remains positively significant. Where carbon performance is employed as the dependent parameter, a positive, significant relationship is established with return on assets, firm value and Tobin’s Q in both the short and long run. The findings also demonstrate that carbon performance is a transmission channel whereby the debt-to-equity ratio, interest cover ratio, price to cash flow ratio and current ratio improve corporate financial performance and firm value in the long run. In the short run, the regression analysis frameworks produce mixed findings on whether carbon performance is a transmission channel. Policy recommendations are made based on the findings.

scholarly journals A Study of A Causality Relationship between Profitability and Firm Value: A Comparison between European Countries

2017 ◽  
Vol 4 (1) ◽  
pp. 108
Author(s):  
Ben Said Hatem
Keyword(s):  
Firm Value ◽  
European Countries ◽  
Tobin’S Q ◽  
Return On Assets ◽  
Tobin's Q ◽  
Mean Values ◽  
Return On Equity ◽  
Market Values ◽  
Causality Relationship

The aim of our paper is to test for a causality interdependence between profitability and firm value. To this end, we examined a sample of two European countries: Italy and Poland. Our samples contain 200 firms from each country studied over a period of 4 years from 2007 to 2010. As a measure of firm performance, we use two ratios; return on assets and return on equity. Regarding firm value, we used two ratios; Tobin’s Q calculated as long-term debt increased by short-term debt divided by total assets, and Market To Book ratio calculated as market capitalization divided by shareholder’s equity. The descriptive statistics show that Italian firms have higher market values. We obtained mean values of 1,123 and 2,0698 of Tobin’s Q and MTB, respectively. However, firms of Poland are more profitable than firms of Italy. Using a data panel method, we concluded that for firms of Italy, there is a causality relationship between profitability, approximated by return on assets and return on equity and firm value, measured by Tobin’s Q. For firms of Poland, a causality relationship is also found.

The Impact of Firm Characteristics on Corporate Financial Performance in Emerging Markets

2020 ◽  
Vol 11 (4) ◽  
pp. 70-89
Author(s):  
Salah A. Ali ◽  
Mohamed Yassin ◽  
Rania AbuRaya
Keyword(s):  
Financial Performance ◽  
Audit Committee ◽  
Corporate Financial Performance ◽  
Tobin’S Q ◽  
Firm Characteristics ◽  
Return On Assets ◽  
Tobin's Q ◽  
Return On Equity ◽  
The Impact

This study investigates the impact of firm characteristics on the financial performance of companies listed on the Egyptian stock market. Regression model was performed to regress six firm characteristics variables, namely firm size, foreign listing, age, leverage, liquidity, and assets tangibility. The study controlled for five more variables related to corporate governance including board size, board independence, CEO role duality, audit committee, and the quality of external auditor to avert their effect on financial performance. The study used both accounting measures such as return on assets (ROA) and return on equity (ROE) and market-based Tobin's Q Ratio for measuring financial performance. The findings generally indicate that firm characteristics have an impact on both accounting financial performance as measured by ROA or ROE and market-based financial performance as measured by Tobin's Q, with little difference in the level of such impact. These findings revealed that firm characteristics affect corporate financial performance as evaluated by the company or the market.

scholarly journals THE STUDY OF RELATIONSHIP BETWEEN TOBIN’S Q AND US STOCK PERFORMANCE OF SELECTED FIRMS

2020 ◽  
Vol 1 (2) ◽  
pp. 85-94
Author(s):  
Papiya Ghosh ◽  
Brishti Guha
Keyword(s):  
Stock Prices ◽  
Correction Term ◽  
Unit Roots ◽  
Annual Data ◽  
Upward Movement ◽  
Tobin’S Q ◽  
Tobin's Q ◽  
Long Run ◽  
Cointegration Tests ◽  
Short Run

The objective of study was to test the dynamic effects of changes in Tobin’Q on stock prices of selected 249 US public companies of different industry categories. Panel unit roots tests and cointegration tests are implemented. Next, DOLS and GMM models are estimated. Annual data for the 2004-2012 period are used for the above selected US companies. Panel unit root tests provide somewhat mixed evidence of non-stationarity of both variables. There is clear evidence of cointegration between the above variables. The negative coefficient of the error-correction term shows convergence toward long-run equilibrium, though at slow pace. The estimates also reveal shortrun net positive interactive feedback effects between the variables. Both DOLS and GMM estimates display similar picture of overvaluation of stocks in terms of upward movement in Tobin’s Q beyond 0-to-1 range. For most parts of the sample period, the US stock market was in declining mode due to heightening of economic uncertainties during the Great Recession and several years beyond. Tobin’s Q should be improved to boost stock prices. This is more of a long-run phenomenon. In the short run, both reinforce each other. The topic is unique and the existing literature on this topic is scant. Relatively new econometric techniques have been applied for estimation using panel data. The results are quite insightful, in our view.

scholarly journals DAMPAK INTELLECTUAL CAPITAL TERHADAP NILAI PASAR PERUSAHAAN DENGAN RETURN ON ASSET SEBAGAI VARIABEL INTERVENING

2018 ◽  
Vol 11 (1) ◽  
Author(s):  
Dennis Sutandar ◽  
Prima Apriwenni
Keyword(s):  
Significant Influence ◽  
Intellectual Capital ◽  
Firm Value ◽  
Stock Exchange ◽  
Value Added ◽  
Intangible Asset ◽  
Observation Data ◽  
Tobin’S Q ◽  
Return On Assets ◽  
Tobin's Q

<p><em>Nowadays, intellectual capital become a very valuable asset on business. Intellectual Capital is an intangible asset that can create value added and competitive advatage for the company. The value added and competitive advatage will increase investors trust that can cause the raising value of the firm. Intellectual capital was measured by Vallue Added Intellectual Capital that consist of human capital, structural capital, and customer capital. The increasing profit was measured by return on asset (ROA). ROA indicates the company abilities to generate earnings (profitability). The firm value was measured by Tobin’s Q. The population in this research using a manufacturing company, especially infrastructure, utility, and transportation listed in Indonesia Stock Exchange during the period 2013-2015. Based on purposive sampling method, 19 samples were obtained, so there are 57 of observation data. The analysis techniques use are multiple linear regresion and path analysis. The result of this research showed that: (1)</em><em> Intellectual capital has a positive and significant influence toward return on assets. (2) Intellectual capital has a positive and significant influence toward firm value. (3) Return on assets has a positive and significant influance on firm value. (4) Intellectual capital has a positive and significant influence toward firm value through return on assets.</em><em></em></p><p><em> </em></p><p><strong><em>Keyword</em></strong><em> : </em><em>Intellectual Capital, Return on Asset, Firm Value, Tobin’s Q</em></p>

scholarly journals Study on the Relationship between CSR and Financial Performance

2019 ◽  
Vol 11 (2) ◽  
pp. 343 ◽  
Author(s):  
Sang Cho ◽  
Chune Chung ◽  
Jason Young
Keyword(s):  
Financial Performance ◽  
Firm Value ◽  
Positive Relationship ◽  
Corporate Financial Performance ◽  
Tobin’S Q ◽  
Tobin's Q ◽  
Positive Correlation ◽  
Social Contribution ◽  
Corporate Social ◽  
The Relationship

This study analyzed whether a systematic relationship exists between corporate social responsibility (CSR) performance and corporate financial performance using 191 sample firms listed on the Korea Exchange. The Korea Economic Justice Institute (KEJI) index of 2015 was used to measure CSR performance; profitability and firm value were used to measure corporate financial performance. Return on assets was used as a proxy for profitability, and Tobin’s Q was used as a proxy for firm value. The correlation between these variables and CSR performance was examined through correlation and regression analysis. The results confirm that CSR performance has a partial positive correlation with profitability and firm value. These results are partly consistent with those of previous studies reporting a positive relationship between CSR and Korean firms’ financial performance using the KEJI index before 2011. In the relationship between CSR performance and profitability, only social contribution yields a statistically positive correlation. Analysis of the correlation between CSR performance and financial performance indicators revealed a positive relationship between the growth rate of total assets and corporate soundness and social contribution. Both soundness and social contribution showed a positive correlation with Tobin’s Q, the measure of corporate value.

scholarly journals The Influences of Sustainability Report and Corporate Governance toward Financial and Entity Market Performance with Political Visibility as Moderating Variable

2017 ◽  
Vol 8 (1) ◽  
pp. 61 ◽  
Author(s):  
Ingrid Panjaitan
Keyword(s):  
Corporate Governance ◽  
Financial Performance ◽  
Structural Equation ◽  
Market Performance ◽  
Equation Modeling ◽  
Tobin’S Q ◽  
Return On Assets ◽  
Tobin's Q ◽  
Sustainability Report

The aim of this research was to identify the effect of corporate governance and sustainability report on the financial performance of entities, and corporate governance and sustainability report on the market entity with political visibility as moderating variable. Sustainability report was measured by a dummy variable by the Corporate Governance Scorecard with Indonesian Institute for Corporate Directorship (IICD). Then, financial performance as measured by profitability ratio (ROA) and Liquidity Ratio (CR), as well as the market performance were measured using Tobin’s Q. Meanwhile, the political visibility was measured by the log of total assets. The analysis of the data used Path Analysis method with Structural Equation Modeling (SEM). The analysis shows four results by using political visibility as moderating variable. First, the quality of corporate governance affects the financial performance. Second, the quality of corporate governance influences Tobin’s Q. Third, the sustainability report has an effect on the Return on Assets and current ratio. Last, sustainability report also affects Tobin’s Q.

scholarly journals Asset liquidity and bank profitability in South Africa

2013 ◽  
Vol 11 (1) ◽  
pp. 745-753
Author(s):  
Godfrey Marozva
Keyword(s):  
South African ◽  
Ordinary Least Squares ◽  
Return On Assets ◽  
Bank Profitability ◽  
Return On Equity ◽  
Distributed Lag ◽  
Autoregressive Distributed Lag ◽  
Long Run ◽  
Asset Liquidity ◽  
Short Run

This paper empirically analyses the relationship between asset liquidity and bank profitability for South African banks for the period between 1994 and 2011. The study employs Ordinary Least Squares (OLS) and the Autoregressive Distributed Lag (ARDL)-bound testing approach to examine the linkage between return on assets (ROA) and liquidity, and the nexus between return on equity (ROE) and liquidity to capture the short-run and long-run dynamics. The study observes that there is neither a significant relationship between ROE and liquidity nor a relationship between ROE and liquidity. These observations hold for both the short-run and long-run. Banks are recommended to embrace the asset liability framework in their analysis and management of liquidity as the asset only approach is insufficient and misleading

Environmental, Social, and Governance Disclosure and Financial Performance

2021 ◽  
pp. 244-253
Author(s):  
İsmail Çağrı Özcan
Keyword(s):  
Financial Performance ◽  
Small Body ◽  
Tobin’S Q ◽  
Return On Assets ◽  
Tobin's Q ◽  
Return On Equity ◽  
Rail Industry ◽  
Transport Industry ◽  
Major Criterion ◽  
Governance Disclosure

The environmental, social, and governance (ESG) disclosure performance of the companies is becoming a major criterion for significant stakeholders like shareholders, creditors, and customers. In line with the increasing interest in ESG activities, a growing respective literature emerges. Despite this evolving attraction, the ESG aspects of the transport industry in general, and the rail industry in particular remain relatively untouched except for a small body of research on airlines. This study aims at filling this gap by analyzing how the ESG disclosure performance of the rail companies affect their financial performance, which the authors measure by return on assets (ROA), return on equity (ROE), and Tobin's Q. Based on a sample of 35 rail companies from nine countries over the 2007-2017 period, the analyses show that ESG disclosure performance has a positive and statistically significant association with the ROA of the rail companies.

Pengukuran Kinerja Perusahaan Menggunakan Pendekatan Objektif dan Subjektif

2020 ◽  
Author(s):  
Raymond Lim
Keyword(s):  
Firm Value ◽  
Likert Scale ◽  
Tobin’S Q ◽  
Tobin's Q ◽  
Value Growth

Mengukur kinerja perusahaan berdasarkan pendekatan objektif dan subjektif. Pengukuran secara objektif dilakukan dengan menggunakan ROA, Tobin's Q, TFP, dan firm value growth. Di sisi lain, pengukuran subjektif dilakukan dengan mengunakan likert scale.

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