scholarly journals Financial Risk Hedging Practices and Firm Value of Non-Financial Firms Listed at Nairobi Securities Exchange

2021 ◽  
Vol 9 (7) ◽  
Author(s):  
Fridah W. Mungai ◽  
Fredrick Wafula
Keyword(s):  
Firm Value ◽  
Financial Risk ◽  
Risk Hedging ◽  
Financial Firms

Effect of Enterprise Risk Management on Firm Value: Empirical Evidence from Non-Financial Firms in Pakistan

GIS Business ◽  
1970 ◽  
Vol 13 (2) ◽  
pp. 15-28
Author(s):  
Nouman Nasir
Keyword(s):  
Risk Management ◽  
Firm Value ◽  
Positive Impact ◽  
Stock Exchange ◽  
Enterprise Risk Management ◽  
Least Square ◽  
Return On Equity ◽  
Financial Firms ◽  
Enterprise Risk ◽  
Ordinary Least Square Regression

This research examines the effect of enterprise risk management on firm value in Pakistan. Further, this study empirically examines company characteristics that establish the execution of an enterprise risk management system. Using a sample of final dataset of 83 non-financial firms located in Pakistan. The sample included non-financial firms from the year 1999 to 2015 and so up to seventeen observation years per company. As in context of Pakistan, most of the organizations are already implement an ERM programs and establish specialized ERM departments because the ERM is now a global term and has become increasingly relevant because of the growing difficulty of risk and an additional development of regulatory frame works. For the empirical evidences, data collected from non-financial firms listed at the Pakistan Stock Exchange (PSX). Results of logistic regression shows that Capital Opacity, Profitability, Financial Leverage, Firm Size and Slack have positive impact on the implementation of an ERM system but Industrial diversification, Industry and Return on Equity are negatively related to an ERM engagement. The results of ordinary least square regression finds positive relationship between use of an ERM and firm value.

Liberalism and Regulation of Financial Market

2012 ◽  
pp. 20-30
Author(s):  
V. Milovidov
Keyword(s):  
Hedge Funds ◽  
Financial Services ◽  
Financial Stability ◽  
Financial Risk ◽  
Risk Hedging ◽  
Rights Protection ◽  
Starting Point ◽  
Derivative Instruments ◽  
Credit Default ◽  
Financial Transactions

Reagan's financial sector deregulation became a starting point for the financial engineering, derivatives, combinatory financial operations industry. Due to it hedge funds developed, and a range of risk financial transactions expanded among the banks that found both new forms of financial risk hedging and new sources of income: arbitrage and hedging, credit default swaps, operations with "second-rate” credits. It was them that exploded the market in 2007–2008. The reaction of states realized in a string of regulation initiatives, including creation of supranational coordination bodies (in particular, Financial Stability Board); reformatting of mega regulators and on their base – the shaping of state prudential supervision and financial services consumer rights protection bodies with different tasks; restrictions on hedge funds activities; toughening of derivative instruments regulation and implementing of a central counterparty institute on derivatives market.

scholarly journals PROFITABILITAS, RISIKO KEUANGAN DAN NILAI PERUSAHAAN, DAN PRAKTIK PERATAAN LABA

Equity ◽  
2019 ◽  
Vol 21 (1) ◽  
pp. 71
Author(s):  
Feby Lutfitasari ◽  
Novrida Qudsi Lutfillah
Keyword(s):  
Significant Influence ◽  
Firm Value ◽  
Financial Risk ◽  
Income Smoothing ◽  
Quantitative Approach ◽  
Research Purpose ◽  
Corporate Value ◽  
Simultaneous Effect

The research purpose is to test the partial and simultaneous effect of the variabel of profitability, financial risk, and firm value to the income smoothing practices. This research is done by quantitative approach upon the companies registered in BEI for 2013-2015 periods. The results showed that there was no significant influence partially and simultaneously variableprofitability, financial risk and corporate value to the practice of income smoothing.

Determinants of corporate foreign exchange risk hedging

2014 ◽  
Vol 40 (2) ◽  
pp. 176-188 ◽  
Author(s):  
Lee-Lee Chong ◽  
Xiao-Jun Chang ◽  
Siow-Hooi Tan
Keyword(s):  
Exchange Rate ◽  
Descriptive Analysis ◽  
Financial Derivatives ◽  
Content Type ◽  
Risk Hedging ◽  
Financial Firms ◽  
Hedging Strategies ◽  
Factors Influencing ◽  
Financial Hedging ◽  
Exchange Risk

Purpose – The purpose of this study is to delineate the factors influencing the use of financial derivatives by non-financial firms in managing their exchange rate exposure. In total, 219 non-financial firms are surveyed in regard to their financial hedging decision. Design/methodology/approach – This study is conducted via a survey and the questionnaires were sent to the treasurers and financial controller of the firms. Descriptive analysis is employed to assess the profiles of the respondents. Then, factor analysis is carried out to determine the factors influencing the use of financial derivatives in Malaysia. Findings – The results indicate that the hedging decision of non-financial firms is influenced by their assertive level toward the market and regulators and also how flexible they are for derivative instruments. The intellectual capability that firms acquire to perform hedging strategies is also vital in influencing them to make hedging decision. Practical implications – The insights of this survey would assist and prepare firms to hedge their exchange rate risk by employing financial derivatives. Knowing the influences of firms' adoption of currency derivatives would allow policy makers to formulate their policies in boosting the liquidity of Malaysian derivative market. Originality/value – This study presents findings on the factors influencing the execution of financial hedging by non-financial firms in Malaysia. Survey data are used to seek for the feedback from the market players in order to provide empirical evidence on the corporate use of financial hedging.

scholarly journals The Paradox of Managerial Dividend Policy in Corporate Malaysia

2019 ◽  
Vol 5 (1) ◽  
pp. 197-204
Author(s):  
Muhammad Farhan Basheer ◽  
Muhammad Haroon Hafeez ◽  
Raza Ali ◽  
Shahzad Akhtar
Keyword(s):  
Firm Value ◽  
Dividend Policy ◽  
Mail Survey ◽  
Cover Letter ◽  
Listed Firms ◽  
Financial Firms ◽  
Single Pattern ◽  
Managerial Perception ◽  
Primary Means ◽  
Potential Factors

The prime objective of this paper is to survey the managers of Bursa Malaysia listed non-financial firms and to divulge their views regarding the significance of various potential factors that may affect dividend decisions. In addition to that, we are also interested in highlighting that how managerial perception about the importance of these factors varies from country to country. Our next objective is to know the level of importance, Malaysian managers give to dividend processes and pattern, firm value. Dividend policy (DP) and residual dividend policy (RDP). Finally, we are interested in measuring the level of support that Malaysian managers provide for different justifications for the payment of dividends. Survey instrument including a cover letter was mailed to chief finance officers (CFO) and finance managers of 493 Bursa Malaysia listed firms in October 2017. In the cover letter, a request was made to all respondents that in case of their non-involvement in dividend decision the letter must be forwarded to concerned authority involved in dividend decisions. The response rate of the current study is 40.09 percent (202 out of 493 firms). The study has used a mail survey of Bursa Malaysia listed non-financial firms that have paid at least one cash dividend during the period of 2013-2016 as a primary means of collecting data. No single pattern in rankings of factors among different countries has emerged. However, like their American, Canadian and Indonesian counterparts, According to Malaysian managers, dividend decisions have a significant effect on firm value. Although, a great deal of support has already been established with all dividend theories, however clientele and agency theory has proven to be the strongest one. In author’s knowledge, this is the first study designed to explore the views of Malaysian managers on DP in Malaysia.

scholarly journals BOARD GENDER DIVERSITY AND ITS IMPACT ON FIRM VALUE AND FINANCIAL RISK

2019 ◽  
Vol 9 (3) ◽  
pp. 407
Author(s):  
Yunia Panjaitan
Keyword(s):  
Board Of Directors ◽  
Firm Value ◽  
Financial Risk ◽  
Positive Impact ◽  
Stock Exchange ◽  
Gender Diversity ◽  
Multiple Linear Regression Model ◽  
Manufacturing Companies ◽  
Board Gender Diversity ◽  
The Impact

One of the things that can be done to maximize firm value is by having a board of directors with diverse characteristics. Gender diversity in the firm’s board of directors can bring a positive impact to the firm. Females are generally more risk-averse than males, and this could lead to a lower risk that must be borne by the firm. This study is conducted to investigate the impact of Board Gender Diversity to firm’s value and financial risk. Using 51 manufacturing companies listed in the Indonesia Stock Exchange from year 2016 to 2017, data was analyzed with the multiple linear regression model for panel data. The findings suggest that the presence of female directors has a positive and significant effect to firm’s value, and a negative but not significant effect to firm’s financial risk

scholarly journals Earnings Volatility, the Use of Financial Derivatives and Earnings Management: Evidence from an Emerging Market

2021 ◽  
Vol 58 (1) ◽  
pp. 1-20
Author(s):  
Lian Kee Phua ◽  
Char-Lee Lok ◽  
Yong Xia Chua ◽  
Tan-Chin Lim
Keyword(s):  
Earnings Management ◽  
Financial Risk ◽  
Emerging Market ◽  
Commodity Prices ◽  
Earnings Volatility ◽  
Financial Firms ◽  
Currency Exchange ◽  
The Face ◽  
Earnings Trends ◽  
The Relationship

In the face of crises such as Covid-19, businesses become devastated by greater risk exposure, particularly in currency exchange, supply chain disruption, and fluctuation in commodity prices that cause volatile earnings trends. Higher earnings volatility is frequently associated with greater risk. Consequently, firms could be inspired to engage in earnings management or derivative use as attempts to mitigate earnings volatility. Using a sample of 169 of the largest non-financial firms with 507 firm-years observations from an emerging market, the researchers examined the relationship among derivative use, earnings volatility, and earnings management. The results of a panel regression analysis showed that derivative use by Malaysian public listed companies was positively connected with earnings volatility, inferring that the use of derivatives did not mitigate earnings volatility as intended. This study also found that both earnings volatility and derivative use have a positive relationship with earnings management. This implies that firms engage in earnings management to curb earnings volatility under circumstances where derivative use is associated with higher earnings volatility. Evidence derived from this study contributes to extant literature on financial risk management involving financial instruments, an area that is very much understudied in the contexts of emerging markets.

scholarly journals Corporate governance, institutional investor type and firm performance: Evidence from an emerging market

2021 ◽  
Vol 5 (4) ◽  
pp. 20-27
Author(s):  
Rama Sastry Vinjamury
Keyword(s):  
Firm Performance ◽  
Institutional Investors ◽  
Firm Value ◽  
Fixed Effects ◽  
Stock Exchange ◽  
Emerging Market ◽  
Developed Economies ◽  
Financial Firms ◽  
Pressure Sensitive

The study analyses the role of institutional investors in improving firm performance. Unlike in developed economies where firm ownership is widely dispersed, firms in emerging economies such as India have substantial promoter shareholdings (often in a majority or close to a majority). Given the promoter control of Indian companies, the role of institutional investors as external monitors is analysed. Following Brickley, Lease, and Smith (1988) and Almazan, Hartzell, and Starks (2005), the study categorises institutional investors as pressure-sensitive and pressure-insensitive institutional investors. Panel data for non-financial firms from India included in National Stock Exchange (NSE) 500 over the period 2008–2017 is studied using fixed-effects models. The study finds that the increased ownership of pressure-insensitive institutional investors is positively associated with firm performance. Also, the increased ownership of pressure-sensitive institutional investors is negatively associated with firm performance. These findings are consistent with the view that pressure-insensitive institutional investors are more effective monitors compared to pressure-sensitive institutional investors. The study offers insights into the role of institutional investors in economies where firms have a substantial promoter shareholding. The study documents that even with a substantial promoter shareholding and control, pressure-insensitive institutional investors aid in enhancing firm value

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