Browsing by Subject "firm performance"

Now showing 1 - 3 of 3
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    Open Access
    Impact of intellectual capital on firm performance: Evidence from South African JSE listed firms
    (2020) Maluleke, Makungu Juanita; Smith, Colin
    The new knowledge economy has created a global interest on the valuation of intellectual capital as well as its impact on firm performance and value. Developing economies have relatively only begun to investigate this relationship and progress has already been made in South Africa by a few researchers. The purpose of this study is to add to this investigation by exploring the relationship between intellectual capital and firm performance for South African listed firms in intellectual capital-intensive industries. A gap exists in South African research regarding the long-term impact of intellectual capital on firm performance. This relationship is important to define as firms may well make inappropriate decisions based on short-term relationships that do not create long-term value. This study applies a lag model in an aim to investigate this relationship in addition to the short-term relationship that exists between intellectual capital and firm performance. The study involves a quantitative analysis of data collected from firms in intellectual capital-intensive industries and makes use of the VAIC model developed by Ante Pulic to value intellectual capital. Measures of firm performance used are return on assets, total asset turnover and market capitalization. This study also makes use of panel data covering 62 JSE listed companies over 10 years. Empirical results show mixed outcomes regarding the relationship between intellectual capital and firm performance for both short-term models and lagged models. In some instances, no association was observed between intellectual capital and performance.
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    Open Access
    The effect of ESG scores on corporate financial performance: case study on South Africa
    (2025) Choga, Simba Michael; Ndlovu, Godfrey
    This study seeks to examine the relationship between environmental, social and governance (ESG) scores and firm performance: using both accounting and market-based measures of firm performance. This research is important because it allows for valuable insights for investors and the local government, enabling them to navigate the complex environment of ESG disclosure and financial performance. Although the bulk of the evidence suggests the existence of a positive relationship between ESG scores and firm performance, a few studies find a negative relationship. Further, most research primarily use the combined ESG score and thus ignore the fact that the effect of the ESG subcomponents may vary. Using a panel of 38 JSE-listed firms over the period 2010 to 2022, the results from this study suggest existence of a negative but insignificant relationship between ESG scores and firm performance; regardless of the measure of performance used. Similar results are also found for the ESG subcomponents. The results suggest that firms engaged in ESG activities experience a negative effect on their profitability and market value. This would suggest that the push for ESG efforts negatively affects JSE-listed firms' performance which aligns with some previous research. Therefore, JSE-listed firms should consider investing less in ESG practices to improve firm performance.
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    Open Access
    The relationship between internationalisation and firm performance in South Africa: the moderating role of slack resources
    (2025) Sebola, Peter; Kew, Jaqueline
    Firm internationalisation has emerged as a crucial growth strategy in an increasingly globalised world. As firms strive to expand their operations beyond their home countries, they face several opportunities as well as challenges. While the effects of internationalisation on firm performance have been extensively studied, conclusive findings remain elusive due to a variety of factors. In particular, its specific implication for South African firms remains under-studied. Furthermore, there is a significant gap in the literature regarding how slack resources moderate this relationship. This study aims to analyse the relationship between the degree of internationalisation and firm performance among South African firms. It also examines how absorbed and unabsorbed slack resources influence this relationship. Employing a regression model, this study uses panel data from internationalised South African firms listed on the Johannesburg Stock Exchange between 2010 and 2019, providing a rich long-term dataset for analysis. The results indicate an insignificant relationship between the degree of internationalisation and firm performance, suggesting that increased internationalisation does not impact financial performance. The results also indicate that increasing absorbed and unabsorbed slack resources have an insignificant moderating effect on this relationship. This study contributes to the existing body of knowledge by providing insight into how firm internationalisation relates to performance, while considering the moderating effects of firm-specific factors. Additionally, it enhances the understanding of firm internationalisation in the emerging market context of South Africa. These findings offer practical implications for South African firms aiming to expand internationally, highlighting the importance of strategic resource allocation during internationalisation.