Research

Abdul Ghafoor · Rozaimah Zainudin · Nurul Shahnaz Mahdzan ·Journal of Business Ethics ·2019

This study investigates the key factors that elicit financial reporting fraud among companies in Malaysia. Using enforcement action releases issued by the Security Commission of Malaysia (SC) and Bursa Malaysia, we identify a sample of 76 firms that had committed financial reporting fraud during the period of 1996–2016. We use the fraud triangle framework and the Malaysian International Standards on Auditing 240 to identify the factors. Since the simple probit model fails to address the identification problem (partial observability), we estimate our results using a bivariate probit model. The new model estimates the effects of pressure, opportunity, and rationalization on the probability of fraud likelihood by disentangling the detection probability of fraud. Among several proxies used for pressure, our results suggest that aggressive tax reporting and financial difficulties increase the likelihood of fraud commission. In regard to opportunity, we find that dedicated institutional investors, independence of the board, effective audit committee, and the presence of a female on the board provide active monitoring and oversight in reducing fraud occurrence. Results for rationalization suggest that prior violations and frequent changes of external auditors increase the chances of fraud occurrence. This research offers possible insights to auditors, managers, and regulators to prevent, detect, and react to fraud. Specifically, it highlights the specific factors that may exacerbate the fraudulent intentions of firms.

Lee Hwok Aun ·Asian Economic Policy Review ·2021 ·JEL: D30, D63, I30, J15

The New Economic Policy (NEP) which focused on poverty reduction and social restructuring has transformed Malaysia since 1971. Pro-Bumiputera affirmative action was intensively pursued and has continuously faced pushback, with heightened debate at key junctures. The NEP was marred by gaps and omissions, notably its ambiguity on policy mechanisms and longterm implications, and inordinate emphasis on Bumiputera equity ownership. Broader discourses have imbibed these elements and tend to be more selective than systematic in policy critique. During the late 1980s, rousing deliberations on the successor to the NEP settled on a growth-oriented strategy that basically retained the NEP framework and extended ethnicitydriven compromises. Since 2010, notions of reform and alternatives to the NEP’s affirmative action programme have been propagated, which despite bold proclamations, again amount to partial and selective – not comprehensive – change. Affirmative action presently drifts along, with minor modifications and incoherent reform rhetoric stemming from conflation of the NEP’s two prongs.

Muhammad Haseeb · Irwan Shah Zainal Abidin · Qazi Muhammad Adnan Hye · Nira Hariyatie Hartani ·International Journal of Energy Economics and Policy ·2019 ·JEL: I31; Q22; Q52

This present study examines the role of renewable energy in influencing economic well-being in Malaysia. We used annual data over the period of 1980–2016 in order to apply recent econometrics. The study used renewable energy and economic growth as a proxy of economic well-being to examine the long run connection between renewable energy and economic well-being. The results of auto regressive distributed bound testing approach confirm the valid long-term connection among renewable energy and economic well-being in Malaysia. Furthermore, the results indicate that renewable energy have significant and positive impact on economic well-being in short and long run. It is therefore recommended that the policymakers are required to focus on the green energy generation sector by increasing renewable energy production from the existing sources.

Miao Zhanga · Md Aslam Mia ·Journal of the Asia Pacific Economy ·2020 ·JEL: D22 F23 L60 O14

With cognizance to firms’ heterogeneity in an industry, this paper employs the most recent, unpublished and large-scale firm-level data of 14,687 manufacturing firms in Malaysia in 2015 to revisit the drivers of manufacturing exports. Applying the OLS and logistic regressions, we observed a strong positive relationship between a firm’s labor productivity and export intensity. Firms’ foreign ownership, size and age are positively connected to their export competitiveness. The incorporation of location variables into the regression reveals that firms in the Southern peninsula of Malaysia (e.g., Johor) have a positive effect and demonstrate the highest probability to engage in export activities. Our study is informative to trade policymakers on the key drivers of manufacturing exports, providing references to not only Malaysia, but other economies in Eastern Asia and developing nations.

Kartini Muniandy · Suzari Abdul Rahim · Aidi Ahmi · Nor Aida Abdul Rahman ( Malaysian Institute of Aviation Technology (UniKL MIAT)) ·International Journal of Supply Chain Management ·2019

In recent years, the hospitality Industry has overcome numerous challenges to initiate green practices. Greater interest in customers green behaviours has led the hotel industry to practice more environmentally friendly activities. Therefore, this study aims to identify the factors that influence customers in visiting green hotels in Malaysia. The theory of planned behaviour (TPB) has been embedded to investigate the factors. Data was collected via questionnaires through online by invitation through email and offline from travellers in selected airports. IBM SPSS Statistics software was used to analyse the data. The results discovered that attitude, subjective norms, perceived behavioural control and environmental concern significantly influence customers in visiting green hotels. Meanwhile, attitudes mediate subjective norms and perceived behavioural control and finally attitudes, and perceived behavioural control possess a positive relationship with the environmental concern of visitors in visiting green hotels. Findings from this research can help the Malaysian government and hoteliers to integrate the research framework in their current business model and imposed more effective strategies on a green environment in developing green hotels.

Mohammad Sharif Karimi ·International Economic Journal ·2018 ·JEL: C22; O11

In this study, we examine the nonlinear relationship between international tourism arrival and economic growth of Malaysia by using asymmetric models over the periods 2000:1–2015:4. The results show that the tourism arrival is positively related to Malaysia’s economic growth in the long run, but there is no short-run relationship and other traditional growth factors such as trade, exchange rate and Consumer Price Index are important for economic growth in the case of Malaysia. This implies that tourism can be one of the important factors for Malaysia’s economic growth in the long run and development and can be used to stimulate the overall economic growth and hence, policy-makers should pay greater attention towards promoting inbound tourism.

Habib Ahmed · Ahmed H. Elsayeda ·Quarterly Review of Economics and Finance ·2019

This study examines the decoupling hypothesis between Islamic and conventional capital markets by analysing the dynamic interdependencies among conventional stock, Islamic stock, bonds and sukuk markets in Malaysia over the period January 3, 2007 to March 31, 2017. Empirical findings on the total spillover index show that, on average, one third of the total forecast error variance attributed to spillovers has affects across four markets, indicating that conventional and Islamic markets are highly interconnected. The conventional stock and bond markets are considered to be the main net transmitters of spillovers towards other markets, whereas the sukuk market is a net receipt of modest levels of return shocks from conventional, Islamic and bond markets throughout the sample period. The interlinkages and connectedness between sukuk and conventional bonds are robust compared with other markets but show variations in the spillovers over the period. While one way to explain the differences in the spillovers between the conventional bond and sukuk indices can be attributed to external factors such as the financial crisis, changes in the legal regime and political uncertainties, another explanation may lie in the differences in the contractual structures of these instruments.

Asrul Akmal Shafie · Haarathi Chandriah · Yee Vern Yong · Sharifa Ezat Wan Puteh ·Value in Health Regional Issues ·2019

Objective To describe the process and role of health technology assessment (HTA) in the context of drug policy in Malaysia. Methods We summarized the HTA process through review of documents and reports available in the public domain combined with the authors' experience. Results Health technology assessment plays an integral part in prioritizing treatment in public health facilities in Malaysia, particularly for the Ministry of Health Medicines Formulary (MOHMF). The MOHMF is the reference list of drugs allowed to be prescribed in the Ministry of Health (MOH) facilities. There are 2 organizations within the MOH that conduct HTA as their core activities, namely the Malaysian Health Technology Assessment Section and the Formulary Management Branch of Pharmacy Practice & Development Division. The assessment of pharmaceuticals for the purpose of listing medicines into the MOHMF is under the purview of the Formulary Management Branch. The evidence-based assessment focuses on safety, efficacy, effectiveness, and budget impact of the drug. Cost-effectiveness evidence is currently not mandatory but is of interest to the decision makers. The assessment outcomes are considered by the MOH Medicines List Review Panel for formulary decisions. Conclusions Health technology assessment has supported formulary decisions in MOH. Evidence generation needs to progress beyond efficacy or effectiveness, safety, and budget impact to incorporate cost-effectiveness. Nevertheless, there are challenges to be met to achieve this. The impact of the HTA process is currently unknown and is yet to be evaluated formally.

Suhaiza Ismail · Zuhudha Rasheed ·Meditari Accountancy Research ·2019

Purpose This paper aims to identify the influence of personal factors on the ethical judgement of future accountants in Malaysia. In particular, there are two research objectives for this study: first, to investigate the influence of ethical ideology on the ethical judgement of accounting students and second, to investigate the influence of emotional intelligence (EI) on ethical judgement. Design/methodology/approach The respondents of the study were final year undergraduate accounting students from three public universities in Malaysia. A survey questionnaire comprising instruments about ethical ideology, EI and ethical judgement was distributed. A total of 205 responses were received and were deemed as useable. To achieve the research objectives, multiple regression was performed. Findings The findings indicate that idealism and EI have a positive influence on the ethical judgement. In contrast, the study discovered that relativism influences ethical judgement negatively. Originality/value This study fills the research gap as research on personal factors on the ethical judgement of future accountants is very limited and scarce. It gives insights to the various parties concerning how to enhance ethical judgement among future accountants, which ultimately will improve the credibility of the accounting profession.

Emile Kok-Kheng Yeoh · Le Chang · Yemo Zhang ·The Chinese Economy ·2019

With trade volume registering more than US$10 billion in recent years, Malaysia has already been China’s largest Association of Southeast Asian Nations (ASEAN) trading partner since 2008 and its third biggest Asian trading partner after Japan and South Korea. It is expected that China–Malaysia bilateral trade with an 8% annual growth rate will continue to expand, and this strong bilateral tie is set to be strengthened in the face of Chinese president Xi Jinping’s efforts to enhance regional connectivity and especially maritime linkage by proposing the “One Belt One Road” (OBOR) construction. Malaysia is well placed, probably even better than most of its ASEAN neighbors, to embrace the opportunities brought about by the surge of infrastructure development and trade deals that is going to come with the progress in constructing the ocean-based Maritime Silk Road (MSR), one of the two initiatives of OBOR, the other being the land-based Silk Road Economic Belt. With Malaysia’s traditional linkage with China’s southeastern provinces of Guangdong and Fujian, and as the holder of the Strait of Malacca, Malaysia is occupying a key strategic location that can serve well as China’s gateway to the ASEAN Economic Community. A statement made by the Malaysian transport minister has declared that a few ports in Malaysia has been identified to be part of the MSR. The close ties between both countries have resulted in cooperation in the transportation field such as railway projects and purchasing of trains from China. Indeed, Malaysia is in the process of developing inter–port city collaboration between China’s Qinzhou Port and Malaysia’s Kuantan Port. In recent years, China’s Guangxi Beibu Gulf International Port Group has bought a 40% stake in Malaysia’s Kuantan Port Consortium from the construction group IJM Group for a total of US$102 million. It is in such context and with due consideration of such developments that this paper will explore the prospects and challenges facing China–Malaysia cooperation within the overall framework of China–ASEAN strategic relations.

Kunal Sen · Matthew Tyce ·Structural Change and Economic Dynamics ·2019

Both Malaysia and Thailand were seen to be part of the miracle growth economies of East Asia and fast moving into high income status in the early 1990s. Following the Asian Financial Crisis (AFC) of the mid 1990s, both countries have observed prolonged growth slowdowns. In this paper, we offer a political economy explanation of the growth slowdown in Malaysia and Thailand in their post AFC phases. We argue that the nature of the political settlement in these two countries determined a growth strategy that was predicated on offering open deals in the export-oriented manufacturing sector that were accessible to most firms, while at the same time, offering closed deals to politically connected firms in the natural resource and services sectors. As the political settlement moved to a vulnerable authoritarian one in both countries, such a dualistic deals strategy became patronage based over time and detrimental to growth.

Nur Ainna Ramli · Hengky Latan · Grace T.Solovida ·Quarterly Review of Economics and Finance ·2019 ·JEL: G14; G10; M41

We examine the impact of capital structure determinants on firm financial performance together with the mediation effect of firm leverage in Malaysia and Indonesia over the period of 1990–2010. Our results show that certain of the capital structure determinants directly affect firm financial performance. We also observe that only the Malaysian sample has a positive significant correlation between firm leverage and firm financial performance. Malaysian firms use external financing instead of internal financing to heighten performance. Our results also show that firm leverage plays a mediating role in Malaysia but not for the Indonesian sample. The asset structure, growth opportunities, liquidity, non-debt tax shield and interest rate are the attributes that were indirectly influenced by firm leverage on firm financial performance. Further analysis for multi-group analysis (MGA) in PLS was also used to test the equality of the parameter estimates. We observe that certain attribute coefficients in the determinants of capital structure and firm financial performance are significantly different between Malaysia and Indonesia.

Bakri Mat (Universiti Utara Malaysia (UUM)) · Ku Nurasyiqin Ku Amir (Universiti Utara Malaysia (UUM)) ·International Journal of Supply Chain Management ·2019

Food security is one of the non-traditional security components that forms the basic needs of a nation, households, and individuals. Any problem in food supply or disruption in any of the four key elements of food security will threaten security and well-being of the citizens. In Malaysia, although food availability is ensured through via local production and imports at national level, accessibility and utilization are not yet fulfilled as certain groups and households are still unable to access and utilise adequate food accordingly. Therefore, this research attempts to examine the socioeconomic factors that may contribute towards food insecurity among Malaysian households within communities in Malaysia-Thailand border using human security approach. This study is conducted using qualitative research method to collect and analyse both primary and secondary data. Primary data was obtained through official documents and an in-depth interview with key informants among Malaysian households of the communities near Malaysia-Thailand border, local leaders and academicians. Meanwhile, the secondary source of data was obtained from published materials and online documents such as books, journal articles and reports. The findings indicate that socioeconomic factors were pertinent in contributing towards food insecurity among the households in form of household income, insufficient assistance program, and high living costs. These factors form the main foundation in ensuring the sanctity and wellbeing of the households. In designing state policies, the socioeconomic issues should be prioritized as in ensuring human security of the vulnerable groups, specifically the B40 households. In addition, continuous effort in developing societal empowerment and resilience are vital to achieve citizen wellbeing.

Siew Imm Ng · Jo Ann Ho · Xin Jean Lim · Kee Lin Chong · Khairunnisak Latiff ·Young Consumers ·2019

Purpose In this digitalization age, smart technologies are on the cusp of changing all business sector including retailing. Today’s consumers desire to shop in a smart store where the physical products on display are connected to the internet world. This study aims to propose a model for investigating Generation Z (Gen-Z) consumers’ expectations towards the smart retail technology (SRT) in the Malaysian context through the application of the stimulus-organism-response framework. Design/methodology/approach By using a purposive sampling technique, a self-administered questionnaire was conducted. A total of 220 usable responses were collected from Gen-Z consumers who had experience in using SRT. The data were analysed using partial least square structural equation modelling (PLS-SEM). Findings This study underscores the role of perceived usefulness, perceived enjoyment and perceived value on Gen-Z consumers’ attitude and word-of-mouth (WOM). Expectations on usefulness, enjoyment and value provide some ideas on Gen-Z consumers’ value who put a high emphasis on functional value, fun value and value for money when adopting the SRT. On the other hand, the result also demonstrates the mediating role of consumers’ attitude in connecting perceived value and perceived enjoyment on WOM towards SRT. Practical implications The findings of this study provide beneficial insights for a retailer who desire to pursue a smart-related acquisition strategy. Retailers are recommended to embrace on the following three key features: innovative solution (high usefulness), reliable benefits (high perceived value) and fun experience (high enjoyment) to provide Gen-Z consumers with compelling experiences. Additionally, retailers are suggested to acknowledge the importance of managing consumers’ attitude in driving positive WOM evaluations. Originality/value This paper responds to Ting et al.’s (2018) call in uncovering values and lifestyles of generation in details. In Malaysia, retailers ought to incorporate of the high level of usefulness, value and enjoyment when designing their SRT to constitute the Gen-Z consumers’ expectations. Moreover, similar to Ting’s conclusion, this cohort members are very much into technologies and they tend to embrace SRT in their lifestyles.

Christopher Gan · Rafiatul Adlin Hj Mohd Ruslan · Baiding Hu · Nguyen Thi Thieu Quang ·International Journal of Business and Economics ·2020 ·JEL: L26; O53

This study investigates the relationship between access to microcredit and SMEs’ performance. Using survey data on SME’s owners/managers in Terengganu, Malaysia in 2016, the study investigates how access to microcredit affects SME sales and employment growth. Employing the Propensity Score Matching method (PSM), the study showed that SMEs with microcredit borrowing had their sales 25.6% to 25.7% higher than nonmicrocredit borrowers. After minimizing the selection bias from both observable and unobservable characteristics using Differences in Differences method (DID), the difference was much larger (28.7%). However, both PSM and DID analyses revealed no impact of microcredit access on SME employment growth. The Endogenous Switching Regression method (ESR) confirmed these findings.