Research

Catherine S F Ho · Nur Hazimah Amran · Irfan Syarafuddin B Ab Aziz · Wahida Ahmad ·International Journal of Economics and Management ·2021 ·JEL: G11, G12, G15, G23

Financial crises and the geopolitical issues around the world have caused much volatility in returns and market uncertainty. This trend of higher uncertainty in risk and return causes vast changes in stock and investment values, which caused investors scrabbling to maintain the value of their wealth. It is therefore vital that investors understand and compare investment alternatives in order to maximize return. The purpose of this research is to analyze the performance of Islamic and conventional mutual funds and provide a comparison of fund performances to enable investors to make informed decisions. Mutual fund data from 2013 to 2017 for Saudi Arabia and Malaysia, the two largest Islamic fund markets are compiled and risk-adjusted performance statistics applied to arrive at measurement of performances. Although fund performance comparison is a wellresearched area, this study contributes to the literature in terms of a comprehensive investigation of various types of Islamic funds with an in-depth evaluation of different investment time horizons. Empirical evidence on risk-adjusted performance comparison indicates that Malaysian conventional equity, mixed asset and money market funds for all 1, 3 and 5-year horizons outperform their Islamic counterparts. Similarly, Saudi Arabian equity and mixed asset funds also outperform their Islamic counterparts for all time horizons. On the contrary, the Saudi Islamic money market funds outperform their conventional partners. Cross country comparison confirms that Malaysian funds achieve superior performance except for money market funds which underperform their Saudi counterparts. In summary, current evidence concludes that, depending on the investment horizon and risk appetite, investors are better off investing in the appropriate fund.

Norashikin Ismail · Nadia Anridho · Mohamad Azwan Md Isa · Nor Hadaliza Abd Rahman · Noriah Ismail ·International Journal of Economics and Management ·2022 ·JEL: O16, L25

The aim of study is to examine the impact of corporate sustainability (ESG) on the financial performance for Malaysia and Indonesia. A sample was selected comprising of 36 companies listed in Bursa Malaysia and 24 companies listed in Indonesia Stock Exchange over the ten-year period 2010-2019. Using fixed effect (FE) and pooled OLS suggest that ESG practices are positively associated with financial performance. This result implies that companies engaged in environmental, social and governance aspects have a higher shareholder value. A good economy condition encouraged companies to integrate ESG aspects and rewarded investors with good financial return (ROE). Companies with lesser governance practice would increase shareholders value (ROE). Essentially, this empirical evidence confirms stakeholder’s theory and agency theory. The implication of this study is to strengthen the development of sustainability from ESG practice and in line with current agenda of sustainable finance for the policymakers. Indeed, this study encourages more potential investors to invest companies with ESG practices

Siong Hook Law · M.N.A. Naseem · Anitha Roslan · Nirvikar Singh ·Malaysian Journal of Economic Studies ·2021 ·JEL: G29, O11, O43

This study examines the effects of business (enterprise) credit and household credit on economic performance in Malaysia. The World Bank’s Doing Business report ranked Malaysia at number one among developing countries in terms of ease of getting credit in the six consecutive years since 2008. The analysis is based on quantile regression estimations, using quarterly time series datasets from 1999: Q4 to 2019: Q4. The empirical findings reveal that business credit is positively associated with economic performance whereas household credit is an insignificant determinant of economic performance. We also consider the interaction between credit and institutional quality, an emerging key fundamental variable that determines economic performance. The results demonstrate that only the interaction term between business credit and institutions is statistically significant. In short, business credit outperforms household credit in promoting economic performance in Malaysia. The empirical findings are robust to alternative control variables and quantile regression estimation techniques.

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

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.

Arif Imam Suroso ·Economies ·2022

Palm oil is one of the most traded vegetable oils in the global market due to its versatile usage and having a lower price than competitor products. Trade is related to logistics performance as it connects the exporter and importer countries; thus, improving the indicators of logistics also improves the performance of trade, especially in agricultural export. Currently, no study has revealed the effect of logistics performance on palm oil export by considering all the indicators. This study investigates the impact of all the indicators of the logistics performance index on palm oil and palm-based products. Using a panel data regression approach, the extended gravity model is applied in this study to examine Indonesia and Malaysia as the leading exporters of palm oil and palmbased products. The results reveal that all the Logistics Performance Index indicators affect palm oil and palm-based products export in Indonesia and Malaysia. The critical indicators of the Logistics Performance Index in Indonesia are timeliness and tracking and tracing. However, competence and quality of trade infrastructure are the main indicators of Malaysia’s palm oil and palm-based products. The future direction of this research is to explore other agricultural commodities and extend the period of the analysis.

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.

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.

Rahmat Heru Setianto · Rani Septiani Sipayung · W.N.W. Azman-Saini ·Entrepreneurial Business and Economics Review ·2022

The objective of the article is to empirically investigates the role played by financial development in determining the relationship between working capital financing and firms’ performance. Employing data of publicly listed manufacturing firms in five ASEAN countries, namely, Indonesia, Malaysia, Philippines, Singapore, and Thailand spanning from 2009-2018 resulted in 6,183 firm years observation. This study conducts an analysis using the two-steps generalized method of moments (GMM) estimator. The inverted U-shape effect of working capital financing on firm profitability is confirmed, indicating a trade off in utilizing short-term debt to finance working capital requirements. Moreover, new evidence was shown that firms which operate in more financially developed regions have the opportunity to utilise a greater percentage of short-term debt without destroying their profitability.

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.

Mohd Azwan Zainol · Zakaria Abas · Ahmad Shabudin Ariffin ·International Journal of Supply Chain Management ·2019

This paper conceptualizes the innovative supply chain integration and business performance of aquaculture contract farming setting in Malaysia. Based on the SCM philosophy, it highlights three related variables of supply chain integration, namely: external integration with suppliers, external integration with customers and supply chain risks, and technological innovation, and the relation amongst the variables in focus that could produce promising business performance. Hence, ability to conceptualize, observe and give due recognition to the possible relation amongst these variables in question by the prospective aquaculture contract farming participants that could bring about an insightful engagement for the betterment of the aquaculture business performance.

Basu Govindaraju · John Jeyasingam · Md. Mamun Habib · Uvarani Letchmana · Sasidevi Ratnam ·International Journal of Supply Chain Management ·2019

This empirical study employed structural equation modeling (SEM) to investigate the impact of sustainable practices on sustainable performance of higher education institutions. Firstly, the sustainable performance survey is designed to investigate its main influencing factors among the pool of constructs includes; economic, environment, social and top management support factors. Secondly, based on the SEM, the levels of sustainable performance of the universities are quantified in accordance with factors. The findings were supported by empirical evidence, as the study established that only economic and environment factors have significant positive relationship and impact sustainability performance. This paper provides a greater understanding of the interactions between key elements of sustainable practices associated with university performance provision.

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.