Growth of Companies: Empirical Study of the Companies Listed in Developing Economies Pertumbuhan Perusahaan: Studi Empiris Perusahaan Yang Terdaftar di Negara Berkembang
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Published:
Jul 31, 2020
Keywords:
Financial market; companies’ growth; control determinants; industrial and service sectors; developing economies
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Abstract
The aim of this study is to investigate the impact of some control determinants on growth of companies as a reflection to an economic perspective. The methodology used in the current study is cross sectional for a sample of companies belonging to industrial and service sectors (non-financial sector) for the year of 2019 in developing economies. We find a positive link between a number of board members and companies’ growth, while leadership position has insignificant link to companies’ growth. This means that an important policy implication should be considered by policy makers and management in the companies to increase numbers of members in the board of directors which is worth towards enhancement of companies’ growth. The value and originality of this study lies in its results that should be taken into account by several interested parties such as the management in the companies who engage in behavior that leads to maintaining strong control determinants, and also the financial analysts who manage studies on control determinants to enhance companies' growth and further the policymakers who design and implement plans of such determinants.
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Tariq Tawfeeq Yousif Alabdullah. (2020). Growth of Companies: Empirical Study of the Companies Listed in Developing Economies . Journal of Accounting Science, 4(2), 1-10. https://doi.org/10.21070/jas.v4i2.677
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Financial Accounting
Copyright (c) 2020 Author
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
Abushammala, S. N., Alabdullah, T. T. Y., and Ahmed, E. R. (2015). Causal Relationship between Market Growth and Economic Growth. Comparison Study. European Journal of Business and Management 7.
Ahmed, E. R., Alabdullah, T. T. Y., Amran, A., and &yahya, S. B. (2018a).
Indebtedness Theory and Shariah Boards: A Theoretical Approach. Global Business and Management Research 10, 127–134.
Ahmed, E. R., Alabdullah, T. T. Y., Thottoli, M. M., and Maryanti, E. (2020). Does Corporate Governance Predict Firm Profitability? An Empirical Study in Oman. The International Journal of Accounting and Business Society 28, 127–143.
Ahmed, E. R., Alabdullah, T. Y., Islam, M. A., and Asmar, M. (2014a). Sukuk Legitimacy: A New Measurement Based on Content Analysis” 16th Malaysian Finance Association Conference in SasanaKijang Central Bank of Malaysia (Kuala Lumpur).
Ahmed, E. R. and &zuqibeh, A. (2013). The role of shariah supervisory board in the reviewing and supervision on takaful (islamic insurance). Insurance and Takaful Journal.
Ahmed, E. R., Amran, A., and Islam, M. A. (2018b). Sukuk Documentation and Legitimacy: The Role of Shariah Supervisory Board as a Moderator. International Academic Journal of Accounting and Financial Management 05, 22–40. doi:10.9756/iajafm/v5i2/1810015.
Ahmed, E. R., Islam, A., and & Yahya, S. (2014b). Comparative study of Zakat and taxation system for Muslims and Non-Muslims in Malaysia. Advances in Environmental Biology, 549–554.
Ahmed, E. R., Islam, A., and Amran, A. B. (2019). Examining the legitimacy of Sukuk structure via Shariah pronouncements. Journal of Islamic Marketing 10,1151–1166. doi: 10.1108/jima-03-2018-0050.
Ahmed, E. R., Islam, M. A., Alabdullah, T. T. Y., and bin Amran, A. (2018c). Proposed the pricing model as an alternative Islamic benchmark. Benchmarking: An International Journal 25, 2892–2912. doi: 10.1108/bij-04-2017-0077.
Ahmed, E. R., Islam, M. A., and &alabdullah, T. T. Y. (2018d). The moderating role of Shariah supervisory board on sukuk pricing benchmark. International Journal of Excellence in Islamic Banking and Finance 6.
Ahmed, E. R., Islam, M. A., and Harthy, F. N. (2013). The relationship between shareholders and Shubuhat: a study on the Islamic banks in Malaysia. Journal of Asian Scientific Research 3, 538–538.
Ahmed, E. R., Yahaya, S., and harashid, M. (2012). Shubuhat on Matter of
Bai’alinah and Tawarruq. International Journal of Business and Technopreneurship 2, 85–101.
Alabdullah, T. T. Y. (2016a). Agency Cost and Management Behavior: The Role of Performance as a Moderator. International Journal of Science and Research (IJSR) 5, 1858–1864.
Alabdullah, T. T. Y. (2016b). Agency Theory Perspective: A Quantitative Study Of Accounting Performance Measures In Emerging Economies. In ICTE Proceedings.
Alabdullah, T. T. Y. (2016c). Are Board Size And Ownership Structure Beneficial In Emerging Markets’ Firms? Evidence From Jordan. International Journal of Management & Information Systems (IJMIS) 20, 87–94. doi: 10.19030/ijmis.v20i3.9752.
Alabdullah, T. T. Y. (2016d). Corporate governance from the perspective of the
past and the present and the need to fill an international GAP. Risk Governance and Control: Financial Markets and Institutions 6, 96–101. doi: 10.22495/rcgv6i4art12.
Alabdullah, T. T. Y. (2016e). The performance of companies and the board’s characteristics from the new perspective of manipulation avoidance. Corporate Ownership and Control 13, 279–286. doi: 10.22495/cocv13i4c2p1.
Alabdullah, T. T. Y. (2017). Compensation committee, company board attributes, and company performance: The moderating effect of leadership position. International Academic Conference Proceedings.
Alabdullah, T. T. Y. (2018). The relationship between ownership structure and firm financial performance. Benchmarking: An International Journal 25, 319–333. doi: 10.1108/bij-04-2016-0051.
Alabdullah, T. T. Y. and Ahmed, E. R. (2018). Corporate Governance: To What Extent it is important in the Arab Countries? International Journal of Science and Research 7.
Alabdullah, T. T. Y., Ahmed, E. R., and Nor, M. I. (2020). The World Declining Economy And Coronavirus Pandemic: Systems Should Be Continued. Russian Journal of Agricultural and Socio-Economic Sciences 102, 89–96. doi:
10.18551/rjoas.2020-06.11.
Alabdullah, T. T. Y., Alfadhl, M. M. A., .Yahya, S., and Rabi, A. M. A. (2014a). The Role of Forensic Accounting in Reducing Financial Corruption: A Study in Iraq. International Journal of Business and Management 9.
Alabdullah, T. T. Y., Nor, M. I., Ahmed, and R, E. (2018). The Determination of Firm Performance in Emerging Nations: Do Board Size and Firm Size Matter. Management 5, 57–66.
Alabdullah, T. T. Y., Yahya, S., Nor, M. I., and Majeed, F. Q. (2016). An Investigation of Corporate Governance From a New Perspective: Examining The Financial Performance of Companies and The Impact of Executive Turnover. Corporate Board: Role, Duties &Composition 12, 53–67.
Alabdullah, T. T. Y., Yahya, S., and Ramayah, T. (2014b). Corporate Governance Mechanisms and Jordanian Companies’ Financial Performance. Asian Social Science 10, 247–247. doi: 10.5539/ass.v10n22p247.
Alabdullah, T. Y., Sofriyahya, and Thurasamy, R. (2014c). Corporate Governance Development: New or Old Concept? European Journal of Business and Management 6.
Alfadhl, M. M. A. F. and Alabdullah, T. T. Y. (2013). Determinants of the Managerial Behavior of Agency Cost and Its Influential Extent on Performance: A Study in Iraq. International Journal of Humanities and Social Science, 3–3.
Ali, A. and Zarowin, P. (1992). The Role of Earnings Levels in Annual EarningsReturns Studies. Journal of Accounting Research 30, 286–286. doi: 10.2307/
2491128.
Ali, W., Frynas, J. G., and Mahmood, Z. (2017). Determinants of Corporate Social Responsibility (CSR) Disclosure in Developed and Developing Countries: A Literature Review. Corporate Social Responsibility and Environmental Management 24, 273–294. doi: 10.1002/csr.1410.
Alabdullah, T. T. Y. (2019). Management Accounting and Service Companies’ Performance: Research in Emerging Economies. Australasian Accounting, Business and Finance Journal 13, 100–118. doi: 10.14453/aabfj.v13i4.8.
Baliga, B. R., Moyer, R. C., and Rao, R. S. (1996). CEO Duality and Firm Performance: What’s The Fuss? Strategic Management Journal 17, 41–53.
Brooks, C. (2014). Introductory econometrics for finance (New York: Cambridge university press).
DiPeitro, W. R. and Anoruo, E. (2012). Government size, public debt and real economic growth: a panel analysis. Journal of Economic Studies 39, 410–419. doi: 10.1108/01443581211255620.
Fauzi, F. and Locke, S. (2012). Board structure, ownership structure and firm performance: A study of New Zealand listed-firms.
Hashim, F., Ahmed, E. R., and Huey, Y. M. (2019a). Board Diversity and Earning Quality: Examining the Role of Internal Audit as a Moderator. Australasian Accounting, Business and Finance Journal 13, 73–91.
Hashim, F., Ries, E. A., and Huai, N. T. (2019b). Corporate Social Responsibility
and Financial Performance: The Case of ASEAN Telecommunications Companies. KnE Social Sciences, 892–913. doi: 10.18502/kss.v3i22.5095.
Jensen, M. C. and Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics 3, 305–360.
Omar, N. S. (2019). Innovation and economic performance in MENA region. Review of Economics and Political Science 4, 158–175.
Pfeffer, J. (1972). Size and Composition of Corporate Boards of Directors:The Organization and its Environment. doi: 10.2307/2393956. https://dx.doi.org/10.2307/ 2393956.
Rahim, A., Ahmed, N. F., Sarkawi, E. R., Jaafar, M. N., & shamsuddin, A. R., and J (2019). Operational risk management and customer complaints: the role of product complexity as a moderator. Benchmarking: An International Journal 26, 2486–2513.
Thottoli, M. M., Thomas, K. V., and Ahmed, E. R. (2019). Qualitative Analysis on Information Communication Technology and Auditing Practices of AccountingProfessionals. Journal of Information and Computational Science 9.
Yermack, D. (1996). Higher market valuation of companies with a small board of directors. Journal of Financial Economics 40, 185–211. doi: 10.1016/0304-405x(95)00844-5.
Ahmed, E. R., Alabdullah, T. T. Y., Amran, A., and &yahya, S. B. (2018a).
Indebtedness Theory and Shariah Boards: A Theoretical Approach. Global Business and Management Research 10, 127–134.
Ahmed, E. R., Alabdullah, T. T. Y., Thottoli, M. M., and Maryanti, E. (2020). Does Corporate Governance Predict Firm Profitability? An Empirical Study in Oman. The International Journal of Accounting and Business Society 28, 127–143.
Ahmed, E. R., Alabdullah, T. Y., Islam, M. A., and Asmar, M. (2014a). Sukuk Legitimacy: A New Measurement Based on Content Analysis” 16th Malaysian Finance Association Conference in SasanaKijang Central Bank of Malaysia (Kuala Lumpur).
Ahmed, E. R. and &zuqibeh, A. (2013). The role of shariah supervisory board in the reviewing and supervision on takaful (islamic insurance). Insurance and Takaful Journal.
Ahmed, E. R., Amran, A., and Islam, M. A. (2018b). Sukuk Documentation and Legitimacy: The Role of Shariah Supervisory Board as a Moderator. International Academic Journal of Accounting and Financial Management 05, 22–40. doi:10.9756/iajafm/v5i2/1810015.
Ahmed, E. R., Islam, A., and & Yahya, S. (2014b). Comparative study of Zakat and taxation system for Muslims and Non-Muslims in Malaysia. Advances in Environmental Biology, 549–554.
Ahmed, E. R., Islam, A., and Amran, A. B. (2019). Examining the legitimacy of Sukuk structure via Shariah pronouncements. Journal of Islamic Marketing 10,1151–1166. doi: 10.1108/jima-03-2018-0050.
Ahmed, E. R., Islam, M. A., Alabdullah, T. T. Y., and bin Amran, A. (2018c). Proposed the pricing model as an alternative Islamic benchmark. Benchmarking: An International Journal 25, 2892–2912. doi: 10.1108/bij-04-2017-0077.
Ahmed, E. R., Islam, M. A., and &alabdullah, T. T. Y. (2018d). The moderating role of Shariah supervisory board on sukuk pricing benchmark. International Journal of Excellence in Islamic Banking and Finance 6.
Ahmed, E. R., Islam, M. A., and Harthy, F. N. (2013). The relationship between shareholders and Shubuhat: a study on the Islamic banks in Malaysia. Journal of Asian Scientific Research 3, 538–538.
Ahmed, E. R., Yahaya, S., and harashid, M. (2012). Shubuhat on Matter of
Bai’alinah and Tawarruq. International Journal of Business and Technopreneurship 2, 85–101.
Alabdullah, T. T. Y. (2016a). Agency Cost and Management Behavior: The Role of Performance as a Moderator. International Journal of Science and Research (IJSR) 5, 1858–1864.
Alabdullah, T. T. Y. (2016b). Agency Theory Perspective: A Quantitative Study Of Accounting Performance Measures In Emerging Economies. In ICTE Proceedings.
Alabdullah, T. T. Y. (2016c). Are Board Size And Ownership Structure Beneficial In Emerging Markets’ Firms? Evidence From Jordan. International Journal of Management & Information Systems (IJMIS) 20, 87–94. doi: 10.19030/ijmis.v20i3.9752.
Alabdullah, T. T. Y. (2016d). Corporate governance from the perspective of the
past and the present and the need to fill an international GAP. Risk Governance and Control: Financial Markets and Institutions 6, 96–101. doi: 10.22495/rcgv6i4art12.
Alabdullah, T. T. Y. (2016e). The performance of companies and the board’s characteristics from the new perspective of manipulation avoidance. Corporate Ownership and Control 13, 279–286. doi: 10.22495/cocv13i4c2p1.
Alabdullah, T. T. Y. (2017). Compensation committee, company board attributes, and company performance: The moderating effect of leadership position. International Academic Conference Proceedings.
Alabdullah, T. T. Y. (2018). The relationship between ownership structure and firm financial performance. Benchmarking: An International Journal 25, 319–333. doi: 10.1108/bij-04-2016-0051.
Alabdullah, T. T. Y. and Ahmed, E. R. (2018). Corporate Governance: To What Extent it is important in the Arab Countries? International Journal of Science and Research 7.
Alabdullah, T. T. Y., Ahmed, E. R., and Nor, M. I. (2020). The World Declining Economy And Coronavirus Pandemic: Systems Should Be Continued. Russian Journal of Agricultural and Socio-Economic Sciences 102, 89–96. doi:
10.18551/rjoas.2020-06.11.
Alabdullah, T. T. Y., Alfadhl, M. M. A., .Yahya, S., and Rabi, A. M. A. (2014a). The Role of Forensic Accounting in Reducing Financial Corruption: A Study in Iraq. International Journal of Business and Management 9.
Alabdullah, T. T. Y., Nor, M. I., Ahmed, and R, E. (2018). The Determination of Firm Performance in Emerging Nations: Do Board Size and Firm Size Matter. Management 5, 57–66.
Alabdullah, T. T. Y., Yahya, S., Nor, M. I., and Majeed, F. Q. (2016). An Investigation of Corporate Governance From a New Perspective: Examining The Financial Performance of Companies and The Impact of Executive Turnover. Corporate Board: Role, Duties &Composition 12, 53–67.
Alabdullah, T. T. Y., Yahya, S., and Ramayah, T. (2014b). Corporate Governance Mechanisms and Jordanian Companies’ Financial Performance. Asian Social Science 10, 247–247. doi: 10.5539/ass.v10n22p247.
Alabdullah, T. Y., Sofriyahya, and Thurasamy, R. (2014c). Corporate Governance Development: New or Old Concept? European Journal of Business and Management 6.
Alfadhl, M. M. A. F. and Alabdullah, T. T. Y. (2013). Determinants of the Managerial Behavior of Agency Cost and Its Influential Extent on Performance: A Study in Iraq. International Journal of Humanities and Social Science, 3–3.
Ali, A. and Zarowin, P. (1992). The Role of Earnings Levels in Annual EarningsReturns Studies. Journal of Accounting Research 30, 286–286. doi: 10.2307/
2491128.
Ali, W., Frynas, J. G., and Mahmood, Z. (2017). Determinants of Corporate Social Responsibility (CSR) Disclosure in Developed and Developing Countries: A Literature Review. Corporate Social Responsibility and Environmental Management 24, 273–294. doi: 10.1002/csr.1410.
Alabdullah, T. T. Y. (2019). Management Accounting and Service Companies’ Performance: Research in Emerging Economies. Australasian Accounting, Business and Finance Journal 13, 100–118. doi: 10.14453/aabfj.v13i4.8.
Baliga, B. R., Moyer, R. C., and Rao, R. S. (1996). CEO Duality and Firm Performance: What’s The Fuss? Strategic Management Journal 17, 41–53.
Brooks, C. (2014). Introductory econometrics for finance (New York: Cambridge university press).
DiPeitro, W. R. and Anoruo, E. (2012). Government size, public debt and real economic growth: a panel analysis. Journal of Economic Studies 39, 410–419. doi: 10.1108/01443581211255620.
Fauzi, F. and Locke, S. (2012). Board structure, ownership structure and firm performance: A study of New Zealand listed-firms.
Hashim, F., Ahmed, E. R., and Huey, Y. M. (2019a). Board Diversity and Earning Quality: Examining the Role of Internal Audit as a Moderator. Australasian Accounting, Business and Finance Journal 13, 73–91.
Hashim, F., Ries, E. A., and Huai, N. T. (2019b). Corporate Social Responsibility
and Financial Performance: The Case of ASEAN Telecommunications Companies. KnE Social Sciences, 892–913. doi: 10.18502/kss.v3i22.5095.
Jensen, M. C. and Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics 3, 305–360.
Omar, N. S. (2019). Innovation and economic performance in MENA region. Review of Economics and Political Science 4, 158–175.
Pfeffer, J. (1972). Size and Composition of Corporate Boards of Directors:The Organization and its Environment. doi: 10.2307/2393956. https://dx.doi.org/10.2307/ 2393956.
Rahim, A., Ahmed, N. F., Sarkawi, E. R., Jaafar, M. N., & shamsuddin, A. R., and J (2019). Operational risk management and customer complaints: the role of product complexity as a moderator. Benchmarking: An International Journal 26, 2486–2513.
Thottoli, M. M., Thomas, K. V., and Ahmed, E. R. (2019). Qualitative Analysis on Information Communication Technology and Auditing Practices of AccountingProfessionals. Journal of Information and Computational Science 9.
Yermack, D. (1996). Higher market valuation of companies with a small board of directors. Journal of Financial Economics 40, 185–211. doi: 10.1016/0304-405x(95)00844-5.