Proceedings of the International Conference on Economics and Banking 2015

The Influence Of Director Ownership on the relationship between firm's Financial Performances (FP) and Social Peformance (SP): Malaysian Evidence

Authors
Sarifah Ismail, Teh Suhaila Tajudin, Zainab Aman
Corresponding Author
Sarifah Ismail
Available Online May 2015.
DOI
https://doi.org/10.2991/iceb-15.2015.33How to use a DOI?
Keywords
financial performance, social performance, director ownership, slack resources, GRI
Abstract
The slack resource theory is argued that companies who are financially strong would have slack resources that would provide the opportunity to invest in social activities for community, employee, and environment. If slack resources are available from previous financial performance, better financial performance would be a predictor for better social performance. However, past studies have documented inconsistent evidence of the relationship between with financial performance (FP) and social performance (SP). To improve the theoretical framework, this study introduces moderator variables, director ownership that expected to enhance the relationship between financial and social performance. This argument is on their ability of influencing company decision making since they are the owner of company. They have voting right to make decision this will help to the increase of slack resources allocation in social activity. Past study documented positive relationship between director ownership and social performance this provide evidence that when director of company have positive view toward SP this will help to increase to allocation available slack resources in social activity that will lead better SP. Sample of this study comprises of 262 public listed companies in Bursa Malaysia for the year 2012. The results of the regression analysis provide a support for slack resource theory, that is, financially strong companies have a positive and significant relationship with social performance. Furthermore this study is expected to supports the board ownership in influencing the relationship. This study contributes new knowledge by introducing director ownership as moderator of the relationship between social performance and financial performance
Open Access
This is an open access article distributed under the CC BY-NC license.

Download article (PDF)

Proceedings
International Conference on Economics and Banking (iceb-15)
Part of series
Advances in Economics, Business and Management Research
Publication Date
May 2015
ISBN
978-94-62520-86-8
ISSN
2352-5428
DOI
https://doi.org/10.2991/iceb-15.2015.33How to use a DOI?
Open Access
This is an open access article distributed under the CC BY-NC license.

Cite this article

TY  - CONF
AU  - Sarifah Ismail
AU  - Teh Suhaila Tajudin
AU  - Zainab Aman
PY  - 2015/05
DA  - 2015/05
TI  - The Influence Of Director Ownership on the relationship between firm's Financial Performances (FP) and Social Peformance (SP): Malaysian Evidence
BT  - International Conference on Economics and Banking (iceb-15)
PB  - Atlantis Press
SN  - 2352-5428
UR  - https://doi.org/10.2991/iceb-15.2015.33
DO  - https://doi.org/10.2991/iceb-15.2015.33
ID  - Ismail2015/05
ER  -