Financial hegemony, diversification strategies and the firm value of top 30 FTSE companies in Malaysia

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2 Citations (Scopus)

Abstract

This study investigates the relationships between financial hegemony groups, global diversification strategies and firm value of the Malaysia’s 30 largest companies listed in FTSE Bursa Malaysia Index Series during 2009 to 2012 period. We chose Malaysia as an ideal setting because the findings contribute to the phenomenon of the diversification-performance relationship in the Southeast Asian countries. We apply hegemony stability theory to explain the importance of financial hegemony groups in deciding international locations for operations. By using panel data analysis, we find that financial hegemony groups are significantly important in international location decisions. Results reveal that the stability of financial hegemony in BRICS and G7 groups enhances the financial value of the Malaysia’s 30 largest companies, whereas the stability of financial hegemony in ASEAN groups is able to enhance the non-financial value of the firms. Overall, this paper suggests that in order to diversify globally, it is necessarily for the manager in the guest country to evaluate and fully understand the host country’s geopolitical situation and its financial stability.

Original languageEnglish
Pages (from-to)14-23
Number of pages10
JournalAsian Social Science
Volume12
Issue number3
DOIs
Publication statusPublished - 1 Mar 2016

Fingerprint

diversification
hegemony
Malaysia
firm
Values
Group
stability theory
ASEAN
Firm value
Hegemony
Diversification strategy
Diversification
data analysis
manager
performance
Large companies

Keywords

  • Emerging markets
  • Geopolitics
  • Multinational firm
  • Panel data

ASJC Scopus subject areas

  • Social Sciences(all)
  • Arts and Humanities(all)
  • Economics, Econometrics and Finance(all)

Cite this

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abstract = "This study investigates the relationships between financial hegemony groups, global diversification strategies and firm value of the Malaysia’s 30 largest companies listed in FTSE Bursa Malaysia Index Series during 2009 to 2012 period. We chose Malaysia as an ideal setting because the findings contribute to the phenomenon of the diversification-performance relationship in the Southeast Asian countries. We apply hegemony stability theory to explain the importance of financial hegemony groups in deciding international locations for operations. By using panel data analysis, we find that financial hegemony groups are significantly important in international location decisions. Results reveal that the stability of financial hegemony in BRICS and G7 groups enhances the financial value of the Malaysia’s 30 largest companies, whereas the stability of financial hegemony in ASEAN groups is able to enhance the non-financial value of the firms. Overall, this paper suggests that in order to diversify globally, it is necessarily for the manager in the guest country to evaluate and fully understand the host country’s geopolitical situation and its financial stability.",
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author = "Yusoff, {Wan Sallha} and {Md. Salleh}, {Mohd Fairuz} and Azlina Ahmad and Norida Basnan",
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AU - Ahmad, Azlina

AU - Basnan, Norida

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N2 - This study investigates the relationships between financial hegemony groups, global diversification strategies and firm value of the Malaysia’s 30 largest companies listed in FTSE Bursa Malaysia Index Series during 2009 to 2012 period. We chose Malaysia as an ideal setting because the findings contribute to the phenomenon of the diversification-performance relationship in the Southeast Asian countries. We apply hegemony stability theory to explain the importance of financial hegemony groups in deciding international locations for operations. By using panel data analysis, we find that financial hegemony groups are significantly important in international location decisions. Results reveal that the stability of financial hegemony in BRICS and G7 groups enhances the financial value of the Malaysia’s 30 largest companies, whereas the stability of financial hegemony in ASEAN groups is able to enhance the non-financial value of the firms. Overall, this paper suggests that in order to diversify globally, it is necessarily for the manager in the guest country to evaluate and fully understand the host country’s geopolitical situation and its financial stability.

AB - This study investigates the relationships between financial hegemony groups, global diversification strategies and firm value of the Malaysia’s 30 largest companies listed in FTSE Bursa Malaysia Index Series during 2009 to 2012 period. We chose Malaysia as an ideal setting because the findings contribute to the phenomenon of the diversification-performance relationship in the Southeast Asian countries. We apply hegemony stability theory to explain the importance of financial hegemony groups in deciding international locations for operations. By using panel data analysis, we find that financial hegemony groups are significantly important in international location decisions. Results reveal that the stability of financial hegemony in BRICS and G7 groups enhances the financial value of the Malaysia’s 30 largest companies, whereas the stability of financial hegemony in ASEAN groups is able to enhance the non-financial value of the firms. Overall, this paper suggests that in order to diversify globally, it is necessarily for the manager in the guest country to evaluate and fully understand the host country’s geopolitical situation and its financial stability.

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