Abstract
Enterprise risk management (ERM) manages risk in a holistic manner thus improves the traditional risk approach. Due to potential increase in overhead costs, only firms with strong financial performance could afford to implement ERM; which is still a debatable issue. This study examines the effect of high-performance organization (HPO) on ERM implementation using 435 public listed firms from 2001 to 2013. Logistic regression shows that HPO firm is most likely to implement ERM by more than 65 percent compared to the non-HPO firm, consistent with the positive association provided by subsample analysis. Thus, firms with high financial performance have the incentive to provide resources in absorbing the high cost of ERM. The results suggest the importance of HPO in the policy formulation for ERM implementation.
| Original language | English |
|---|---|
| Pages (from-to) | 347-368 |
| Number of pages | 22 |
| Journal | International Journal of Business and Management Science |
| Volume | 8 |
| Issue number | 2 |
| Publication status | Published - 1 Jan 2018 |
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Keywords
- Firm performance
- Logistic regression
- Organizational theory
- Public listed firms
- Risk management
ASJC Scopus subject areas
- Business and International Management
- Economics and Econometrics
Cite this
High performance organization and enterprise risk management implementation. / Bangaan Abdullah, Mohd Hafizuddin Syah; Janor, Hawati; Abdul Hamid, Mohamad.
In: International Journal of Business and Management Science, Vol. 8, No. 2, 01.01.2018, p. 347-368.Research output: Contribution to journal › Article
}
TY - JOUR
T1 - High performance organization and enterprise risk management implementation
AU - Bangaan Abdullah, Mohd Hafizuddin Syah
AU - Janor, Hawati
AU - Abdul Hamid, Mohamad
PY - 2018/1/1
Y1 - 2018/1/1
N2 - Enterprise risk management (ERM) manages risk in a holistic manner thus improves the traditional risk approach. Due to potential increase in overhead costs, only firms with strong financial performance could afford to implement ERM; which is still a debatable issue. This study examines the effect of high-performance organization (HPO) on ERM implementation using 435 public listed firms from 2001 to 2013. Logistic regression shows that HPO firm is most likely to implement ERM by more than 65 percent compared to the non-HPO firm, consistent with the positive association provided by subsample analysis. Thus, firms with high financial performance have the incentive to provide resources in absorbing the high cost of ERM. The results suggest the importance of HPO in the policy formulation for ERM implementation.
AB - Enterprise risk management (ERM) manages risk in a holistic manner thus improves the traditional risk approach. Due to potential increase in overhead costs, only firms with strong financial performance could afford to implement ERM; which is still a debatable issue. This study examines the effect of high-performance organization (HPO) on ERM implementation using 435 public listed firms from 2001 to 2013. Logistic regression shows that HPO firm is most likely to implement ERM by more than 65 percent compared to the non-HPO firm, consistent with the positive association provided by subsample analysis. Thus, firms with high financial performance have the incentive to provide resources in absorbing the high cost of ERM. The results suggest the importance of HPO in the policy formulation for ERM implementation.
KW - Firm performance
KW - Logistic regression
KW - Organizational theory
KW - Public listed firms
KW - Risk management
UR - http://www.scopus.com/inward/record.url?scp=85061984805&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=85061984805&partnerID=8YFLogxK
M3 - Article
VL - 8
SP - 347
EP - 368
JO - International Journal of Business and Management Science
JF - International Journal of Business and Management Science
SN - 1837-6614
IS - 2
ER -