DOES CEO POWERS MODERATE THE RELATIONSHIP BETWEEN INTELLECTUAL CAPITAL AND FINANCIAL DISTRESS? A COMPARATIVE STUDY
The purpose of this study is to investigate the impact of intellectual capital (IC) on financial distress (FD) as well as the moderating role of CEO Power (CEO_P) in Pakistan and India's comparative study. A quantitative approach is used in the study and secondary data is collected from finan...
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| Format: | Article |
| Language: | English |
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Hailey College of Banking and Finance, University of the Punjab Lahore
2024-12-01
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| Series: | International Journal of Business Reflections |
| Subjects: | |
| Online Access: | http://111.68.103.26/journals/index.php/ijbr/article/view/7902 |
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| author | Muhammad, Naeem Shoukat,Ali Ahmad Shah,Durrani Muzzammil,Siraj |
| author_facet | Muhammad, Naeem Shoukat,Ali Ahmad Shah,Durrani Muzzammil,Siraj |
| author_sort | Muhammad, Naeem |
| collection | DOAJ |
| description | The purpose of this study is to investigate the impact of intellectual capital (IC) on financial distress (FD)
as well as the moderating role of CEO Power (CEO_P) in Pakistan and India's comparative study. A
quantitative approach is used in the study and secondary data is collected from financial reports of 110
firms registered at the Pakistan Stock Exchange (PSX) and also 110 firms at the Bombay Stock Exchange
(BSX) from the study period 2016 to 2023. Panel data techniques are used for analysis. Both countries
with stronger IC are less likely to face FD and CEO_P partially moderate this relationship IC_FD.
Findings support this argument. Resource-based view (RBV) theory and managerial discretion theory
(MDT) are used in this study. This study uses the modified value-added intellectual coefficient (MVAIC)
method, which incorporates relational capital (RC) in measuring IC. This study investigates two
economies with varying socioeconomic development and stresses the importance of IC in both countries
in reducing the risk of FD. It also evaluates whether powerful CEOs use business resources for their
benefit or not. This study has some implications for stakeholders, policymakers, and managers of
business. These findings suggest that managers should prioritize IC to reduce the risk of default and
accounting bodies should formulate strategies to reduce the powers of CEOs to protect the rights of
stakeholders.
|
| format | Article |
| id | doaj-art-cbbd63d942cf408da9fc7f74a4c5fbd5 |
| institution | DOAJ |
| issn | 2708-9290 2708-9304 |
| language | English |
| publishDate | 2024-12-01 |
| publisher | Hailey College of Banking and Finance, University of the Punjab Lahore |
| record_format | Article |
| series | International Journal of Business Reflections |
| spelling | doaj-art-cbbd63d942cf408da9fc7f74a4c5fbd52025-08-20T02:52:49ZengHailey College of Banking and Finance, University of the Punjab LahoreInternational Journal of Business Reflections2708-92902708-93042024-12-015214816810.56249/ijbr.03.01.55DOES CEO POWERS MODERATE THE RELATIONSHIP BETWEEN INTELLECTUAL CAPITAL AND FINANCIAL DISTRESS? A COMPARATIVE STUDYMuhammad, Naeem0Shoukat,Ali1Ahmad Shah,Durrani2Muzzammil,Siraj3Islamia University of BahawalpurIslamia University of BahawalpurGhazi University of Dera Ghazi KhanSBB Dewan University, PakistanThe purpose of this study is to investigate the impact of intellectual capital (IC) on financial distress (FD) as well as the moderating role of CEO Power (CEO_P) in Pakistan and India's comparative study. A quantitative approach is used in the study and secondary data is collected from financial reports of 110 firms registered at the Pakistan Stock Exchange (PSX) and also 110 firms at the Bombay Stock Exchange (BSX) from the study period 2016 to 2023. Panel data techniques are used for analysis. Both countries with stronger IC are less likely to face FD and CEO_P partially moderate this relationship IC_FD. Findings support this argument. Resource-based view (RBV) theory and managerial discretion theory (MDT) are used in this study. This study uses the modified value-added intellectual coefficient (MVAIC) method, which incorporates relational capital (RC) in measuring IC. This study investigates two economies with varying socioeconomic development and stresses the importance of IC in both countries in reducing the risk of FD. It also evaluates whether powerful CEOs use business resources for their benefit or not. This study has some implications for stakeholders, policymakers, and managers of business. These findings suggest that managers should prioritize IC to reduce the risk of default and accounting bodies should formulate strategies to reduce the powers of CEOs to protect the rights of stakeholders. http://111.68.103.26/journals/index.php/ijbr/article/view/7902intellectual capital;financial distressceo powersresource-based viewmanagerial discretion theory |
| spellingShingle | Muhammad, Naeem Shoukat,Ali Ahmad Shah,Durrani Muzzammil,Siraj DOES CEO POWERS MODERATE THE RELATIONSHIP BETWEEN INTELLECTUAL CAPITAL AND FINANCIAL DISTRESS? A COMPARATIVE STUDY International Journal of Business Reflections intellectual capital; financial distress ceo powers resource-based view managerial discretion theory |
| title | DOES CEO POWERS MODERATE THE RELATIONSHIP BETWEEN INTELLECTUAL CAPITAL AND FINANCIAL DISTRESS? A COMPARATIVE STUDY |
| title_full | DOES CEO POWERS MODERATE THE RELATIONSHIP BETWEEN INTELLECTUAL CAPITAL AND FINANCIAL DISTRESS? A COMPARATIVE STUDY |
| title_fullStr | DOES CEO POWERS MODERATE THE RELATIONSHIP BETWEEN INTELLECTUAL CAPITAL AND FINANCIAL DISTRESS? A COMPARATIVE STUDY |
| title_full_unstemmed | DOES CEO POWERS MODERATE THE RELATIONSHIP BETWEEN INTELLECTUAL CAPITAL AND FINANCIAL DISTRESS? A COMPARATIVE STUDY |
| title_short | DOES CEO POWERS MODERATE THE RELATIONSHIP BETWEEN INTELLECTUAL CAPITAL AND FINANCIAL DISTRESS? A COMPARATIVE STUDY |
| title_sort | does ceo powers moderate the relationship between intellectual capital and financial distress a comparative study |
| topic | intellectual capital; financial distress ceo powers resource-based view managerial discretion theory |
| url | http://111.68.103.26/journals/index.php/ijbr/article/view/7902 |
| work_keys_str_mv | AT muhammadnaeem doesceopowersmoderatetherelationshipbetweenintellectualcapitalandfinancialdistressacomparativestudy AT shoukatali doesceopowersmoderatetherelationshipbetweenintellectualcapitalandfinancialdistressacomparativestudy AT ahmadshahdurrani doesceopowersmoderatetherelationshipbetweenintellectualcapitalandfinancialdistressacomparativestudy AT muzzammilsiraj doesceopowersmoderatetherelationshipbetweenintellectualcapitalandfinancialdistressacomparativestudy |