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Risk Management and Value Creation: Empirical Findings from Government Linked Companies in Malaysia

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  • Said, Jamaliah
  • Alam, Md. Mahmudul

    (Universiti Utara Malaysia)

  • Abdullah, Nik Herda Nik
  • Zulkarnain, Nur Nadiah

Abstract

This study is an attempt to assess the status of current level of value creation among the Government Linked Companies (GLCs) in Malaysia. This study collected primary data based on a set of questionnaire survey among 134 executives and managers of GLCs in Malaysia. The data were collected based on opinions of the ten factors of value creation practices by using the five-point Likert scale. The data were analysed using descriptive statistics. Further, the reliability of the data was tested using Cronbach’s alpha test, the validity of the data was tested by checking the normality test through skewness and kurtosis, and the consistency of the data was tested using factor analysis. On an average, 80.6% of the respondents agreed that they focus on these factors of value creation. Overall, the federal owned GLCs place more emphasis on certain elements of value creation than the state owned GLCs. Among the elements of value creation, the state owned GLCs emphasize the most on quality development and brand value creation, where the federal owned GLCs emphasized the most on reputation. The GLCs engaged in service sector emphasized the most on brand value and the GLCs engaged in manufacturing sector emphasized the most on customer satisfaction and quality development. This study suggest that GLCs in Malaysia improve the overall value creation by emphasizing on responsiveness, average return on investment, sales growth, profit growth and average return on sales.

Suggested Citation

  • Said, Jamaliah & Alam, Md. Mahmudul & Abdullah, Nik Herda Nik & Zulkarnain, Nur Nadiah, 2019. "Risk Management and Value Creation: Empirical Findings from Government Linked Companies in Malaysia," SocArXiv u7f4k, Center for Open Science.
    • Handle: RePEc:osf:socarx:u7f4k
    DOI: 10.31219/osf.io/u7f4k
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    References listed on IDEAS

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    1. Nazrul Hisyam Ab Razak & Rubi Ahmad & Huson Aliahmed Joher, 2011. "Does Government Linked Companies (GLCs) perform better than non-GLCs? Evidence from Malaysian listed companies," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 1(1), pages 1-10.
    2. Feng, Fang & Sun, Qian & Tong, Wilson H. S., 2004. "Do government-linked companies underperform?," Journal of Banking & Finance, Elsevier, vol. 28(10), pages 2461-2492, October.
    3. Aivazian, Varouj A. & Ge, Ying & Qiu, Jiaping, 2005. "Can corporatization improve the performance of state-owned enterprises even without privatization?," Journal of Corporate Finance, Elsevier, vol. 11(5), pages 791-808, October.
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