IDEAS home Printed from https://ideas.repec.org/a/ahs/journl/v9y2024i1p213-229.html
   My bibliography  Save this article

The Relationship between Firm Value and Financial Risks: An Application on BIST Sustainability Index

Author

Listed:
  • Ayşegül Ertuğrul
  • İlknur Külekçi
  • Mete Bumin

Abstract

Managing financial risks is necessary to protect the value and stability of companies. In this context, revealing the impact of financial risks on firm value is important for company shareholders, managers, and investors. This study aims to examine the relationship between the firm value and financial risks of companies in the BIST Sustainability Index. In this context, the relationship between the firm value and financial risks of the companies in the BIST Sustainability Index, excluding financial sector companies, is analyzed by panel regression analysis (fixed effect model) method based on quarterly data between 2018 and 2022. In the study, market capitalization/book value ratio was determined as the dependent variable representing the firm value; and financial leverage, currency risk, credit risk, and liquidity risk, which were selected as financial risk factors, were determined as independent variables. According to the findings of the study, a significant and negative relationship was found between firm value and financial leverage, while a significant and positive relationship was found between firm value and currency risk and credit risk. No significant relationship was found between firm value and liquidity risk.

Suggested Citation

  • Ayşegül Ertuğrul & İlknur Külekçi & Mete Bumin, 2024. "The Relationship between Firm Value and Financial Risks: An Application on BIST Sustainability Index," Journal of Research in Economics, Politics & Finance, Ersan ERSOY, vol. 9(1), pages 213-229.
    • Handle: RePEc:ahs:journl:v:9:y:2024:i:1:p:213-229
    DOI: 10.30784/epfad.1418132
    as

    Download full text from publisher

    File URL: https://dergipark.org.tr/tr/download/article-file/3653679
    Download Restriction: no
    File URL: https://libkey.io/10.30784/epfad.1418132?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Keywords

    İşletme Değeri; Finansal Risk; Panel Veri Analizi;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ahs:journl:v:9:y:2024:i:1:p:213-229. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ersan Ersoy (email available below). General contact details of provider: https://epfjournal.com/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.