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The Relationship between Environmental Uncertainty and Firm Performance in Chinese Listed Manufacturing Companies: The Mediating Role of Competitive Strategy

Author

Listed:
  • Pu Zhao
  • Raman Noordin
  • Stephen Laison Sondoh Jr

Abstract

Economic globalization has brought great challenges to companies. Faced with uncertainty, appropriate strategic choice is an important means to deal with uncertainty and competitive challenges. The purpose of this research is to investigate the mediating effect of competitive strategy on the relationship between environmental uncertainty and firm performance in Chinese listed manufacturing companies. This research uses OLS regression models to test the mediating role of competitive strategy. The data used in this research are all derived from the public financial statement of listed companies from 2007 to 2019. We found that there is a mediating role of competitive strategy on the relationship between environmental uncertainty and firm performance. In addition, corporate life cycle is introduced as a moderating variable in the relationship between environmental uncertainty and competitive strategy. This study provides strong evidence to help managers in the decision-making process under environmental uncertainty and give managers more accurate advice based on the corporate life cycle of their companies.

Suggested Citation

  • Pu Zhao & Raman Noordin & Stephen Laison Sondoh Jr, 2022. "The Relationship between Environmental Uncertainty and Firm Performance in Chinese Listed Manufacturing Companies: The Mediating Role of Competitive Strategy," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 12(8), pages 636-658.
    • Handle: RePEc:asi:aeafrj:v:12:y:2022:i:8:p:636-658:id:4574
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