Financial Decision-Making and SME Growth in China: The Mediating Role of Corporate Culture

Junliang Guan
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Junliang Guan: Asia Metropolitan University (AMU), Johor Bahru, Malaysia.

International Journal of Science and Business, 2025, vol. 43, issue 1, 1-10

Abstract: This study delves into the intricate relationship between financial decision-making and the growth of small and medium-sized private enterprises (SMEs) in China, emphasizing the mediating role of corporate culture. Through a comprehensive analysis of data collected from 405 SMEs via a questionnaire survey, this research employ multiple regression analysis to test the hypotheses. The findings underscore the significant influence of corporate culture, which categorize into four dimensions: values, relationship culture, innovative culture, and risk culture. These cultural aspects shape financial decision-making processes, subsequently impacting SME growth as measured by profitability, development scale, and growth stage. Notably, financial stability emerges as a pivotal factor; more aggressive financial strategies are associated with higher profitability but may result in a smaller development scale and lower growth stage. This research not only contributes to the existing literature by elucidating the complex interplay between corporate culture, financial decision-making, and SME growth within the Chinese context but also offers practical insights and strategies for SME managers seeking to optimize their financial decisions and foster sustainable growth.

Keywords: Financial Decision-Making, Small and Medium-Sized Private Enterprises, Corporate Culture; Growth Potential, Mediating Role & China (search for similar items in EconPapers)
Date: 2025
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