The impact of non-commodity sovereign wealth funds’ ownership on the domestic target firm performance

Hai Chi Nguyen, Doan Thanh Nguyen and Mohammed M Elgammal

Cogent Economics & Finance, 2021, vol. 9, issue 1, 1878620

Abstract: Previous research fails to investigate the impact of sovereign wealth funds (SWFs) on financial and non-financial performances of target firms. This study aims to fill the gap by using quantile regression technique on a sample of non-commodity SWFs and their target firms in five countries, namely France, Singapore, China, Malaysia and Vietnam. The research shows that non-commodity SWFs have a positive effect of increasing the financial performance for domestic target firms with relatively good performance. However, the SWFs have no significant impact on low-performing target businesses. The research findings imply that SWFs have limitations in management skills and experience and hesitate to invest in businesses with poor performance to avoid risks of bankruptcy and financial distress. The results show that the non-commodity SWFs tend to exert a negative impact on the non-financial performance of domestic target firms more strongly when the non-financial performance of the target firms is higher. Finally, these results indicate that SWFs are concerned with both financial and non-financial performances, and try to balance the two types of performance in an optimal way.

Date: 2021
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/23322039.2021.1878620 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:oaefxx:v:9:y:2021:i:1:p:1878620

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/OAEF20

DOI: 10.1080/23322039.2021.1878620

Access Statistics for this article

Cogent Economics & Finance is currently edited by Steve Cook, Caroline Elliott, David McMillan, Duncan Watson and Xibin Zhang

More articles in Cogent Economics & Finance from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().