 Drivers of the cost of capital: The joint role of non-financial metricsAlexander Himme and Marc Fischer International Journal of Research in Marketing, 2014, vol. 31, issue 2, 224-238 Abstract: Recent marketing studies suggest that non-financial metrics, such as customer satisfaction and brand value, help explain the variation in the cost of equity and the cost of debt. These studies typically focus on only one non-financial metric and one component of capital cost. In this study, we broaden the understanding of the relevance of non-financial metrics to the cost of capital. We investigate the joint role of customer satisfaction, brand value, and corporate reputation for stock market beta and credit ratings, which reflect variation in equity and debt risk premiums across firms. In addition to the joint direct influence of these metrics on capital cost, we also study their interaction effects. We develop a conceptual model to explain the effects on capital costs and test the resulting hypotheses in a broad sample of 344 firms from diverse industries using data from the 1991–2006 period. Keywords: Cost of capital; Stock market beta; Credit spreads; Brand value; Customer satisfaction; Corporate reputation (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:ijrema:v:31:y:2014:i:2:p:224-238 DOI: 10.1016/j.ijresmar.2013.10.006 Access Statistics for this article International Journal of Research in Marketing is currently edited by Roland Rust More articles in International Journal of Research in Marketing from Elsevier |
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