The Components of Enterprise Risk Management and Financial Performance of the Non-Financial Firms through Mediation of Corporate Reputation

Muhammad Ramzan Sajid, Syed Zain ul Abdin and Hassan Mujtaba Nawaz Saleem

Journal of Accounting and Finance in Emerging Economies, 2023, vol. 9, issue 4, 501-514

Abstract: Purpose: This research study aims to investigate the relationship between enterprise risk management (ERM) components and non-financial companies’ financial performance (FP), which are listed at PSX, while exploring the corporate reputation (CR) role as a mediation between ERM components and financial indicators performance.Design/Methodology/Approach: This study used a questionnaire survey, and 340 responses were collected from non-financial sector firms’ board executives and top management. The PLS-SEM technique was employed for the data analysis using smart PLS 4.0 software.&Findings: the results showed that ERM components significantly influence the corporate reputation. Further, corporate reputation positively and significantly mediates between ERM components and financial performance. This study plays a crucial role in pinpointing and addressing risks within non-financial firms, aiming to enhance the prosperity of the non-financial sector and contribute to overall economic growth through the ERM components framework.Implications/Originality/Value: Future research could extend to various sectors, encompassing financial and non-financial companies, service firms, and the food industry. Such studies could explore the influence of ERM components on financial performance, particularly emphasizing reputation as a critical resource for success in competitive markets.

Keywords: Enterprise Risk Management (ERM); Culture; Corporate Reputation; Financial Performance; Non-financial Sector (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:src:jafeec:v:9:y:2023:i:4:p:501-514

DOI: 10.26710/jafee.v9i4.2825

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