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Shareholders in the Driver’s Seat: Unraveling the Impact on Financial Performance in Latvian Fintech Companies

Author

Listed:
  • Ramona Rupeika-Apoga

    (Faculty of Business, Management and Economics, University of Latvia, LV-1586 Riga, Latvia
    Women Researchers Council (WRC), Azerbaijan State University of Economics (UNEC), Baku AZ1001, Azerbaijan)

  • Stefan Wendt

    (Department of Business, Bifröst University, 311 Borgarnes, Iceland)

  • Victoria Geyfman

    (Department of Finance, Zeigler College of Business, Bloomsburg University of Pennsylvania, 400 East Second Street, Bloomsburg, PA 17815-1301, USA)

Abstract

Fintech companies are relatively young and operate in a rapidly evolving and ever-changing industry, which makes it important to understand how different factors, including shareholder presence in management roles, affect their performance. This study investigates the impact of shareholder presence in director and manager positions on the financial performance of Latvian fintechs. Our investigation centers on essential financial ratios, including Return on Assets, Return on Equity, Profit Margin, Liquidity Ratio, Current Ratio, and Solvency Ratio. Our findings suggest that the presence of shareholders in director and manager roles does not significantly affect the financial performance of fintech companies. Although the statistical analysis did not yield significant results, it is important to consider additional insights garnered from Cliff’s Delta effect sizes. Specifically, despite the lack of statistical significance, practical significance indicates that fintech companies in which directors and managers are shareholders show slightly better performance than other fintech companies. Beyond shedding light on the intricacies of corporate governance in the fintech sector, this research serves as a valuable resource for investors, stakeholders, and fellow researchers seeking to understand the impact of shareholder presence in director and manager roles on the financial performance of fintechs.

Suggested Citation

  • Ramona Rupeika-Apoga & Stefan Wendt & Victoria Geyfman, 2024. "Shareholders in the Driver’s Seat: Unraveling the Impact on Financial Performance in Latvian Fintech Companies," Risks, MDPI, vol. 12(3), pages 1-16, March.
    • Handle: RePEc:gam:jrisks:v:12:y:2024:i:3:p:54-:d:1358990
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    References listed on IDEAS

    as
    1. Tzanaki, Anna & Alekseeva, Liudmila & Azar, José, 2023. "Common ownership in fintech markets," Working Papers 329, The University of Chicago Booth School of Business, George J. Stigler Center for the Study of the Economy and the State.
    2. Fama, Eugene F, 1980. "Agency Problems and the Theory of the Firm," Journal of Political Economy, University of Chicago Press, vol. 88(2), pages 288-307, April.
    3. Caselli, Stefano & Gatti, Stefano & Chiarella, Carlo & Gigante, Gimede & Negri, Giulia, 2023. "Do shareholders really matter for firm performance? Evidence from the ownership characteristics of Italian listed companies," International Review of Financial Analysis, Elsevier, vol. 86(C).
    4. Ruchika Jain & Satinder Kumar & Kiran Sood & Simon Grima & Ramona Rupeika-Apoga, 2023. "A Systematic Literature Review of the Risk Landscape in Fintech," Risks, MDPI, vol. 11(2), pages 1-15, February.
    Full references (including those not matched with items on IDEAS)

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