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Sustainable Innovation and Firm Performance Driven by FinTech Policies: Moderating Effect of Capital Adequacy Ratio

Author

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  • Jian-Hang Wang

    (Graduate Program of Executive Master of Business Administration, National Taichung University of Education, No. 140, Minsheng Rd, West District, Taichung City 403, Taiwan)

  • Yu-Hsien Wu

    (Department of Risk Management and Insurance, Feng Chia University, No. 100, Wenhua Rd, Xitun District, Taichung City 407, Taiwan)

  • Phil Yihsing Yang

    (Graduate Institute of Business Administration, National Taichung University of Education, No. 140, Minsheng Rd, West District, Taichung City 403, Taiwan)

  • Hsiang-Yi Hsu

    (Department of Risk Management and Insurance, Feng Chia University, No. 100, Wenhua Rd, Xitun District, Taichung City 407, Taiwan)

Abstract

This study empirically investigated the role played by government policy in the financial industry in promoting sustainable innovation, business performance, and risk management. An original dataset, comprising data from the Taiwan Economic Journal (TEJ), Taiwan Patent Search System, and company annual reports from the period 2015–2019 was used to analyze the effects of government policy on the financial industry in Taiwan. The research results showed that a firm’s sustainable commitment is conducive to its business growth and does not increase its risk in the financial industry. The financial industry can report on FinTech news that highlights business growth, while companies with high capital adequacy rates are better equipped to manage the risks associated with innovation commitment. Financial companies are suggested to engage in sustainable innovation and thus improve their profitability. In addition, policymakers should mandate that financial companies increase their capital adequacy ratios, improve their risk-bearing capacity, and maintain financial market stability.

Suggested Citation

  • Jian-Hang Wang & Yu-Hsien Wu & Phil Yihsing Yang & Hsiang-Yi Hsu, 2023. "Sustainable Innovation and Firm Performance Driven by FinTech Policies: Moderating Effect of Capital Adequacy Ratio," Sustainability, MDPI, vol. 15(11), pages 1-15, May.
    • Handle: RePEc:gam:jsusta:v:15:y:2023:i:11:p:8572-:d:1155351
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    References listed on IDEAS

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    1. Wang, Xiaoran & Ibrahim, Haslindar, 2024. "Unveiling the effects of mineral markets, fintech and governance on business performance: Evidence from China," Resources Policy, Elsevier, vol. 91(C).

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