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Exploring R&D Influences on Financial Performance for Business Sustainability Considering Dual Profitability Objectives

Author

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  • Kao-Yi Shen

    (Department of Banking & Finance, Chinese Culture University (SCE), Taipei 11114, Taiwan)

  • Min-Ren Yan

    (Institute of International Business Admin., Chinese Culture University (SCE), Taipei 11114, Taiwan)

  • Gwo-Hshiung Tzeng

    (Graduate Institute of Urban Planning, National Taipei University, New Taipei City 23741, Taiwan)

Abstract

The importance of research and development (R&D) for business sustainability have gained increasing interests, especially in the high-tech sector. However, the efforts of R&D might cause complex and mixed impacts on the financial results considering the associated expenses. Thus, this study aims to examine how R&D efforts may influence business to improve its financial performance considering the dual objectives: the gross and the net profitability. This research integrates a rough-set-based soft computing technique and multiple criteria decision-making (MCDM) methods to explore this complex and yet valuable issue. A group of public listed companies from Taiwan, all in the semiconductor sector, is analyzed as a case study. More than 30 variables are considered, and the adopted soft computing technique retrieves 14 core attributes—for the dual profitability objectives—to form the evaluation model. The importance of R&D for pursuing superior financial prospects is confirmed, and the empirical case demonstrates how to guide an individual company to plan for improvements to achieve its long-term sustainability by this hybrid approach.

Suggested Citation

  • Kao-Yi Shen & Min-Ren Yan & Gwo-Hshiung Tzeng, 2017. "Exploring R&D Influences on Financial Performance for Business Sustainability Considering Dual Profitability Objectives," Sustainability, MDPI, vol. 9(11), pages 1-21, October.
    • Handle: RePEc:gam:jsusta:v:9:y:2017:i:11:p:1964-:d:116709
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    References listed on IDEAS

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    Cited by:

    1. Kao-Yi Shen & Gwo-Hshiung Tzeng, 2018. "Advances in Multiple Criteria Decision Making for Sustainability: Modeling and Applications," Sustainability, MDPI, vol. 10(5), pages 1-7, May.
    2. Marta Postu?a & Wojciech Chmielewski, 2019. "The Impact of Intangible Assets and R&D Expenditure on the Market Capitalization and EBITDA of Selected ICT Sector Enterprises in the European Union," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 11(8), pages 117-117, August.
    3. Hunady, Jan & Pisar, Peter, 2020. "Business Spending on Research and Development and its Relationship to Invention and Innovation," Proceedings of the ENTRENOVA - ENTerprise REsearch InNOVAtion Conference (2020), Virtual Conference, in: Proceedings of the ENTRENOVA - ENTerprise REsearch InNOVAtion Conference, Virtual Conference, 10-12 September 2020, pages 542-552, IRENET - Society for Advancing Innovation and Research in Economy, Zagreb.
    4. Yang Gao & Yu Wang & Chien-Chi Chu & Sang-Bing Tsai & Xiaomin Du & Quan Chen, 2018. "Nonlinear Effect of Financial Efficiency and Financial Competition on Heterogeneous Firm R&D: A Study on the Combined Perspective of Financial Quantity Expansion and Quality Development," Sustainability, MDPI, vol. 10(5), pages 1-15, May.
    5. Min-Ren Yan & Kuo-Ming Chien & Lin-Ya Hong & Tai-Ning Yang, 2018. "Evaluating the Collaborative Ecosystem for an Innovation-Driven Economy: A Systems Analysis and Case Study of Science Parks," Sustainability, MDPI, vol. 10(3), pages 1-13, March.
    6. Huňady, Ján & Pisar, Peter & Durcekova, Ina, 2019. "Business R&D Expenditure in the ICT Sector: Effects on Business Performance Indicators," Proceedings of the ENTRENOVA - ENTerprise REsearch InNOVAtion Conference (2019), Rovinj, Croatia, in: Proceedings of the ENTRENOVA - ENTerprise REsearch InNOVAtion Conference, Rovinj, Croatia, 12-14 September 2019, pages 519-530, IRENET - Society for Advancing Innovation and Research in Economy, Zagreb.
    7. Yang-Chieh Chin & Wen-Zhong Su & Shih-Chih Chen & Jianing Hou & Yu-Chuan Huang, 2018. "Exploring Users’ Self-Disclosure Intention on Social Networking Applying Novel Soft Computing Theories," Sustainability, MDPI, vol. 10(11), pages 1-16, October.
    8. Marta Postuła & Wojciech Chmielewski & Piotr Puczyński & Rafał Cieślik, 2021. "The Impact of Information and Communication Technologies (ICT) on Energy Poverty and Unemployment in Selected European Union Countries," Energies, MDPI, vol. 14(19), pages 1-18, September.

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