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The Performance of Government-Linked Companies in Malaysia

Author

Listed:
  • Mansor Isa

    (Universiti Malaya)

  • Siew-Peng Lee

    (Universiti Tunku Abdul Rahman)

Abstract

This study examines the performance of selected government-linked companies (GLCs) versus non-GLC matching firms, during the period 2008-2013. Our sample of GLCs is drawn from the list contained in the GLC Transformation Program of the Government of Malaysia. Three performance measures are used – ROA, ROE and Tobin’s Q ratio. Two methods of analysis are performed: univariate analysis and multiple regressions. The results strongly indicate that GLCs perform worse than their non-GLC counterparts in all performance measures and in both univariate and multivariate tests. The performance of both GLCs and non-GLCs is found to be negatively related to leverage and board size. Further, non-GLCs performance is also found to be related to firm size and non-duality.

Suggested Citation

  • Mansor Isa & Siew-Peng Lee, 2016. "The Performance of Government-Linked Companies in Malaysia," Capital Markets Review, Malaysian Finance Association, vol. 24(2), pages 1-13.
    • Handle: RePEc:mfa:journl:v:24:y:2016:i:2:p:1-13
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    File URL: http://www.mfa.com.my/wp-content/uploads/2013/12/CMR_20162_001.pdf
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    Citations

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    Cited by:

    1. Harry Entebang, 2019. "A Proposed Framework of Corporate Entrepreneurship in Government-linked Companies," Business Management and Strategy, Macrothink Institute, vol. 10(2), pages 234-249, December.
    2. Abdul Ismail Hj Mohd Jawi & Malvern Abdullah & Chung Siew Mee Ellen Chung, 2023. "Recent Development on Information System Capabilities and Sustainable Competitive Advantages: A Research Model, Review and Directions for Future Research," Information Management and Business Review, AMH International, vol. 15(2), pages 44-56.

    More about this item

    Keywords

    Government-linked companies; firm performance; corporate governance; returns on asset; return on equity; Tobin’s Q ratio.;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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