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IT investment and corporate performance: Evidence from Malaysia

Author

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  • Abdelkader Alghorbany
  • Ayoib Che-Ahmad
  • Salau Olarinoye Abdulmalik

Abstract

This paper aims to investigate the effect of Information Technology (IT) investment on firm performance in Malaysia. The data of this study were collected from 231 firms listed on Bursa Malaysia from 2010 to 2019. A dynamic model was built, and estimation was carried out by using the Generalized Method of Moments (GMM) that controls the endogeneity nature of the equity value multiple model. As predicted, IT investment incurred in the current study displayed a positive but weakly significant impact upon firm performance. This result provides valuable information for investors, stakeholders, and the public in general and encourages the companies to implement IT to its benefit in improving the firms’ performance. Thus, the findings confirm the significance of future studies that could suggest other variables to further understand whether they support or oppose managerial opportunism to enhance the relationship. Consistent with this suggestion, the result of the present study could help researchers and practitioners identify the key factors to making the right IT investment decision.

Suggested Citation

  • Abdelkader Alghorbany & Ayoib Che-Ahmad & Salau Olarinoye Abdulmalik, 2022. "IT investment and corporate performance: Evidence from Malaysia," Cogent Business & Management, Taylor & Francis Journals, vol. 9(1), pages 2055906-205, December.
    • Handle: RePEc:taf:oabmxx:v:9:y:2022:i:1:p:2055906
    DOI: 10.1080/23311975.2022.2055906
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    Cited by:

    1. Andrea Sujová & Ľubica Simanová, 2023. "Impacts of Implemented Changes on Business Performance of Slovak Enterprises," Central European Business Review, Prague University of Economics and Business, vol. 2023(3), pages 103-122.

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