Title: A comparative modelling analysis of firm performance

Authors: Owen P. Hall Jr.; Darrol J. Stanley

Addresses: Department of Decision Sciences, Graziadio School of Business and Management, Pepperdine University, 24255 Pacific Coast Highway, Malibu, CA 90263, USA. ' Department of Finance and Accounting, Graziadio School of Business and Management, Pepperdine University, 24255 Pacific Coast Highway, Malibu, CA 90263, USA

Abstract: The ongoing financial and economic crisis throughout the industrialised world has spotlighted a number of significant deficiencies in corporate governance and management. The strength and composition of the management team along with effective corporate governance policy should play an important role in addressing these challenges. The purpose of this paper is to illustrate how analytics can be used to identify the importance of specific organisational factors that could impact corporate performance. A WRDS database consisting of a variety of factors was examined using Logit, neural net and CART modelling techniques. The results from the analysis indicate that diversity and governance policies appear to have played only a modest role in explaining corporate performance as measured by Tobin's Q for the year 2004.

Keywords: corporate governance; S&P 500; capitalisation-weighted indices; Standard & Poor's; public companies; stock exchanges; USA; United States; CART; classification tree; regression tree; decision trees; neural nets; Tobin's quotient; James Tobin; statistical ratios; market value; replacement value; physical assets; firm performance; Tobin's Q; comparative analysis; modelling analysis; financial crises; economic crises; industrialised world; corporate management; management teams; analytics; organisational factors; corporate performance; Wharton Research Data Services; WRDS; databases; logit; diversity policies; governance policies; corporate performance; data analysis techniques; data analysis strategies.

DOI: 10.1504/IJDATS.2012.045121

International Journal of Data Analysis Techniques and Strategies, 2012 Vol.4 No.1, pp.43 - 56

Published online: 27 Jan 2012 *

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