Eco-efficiency and firm value of Malaysian firms
by Ayoib Che-Ahmad; Nosakhare Peter Osazuwa
International Journal of Managerial and Financial Accounting (IJMFA), Vol. 7, No. 3/4, 2015

Abstract: The objective of the study is to investigate eco-efficiency as a proxy for environmental policy and its effect on the overall value of the firm. The study adopts Ohlson's value relevance model in explaining how value relevant the concept of eco-efficiency is to the firm. The sample comprises 667 non-financial firms quoted on the Bursa Malaysia as at 2013. The result of the analysis reveals a positive association existing between eco-efficiency and the value of the firm, indicating that Malaysian firms engaging in eco-efficiency are performing better in terms of firm value than firms not engaging in eco-efficiency. This study is a pioneering study examining eco-efficiency from a developing country perspective, specifically from the Malaysian environment. The findings of the study will prove to shareholders and investors that eco-efficient firms can increase its earnings in the future, and therefore such a policy will not affect the financial aim of the company.

Online publication date: Mon, 22-Feb-2016

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