Environmental sustainability orientation and financial resources of small manufacturing firms in the Philippines

Purpose - This study challenges the conventional view that resources determine the extent of environmental sustainability orientation (ESO) of small firms in a developing Southeast Asian country context. First, this study attempts to develop a measurement model of ESO of small firms in the manufacturing sector in the Philippines. Second, the study explores the impact of the financial resources on the ESO of firms.

Design/methodology/approach - The study uses survey data from 166 small manufacturing firms in three Philippine cities. Multiple regression modelling is used to estimate the relationships between firm resources and ESO.

Findings - The results indicate that ESO is a multi-dimensional construct with three facets: awareness of, actions for, and appreciation of environmental sustainability. The empirical evidence does not support the conventional firm resources – ESO proposition.

Research limitations/implications - A proactive ESO is not necessarily beyond the reach of resource-constrained small firms. The generalisability of the findings however is limited to small manufacturing firms in the Philippines.

Practical implications - This study informs owner-managers of small firms that a proactive ESO does not largely depend on financial resources. Government policies and programs to encourage small firms to become sustainable should not only focus on financial forms of assistance.

Originality/value -  To date, this is the only Philippine-based study and one of the scarce small firm-focused studies that examine the proposition that small firms are unable to pursue a proactive ESO due to resource-constraints.

Knowledge management culture, strategy and process in Malaysian firms

Malaysia is one of the leading countries in Asia that are at the forefront in the development of a knowledge-based economy (KBE). The Malaysian government has been making substantial investments in both physical and technological infrastructure to facilitate knowledge-intensive economic activities. Foreign and local firms in Malaysia are encouraged to take advantage of the opportunities brought by the emerging KBE. However, little is known as to how firms in Malaysia respond to this new trajectory of economic development. In particular, there is paucity in the literature as to how Malaysian firms manage knowledge in their organizations as they strive to achieve sustainable competitive performance. Little is known as to how and why firms in Malaysia develop and manage their intangible and knowledge-based resources as they operate and respond to the modern knowledge-based competitive economic arena. This paper examines a type of organizational culture that supports and promotes knowledge management (KM) within firms in Malaysia. The paper argues that KM-oriented culture shapes the overall KM strategy of firms, which consequently shapes the organizational process required to manage the firm's knowledge-based resources. The study uses survey data from a sample of 153 firms from Malaysia. Structural equation modelling was used to develop and test the measurement model of KM-oriented culture, KM strategy and KM process of the sample firms, as well as the structural model of their hypothesized relationships. The results show that firms with high level of KM-oriented culture demonstrated well-defined KM strategies. Firms that implemented well-defined KM strategies also reported that they have better KM processes in place. Building a KM-oriented culture within the organization is a pre-requisite to the implementation of any KM systems in Malaysian firms. Successful implementation of KM strategies, processes and the supporting technological infrastructure depends on whether organizational members consider KM as a norm within the firm. The study's focus on the linkages between KM-oriented culture, strategy and process in the context of Malaysian firms contributes to a more nuanced understanding of KM among firms in the Asian context in general, and in the Malaysian context in particular.

Explaining the levels of innovation and R&D in New Zealand's small and medium-sized enterprises : too many small firms?

This paper is concerned with explaining the levels of innovative activity in New Zealand's SMEs. It is arguable that New Zealand provides a special case where innovation and R&D levels are comparatively low in SMEs, yet, paradoxically, it is also a nation of high rates of entrepreneurial activity. This paper seeks to examine the factors that affect innovation levels in New Zealand SMEs from an analysis of panel data set of 1500 SMEs. We test research propositions based on existing theory and literature on innovation levels in SMEs and discuss our findings. Firm size is found to be significant; we argue that New Zealand has too few growth firms rather than too many small firms and we suggest that barriers to innovation, such as access to finance, remain an issue which should be a focus for government support.

An examination of Australian gold mining firms' exposure over the collapse of gold price in the late 1990s

Purpose – The purpose of this study is to examine the exposures of Australian gold mining firms in the highly volatile period from 1995 to 2000. This period has been characterized by significant changes in gold price due to bulk sale of gold by collective central banks. Specifically, the paper aims to investigate several firm-specific factors that are hypothesized to carry substantial influence on gold beta.

Design/methodology/approach – To estimate gold beta, we use the following multifactor model: R_g,_t = a+ß_gGPR_t + ß_xFXR_t + ß_mR_m,_t + _Et , where R_g,_t is the return on the gold stock Index at time t, GPR_t is the gold price return denominated in US dollar at time t, FXR_t is the foreign exchange return of Australian dollar in terms of US dollar at time t, R_m,t is the market return at time t, and _Et is the random error term at time t.

Findings – The paper finds that the values of gold beta are consistently greater than one, implying the sensitive nature of firms’ stock returns to gold price changes. This also suggests that investors holding gold mining stock would receive higher percentage increases in stock returns from a percentage increase in gold price returns, as opposed to investors holding gold bullion. Furthermore, these values have changed substantially over time with significant changes in gold price volatility. The most important and consistent relationship that we find is the impact of firms’ hedging behavior on their respective gold betas. This is consistent with Tufano’s study. It implies that firms, which hedge a greater proportion of their gold reserves, are less sensitive to movements in gold prices. The finding therefore supports the risk management theory that hedging increases shareholder’s wealth. However, cash operating costs, cash reserves and the level of gold production seem to influence very little on the firms’ exposure to gold price changes.

Originality/value – This study is of interest and important to the stock mining companies and investors because the extent of the effect of gold price movements on the stock returns of gold mining companies has significant impacts on returns for both firms and investors especially in their risk management and investment decisions, respectively.

Book review : The new European rurality : strategies for small firms

The new European rurality: strategies for small firms, by Teresa de Noronha Vaz, Eleanor J. Morgan and Peter Nijkamp. Ashgate Publishing, 2006

The role of board independence in mitigating agency problem II in Australian family firms

We investigate the impact of board independence on earnings management on a sample of family controlled firms listed on the Australian Securities Exchange (ASX). Using panel data over the period 2000–2004, we find evidence of earnings management among family controlled firms in Australia, an environment of high investor protection and private benefits of control. Findings show that a higher proportion of independent directors on boards is effective in reducing earnings management, thereby mitigating agency problems associated with entrenchment and expropriation in family firms. We also find that managers of family firms are less aggressive in managing earnings via discretionary long-term accruals compared to non-family firms.

Sustaining the international competitive advantage of Asian firms : a conceptual framework and research propositions

The sudden loss of export markets by many Asian firms during the Asian financial crisis (AFC) has raised important questions on how firms in the region can regain and sustain their competitive advantage in international markets. This paper develops a conceptual model which focuses on certain key elements of a firm's internal resources as critical sources of competitive advantage and offers research propositions. It is argued that Asian firms can enhance their international competitive advantage by leveraging their internal resources within an external environment generally conducive to growth.

Relationships, the role of individuals and knowledge flows in the internationalization of service firms

This article develops a new conceptual model of knowledge flows within international service firms. Our model takes explicit account of the critical role of relationships and the individual as being central to the process of knowledge transfer for service firms. The model is then validated with data collected from five international service firms using critical event analysis techniques. The findings reinforce our contention that the individual plays a critical role in the process of knowledge transfer and that relationships form an integral part of this process. The implications of this finding are also discussed.

The impact of guanxi on export performance: A study of New Zealand firms exporting to China

Broadly defined as interpersonal relationship in Chinese society, guanxi embodies several intricate and unique Chinese cultural values. Although more and more western business people are becoming increasingly aware of the importance of guanxi in doing business in China, its potential impacts on the performance of business are still not well understood by western business people. This paper uses path analysis to assess the impacts of guanxi on export performance of a sample of New Zealand firms exporting to China. The results show that guanxi variables significantly facilitate trade partnering, business negotiating, and problem solving and generally contributes positively to the overall export performance of firms.

Foreign environmental impacts on export performance A study of agribusiness firms exporting to Japan

Although a large body of literature exists on export performance, little attention has been given to how foreign environments impact on the performance of firms exporting to a particular market. This study examines how the business environment in Japan impacts on a sample of New Zealand agribusiness firms exporting to this market. Using path analysis with LISREL, the findings suggest that the foreign environment in Japan has a small but significant adverse impact on export performance. The results also show that exporters are able to mediate the adverse effects of the Japanese business environment on their overall export performance by formulating effective product, pricing, promotion and distribution strategies.

Real estate graduates’ employability skills : the perspective of human resource managers of surveying firms

Purpose – The purpose of this paper is to report further on research funded by the Centre for Education in the Built Environment (CEBE) into real estate programmes of study in UK universities (Poon and Hoxley). The aim of this paper is to identify human resource managers’ view on the employability skills of real estate graduates. It also compares the views on the employability skills of real estate graduates between human resource managers, a large sample of real estate employers and real estate course directors.

Design/methodology/approach – This paper presents the research findings of eight interviews with human resource managers who work in different types of surveying firms. The approach for collecting their view of the employability skills required by real estate graduates was through gathering their opinions on three charts. These charts compare what employers feel graduates require and what they feel graduates demonstrate in 31 knowledge areas, 20 skills and 21 attributes, alongside a list of additional competencies made by graduates and employers which was developed as part of an earlier study.

Findings – The human resource managers identified the key employability skills for real estate graduates as soft skills, in particular report writing skills, communication skills, presentation skills, client care and professional standards. The human resource managers of real estate consultancy firms also voiced their concern regarding graduates’ lack of commercial awareness, which echoed the same view from real estate employers and real estate course directors mentioned in the previous research (Poon, Hoxley and Fuchs). Therefore, it is necessary for universities to embed these soft skills, such as commercial awareness in the curriculum in order to enhance the employability of graduates.

Originality/value – This paper makes an original contribution to existing literature on the identification and discussion of employability skills for real estate graduates. It describes pioneering research focusing on the human resource managers’ perspective of the real estate graduate employability skills.