Narrow Results

This study examines how Environmental, Social, and Governance (ESG) performance and state ownership affect firm valuation in Singapore and determines if the effects of ESG on firm valuation are more pronounced in state-owned companies. The data comprises 51 companies listed on the Singapore Stock Exchange with complete ESG and financial information during the five-year period from 2018 to 2022. This study finds that only social practices positively and statistically significantly affect stock prices. Overall ESG values, and the other two dimensions of ESG appear not to be statistically significant. State ownership appears to positively and significantly affect the stock price. The finding suggests that the Singapore government’s substantial influence over corporate practices could accentuate the difference in market perception of ESG efforts between SOEs and companies. The study provides useful and practical implications to policymakers, managers and investors, which affect firm financial and operational performance.

Basel II process driving for risk-sensitivity in regulatory capital led to the adaptation of practitioner models. Basel II launching in 2007, it has carried on an immerse impact not only on financial industry but also on the non-financial firms. For financial industry, the increasing cost of credit investigation could reduce the profits of loans. For the non-financial firms, to maintain financial status and credit records in a good shape becomes very crucial. However, there are few standard models to take account of the corporate credit risk and asymmetric information in the literature. The purpose of this study is to provide a sophisticated statistical method on measuring listed companies' cashflow-at-risk (CFaR). CFaR quantifies the risk of unforeseen shortfalls in free cash flow. The CFaR model is constructed based on the 416 listed companies from the first quarter of year 2001 to the third quarter of year 2005 by a set of peer-group companies. This is based on a similar industry risk, market capitalization, profitability and stock price volatility. Empirically, the unprofitable companies are accompanied with higher volatility of stock price and higher credit risk. It is consistent to evaluate corporate risk under three factors analysis efficiently.