Abstract: Malaysian Government–linked Companies (GLCs) are part of the government policies in developing the nation. Due to GLCs role and significant presence in the market, issues on GLCs and Non-GLCs financial performance is often a question mark. Hence, the current study aims to contribute to the body of knowledge on the factors that have an impact on GLCs performance, in comparison with Non-GLCs. Specifically, the present study analyzed the factors that have different impact on the financial performance of GLCs and Non-GLCs such as GLCs social obligations, corporate governance, and market structure. Based on the matched sample of 39 GLCs and 39 Non-GLCs listed on the Main Board of the Bursa Malaysia over a 5-years period of 2011 to 2015, this study found that there is no significant difference in financial performance measures (ROA and ROE) between these two groups of companies. This study concluded that despite the GLCs social obligations that negatively affected its financial performance, there is no significant difference in the financial performance between these two groups of companies due to the crowd out of private investment (Non-GLCs) in the market that positively affected the financial performance of GLCs.
Keywords: GLCs, social obligation, corporate governance, private investment, crowding out.
Title: The Financial Performance of GLCs and Non-GLCs in Malaysia
Author: HARTINI BINTI MOHD NASIR
International Journal of Social Science and Humanities Research
ISSN 2348-3156 (Print), ISSN 2348-3164 (online)
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