Determining the Financial Performance of Malaysian Green Technology Companies Using Tobin’s Q

Abstract

Massive technology, business pressure and the growth of global market penetration have led to most businesses becoming more environmentally friendly. The issue of climate change, waste management, air pollution and water pollution have all challenged the practice of business ethics, notwithstanding the ever-present pressure for companies to be more competitive in the marketplace. To be more financially sustainable, most of the businesses are forced to keep the balance between resources available and future sustainability in the long-term period. To ensure the success of sustainability, green technology is one of the most important initiatives to motivate companies to become more financially sustainable in the future. Thus, the purpose of this study is to examine the factors that have influenced the financial performance of Malaysian green technology companies using Tobin's Q. The dependent variable is Tobin’s Q which represents the firm’s market value, while independent variables are measured by carbon productivity, waste productivity, energy productivity, growth and firm size. The data for the study came from 10 selected green technology companies listed in the Bursa Malaysia and were the top-ranked eco-friendly companies in Malaysia. The findings indicate that all independent variables (growth, carbon productivity, waste productivity and energy productivity) were significant, but firm size was not significant. The findings imply that by adapting to the use of green technology, companies benefited a lot in terms of minimizing cost, sustaining a healthy environment, as well as helping companies to become sustainable in the long term.

A Systematic Review on Nexus Between Green Finance and Climate Change: Evidence from China and India

“…On the other hand, green financing also promotes green technology innovations (energy, transport, construction, wastewater treatment, chemical processing, and material innovation), which are significant tech developments and breakthroughs advancing efforts to decarbonization and elevating green growth (Badri Shah, 2021;Chen and Chen, 2021;Debrah et al, 2022;Jin, 2021;Li et al, 2020;Ma et al, 2021;Zhou et al, 2020;. Followed the studies by (Al Mamun et al, 2022;Chang et al, 2021;Lin et al, 2023;Nawaz et al, 2021;Zhang et al, 2022) reveal that green financing efforts are critical in minimizing the impacts of climate change and fostering sustainable growth.…”