International Journal of Entrepreneurship (Print ISSN: 1099-9264; Online ISSN: 1939-4675)


The Effect of Systematic Risks on Companies Financial Performance - Empirical Approach

Author(s): Ruba Ahmad Ata-Allah Al-quraan, Thair Adnan Kaddumi

Different economic sectors in the country are exposed to many risks that may reflect a negative impact and threaten their financial performance, thus their existence and sustainability. This study aims at investigating the impact of systematic risks on Jordanian industrial companies’ financial performance during the period of (1999-2018) listed at Amman Stock Exchange (ASE). The study employed multi regression analysis to analyze the research data. The analysis results concluded that there is significant and positive impact of all the study systematic risks variables on the dependent variable Return on Equity (ROE) and there is a positive impact of inflation rate and interest rate on cash flow per share (CSF). Additionally, the analyses results indicate that, there is significantly positive impact of companies’ size on the impact of interest rates and cash flow per share, but the case was not the same regarding ROE as the moderating variable (company`s size) has adversely impacted the role of independent variables. The research concluded many recommendations of which, the necessity of strengthening the role and responsibility of management in taking precautionary measures to reduce the impact of risks on performance of companies, and to analyses such potential risks in order to mitigate them or eliminate its effect.

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