completed - Evaluation 1a_G2_FIN5000.pptx

RESEARCH AND METHODOLOGY OF FINANCE

1. CSR, Debt Management, and R&D Effects on Sustainable Growth Rate of Malaysian Energy Companies Name Matric No Abdulwahid M Juma GS69356 Meisya Aulia Azahra GS69151 Nur Izzah IzzatiI GS69875 Su Jianxiong GS70105

2. Group 2 Members Izzah Meisya Abdulwahid Su Jianxiong

3. Table of contents Problem Statement Research Questions Introduction Significance of Study Research Objectives 01 02 03 04 05

4. Introduction 01

5. Sustainable Growth R ate & R&D Robert Higgins (1977) defined SGR as the fastest rate at which a business may grow its sales without exhausting all its financial resources. Rapid expansion can deplete resources, while a slow-growing corporation may not be able to effectively utilize its resources (Chang, 2012). The management is forced to think about a growth plan that can be used to the firm in line with the company’s growth by Higgins’ notion of sustainable growth rate. The fundamental concept underlying sustainable expansion is that the actual expansion of the company's operations must be compatible with the available resources. The development and deployment of new and improved energy technologies have been, and will continue to be, central to the transition towards cleaner and more efficient forms of energy production and consumption. New technologies enable shifts in the trajectory of the energy sector in many different ways, allowing it to deliver improved services, to become more efficient, and to respond to environmental concerns such as local air pollution and global climate change. (Sagar, A.D., & Van der Zwaan, B., 2006)

6. CSR & Debt Management As a result of the environmental and social issues caused by business organizations operating in environmentally sensitive industries (Alam et al., 2019; Sueyoshi and Goto, 2014), the importance of CSR and sustainability-related reporting practices based on globally recognized reporting guidelines, such as the Global Reporting Initiative (GRI) framework, has increased substantially in the last few years This expansion is driven by a need to convey messages to various stakeholders that environmental and social risks are properly managed (Sìmnett et al., 2009). Energy companies are being forced to address a broader set of CSR and sustainability-related efforts and activities that encompass a wide range of dimensions, including environmental performance, social impacts, human and labor rights, and sustainable development (Alazzani and Wan-Hussin, 2013; Choumert Nkolo, 2018; Liu et al., 2014). Debt management is any strategy that helps a debtor to repay or otherwise handle their debt better. Debt management refers to how debt is administered or handled so as to avert/avoid adverse economic effects (Emerenini, F.M., & Nnanna, A.U. (2015)

7. Problem Statement 02

8. Literature Gap Previous study conducted by (Cho et al.,,2019) on the relationship between CSR and financial performance highlight that the relationship between CSR performance and profitability, only social contribution yields a statistically positive correlation”, as well as “a positive relationship between the growth rate of total assets and corporate soundness and social contribution. I n addition, (Ramli et al.,,2022) investigate how firm specific factors and share price performance mediates SGR on shariah compliant company in Malaysia. According to the results, the Shariah-compliant sample meets SEM requirements, such that the sustainable growth rate shows a significant relationship with share price performance. According to mediation effect results of firm specific factors, capital structure, dividend policy, profitability and firm size are considered “indirect-only mediator”. Previous research (Thuy Van Vu Thi et al.,2023) has demonstrated that various procedures for recognizing intangible assets can alter a company's reported income. It found that present investments in intangibles, particularly R&D, are linked to improved future performance. In today's digital economy, businesses often prioritize intangible investments for growth.

9. Practical Gap/Problem Limited studies of the benefit of value increase in investment R&D to the existing firm. Existing R&D strategies may merely reflect corporations' innovative efforts. This promotes the need for managers to carefully assess and evaluate the contribution of innovation and discovery to various areas (Thuy Van Vu Thi., 2023) According to the predictions, public spending on energy R&D increased by 10% in 2022, reaching roughly USD 44 billion, with renewable energy accounting for 80%. Preliminary figures from listed firms in the energy industry show a comparable increase in R&D budgets in 2022, while early-stage venture capital investment into clean energy start-ups set a new high of USD 6.7 billion. These good accomplishments obtained despite greater capital costs and pervasive economic uncertainty (Simon Bennett, 2023). Malaysia is among the most highly developed states of the Southeast Asia region and a founding member of the Association of Southeast Asian Nations (ASEAN). By 2050, primary energy supply in Malaysia is expected to increase by 60% over that of 2018, while the country’s population is projected to rise to more than 40 million people. Malaysia energy transition outlook draws on IRENA’s Renewable Readiness Assessment , Renewable Energy Roadmap toolkit (REmap) and Power System Flexibility Assessment to chart possible energy pathways to 2050. It also presents sector-specific technological pathways and investment opportunities that will help Malaysia to accelerate its energy transition (International Renewable Energy Agency, March 2023,). While previous study have examined the impact of CSR and the deviation of Corporate Actual Growth Rate from Sustainable Growth Rate (Mukherjee et al., 2018), financial performances ( Cho et al.,2019), there is limited empirical research that comprehensively explores the synergies and trade-offs among these elements in the context of Malaysia's dynamic energy sector.

10. Research Objectives 03

11. Research Objectives This study aims to examine CSR, Debt Management and R&D Effects on Sustainable Growth rate based on evidence of Malaysian energy companies. Contribute to the sustainable development of the company. To examine the effects of CSR on sustainable growth rate on Malaysian energy companies. To examine the effects of debt management on sustainable growth rate on Malaysian energy companies. To examine the effects of R&D on sustainable growth rate on Malaysian energy companies.

12. Research Question 04

13. Research Questions What is the effect of CSR on sustainable growth rate based on Malaysian energy companies. What is the effect of debt management on sustainable growth rate on Malaysian energy companies. What is the effect of R&D on sustainable growth rate based on Malaysian energy companies.

14. Significance of study 05

15. Significance of Study Investors & Shareholders: Informed decision making on risk-return of the companies. Company Management & Executives: Formulate strategic plans and prioritize resource allocation to enhance competitiveness and long term-viability Regulators & Government Agencies: Policy development, regulatory frameworks and Incentives. Communities: Addressing concerns and promote mutual benefits Academic and Research Institution: Further innovation and Educational programs and initiatives.

16. Reference C ho, S., Chung, C., & Young, J., 2019, Study on the relationship between CSR and financial performance. Sustainability, 11(2), 343. https://doi.org/10.3390/ su11020343 The mediating effects of sustainable growth rate: evidence from the perspective of Shariah-compliant companies. Cogent Business & Management, 9(1). https://doi.org/10.1080/23311975.2022.2078131 International Renewable Energy Agency. (2023, March). Malaysia energy transition outlook. Retrieved from https://www.irena.org/Publications/2023/Mar/Malaysia-energy-transition-outlook Emerenini, F. M., & Nnanna, A. U. (2015). Debt management and economic growth empirical evidence from Nigeria. International Journal of Innovative Research & Development, 4(1), 243-258. Karaman, A. S., Orazalin, N., Uyar, A., & Shahbaz, M. (2021). CSR achievement, reporting, and assurance in the energy sector: does economic development matter?. Energy Policy, 149, 112007. Sagar, A. D., & Van der Zwaan, B. (2006). Technological innovation in the energy sector: R&D, deployment, and learning-by-doing. Energy policy, 34(17), 2601-2608. Higgins, R. C. (2003). Analysis for Financial Management. 6th edition Irwin/McGrawHill Chang, Y. C. (2012). Strategy formulation implications from using a sustainable growth model. Journal of Air Transport Management, 20, 1-3.

17. Thank You!