Impact Of Retrenchment Generalship on Firm Performance: Pakistan's Listed Companies as Evidence
DOI:
https://doi.org/10.56976/rjsi.v4i1.39Abstract
Retrenchment refers to a business strategy that reduces the company's Size by decreasing its level of diversity. When a business experiences losses, cutting costs and slowing operations is one ways to ensure the company can continue operating. The study's goal is to learn more about how Retrenchment Strategy and financial indicators affect the success of Pakistan's publicly listed companies. Secondary data from the yearly financial statements of 76 non-financial businesses listed on the KSE-100 Index between 2015 and 2021 has been utilized to analyze Retrenchment and performance characteristics. We tested whether or not any of our research assumptions held using Panel Regression Analysis (ROE model) and Fixed Effects Panel Regression Analysis (ROA model). Based on the results of the panel regression analysis, it is clear that the Retrenchment Strategy has a significant and favourable impact on the success of Pakistani businesses. In support of the company's Retrenchment practices, the study provides evidence from Resource Basis View Theory and the Agency Theory. Using retrenchment as the primary dependent variable, it first examines how this strategy relates to the success of businesses. In addition, it will add to the canon by shedding light on the rising markets in Pakistan. The findings might serve as a benchmark for similar studies to be conducted in the future in Pakistan
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Copyright (c) 2022 Ansar Abbas Shah, Waqar Ahmed, Rizwan Anwar, Arooj Arshad
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