The impact of enterprise risk management on firm value of listed companies in the Stock Exchange of Thailand
Keywords:
Enterprise Risk Management, Firm Value, Thai Stock MarketAbstract
This study examines the impact of Enterprise Risk Management (ERM) on firm value of publicly listed companies in the Stock Exchange of Thailand, using a sample of 200 firm-year observations from 2020 to 2024. Multiple regression analysis indicates that ERM disclosure under the COSO-ERM 2017 framework is relatively high, reflecting firms’ awareness of risk management practices. However, ERM disclosure does not have a statistically significant effect on firm value when controlling for industry effects (B = -2.440, p = 0.093), suggesting that compliance-driven ERM reporting does not clearly reflect practical effectiveness or create financial value. In contrast, when industry effects are not controlled, ERM disclosure has a significant negative impact on firm value (B = -3.185, p = 0.039), highlighting the role of industry characteristics and business structure in market interpretation. Additional findings indicate that ROA has a positive and significant effect on firm value, whereas ROE has a small but significant negative effect. Firm size and leverage are not significant determinants. Differences across industries were observed, with technology firms exhibiting a positive effect on firm value, while resource-based firms show a significant negative effect.
This study supports both Agency Theory and Stakeholder Theory, suggesting that document-based ERM may only marginally reduce agency costs and does not directly enhance firm value. The findings provide empirical evidence to fill academic and practical gaps, demonstrating how risk management practices influence firm value and inform sustainable strategic decision-making in the Thai capital market.
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