Assessing the Impact of Internationally Recognized Quality Standards on the Business Performance of Firms

Authors

  • Chathurika Rajapaksha Wayamba University of Sri Lanka
  • Jagath Chaminda Edirisinghe Wayamba University of Sri Lanka

Keywords:

Firm performance, Quality standards, Treatment effects model

Abstract

Internationally recognized quality standards are obtained by many firms with the intention of enhancing their corporate reputation. A question prevails whether this decision ultimately addresses the establishment’s main financial objective of shareholder wealth maximization. The objective of this study is to examine the impact on the business performance of firms through certification and also to identify the factors that influence a firm to obtain international quality standards. Secondary data obtained from 606 firms from Sri Lanka is analysed using a Treatment Effects Model. The results reveal that obtaining quality standards has a significant positive impact on business performance of firms. We find higher probability of adoption of quality standards for firms in the food industry. Experience of the top management, firm size, investment on research and development, new technology, new logistic and business processes also increases the probability of obtaining certification.

Author Biographies

Chathurika Rajapaksha, Wayamba University of Sri Lanka

Research Student

Jagath Chaminda Edirisinghe, Wayamba University of Sri Lanka

Senior Lecturer

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Published

2014-07-01

How to Cite

Rajapaksha, C., & Edirisinghe, J. C. (2014). Assessing the Impact of Internationally Recognized Quality Standards on the Business Performance of Firms. International Journal of Economic Practices and Theories, 4(4), 437-443. Retrieved from http://ijept.eu/index.php/ijept/article/view/Assessing_the_Impact_of_Internationally_Recognized_Quality_Sta

Issue

Vol. 4 No. 4 (2014)

Section

Articles

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