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    CSR performance and tax aggressiveness : evidence from Malaysia : a thesis presented in partial fulfilment of the requirements for the degree of Doctor of Philosophy in Accountancy at Massey University, Manawatu Campus, New Zealand
    (Massey University, 2024) Shanmugam, Santhi
    Globally, government debt has risen substantially, and the need to increase revenue to meet society's needs has become paramount, yet some companies are tax aggressive. Drawing upon shareholder and stakeholder theories, this thesis examines the relationship between CSR performance and tax aggressiveness using 556 observations spanning from 2008 to 2021. The study applies a quantitative research method using regression analysis to test the hypotheses. To gain a deeper understanding of which specific dimension of CSR performance (environmental, social or governance) influences tax aggressiveness, this thesis delves into exploring the connection between the individual dimension of CSR performance and tax aggressiveness. To overcome the limitations of prior studies, the thesis also examines the effect of the Sustainability Reporting Guide (SRG) and FTSE4Good Bursa Malaysia (F4GBM) on CSR performance and tax aggressiveness of Malaysian public listed companies. The thesis results reveal a significant finding. There is a positive relationship between CSR performance and tax aggressiveness, suggesting that socially responsible companies in Malaysia engage in tax aggressiveness and do not consider tax as part of CSR performance. Instead, companies view tax and CSR performance as substitutes and perceive reductions in tax payments through tax aggressiveness as a means to generate more profits. This allows them to invest in innovation, create job opportunities, and contribute directly to societal well-being while meeting shareholders' expectations of profit maximisation. The results also show that different dimensions of CSR performance relate differently to tax aggressiveness. Environmental performance exhibits an insignificant relationship, while governance and social dimensions show positive relationships. Further, the study shows that the introduction of SRG and the presence of the F4GBM index, to some extent, affects the relationship between CSR performance and tax aggressiveness. The results suggest that firms adopting SRG and listing in the F4GBM index recognise the importance of meeting the needs of their different stakeholders beyond the needs of shareholders, thus mitigating the positive relationship between CSR performance and tax aggressiveness. The study contributes to the literature on CSR performance by unravelling the overarching influence of CSR performance on tax aggressiveness. The study shows that Malaysian companies view tax and CSR performance as having a substitutive relationship, indicating that they prioritise the interests of shareholders over broader stakeholder considerations. The key contribution is the examination of SRG and F4GBM on the relationship between CSR performance and tax aggressiveness. It provides insights into the role of regulatory pressure and the effect of compliance on the SRG and corporate reputation through listing in the (F4GBM) Index on the relationship between CSR performance and tax aggressiveness of Malaysian companies. Additionally, the study provides evidence on how each dimension of CSR performance contributes to shaping tax aggressiveness, covering an expansive timeframe, thus providing a unique and comprehensive view of the evolution of CSR performance and its correlation with tax aggressiveness.
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    Three essays on the impact of regulatory changes on firms’ operation : a dissertation presented in partial fulfilment of the requirements for the degree of Doctor of Philosophy in Finance, Massey Business School, School of Finance and Economics
    (Massey University, 2023-12-04) Nguyen, Van Phuc
    This dissertation offers an in-depth exploration of how major and cross-country laws, such as anti-collusion, enhanced by a leniency program and the recently emerging free trade agreement, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), influence firms' operational efficiencies and strategies across various contexts. Employing rigorous methodologies, including advanced Difference-in-Differences (DiD) estimators and Propensity Score Matching (PSM-DiD), this research spans multiple countries and time periods to furnish a detailed understanding of regulatory impacts. The first essay investigates the implications of leniency laws on firms' operational efficiency across 64 countries from 1990–2020. Findings reveal that in response to leniency laws, firms adopt a dual strategy: they initially extend credit terms, which pose short-term risks to asset turnover, while also optimizing fixed asset utilization for long-term sustainable growth. The study uncovers considerable heterogeneity in the laws' impact, notably more pronounced in developing economies and within specific cultural frameworks. The study identifies that leniency laws, in particular, affect larger and more profitable firms by leading them to extend more favorable payment terms. Additionally, the laws have a more pronounced impact on developing economies and cultures characterized by specific traits such as low power distance, collectivism, high uncertainty avoidance, and long-term orientation, as outlined by Hofstede (2011). The second essay examines the influence of the CPTPP on Vietnamese firms from 2017–2021, a transformative era where Vietnam pivoted from an agrarian economy to a manufacturing powerhouse where operational efficiency plays a key role (Laiprakobsup & Chorkaew, 2018). This pivotal change, spurred by the “China Plus One” strategy, not only cements Vietnam’s status as a key player in global manufacturing but also warrants an in-depth analysis as to how its competitive labor and production costs, enhanced by a strategic location, contribute to its increasing economic allure. Our study reveals an initial dip in operational efficiency during the first year of the CPTPP, indicating a strategic realignment phase with increased fixed asset investments and trade credit extensions. However, subsequent years saw a substantial recovery in operational efficiency, marking the successful adaptation of the new trade conditions. The CPTPP's effects were particularly pronounced for high profitability, large-sized firms, those listed on HOSE, and, since 2020, those resilient to the impact of COVID-19. Financially constrained firms seek to use the CPTPP for revenue gains and stress relief but remain cautious about major investments due to debt management concerns. Our findings underscore the transformative role of major trade agreements, and the strategic shifts firms employ to harness these opportunities. The third essay explores the influence of the CPTPP on Research and Development (R&D) investment strategies within Japanese firms. The CPTPP's Chapter 18, with its comprehensive intellectual property protections, presents an opportunity for Japan to rejuvenate its innovation sector, especially as the nation seeks to reclaim its status as a technological leader amid a historical decline in patent registrations. The study presents a detailed impact of the CPTPP on R&D activities within Japanese firms. While enhanced intellectual property protections boost R&D investment, this is counterbalanced by opportunities for market expansion. Manufacturing firms aligned with Japan's cultural long-term orientation consistently increase R&D activities, while service-oriented and technology-intensive firms initially scale down, but eventually recover. Financially constrained firms and those with high sales growth exhibit similar, but distinct patterns in R&D investment. All these findings are framed within the Pecking Order Theory and Japan's cultural norms. Collectively, navigating through the intricacies of international industries and cultures, these essays shed light on the strategic adaptations of firms across the globe. They provide a valuable addition to the scholarly conversation and offer practical guidance for decision-makers worldwide.