The impact of digital trust on firm value and governance: an empirical investigation of US firms

IF 3.1 Q2 BUSINESS
Leon Kluiters, Mohit Srivastava, L. Tyll
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引用次数: 5

Abstract

Purpose This study aims to investigate the effects of firm- and governance-specific characteristics on digital trust (DT) and firm value. Firm-specific factors include return on assets (ROA), market-to-book ratio (M/B ratio), size and leverage, whilst governance-related factors comprise board size, percentage of female board members, board independence and institutional ownership. All listed US firms over the period of 2011–2016 were analysed in this study. Design/methodology/approach This study provides a novel method to empirically measure DT by combining multiple variables to create a combined DT score. The variables include security and privacy scores, security rankings and data breaches, amongst others. Subsequently, a linear regression was performed to evaluate the effect of firm- and governance-specific characteristics on DT, as well as the effect of DT on firm value. Findings By using signalling theory, this study finds significant evidence that a firm’s profitability (ROA) decreases whilst its size increases DT. This could be due to the fact that firms with lower DT monetise data more actively, decrease DT and increase short-term profitability. Significant evidence also shows that increasing DT leads to an increase in firm value. Originality/value Although numerous studies have been conducted on developing customers’ trust by incorporating corporate social responsibility to improve firm value, the literature remains still on its digital analogue. Therefore, this study extends the knowledge of corporate digital responsibility (CDR) by providing a novel method for calculating DT across industries as an antecedent of CDR. Specifically, it sheds light on how firms can enhance DT by utilising firm- and governance-level factors. This enhanced DT can subsequently increase firm value. The study provides important managerial implications by providing empirical evidence that cybersecurity investments increase firm value. This value increase is related to the rise in shareholder value amongst investors and the increase in the organisation’s consumer perceptions as the latter’s interests are better managed.
数字信任对公司价值和治理的影响:对美国公司的实证调查
本研究旨在探讨企业特征和治理特征对数字信任和企业价值的影响。公司特定因素包括资产收益率(ROA)、市净率(M/B比率)、规模和杠杆率,而治理相关因素包括董事会规模、女性董事会成员比例、董事会独立性和机构所有权。本研究对2011-2016年期间所有美国上市公司进行了分析。设计/方法/方法本研究提供了一种新的方法,通过结合多个变量来创建一个综合的DT分数来经验地测量DT。这些变量包括安全和隐私得分、安全排名和数据泄露等。随后,我们进行了线性回归,以评估企业和治理特定特征对DT的影响,以及DT对企业价值的影响。通过使用信号理论,本研究发现显著证据表明,企业的盈利能力(ROA)下降,而其规模增加的DT。这可能是由于具有较低DT的公司更积极地将数据货币化,降低DT并增加短期盈利能力。显著的证据也表明,DT的增加会导致企业价值的增加。原创性/价值虽然已经进行了大量的研究,通过结合企业社会责任来提高企业价值来发展客户的信任,但文献仍然是在其数字模拟上。因此,本研究通过提供一种新的方法来计算跨行业的DT作为CDR的前因式,扩展了企业数字责任(CDR)的知识。具体而言,它揭示了企业如何通过利用公司和治理层面的因素来增强DT。这种增强的DT可以随后增加公司价值。该研究通过提供网络安全投资增加企业价值的经验证据,提供了重要的管理启示。这种价值的增长与投资者对股东价值的提升以及随着消费者利益得到更好的管理,企业对消费者的认知也在增加有关。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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来源期刊
CiteScore
5.60
自引率
18.80%
发文量
35
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