Does Organizational Culture Impact on Firm Performance: Evidence From Turkey

Year 2022, Volume: 51 Issue: 1, 149 - 174, 01.05.2022

Adem Böyükaslan , Hasan Aşıkoğlu

https://doi.org/10.26650/ibr.2022.51.861397

Abstract

This paper aims to examine the impact of corporate culture over the financial performance of certain enterprises therewith by covering the data of chemical, petroleum, rubber and plastic products firms (XCHEMST) traded in Borsa Istanbul. In that regard, corporate culture data have been obtained from the surveys of the Denison’s Organizational Culture Model (DOCM) employees and managers of these businesses while the financial data were gleaned from financial statements of the mentioned enterprises between 2012-2016. We posited the ROE as a dependent variable while ROA and DEBT EQUITY have been employed as explanatory financial variables. Accordingly, we have determined SIZE and AGE as firm-specific variables. Utilizing cross-sectional data and multiple linear regression models, we estimated the coefficients of the variables with the aid of an OLS estimator. In so doing, this paper provides sufficient empirical evidence that three out of four cultural traits in the Denison’s Theory have had no impact on the financial performance of Turkey’s chemical firms traded on BIST, whereas the mission trait has had a significant impact. Consequently, our results are largely in line with the findings of other C/P research, suggesting that the mission trait of the DOCM is the core cultural term in ensuring thriving firm corporate performance.

Keywords

Firm Performance, Effectiveness, Organizational Culture, Organizational Behaviour, Emerging Market Countries

Supporting Institution

Afyon Kocatepe University, The Scientific Researches Projects Commission.

Project Number

15.SOSBIL.02

Thanks

This work is based on the first author’s doctoral dissertation. He would like to deliver his sincere gratitude to committee members for their supports and invaluable contributions. The author also would like to present his special thanks to the Scientific Research Projects Commission of Afyon Kocatepe University for funding the research data.

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