Sufficiency Economy Philosophy and Firm Risks

19 Pages Posted: 26 Oct 2016

Date Written: October 24, 2016

Abstract

Using data from Thailand, we designed and created our Sufficiency Economy Philosophy score (SEP score) that measures the extent to which a firm is aligned with Sufficiency Economy Philosophy. We find that our SEP score has a negative relationship with firm-specific risk measured by the standard deviation of residuals from the market model. However we find no relationship between SEP score with neither market risk nor other measures of firms’ performance. The findings support the notion that alignment with Sufficiency Economy Philosophy could reduce risk without sacrificing performance, it leads to sustainability, and that Sufficiency Economy Philosophy practices are well aligned with shareholders’ interests.

Keywords: Sufficiency Economy Philosophy, firm-specific risk, risks

Suggested Citation

Chatjuthamard, Pattanaporn and Lawatanatrakul, Vacin and Pisalyaput, Nick and Srivibha, Vasu, Sufficiency Economy Philosophy and Firm Risks (October 24, 2016). Available at SSRN: https://ssrn.com/abstract=2858216 or http://dx.doi.org/10.2139/ssrn.2858216

Pattanaporn Chatjuthamard

Sasin GIBA ( email )

Bangkok
Thailand

Vacin Lawatanatrakul (Contact Author)

Sasin GIBA ( email )

Bangkok 10330
Thailand

Nick Pisalyaput

Sasin GIBA ( email )

Bangkok 10330
Thailand

Vasu Srivibha

Sasin GIBA ( email )

Bangkok 10330
Thailand

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