Resumen

JOHNSON, Liam R.; MANS-KEMP, Nadia  y  ERASMUS, Pierre D.. Linking working capital management to value-based financial performance. S. Afr. j. econ. manag. sci. [online]. 2026, vol.29, n.1, pp.1-10. ISSN 2222-3436.  https://doi.org/10.4102/sajems.v29i1.6250.

BACKGROUND: Effective working capital management (WCM) enables corporate leaders to direct scarce resources to the most promising and productive uses. Value can thus be created in a sustainable manner by deploying excess capital to financially feasible projects. As prior authors focused on the associations between WCM and short-term profitability metrics, the value-based perspective warrants attention. AIM: The linkages between WCM and value-based financial performance were investigated in the South African emerging market context. SETTING: The value-based WCM and financial performance outcomes of 122 firms that were listed on the Johannesburg Stock Exchange between 2006 and 2022 were analysed, thereby incorporating two crisis periods. METHOD: Panel regression analysis was conducted to explore the linkages between selected value-based financial performance and WCM metrics. RESULTS: Significant negative relationships were noted between net operating working capital (NOWC) and return on invested capital and spread, respectively. In contrast, a significant positive link was observed between NOWC and free cash flow (FCF). The sampled companies' WCM strategies thus enhanced their value-based financial performance. CONCLUSION: Optimal WCM had positive value-based financial performance implications for selected JSE-listed companies over a 17-year period, including the 2008 global financial crisis and the COVID-19 pandemic. CONTRIBUTION: The value-based perspective can enable corporate leaders to optimise the allocation of working capital.

Palabras clave : working capital management; financial performance; value-based measures; Johannesburg Stock Exchange; net operating working capital; net operating trade cycle.

        · texto en Inglés     · Inglés ( pdf )