Resources - Performance relationship: The mediating role of Enterprise Risk Management (ERM) in Malaysia / Noraznira Abd Razak

This study analyses the relationship between firm resources and its performance while examining the mediating roles of enterprise risk management in the firm resources - firm performance relationship within the context of the Resource-based view theory (RBV) and Donabedian theory. A quantitative approach is employed in this study and responses from 223 risk managers among Malaysian listed firms under Malaysian Bourse were analyzed by using Partial Least Squares (PLS-SEM) technique. The results show that intangible resources are directly related to performance, meanwhile through the mediating effect of enterprise risk management (ERM), an indirect relationship was confirmed. However, tangible resources and capabilities show negative results on the relationship with the performance of the firm and further analysis using ERM as mediator yields the same negative results. A positive relationship between ERM and performance of the firm was also obtained. On the basis of the outcome of this study, it shows that intangible resources need to be fully optimized by firms in order to improve their performances. Overall, the findings of this study reveal how firms may gain competitive advantages and eventually be able to sustain their firms' performances by implementing an integrative model of intangible resources and effective ERM process in their routines and practices