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Lim, Hyoung Joo and Mali, Dafydd 
ORCID: https://orcid.org/0000-0003-3582-2429
(2023)
An analysis of the effect of temporary/permanent contracts on firm efficiency performance: evidence from South Korea.
Journal of Applied Accounting Research, 24 (1).
pp. 149-169.
ISSN 0967-5426
Abstract
Purpose: Because no international accounting policy exists to mandate human capital (HC) information must be reported on financial reports, the association between workforce HC and firm performance/efficiency is not well-established. South Korea is a rare example with high HC reporting quality, as well as relatively high national productivity. On the other hand, in some developed countries (such as the UK), HC reporting quality and productivity is low. Moreover, there is an increasing propensity to offer employees non-standard contracts. Thus, because of a divergence in HC reporting quality internationally, the South Korean sample can provide valuable insights to countries with weak HC reporting quality about the association between contract quality and firm performance/efficiency. Design/methodology/approach: Using a sample of Korean listed firms (2010–2015), pooled Ordinary Least Squares (OLS) regression analysis is conducted to show whether firms that offer employees higher levels of permanent, relative to temporary contacts, demonstrate higher firm performance/efficiency. Findings: Firms that provide employees with increasing permanent (temporary) contracts experience higher (lower) performance/efficiency. Research limitations/implications: This research is limited due to sample selection. However, the sample represents the population of all firms that report contract type information in South Korea, a market with highly robust HC information reporting. Originality/value: Because of data unavailability, a positive association firm-level performance/efficiency and permanent employment can only be made in a handful of countries. The study has policy implications and extends the non-financial reporting literature by addressing HC reporting limitations that exist in the mainstream accounting framework. Based on relative operational efficiency/performance, the study offers practical insights to management about the importance of staff retainment. Moreover, the authors also offer an anthropocentric perspective by inferring how low HC reporting quality can have a negative impact on society in Industry 4.0.
| Item Type: | Article |
|---|---|
| Additional Information: | Publisher Copyright: © 2022, Emerald Publishing Limited. |
| Uncontrolled Keywords: | accounting policy,annual reports,employee rights,human capital,legitimacy theory,productivity,accounting,economics, econometrics and finance (miscellaneous),information systems and management ,/dk/atira/pure/subjectarea/asjc/1400/1402 |
| Faculty \ School: | Faculty of Social Sciences > Norwich Business School |
| Related URLs: | |
| Depositing User: | LivePure Connector |
| Date Deposited: | 23 Aug 2024 09:30 |
| Last Modified: | 25 Sep 2024 18:03 |
| URI: | https://ueaeprints.uea.ac.uk/id/eprint/96345 |
| DOI: | 10.1108/JAAR-08-2021-0227 |
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