Does the Size of a Company Moderate the Relationship between the Factors of Investment and Decision Making?: Perspectives of Individual Shareholders

Abstract

The influence of complex financial and non-financial factors has long been regarded as attributed to acquiring a higher return from the investment decision. The current study aims to investigate the factors affecting the individual shareholders’ investment decision-making moderated by the size of company. While the issue can be regarded as a complex issue, it is an important aspect that has often been neglected. It is important to determine the size of the invested company as the individual shareholders may have a higher chance of investing with a loss. However, very limited research in Malaysia explores the relationship of the factor’s investment decision moderated by the size of company. For this purpose, a survey questionnaire was used to test the hypothesis. The questionnaires were personally distributed among the individual shareholders during the Malaysian Public Listed Companies’ annual general meeting (AGM) located in Klang Valley area and only 680 of them were received back. After the successful collection of the survey, the SPSS software is used to analyze and run the data. Interestingly, this correlation is related to the relationship between factors of corporate social responsibility (CSR) and investment decision, moderated by the size of company. Meanwhile, the factors (accounting information, personal financial needs, advocate recommendations and images of company) and investment decisions have no significant moderating effect. It seems that the individual shareholders will accept the CSR in the investment decision if it is related to the size of company. The current study was limited by the individual shareholders from the industrial product sector, trading services sector and consumer product sector as the unit of analysis while leaving out other investors and contributing factors. Thus, it is recommended to analyze the implication of other factors of investment and moderating effect that might influence the investors in Malaysia as a whole. The findings of this study are practically useful for investors, companies, brokerage houses, financial analysts and policymakers.