Tác động của các nhân tố đến tăng trưởng của doanh nghiệp: Bằng chứng thực nghiệm từ các công ty niêm yết trên thị trường chứng khoán Việt Nam

Nội dung text: Tác động của các nhân tố đến tăng trưởng của doanh nghiệp: Bằng chứng thực nghiệm từ các công ty niêm yết trên thị trường chứng khoán Việt Nam

1. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 THE IMPACT OF FACTORS ON THE FIRM GROWTH: EMPIRICAL EVIDENCES FROM VIETNAMESE LISTED COMPANIES TÁC ĐỘNG CỦA CÁC NHÂN TỐ ĐẾN TĂNG TRƯỞNG CỦA DOANH NGHIỆP: BẰNG CHỨNG THỰC NGHIỆM TỪ CÁC CÔNG TY NIÊM YẾT TRÊN THỊ TRƯỜNG CHỨNG KHOÁN VIỆT NAM Khuc The Anh*, Vu Thi Thuy Van*, Do Quoc Anh*, Thai Duy Tung , Hoang Thi Viet Ha * National Economics University, Industrial University of HoChiMinh City, Hanoi University of Industry anhkt@neu.edu.vn ABSTRACT The aim of this paper is finding empirical evidences for the existence of factors that influence firm growth of Vietnamese listed companies. Research data is extracted from annual audited financial statements of 288 companies listed on Hochiminh Stock Exchange (HOSE) during the period ranging from 2012 to 2017. In order to achieve the research objective, a set of hypotheses derived from previous studies is tested by applying fixed effect model (FEM) on the balanced panel data of companies listed on Hochiminh City Stock Exchange. Also, generalized least square (GLS) method is employed to avoid heteroskedasticity, autocorrelation and cross- sectional dependence. The ultimate result shows that firm size, measured by natural logarithm of total assets, and profitability, determined by return on assets, have positive impacts on firm growth, while debt to equity ratio as the proxy of financial leverage impacts negatively. The study has not found significant statistical evidence of dividend policy’s influence on firm growth. Further researches should be implemented to obtain more specific results and enhance the conclusion for the discussed topic. Keywords: Panel data, firm growth, determinant, Vietnamese listed companies. TÓM TẮT Nghiên cứu này đưa ra các bằng chứng thực nghiệm về các nhân tố ảnh hưởng đến tăng trưởng của các công ty niêm yết trên thị trường chứng khoán Việt Nam. Dữ liệu nghiên cứu được chiết xuất từ báo cáo tài chính của 288 công ty niêm yết trên Sở Giao dịch Chứng khoán thành phố Hồ Chí Minh từ năm 2012 - 2017. Dựa trên các nghiên cứu trước đây, các tác giả sử dụng mô hình tác động cố định (FEM) và dữ liệu mảng cân đối của các công ty niêm yết trên sàn HOSE cũng như sử dụng phương pháp bình phương nhỏ nhất tổng quát để tránh các hiện tượng không đồng nhất, tự tương quan và dữ liệu tiêu biểu tại một thời điểm. Kết quả cho thấy rằng, quy mô doanh nghiệp – được đo bằng logarit tự nhiên của tổng tài sản; khả năng sinh lời – đo bằng ROA – có tác động cùng chiều với tăng trưởng của các doanh nghiệp; trong khi đó đòn bẩy tài chính có tác động ngược chiều. Kết quả của nghiên cứu cũng cho thấy không có bằng chứng cho rằng chính sách cổ tức có tác động lên khả năng tăng trưởng của các doanh nghiệp niêm yết. Từ kết quả nghiên cứu, các tác giả đưa ra một số hàm ý chính sách cụ thể. Từ khóa: Dữ liệu mảng, tăng trưởng doanh nghiệp, nhân tố tác động, các công ty niêm yết. 1. Introduction Firms‟ activities are inevitable in every economy. Each economy can be considered a living body in which each firm acts as “the cell” that forms and enables its survivorship. Firms are the primary contributors to Gross Domestic Product (GDP) and the main taxpayers. Rising tax revenues from firms enable investments in infrastructure development, public services such as healthcare and education, as well as poverty reduction programs. In addition, firms can take advantages of potential productivity, enhance effective allocation of resources, and strengthen the economic recovery and growth. Apparently, firms are essential to power of an economy or a nation. Firm growth is therefore integral to solid and stable economic growth in each country. In Vietnam, firm growth is one of the most concerns of the State, reflecting in the fact that legal environment and operating condition of firms are being improved, enabling the firms‟ effective and sustainable operations in long-term perspective. However, average firm size has not been adequate for the 189
2. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 competitive international integration. According to the Official Result of the General Economic Survey 2017 announced by the General Statistical Office, there were 517.9 thousands of existing firms at the beginning of 2017. Only modest 1.9 per cent of them were considered large firms. The facts result in the needs for discovering reasons and policy implications that enhance firm growth in Vietnam. To achieve that objective, we believe that the determinants of firm growth in Vietnam need to be studied. Although a variety of determinants of firm growth has been studied in other research contexts so far, we limit the analysis to some specific factors because of their explicit and accessible quantifications. They are the Return on Asset (as studied by Hall and Weiss (1967), and Fiegenbaum and Karnani (1991)), firm size (Ramahan, 2011), leverage ratio (Chen, 2018), and dividend policy (proposed by Miller and Modigliani (1961)). Accordingly, the authors would like to introduce the research topic “Determinants of firm growth: Empirical evidences from Vietnamese listed companies”, aiming at analyzing the impacts of factors on firm growth in Vietnamese listed companies, the sample used as empirical evidence in this research. Deriving from the results, we discussed the statistical evidences for the significance and direction of the determinants of firm growth in Vietnamese listed companies. 2. Literature review 2.1. Firm growth determinants Firm growth can be considered in different perspectives. According to Rahaman (2011), firm growth was measured by the growth rate of the number of employees or the growth rate of revenue. Similarly, Patel et al (2018) employed revenue growth as the proxy for firm growth. The study of Coad et al (2016) researched firm growth through the growth rate of revenue, productivity and the number of employees. Under the financial viewpoint, Choi et al (2017) considered firm growth as the growth rate of profit and capital accumulation. However, from the innovative perspective, Chen et al (2018) paid attention to R&D expense, the number of patents and citations when evaluating growth at corporate level. The determinants of firm growth studied in this paper are: 1) Dividend policy, is the earnings distributed to the shareholders periodically; 2) Firm size, as defined in the Degree No. 56/2009/ND-CP dated on 30 June 2009, is the total capital resources or the number of employees; 3) Financial leverage, is measured by the relative level of debt which raises interest expense, and thus reduces profit and creates interest tax shield simultaneously; and 4) Earnings, is the remained profit after excluding all cost. Accumulated earnings finance the expanded operating activities of the firm. 2.2. Key factors affecting firm growth 2.2.1. The impacts of firm size Gibrat (1931) and Penrose (1959) set the foundation for the later studies on the impacts of firm size on firm growth. The resource-based Theory of the Growth of the Firm, proposed by Penrose (1959), stressing on strategic management and business resources, showed that firm growth mainly depended on the power of the internal sources. According to Gibrat (1931), firm growth did not rely on size or history of the firm. Firms in the same industry would have the same sources for growth, irrelevant to their current size or the previous history. In other words, in Gibrat‟s theory, small firms would growth as fast as the large ones. Nevertheless, most empirical researches found the relationship of firm growth and firm size. Hall (1987), Evans (1987), Cooley and Quadrini (2001), and Becchetti and Trovato (2002) stated that the connection between firm growth and firm size was both strong and negative. That negative relationship implied that small firm would grow faster than their larger rivals. On the other hand, Singh & Whittington (1975) and Hart & Prais (1956) identified positive impacts of firm size on firm growth, inferring that big firms grew faster than the smaller ones. The discoveries of Moscarini and Postel-Vinay (2012), particularly solving the motivation for growth – the increase and decrease of employment – of small and 190
3. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 big firms in business cycle, went in the same direction. They argued that larger firms would grow faster in the low-unemployment period when the business cycle was at the booming stage, and grow slower than the small firms during the high-unemployment time when the economy went into the recession stage. Big firms therefore seemed to operate more smoothly, but smaller ones might response to recession and recovery faster. The impacts of size on firm growth were also analysed in the study of Nguyen (2012). According to the author, firm size and labour quality are the main determinants of firm growth. 2.2.2. The impacts of financial leverage The firm‟s accessibility to finance is essential to the growth of the firm itself as well as of the whole economy. Lorente et al (2018) showed that: a few number of the fastest growing and successful companies in Arabian economies were the issuers of equity capital and bonds to raise their capital. These companies not only managed their capital structures when issuing, but also financed the opportunies of investment and development. They dominated the aggregated investment and made the huge economic impacts which influenced significantly on the remained parts of the economy. The results evidenced that the availability and plenty of external financial resources enabled faster growth in Arabian economies. Adversely, Rahaman (2011) argued that financially constrained companies which were less accessible to finance, might resolve this problem by accumulating capital internally. Internal capital accumulation could improve the firms‟ quality in subsequent periods, and then consequently increase the accessibility to external finance. The reliance on internal source would diminish as the firm started to grow and was less financially constrained. Additionally, the study of Rahaman (2011) also found the remarkable influence of firm profit on growth rate though the impact was subject to the firm‟s access to finance. Large firms might be more competitive in more capital intensive industries because they had more resources, and this advantage enabled higher profitability as a result of less competition in the area where the entry barriers really existed (Bayyurt, 2007). Theories on finance (Jensen and Meckling, 1976; Myers, 1977; Myers and Majluf, 1984) highlighted the influences of financial decision on business activities. Empirical researches noted that the lack of finance was the key restriction to firm growth (Audretsch and Elston, 2002; Becchetti and Trovato, 2002; Müller and Zimmerman, 2009; Oliveira and Fortunato, 2006). The studies emphasized the role of financial policies, for instance the profitability and financial leverage, to explain the firm growth (Oliveira and Fortunato, 2006). Leverage affected firm growth through external financing, while profit made its influence through internal financing. Huynh and Petrunia (2010) found a positive and non-linear relationship between firm growth and leverage. Whereas, Lang et al (1996) discovered strong negative correlation between leverage and firm growth, the leverage thus slowed the growth in investment. Another evidence of remarkable impact of financial ability on firm growth can be found in the research of Lorenz (2014). That study, conducted with the sample of firms from 9 African countries, discovered significantly negative impact of financial disadvantage on firm growth in all 9 countries within the researched sample. Mahendra, Zuhdi, and Muyanto (2015) detected that the availability of financial resources had significant effect on firm innovation and other relevant activities. 2.2.3. The impacts of profit Numerous studies on the relationship of firm size and profitability have considered firm size as the proxy for firm growth. This approach has resulted in diverse outcomes. Researches of Hall and Weiss (1967), Fiegenbaum and Karnani (1991), Majumdar (1997), Özgülbaş et al (2006), Jonsson (2007), Serrasqueiro and Nunes (2008), Lee (2009), Stierwald (2009), Karadeniz and İskenderoğlu (2011), Saliha and Abdessatar (2011), Akbaş and Karaduman (2012), Shubita and Alsawalhah (2012) discovered positive correlation of firm size and profitability. On the contrary, Shepherd (1972), Becker-Blease et al (2010) showed that the relationship might be negative. In addition to the mentioned studies, Simon (1962), Whittington (1980), Khatab et al (2011) argued that profitability did not affect firm size. Previous 191
4. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 empirical evidences thus made the determination of profitability‟s impact on firm size ambiguous and opened to further evidences. Most studies employed total assets, total sales or number of staff to measure firm size, except the researches of Becker-Blease et al (2010), Serrasqueiro and Nunes (2008). 2.2.4. The impacts of dividend policies According to Miller & Modigliani (1961), in effective markets, dividend policies would not affect firm value. The shareholders themselves were able to make home-made dividend policies by selling stocks and reinvesting the proceeds at risk free rate, getting value that were equivalent to that of alternative policies. The dividend policies therefore were irrelevant. Empirical researches, however, did not agree with the theory. While Black & Scholes (1974) or Miller & Rock (1985) supported the irrelevancy theory, Litzenberger & Ramaswamy (1979), Dyl & Weigand (1998), Ouma (2012), as well as Gul et al (2012) did not. 3. Methodology 3.1. Research model The research model can be summarized in the Equation (1) below In which: : equity growth of firm i. : Natural logarit of total asset of firm i. : Natural logarit of market capitalization of firm i. : Return of Asset of firm i. : Debt to Equity ratio of firm i. : Annual dividend payout ratio of firm i. i: the company i in the panel. t: the time t in the panel. : error term. The meaning of variables is summarized in Table 1 below: Table 1: Meaning of variables in the model Sign of Relevant No Variable Type Name Formula impact previous studies Dependent Bongseok Choi 1 Firm growth Egrowth variable (2017) Independen 2 TA TA = ln (Total Asset) (-) t variable Gibrat (1931) & Penrose (1959), Cabral & Mata Firm size (2003), Almus & Independent MC = ln (Market Nerlinger (2000), 3 MC (-) variable capitalization) Calvo (2006) 192
5. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 Akbaş & Karaduman Independent ROA = Net Income/ 4 Profitability ROA (+) (2012), Shubita variable Total Asset & Alsawalhah (2012) Oliveira & Financial Independent Fortunato (2006), 5 DOE DOE = Debt/Equity (+) leverage variable Huynh & Petrunia (2010) Litzenberger & Dividend Independent DY = Dividend per share/ Ramaswamy 6 DY (+) policy variable Stock Price (1979), Dyl & Weigand (1998) Source: Summarized by the authors The coefficients from β1 to β5 represent the impacts of the determinants on firm growth. Within a specific level of significance, if there are not statistical evidences that these coefficients are different from zero, meaning that they are statistically insignificant, we can conclude that the mentioned factors may not have impact on the growth of listed companies. 3.2. Research question and hypotheses In this paper, the authors employed the measurement of firm growth based on the research of Choi et al (2017). Accordingly, firm growth is measured by equity accumulation or the equity growth in particular. To test the impacts of the determinants on firm growth, the authors use regression approach on panel data of 288 companies listed on Hochiminh City Stock Exchange (HOSE) during the period between 2012 and 2017. The dependent variable is Egrowth, representing the annual equity growth of the companies in the sample. Independent variables are financial ratios which measure the factors analyzed in the previous section. First, firm size is one of the primary factors which were considered in previous studies on the same topic, such as Gibrat (1931) and Penrose (1959), Cabral & Mata (2003), Almus & Nerlinger (2000), Calvo (2006), Goddard et al (2002). Following approach in these studies, this paper considers total assets and market capitalization as the proxies for firm size. However, in order to match with other financial ratios such as ROA, natural logarithm of Total assets and Market capitalization should be used instead. Hypothesis H1: Firm growth and firm size have negative correlation because bigger firms are growing more slowly and become more stable. The hypothesis agrees with Hall (1987), Evans (1987), Cooley & Quadrini (2001), and Becchetti & Trovato (2002). Second, the next determinant of firm growth is profitability. Following the researches of Hall & Weiss (1967), Fiegenbaum & Karnani (1991), Majumdar (1997), Özgülbaş et al (2006), Jonsson (2007), Serrasqueiro & Nunes (2008), Lee (2009), Stierwald (2009), Karadeniz & İskenderoğlu (2011), Saliha & Abdessatar (2011), Akbaş & Karaduman (2012), Shubita & Alsawalhah (2012), the authors consider the Return on Assets (ROA) as the measurement of firm profitability. Hypothesis H2: Firm growth and profitability have positive correlation because profitability can measure firm performance, thus being able to predict potential growth of the firm. This hypothesis was confirmed by Akbaş & Karaduman (2012), and Shubita & Alsawalhah (2012). Third, this study considers the impact of financial aspects on firm growth, the financial leverage in particular. Based on the researches of Oliveira & Fortunato (2006), Huynh & Petrunia (2010), the authors employed the Debt to Equity ratio (DOE) as the proxy for financial leverage. 193
6. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 Hypothesis H3: Firm growth and financial leverage have positive correlation, because firms will take as many as possible advantages of rapid growth financed by debt to fund their potential investments. The hypothesis agrees with opinions of Myers (1984). Final, this research is also concerned with the influence of dividend policy on firm growth. Theories about dividend policy have yet raised debates because of its theoretical irrelevancy. Accordingly, Miller & Modigliani (1961), Black & Scholes (1974) or Miller & Rock (1985) argued that the investors would not pay attention to dividend policy for the reason that it was irrelevant to firm value. On the other hand, Litzenberger & Ramaswamy (1979), Dyl & Weigand (1998), Ouma (2012), Gul et al (2012) gave the contrary opinions. The annual dividend yield is utilized to represent the dividend policy of companies in this paper. Hypothesis H4: Firm growth and dividend policy are positively correlated, because firms with high dividend yield are more likely to attract investors and raise the expectation on firm growth in future. This hypothesis aims at contributing to the empirical evidences founded by Litzenberger & Ramaswamy (1979), Ouma (2012), and Gul et al (2012). Deriving from the above hypotheses, research model in this paper is linear regression model which includes firm growth as the dependent variable, the objective that is affected, and it is measured by the growth rate of equity. Explanatory variables are natural logarithms of total asset and of market capitalization, both are the proxies of firm size, return on asset representing the profitability, debt to equity ratio representing the level of financial leverage, and annual dividend yield representing dividend policy of the firm. 3.3. Data and analysis techniques Research data is extracted from annual audited financial statements of 288 companies listed on Hochiminh Stock Exchange (HOSE) during the period ranging from 2012 to 2017. Research data is selected to ensure the balance of panel data and through the screening process. The descriptive statistic of research data is shown in Table 2. Table 2: The descriptive statistic of research data Variable Mean Minimum Maximum Standard Deviation Egrowth 0.0895 -2.721 5.484 0.362 TA 14.058 11.539 19.185 1.255 MC 13.236 9.852 19.634 1.499 ROA 0.095 -7.836 0.982 0.296 DOE 0.477 0.002 0.977 0.214 DY 0.070 0 0.949 0.089 Source: calculated by the authors Average equity growth of listed companies on HOSE is 8.95 per cent. In addition, the standard deviation is 36.2 per cent, implying the distinctive growth rates among the companies. The minimum growth is -272 per cent growth of Duong Hieu Trading and Mining Joint Stock Company in 2012, and the maximum is 548 per cent growth achieved by Petro Vietnam Gas Joint Stock Corporation, also in 2012. Average firm size in term of total asset is relatively high. VinGroup is the biggest companies in term of asset, holding asset valued at 214.8 trillion Vietnam dong, keeping a great distance with other rivals. VinGroup is also the biggest firm in term of market capitalization, achieving 336.5 trillion dong of market capitalization at the end of 2017. 194
7. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 Profitability of listed companies, measured by ROA, is approximately 9.5 per cent on average. The divergence among them, however, exists with the maximum figure at 98.2 per cent, and the minimum - 783.6 per cent. The fact can be explained by the dissimilarity of capital usage in different industries. Service business, for instance, may not need too much asset to operate, while manufacturing industry and constructing industry are quite capital intensive. Therefore, return-on-asset ratio of companies varies among different businesses. Debt to Equity ratio is 47.7 per cent on average. The standard deviation of 21.4 per cent and the coefficient of variation of 0.449 show the apparent distinction in debt levels across the firms. Real estate and construction industry, in particular, is the most levered business; average debt to equity ratio of this industry is 54.8 per cent. On the contrary, healthcare has the lowest leverage ratio, only 39.3 per cent on average. Table 3: Correlation matrix of independent variable TA MC ROA DOE DY TA 1 MC 0,664 1 ROA 0,063 0,164 1 DOE 0,317 -0,062 -0,158 1 DY -0,136 -0,0298 0,195 -0,09 1 Source: calculated by the authors Table 3 illustrates the low correlation among independent variables in the model, except the correlation between TA and MC, at 0.664 of correlated coefficient. The possible reason of this fact is that both of TA and MC represent firm size. According to Table 3, the problem of multicolinearity may be insignificant in this model because most of correlated coefficients are relatively low, except the correlation of the two variables representing firm size. Regression methods include POOL regression methods, regression methods according to the approach to factors of fixed effect model (FEM) and regression method according to random effect model (REM). After selecting the appropriate regression method that is suitable for the model, the research team conducted testing and selecting models as well as assessing the defects of the selected model. In the events of defects that violate the hypothesis, the research team will proceed with the generalized least square (GLS). 4. Results To examine and select the appropriate model among the regression method above, the authors used F-test and Hausman test. Via F test we noticed Prob > F = 0.000 chi2 = 0.000 i.e, P_value = 0.000 < α = 5%, therefore, it is sufficiently grounded to reject the hypothesis H0, then fixed effects (FEM) are more appropriate than random effects (REM). Through tests, the method of running FEM model proved to be the best selected. The regression result with FEM is shown in Table 4: 195
8. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 Table 4: Regression result with Fixed Effect Model Estimated Coefficient Std. Error t-value Pr(>|t|) ROA 1.176276 0.131229 8.9635 0.000 DOE -0.697485 0.119372 -5.8429 0.000 DY -0.063558 0.135212 -0.4701 0.6384 MC -0.042535 0.022127 -1.9223 0.0548 TA 0.323958 0.034961 9.2663 0.000 * p |t|) ROA 1.176276 0.284578 4.1334 0.0000382 DOE -0.697485 0.147403 -4.7318 0.000002487 TA 0.323958 0.101772 3.1832 0.001494 * p < 0.1, p < 0.05, p < 0.01 Source: calculated by the authors Based on the empirical results, the authors discuss on the research hypothesis as in the following paragraphs: First, firm growth and firm size measured by natural logarithm of total asset are actually positively correlated because their coefficient is statistically significant at 5 per cent of significance level, and estimation for β1 is 0.323958, a positive value. The growth of total asset will provides more sources of expansion and business capacity development. Hence, it supports firm growth. Conclusion on hypothesis H1: There is no statistical evidence supporting the negative impact of firm size on firm growth. Second, firm growth is positively influenced by profitability which is represented by return on asset. According to Table 5, the coefficient of ROA is statistically significant at 1 per cent, and the estimated value of β3 is 1.176276, suggesting a positive relationship. High ROA indicates the effectiveness of capital employment, financial control as well as the potential growth. Conclusion on hypothesis H2: there is empirical evidence for positive impact of profitability on firm growth. Third, firm growth and financial leverage show a negative correlation in this study, and this correlation is statistically significant at 5%. The estimated value of coefficient β4 is -0.697485, implying a strong negative impact of financial leverage. Debt intensity may raise interest expense. In addition, investment activities of the firm may be passively implemented because of the creditors‟ perspective. Conclusion on hypothesis H3: the hypothesis about positive impact of leverage on firm growth is rejected in this study. 196
9. INTERNATIONAL CONFERENCE FOR YOUNG RESEARCHERS IN ECONOMICS & BUSINESS 2019 ICYREB 2019 Fourth, firm growth has no correlation with either market capitalization or dividend yield. According to Table 5, p-values of these variables are 0.302129 and 0.727006, respectively, and both greater than the significance level at 5 per cent. Therefore, the estimated coefficients are statistically insignificant. Conclusion on hypothesis H4: There is no statistical evidence for the impact of dividend policy on firm growth in Vietnam. CONCLUSION The research has achieved some results while assessing the impact of determinants on firm growth in the context of Vietnam Stock exchange. The authors has tested four hypotheses of factors that affect firm growth, including firm size,, profitability, leverage and dividend policy, by using quantitative method. Employing analysis for panel data and descriptive statistic, based on financial data of 288 Vietnamese companies listed on HOSE during the period between 2012 and 2017, our study can be summarized in some recommendations and implications: The first implication is that asset development is needed to magnify firm growth because asset volume influences positively on firm growth. However, listed companies should maintain stable growth of asset to control the level of growth, avoiding extensive risk arising from unnecessary growth. Based on the impact of profitability on firm growth, we give the second recommendation to the managers. They should pay attention to profitability ratio in order to enhance positive changes in listed companies. The fact that leverage has negative influence on firm growth in listed company raises the third recommendation. Accordingly, firm growth can be achieved if the managers utilize appropriate financial policy, especially the debt policy and risk management. The conclusion also raises the concerns for building models to determine the distance to default in listed firms. In addition to achievement, our study is limited by some drawbacks in data collecting and handling: The first drawback lies in the limited scope of data. We performed empirical testing on data of audited financial statements from listed companies. The robustness of empirical results can be improved by the addition of data from unlisted small and medium enterprises (SMEs). We can also deepen the topic by employing qualitative methods such as interviews with companies‟ representatives and case studies. However, approaching financial data of non-public companies is still a challenge in Vietnam. Second, the study did not consider sufficiently every factor mentioned in previous papers. Therefore, further works can be implemented hereafter as soon as there are reliable measurements of factors which have not studied in this paper. Finally, the aim of this research is finding evidences of factors that impact on firm growth. Nevertheless, it fails to discover those impacts in specific industries. Hence, research results partly meet the initial objectives, as well as provide scientific argument benefiting stakeholders in making decisions. In addition to achieved results, there are some remained flaws in this study with respect to the scope of research sample, time to conduct and factors that are not able to be studied in the research context. REFERENCES [1] Adeyeye, A., Jegede, O. O., Adekemi, J., & Aremu, F. S. (2016). Micro level determinants of mall firms innovation. Innovation and Development, 6(1), pp.25-38. [2] Akbas, H. and Karaduman, H. (2012). The effect of firm size on profitability: An empirical investigation on Turkish manufacturing companies. European Journal of Economics. 197
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