Advances in Economics & Financial Studies

Investment Inefficiency and Financial Distress: Evidence from ASEAN Non-Financial Firms

Mochammad Rifni — 2026-06-30

Purpose: This study examines the effects of investment intensity, over-investment, and under-investment on financial distress among non-financial firms in ASEAN. The study aims to investigate whether inefficient investment behavior increases firms’ financial vulnerability.

Research Method: This study employs unbalanced panel data obtained from the Bureau van Dijk OSIRIS database covering the 2020–2024 period, with a total of 14.371 firm-year observations. Financial distress is measured using the Altman Z”-Score model, while investment inefficiency is proxied by over-investment and under-investment. The analysis applies the fixed effects model with robust standard errors clustered at the firm level. In addition, robustness tests are conducted using ordinary least squares (OLS) and the random effects model (REM).

Results and Discussion: The findings indicate that investment intensity and over-investment significantly increase financial distress risk, suggesting that inefficient investment allocation may weaken firms’ financial conditions. Meanwhile, under-investment does not show a significant effect on financial distress. The robustness test results remain consistent across alternative estimation models, confirming the reliability of the findings.

Implications: This study provides implications for managers and investors regarding the importance of efficient investment decisions in maintaining firms’ financial stability. Future studies are expected to employ broader databases and additional variables to capture firms’ investment behavior more comprehensively.

Originality: This study contributes to the literature by examining the relationship between investment inefficiency and financial distress in the ASEAN context using recent panel data evidence.

The Role of Organizational Commitment in Mediating the Effects of Job Promotion and the Work Environment on Employee Performance

Luckhy N.A. Lotte — 2026-06-30

Purpose: This study aims to analyze the effects of job promotions and the work environment on employee performance, with organizational commitment serving as a mediating variable, at the Manokwari Regency Education Office.

Research Method: This study employed a quantitative approach with an explanatory research design. The sample consisted of 56 civil servants (ASN) selected through saturation sampling. Data were collected using a questionnaire, supplemented by observations, interviews, and documentation, and were then analyzed using Structural Equation Modeling–Partial Least Squares (SEM-PLS) with SmartPLS 4.

Results and Discussion: The work environment has a positive and significant effect on organizational commitment and employee performance. Organizational commitment also positively affects employee performance and partially mediates the relationship between the work environment and employee performance. Conversely, job promotions do not have a significant effect on either organizational commitment or employee performance.

Implications: Improving the quality of the work environment is more effective than job promotions in strengthening organizational commitment and employee performance.

Originality: Improving the quality of the work environment is more effective than job promotions in strengthening organizational commitment and employee performance.

Predictive Analysis of Financial Distress in Construction Service Companies Using the Altman, Springate, Grover, and Zmijewski Models

Yakoba Delatasya Basna — 2026-06-30

Purpose: This study aims to compare the results of financial distress classification produced by the Altman Z-Score (Modified), Springate, Grover, and Zmijewski models for service companies in the construction sector listed on the Indonesia Stock Exchange during the 2022–2024 period.

Research Method: The study employed a comparative quantitative approach with a saturated sample of 21 companies (63 company-year observations). Secondary data in the form of annual financial reports were analyzed using the four models and then evaluated through descriptive analysis, Cohen’s Kappa, the Friedman test, and the Wilcoxon Signed-Rank test.

Results and Discussion: The results of the study show that the four models produce different classification distributions, with varying levels of agreement among the models. The Friedman test revealed significant differences in classification (p < 0.001), indicating that differences in formulas, financial ratios, and threshold values cause each model to provide a different interpretation of the company’s financial condition.

Implications: The research findings provide insights for investors, creditors, and management to consider using multiple models when evaluating a company’s financial condition.

Originality: The novelty of this study lies in its comparative analysis of four financial distress classification models in Indonesia’s construction sector during the post-pandemic period, with an emphasis on the differences in classification results and the degree of agreement among the models.