The effects of corporate governance, human resource practices, and organizational wellbeing

Abstract

The effects of corporate governance, human resources practices, and organizational wellbeing on organizational performance of the companies listed on the stock exchanges in Thailand were the thesis title of this current study. Quantitative research approach was adopted to examine those effects. Its research objective was to investigate the direct and indirect effects of corporate governance, human resources practices, and organizational wellbeing on organizational performance. The companies listed on the stock exchange of Thailand and the market for alternative investment awarded with the CG rating of “Good”, “Very Good”, and “Excellent” were the samples of this current study. The data were collected from 203 companies observed during 2016 – 2018 by the questionnaires. Statistical analysis included frequency, percentage, min, max, mean, and standard deviation. Moreover, the structural equation modeling was utilized to find the casual relationships of human resources practices and organizational wellbeing with organizational performance with the aim to examine its goodness of fit of the model.

The results demonstrated that the mean scores of human resources practices and organizational wellbeing of the companies listed on the stock exchanges in Thailand were in a high level, overall. In terms of organizational performance, return on assets had the mean score of 7.09, return on equity with the mean score of 10.63, Tobin’s Q with the mean score of 1,066.90, earnings per share with the mean score of 1.43, and market capitalization with the mean score of 50.82. Furthermore, the results of hypothesis testing revealed that the structural equation modeling was perfectly fit for the empirical data as indicated by six accepted indices. Those accepted indices included the chi-square x2/df (1.235), p-value (0.102), the goodness of fit index (0.902), the comparative fit index (0.987), the root mean square error of approximation (0.049), and the standardized root mean squared residual (0.058). As far as the direct and indirect effects on organizational performance of the firms listed on the stock exchanges in Thailand, it was found that market capitalization was directly influenced by human resources practices with the effect size of 0.439 at the statistical significance at the 0.05 level. Also, human resources practices had direct effects on the organizational wellbeing with the effect size of 0.839 at the statistical significance of the 0.01 level.