Designing a structural model of factors affecting the development and improvement of the financial structure of manufacturing companies

Subject Areas : Corporate Finance

Reza Karimonnafs ¹ , Rahmat Alizade ^{2 *} , Mohammad Nasrollahi ³ , Alireza Hasan Maleki ⁴

1 - Department of Management, Bab.C., Islamic Azad University, Babol, Iran.
2 - Department of Management, Bab.C., Islamic Azad University, Babol, Iran.
3 - Department of Economics, Bab.C., Islamic Azad University, Babol, Iran.
4 - Department of Accounting, BG.C., Islamic Azad University, Bandar-e-Gaz, Iran.

Received: 2023-12-12 Accepted : 2024-10-25 Published : 2025-03-19

Keywords: Financial Structure, Grounded Theory, Manufacturing Companies, Pattern Design,

Abstract :

Purpose: The financial structure of firms constitutes a major concern for managers in formulating business and financial strategies aimed at achieving optimal performance outcomes. Accordingly, identifying the determinants of financial structure—particularly in manufacturing firms, which play a pivotal role in advancing macroeconomic development goals—is of considerable importance. The present study aims to design a structural model identifying the key factors that influence the development and enhancement of the financial structure of manufacturing companies.

Research Methodology: This research adopts a mixed-methods approach (qualitative-quantitative) grounded in the Grounded Theory methodology. Initial indicators were extracted from theoretical and empirical literature, and indicator enrichment was conducted through expert judgment from academics and professionals in the manufacturing sector. Using a snowball sampling method, semi-structured interviews were conducted with 21 participants. The interview data were analyzed using Confirmatory Factor Analysis (CFA) and Structural Equation Modeling (SEM) via Smart PLS software.

Findings: Based on the analysis, five statistically significant core categories were identified: causal conditions (4 subcategories), central phenomenon (3 subcategories), strategies (2 subcategories), intervening conditions (2 subcategories), contextual factors (3 subcategories), and consequences (3 subcategories). These dimensions led to the identification of three overarching groups of factors influencing the development and improvement of the financial structure of manufacturing firms: internal factors, environmental indicators, and strategic indicators.

Originality / Value: The results of this study provide valuable insights for financial policy-making in manufacturing firms, supporting organizational growth, expected performance improvements, and enhanced flexibility. Given its qualitative and exploratory nature, the study contributes to the theoretical enrichment of literature concerning corporate financial structure by proposing a new conceptual model grounded in empirical evidence.

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