Dua’a Shubita

This study aimed at analyzing the effect of sales promotion and advertising expenses on sales performance, considering firm size as a likely moderating variable.
This research conducted regression analyses on 474 Jordanian companies based on the firm’s advertising expenditure, gross margin, firm size, and sales performance. It tested two models: first, direct impact of advertising expenses on sales performance, and, second, firm size affecting the relationship between advertising expenses and sales performance.
The findings show that advertising and sales promotion expenses do not have a significant effect on sales performance. Besides, firm size did not moderate this relationship, as referred by a non-significant t-value of –1.459 and a p-value of 0.145. The models explained only 4.1% and 0.5% of the variance in sales performance, respectively, suggesting that other factors play a more significant role.
These results suggest that Jordanian firms have to reevaluate their advertising strategies and consider alternative approaches to enhance sales. The research contributes to more understanding of the limited role of advertising in sales performance within the Jordanian market.

Acknowledgement
This research was funded through the annual funding track by the Deanship of Scientific Research, from the vice presidency for graduate studies and scientific research, King Faisal University, Saudi Arabia [Grant no. KFU242402].

The growing need to comprehend how dividend policy affects bank size, particularly in emerging markets like Jordan, makes this study relevant. Bank size, often measured by total assets, is a key indicator of financial strength and stability. This study aims to examine the relationship between various measures of dividend policy – dividend per share, dividend yield, and dividend per share to earnings per share ratio – and bank size in Jordanian banks, using earnings per share as a control variable.
The study employs ordinary least squares regression analysis to investigate the relationship between these variables over a sample of Jordanian banks. Three regression models were constructed to evaluate the impact of each dividend measure on bank size. The results indicate a significant positive relationship between dividend per share and bank size, and between the dividends per share to earnings per share ratio and bank size. The results show that approximately 43.9% of the variance in bank size is explained by the Dividends per share and Earnings per share, and a significant positive correlation is observed between total assets (bank size) and dividend per share, with a coefficient of 53%. Dividend yield, however, showed no significant impact on bank size.
The results support that Jordanian banks with a sound dividend policy on dividend per share and its continuity with earnings exhibit higher asset growth. In this respect, bank growth appears to be highly dependent on a prudent dividend policy even from an emerging markets perspective.

This study investigates the empirical effects of implementing the Expected Credit Loss (ECL) model under IFRS 9 on capital budgeting decisions within the Jordanian banking sector. The analysis is based on a full population of all 13 Jordanian commercial banks listed on the Amman Stock Exchange from 2013 to 2023. Using panel data regression models, the study evaluates changes in three key financial ratios: Capital to Assets (CA), Equity to Assets (EA), and Loans to Assets (LA).
The findings reveal that adopting the ECL model led to a statistically significant increase in CA by 0.3% (p = 0.04), suggesting that banks have strengthened capital buffers in anticipation of higher provisioning requirements. Conversely, the EA ratio declined sharply by 1.1% (p < 0.01), indicating equity reallocation to absorb credit risks. Most notably, the LA ratio fell by 3% (p = 0.006), highlighting a more conservative lending approach post-ECL implementation. Each model exhibited strong explanatory power (R² values between 0.79 and 0.87), supporting the robustness of the results.
These outcomes confirm that IFRS 9 has triggered a structural shift in how Jordanian banks manage capital and credit risk. The study underscores the critical need for adaptable capital strategies in emerging markets, where regulatory changes like IFRS 9 can significantly reshape financial behavior and resource allocation.

This study undertakes an investigation into the nexus between board characteristics and research and development (R&D) investments within the specific context of Jordan. Employing a dataset comprising 24 small and medium enterprises (SMEs) operating in the service and manufacturing sectors and enlisted on the Amman Stock Exchange (ASE) throughout the period from 2010 to 2023, the empirical findings substantiate that the dimensions of the board, mainly board size and independence, exert a positive influence on the intensity of R&D expenditures. However, gender diversity exerts an inverse impact on R&D spending. Consequently, organizations with a tendency toward sustaining innovation endeavors are encouraged to accord heightened consideration to fostering gender diversity during the board selection process. However, CEO duality reveals an insignificant influence on R&D expenditures. To conclude, the study’s outcomes enrich the existing array of findings on the influence of women directors on board independence, particularly in R&D spending. Furthermore, the study offers policy recommendations, enhancing comprehension of the influence of women’s representation on R&D spending.

Type of the article: Research Article

Abstract
In emerging markets, understanding the dynamics of share price volatility is essential for corporate financial management and investor decision-making. The industrial sector often experiences price movements that may be influenced by companies’ financial policies. This research investigates the impact of dividend policy on share price volatility, with a focus on the moderating role of the debt ratio. The research draws on a balanced panel dataset of 64 Jordanian industrial firms listed on the Amman Stock Exchange during the period 2015–2023.
Using panel regression models, the findings reveal a statistically significant negative association between both dividend yield and payout ratio with share price volatility. Specifically, a 1% increase in dividend yield is associated with a 0.42% reduction in volatility (p < 0.01), while a 1-point increase in the payout ratio reduces volatility by approximately 0.31% (p < 0.05). In addition, the debt ratio significantly moderates these relationships, which reduces the stabilizing impact of dividends in highly leveraged firms. The high interaction term between dividend yield and debt ratio was confirmed by the positive interaction term between dividend yield and debt ratio. These findings highlight the importance of balanced dividend and leverage strategies in reducing stock market risk, which may improve market stability.

Acknowledgment(s)
This research was funded through the annual funding track by the Deanship of Scientific Research, from the vice presidency for graduate studies and scientific research, King Faisal University, Saudi Arabia [Grant No. KFU253003].

Type of the article: Research Article

Abstract
This paper examines the influence of reinsurance strategies and insurance liabilities on the performance and market valuation of Jordanian insurance firms. Using panel data from 2010 to 2023 and employing fixed-effects regression and mediation analysis, we test whether Excess Loss Installments (ELI) mediate these relationships. Based on a balanced panel of 16 listed Jordanian insurers over the period 2010–2023, the study applies SPSS, EViews, and SmartPLS to conduct fixed-effects regression and mediation analysis. The findings reveal that a higher reinsurers’ share is significantly associated with lower return on assets (ROA) (β = –0.18, p < 0.05), suggesting that excessive risk cession may erode underwriting profitability. In contrast, insurance contract liabilities have a strong positive impact on ROA (β = 0.29, p < 0.01) and firm value measured by Tobin’s Q (β = 0.32, p < 0.01), indicating that prudent technical reserve accumulation enhances financial strength and investor perception. Correlation analysis further revealed a negative association between reinsurance share and ROA (r = –0.21), while liabilities showed a moderate positive correlation with Tobin’s Q (r = 0.36). Mediation analysis showed that ELI does not play a statistically significant mediating role in the relationship between the main variables. In some models, ELI even had a minor negative indirect effect on firm value.
These findings emphasize the importance of optimizing reinsurance structures and liability management. For Jordanian insurers, effective risk transfer must be balanced against profitability goals. Regulators and firm managers should revisit the strategic use of advanced mechanisms like ELI to reduce inefficiencies and strengthen financial outcomes.

Acknowledgment(s)
This research was funded through the annual funding track by the Deanship of Scientific Research, from the vice presidency for graduate studies and scientific research, King Faisal University, Saudi Arabia [Grant no. KFU253235].

Type of the article: Research Article

Abstract
In recent years, concerns over brand sustainability have gained attention in industrial markets, where financial decision-making and governance structures often prioritize operational efficiency over intangible assets. As industrial firms navigate competitive pressures and dynamic economic conditions, understanding the drivers of brand value erosion has become increasingly relevant. This study investigates whether sales growth, liquidity, and corporate governance influence brand decline in industrial firms listed on the Amman Stock Exchange in Jordan.
The analysis uses panel data covering the years 2014 to 2023, with a focus on variables extracted from audited financial statements. Brand decline is measured using operating margin as a financial proxy, while corporate governance is represented by board size and the number of independent directors. Liquidity is assessed through the current ratio, and sales growth is calculated annually.
The results reveal that liquidity has a statistically significant and positive effect on brand decline (coefficient = 0.071, p = 0.003), explaining approximately 2.4% of the variance. Corporate governance factors are jointly significant (F = 6.51, p = 0.002), accounting for 6.2% of brand decline variation, although individual components – board size and board independence – do not retain significance when entered together due to multicollinearity. Sales growth shows no significant effect on brand decline (p = 0.841).
These findings suggest that excess liquidity and governance structure can influence brand outcomes, while sales growth alone does not safeguard against brand erosion. Industrial firms must align financial and governance strategies with long-term brand management priorities.

Acknowledgment(s)
This research was funded through the annual funding track by the Deanship of Scientific Research, from the vice presidency for graduate studies and scientific research, King Faisal University, Saudi Arabia [Grant no. KFU253311]. 

Type of the article: Research Article

Abstract
In the age of the knowledge economy, intellectual capital has become a key factor in the success of business organizations, especially in emerging countries. This study examines the relevance of intangible assets to firm development in Jordan’s industrial sector. The paper attempts to estimate the effect of intellectual capital on the growth of Jordanian industrial firms under the Value-Added Intellectual Coefficient (VAIC) model. The study used panel data on 64 industrial companies listed on the Amman Stock Exchange for the period 2014–2023. Intellectual capital efficiency is measured as VAIC and the components of intellectual capital efficiency (human, structural, and capital employed efficiencies). A panel regression model (fixed-effects, selected by the Hausman test) is estimated, and apart from the independent variable, firm size and liquidity are controlled. The study found a significant positive effect of intellectual capital efficiency on firm growth; that is, firms with a higher VAIC tend to have a higher annual growth. Quantitatively, every 1-point increase in VAIC is estimated to be associated with an increase in entity growth (on average) of several percentage points each year. Amongst the VAIC components, human capital efficiency stands out as the best contributor to growth (p < 0.01), whereas efficiency of the structural and capital employed contributes weakly and has statistically insignificant effects. The results confirm that boosting intellectual resources is the driving force behind superior growth for industrial firms. This emphasizes the need to invest in developing human capital and knowledge assets to maintain corporate growth in the Jordanian industrial sector.

Acknowledgment
This research was funded through the annual funding track by the Deanship of Scientific Research, from the vice presidency for graduate studies and scientific research, King Faisal University, Saudi Arabia [Grant No. KFU262433]. 

Type of the article: Research Article

Abstract
This study examines the relationship between governance quality, leverage, and firm performance and financial distress in Jordanian industrial companies listed on the Amman Stock Exchange (ASE). The industrial sector was chosen for this study due to its capital-intensive nature, reliance on external funding, and ongoing operational and market challenges in Jordan. The sample consists of 474 observations from 2014 to 2022. The quality of governance is represented by board size and board independence, leverage is represented by the debt-to-assets ratio, and firm performance is represented by gross margin. For financial distress, the integrated logit model indicates that board size is not statistically significant (coefficient = 0.078, p = 0.361), and the board independence is also not statistically significant (coefficient = 2.341, p = 0.076). Leverage, on the other hand, has a positive and significant association with financial distress (coefficient = 3.560, p = 0.001), while gross margin is negatively and significantly associated with financial distress (coefficient = –9.614, p < 0.001). The results suggest that financial distress for Jordanian industrial firms is primarily attributed to financing pressure and operating performance, and that the governance proxies used in this study do not adequately explain financial distress.

Acknowledgment
This research was funded through the annual funding track by the Deanship of Scientific Research, from the vice presidency for graduate studies and scientific research, King Faisal University, Saudi Arabia [Grant No. KFU263483].

Type of the article: Research Article

Abstract
Cash flow volatility is an important source of financial uncertainty because unstable operating cash flows may weaken firms’ ability to meet obligations, sustain investment, and preserve financial flexibility. This issue is particularly relevant in emerging markets, where firms often face financing constraints and sectoral structure may shape financial stability differently. This study examines the relationship between cash flow volatility and financial stability in Jordanian listed firms and investigates whether the insurance sector responds differently to operating cash flow uncertainty compared with other non-financial firms. Financial stability is measured using the Z-score, while cash flow volatility is calculated as the rolling standard deviation of operating cash flow scaled by average total assets. The analysis uses panel data for Jordanian listed firms over 2014–2024. A three-year rolling window is applied in the baseline model, while a five-year rolling window is used as a robustness check. The regression model includes an interaction term between cash flow volatility and an insurance-sector dummy, along with firm size, leverage, firm age, and sales growth as control variables. The results indicate statistically weak evidence that the Z-score is negatively associated with cash flow volatility, albeit in a directionally weak one. But this is not statistically significant in the baseline fixed-effects model. Furthermore, the interaction between cash flow volatility and the insurance sector dummy is not statistically significant and has a different sign in one robustness specification. The study therefore does not confirm that insurance firms are structurally less sensitive to cash flow volatility. Leverage remains the most robust determinant of lower financial stability.

Acknowledgment
This research was funded through the annual funding track by the Deanship of Scientific Research, from the vice presidency for graduate studies and scientific research, King Faisal University, Saudi Arabia [Grant No. KFU263523].