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Zahida Sarwary . Photo

Zahida Sarwary

Senior lecturer

Zahida Sarwary . Photo

Managerial discretion and the choice of capital budgeting techniques

Author

  • Zahida Sarwary
  • Timur Uman

Summary, in English

The purpose of this study is to apply Hambrick and Finkelstein's (1987) framework of managerial discretion to the field of capital budgeting techniques (CBT). This study uses a qualitative method based on semi-structured interviews with 12 CFOs in Swedish high-growth small and medium-sized (SMEs) firms. The findings indicate that the choice of CBTs is largely enabled by individual forces and mainly disabled by environmental and organisational forces. The study contributes with managerial implications discussing how the choice of CBT is beneficial for communication, negotiating for resources, and maintaining good relationships with stakeholders. Being aware of how to use the choice of CBT as a communication tool could give firms a competitive advantage.

Department/s

  • Entrepreneurship

Publishing year

2022

Language

English

Pages

197-216

Publication/Series

International Journal of Managerial and Financial Accounting

Volume

14

Issue

3

Document type

Journal article

Publisher

Inderscience Publishers

Topic

  • Business Administration

Keywords

  • capital budgeting techniques
  • CBT
  • First North
  • managerial discretion
  • qualitative method
  • small and medium-sized
  • SMEs
  • theory-practice gap

Status

Published

ISBN/ISSN/Other

  • ISSN: 1753-6715