Investment Strategies and Corporate Risk-Taking: A BRICS Market Perspective

Investment Strategies and Corporate Risk-Taking: A BRICS Market Perspective | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article Investment Strategies and Corporate Risk-Taking: A BRICS Market Perspective Tanveer Bagh, Mirza Muhammad Naseer, Muhammad Asif Khan This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-5932032/v1 This work is licensed under a CC BY 4.0 License Status: Posted Version 1 posted You are reading this latest preprint version Abstract Corporate governance literature extensively explores the determinants of corporate risk-taking, however consensus on the key motivating factors remains elusive. Addressing this gap, we examine the role of investment efficiency, financial flexibility, and investment scale as drivers of corporate risk-taking in emerging markets, offering insights to help firms make informed high-stakes investment decisions. Using a sample of 4,889 listed firms from BRICS countries (Brazil, Russia, India, China, and South Africa), we analyze three distinct periods: (a) the full sample, (b) the pre-COVID period, and (c) the COVID period. Applying static and dynamic panel estimation techniques, our generalized method of moments, results confirm that financial flexibility, investment efficiency, and investment scale significantly and positively influence corporate risk-taking across all three periods. Furthermore, quantile regression results highlight that these factors exert a stronger influence in the upper and median quantiles of risk-taking. These findings suggest that investment efficiency, financial flexibility, and investment scale serve as enablers that empower firms to undertake calculated risks, seize growth opportunities, and strengthen their market positioning. Robustness checks affirm the stability of our results, and we conclude with key policy implications. Investment scale financial flexibility investment efficiency risk-taking BRICS Markets Full Text Additional Declarations No competing interests reported. Cite Share Download PDF Status: Posted Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. 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Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-5932032","acceptedTermsAndConditions":true,"allowDirectSubmit":true,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":409487636,"identity":"a8120e06-bd78-4c36-86cc-8caadf242dcf","order_by":0,"name":"Tanveer Bagh","email":"","orcid":"","institution":"Central University of Finance and Economics","correspondingAuthor":false,"prefix":"","firstName":"Tanveer","middleName":"","lastName":"Bagh","suffix":""},{"id":409487637,"identity":"9bc78b12-db5e-411b-a00e-d861dd77f6f6","order_by":1,"name":"Mirza Muhammad Naseer","email":"data:image/png;base64,iVBORw0KGgoAAAANSUhEUgAAAZAAAAAyAQMAAABI0h/eAAAABlBMVEX///8AAABVwtN+AAAACXBIWXMAAA7EAAAOxAGVKw4bAAAAyklEQVRIie3RsQrCMBCA4ZNCXU67Rjr0CYQrgYAofZZCIY6ugoKFQiefx7klkC6+gJN0cXcyXdRu4tLWzSH/dBk+OC4ANts/531GdyCZ5T8T0kPJPJ2Ud7Ndbfg1K2sDUQBMxp1EFNPEx7NcnLSbcIQkTJksegiSP8oVCY3CB3BiYOu0j/Cmeb6I596jMXAYRASbpAWRiy4gqJb0LaZQLFEnxLTkPlIV5niLu0l15Bezj8jLVN2ebhd4Y0mdBJyvFw3/SJvNZrN19AbgYjsDuVmMbwAAAABJRU5ErkJggg==","orcid":"","institution":"Teesside University","correspondingAuthor":true,"prefix":"","firstName":"Mirza","middleName":"Muhammad","lastName":"Naseer","suffix":""},{"id":409487638,"identity":"edaab443-94f4-48d0-92b7-c2c9165c050d","order_by":2,"name":"Muhammad Asif Khan","email":"","orcid":"","institution":"University of Kotli AJK","correspondingAuthor":false,"prefix":"","firstName":"Muhammad","middleName":"Asif","lastName":"Khan","suffix":""}],"badges":[],"createdAt":"2025-01-30 18:08:02","currentVersionCode":1,"declarations":"","doi":"10.21203/rs.3.rs-5932032/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-5932032/v1","draftVersion":[],"editorialEvents":[],"editorialNote":"","failedWorkflow":false,"files":[{"id":75586193,"identity":"2bf7857c-37cf-4267-a6d3-54135667dc28","added_by":"auto","created_at":"2025-02-06 06:29:04","extension":"pdf","order_by":1,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":521263,"visible":true,"origin":"","legend":"","description":"","filename":"Manuscript.pdf","url":"https://assets-eu.researchsquare.com/files/rs-5932032/v1_covered_6547e762-1238-4b3e-98da-7bb2c0b99f77.pdf"}],"financialInterests":"No competing interests reported.","formattedTitle":"Investment Strategies and Corporate Risk-Taking: A BRICS Market Perspective","fulltext":[],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":false,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":false,"hideJournal":true,"highlight":"","institution":"","isAcceptedByJournal":false,"isAuthorSuppliedPdf":true,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":true,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true},"keywords":"Investment scale, financial flexibility, investment efficiency, risk-taking, BRICS Markets","lastPublishedDoi":"10.21203/rs.3.rs-5932032/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-5932032/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003eCorporate governance literature extensively explores the determinants of corporate risk-taking, however consensus on the key motivating factors remains elusive. 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