Impact of Financial and Non-Financial Factors on the Performance of Companies in the Global Health Care Sector

Abstract

This paper evaluates the impact of financial and non-financial factors on the performance of companies in the Global Health Care Sector while also promoting sustainable development goals (SDGs), specifically, SDG 3 (Good health and well-being) and SDG 5(Gender equality). The S&P 700 healthcare index is chosen, and a purposive sampling technique is used to obtain the top 50 companies in the index with 12 years of annual data of the given variables. This research applies a multiple linear regression test on panel data collected utilising the S&P CapitalIQ database. Notably, the research findings indicate that factors including market capitalisation, firm size, capital expenditures, and dividend per share (partially) have a positive and significant relationship, while the cost of goods sold hurts a company's profitability. These outcomes are consistent with the impact that these variables will have on business financial success. However, empirical data analysis results did not support other variables, especially, governance-related variables. The findings show that business profitability is unaffected by capital expenditures as a percentage of sales, leverage levels, liquidity levels, board independence, board size, board tenure, and women's representation. This discrepancy between expected and observed results emphasises how complicated business dynamics are and how many different factors can affect success. Profitability, corporate governance, innovative capacity, environmental sustainability, and social responsibility are only a few of the variables that contribute to the value of healthcare companies. This can help us learn more about ethical and environmentally friendly business methods.