Effect of human resources management practices on the financial performance of Ivorian companies

Abstract

The objective of this article is to study the relationship between human resources management (HRM) practices and the financial performance of Ivorian companies (PFE). Indeed, the relationship between HRM practices and PFE has been the subject of an overview of studies on the measurement of interactions. The theoretical results of these studies are mixed and divergent (Allouche et al. 2004). In a context of developing countries like Ivory Coast, the subject of this research allows us to question whether HRM practices (Remuneration, Recruitment, Training, and Social Climate) constitute an opportunity or a threat on the Ivorian PFE. An analysis carried out on the basis of 88 Ivorian companies chosen in several sectors of activity from the variables of interest: HR practices and size then the variable to explain the financial performance characterized by the return on equity (ROE) and the return on assets (ROA), allows us to solve this problem. The methodological approach adopted is a quantitative approach based on a binary code (1.0) of the Likert scale (1932), processed by a logistic regression model. The results of the statistical model from logistic regression show the absence of a link between HRM practices and PFE, measured by the ROE ratio. As for the use of the ROA ratio, only the Recruitment practice contributes positively and significantly at the 1% threshold to the PFE. Thus, to overcome this problem, each aspect of HRM practices should be studied in its own right, in order to have a clearer vision of adherence to the principles of HRM.

Keywords: Human Resources Management (HRM), Corporate Financial Performance (PFE), HRM Practices, Size.

Classification JEL : M41 ; G30.

Paper type: Empirical Research