OVERVIEW OF THE INTERNAL FIRM GROWTH AND CORPORATE FINANCE PRINCIPLES - THEORIES, EXPECTATIONS AND APPLICATION OUTCOMES

Throughout almost a century many theories of firm growth, investments, financial leverage and dividend policy have been developed aiming to capture decisive relations among the crucial firm internal potentials. The extensive literature reveals many determinants influencing firm growth. The expectations of the relations among investment activities, financial structures and dividend policy on one hand and firm growth indicators (value, sales volume, employment, return) on the other hand exibit clear and simple relations. Though most of the theories excerpt all relations and represent state of the art in the internal growth potentials relation, we may find a bunch of counter-expectations findings in the related literature. Namely, affected by specific circumstances firms behave in different ways with suboptimal use of internal growth potentials. Among the specific circumstances that may affect national economy, transition, post-recession and underdeveloped financial market deserve particular research attention and focus. In this paper we present the existing theories overview, potential challenges of the labelled circumstances and review of the relations between selected corporate finance principles and firm growth indicators. The research reveals the findings based on the extensive firms dataset related in Bosnia and Herzegovina. Findings of this paper might inspire further research efforts, vivid theoretical debate on the causes and consequences of the findings as well as clear response from the related government bodies responsible for macro-economic development

PROFITABILITY OF THE BANKS IN THE REPUBLIC OF NORTH MACEDONIA - PANEL ANALYSIS FOR THE 2010-2019 PERIOD

The purpose of this paper is to examine some of the significant factors that affect the profitability of the banks in the Macedonian banking industry. The profitability is shown through the ROA indicator. The analysis uses a model of multiple regression with a data panel that includes 14 banks in the Republic of North Macedonia for the period 2010 to 2019.   The analysis shows that operating efficiency is a variable with a significant impact on profitability. The size of the bank cannot be argued to be a significant factor in the profitability of banks, but the share of loans in total assets shows a positive impact on profits. On the other hand, the share of deposits and the share of interest income in total income, they both have a weaker impact on profitability.   The results of the research can help to determine the most important factors for success (or failure) of the banking industry. Also, they could help making sound decisions of bank management in the future, especially in terms of improving banks profitability. &nbsp

STRUCTURE OF CONSUMER LOANS, THEIR BENEFICIARIES AND MOTIVATIONS FOR BORROWING WITH BANKS IN THE REPUBLIC OF SRPSKA

In the research, we start from the fact that consumer loans are the most common type of loans offered by the commercial banking sector to the public of Bosnia and Herzegovina (B&H). We started from the assumption that citizens or households use bank consumer loans predominantly in order to finance current consumption and compensate for insufficient current income to finance basic current living needs. We made such assumptions based on the fact of low general income per capita, low average wages and high unemployment rates in B&H. On the other hand, we considered that a significant volume of loan use by households was the result of ill-considered and spontaneous decisions that were not in line with the real possibilities of houshold borrowing.The research is based on a comprehensive survey that we conducted on a large number of participants, users of bank consumer loans. We found that the vast majority of loan users have below average incomes. These loans are mostly non-purpose cash loans. Average loan amounts per user are relatively low, which is to be expected given their income position. The motives, life requirements and expectations of the borrower usually move within a modest radius of providing basic living needs. The answers of most users indicate the modest needs and consumption of loan users, and credit for most of its users is under the sign of "must". This means that the users have almost no motives that arise from the expressed consumer preferences of citizens. For some users, there is a noticeable preference for higher consumption that goes beyond the actual borrowing potential of these households

RELATIONSHIP BETWEEN THE TYPE OF MANAGERS AND SOCIALLY RESPONSIBLE BUSINESS OF COMPANIES IN FEDERATION OF BOSNIA AND HERZEGOVINA

In today's dynamic business environment, socially responsible business occupies a special place. Companies that are socially responsible are more sensitive to the needs and expectations of the most important stakeholder groups: shareholders, employees, customers and the community. In addition to socially responsible companies working in accordance with the needs and expectations of this group of stakeholders, it can achieve many other benefits from corporate social responsibility: gain a better reputation and image in the market, attract quality human resources, attract many investors and the etc. Application of socially responsible business in companies requires from managers proactive approach,orientation towards stakeholders and ethical behavior in making business decisions. When it comes to socially responsible business, in theory there are three types of managers: immoral, amoral and moral type. Immoral type of managers actively oppose what is considered correct or ethical. Immoral type of managers are neither immoral nor moral. Their main characteristic is not too sensitive to the fact that their business decisions can have harmful consequences for others. Moral type of managers use ethical norms and adhere to high standards of good behavior.   This paper researched the dominant type of managers, with the aspect of socially responsible business, in large private companies in Federation of Bosnia and Herzegovina. The research found that managers, who are not too sensitive to the fact that their business decisions can have harmful consequences for others, are the dominant type of managers in large private companies in the Federation of Bosnia and Herzegovina. The research was proven on 63 large private companies in Federation of Bosnia and Herzegovina

CORPORATE SOCIAL RESPONSIBILITY IN THE FUNCTION OF EMPLOYEE MOTIVATION

Corporate social responsibility implies the company's commitment to create and implement business strategies and activities in harmony with the environment and ethical behavior towards stakeholders. Employees belong to the important interest groups and resources of every company, because their actions directly affect business results. The paper presents activities of ​​corporate social responsibility towards employees. Employee motivation is important because it directly affects the productivity of workers, which further has consequences on the business results of the company. Employee motivation changes in the action of various factors from the employee's environment, inside and outside the work environment. In this paper, corporate social responsibility will be presented as a factor related to employee motivation. The main goal of this paper is to examine the relationship between corporate social responsibility and employee motivation, about is there a connection between socially responsible activities toward employees and their motivation. The research will be conducted by examining the attitudes of managers about the connection between socially responsible business and motivation, because managers make decisions about employees within their work activities. The sample includes managers of large Bosnian companies

THE CONNECTION BETWEEN CORPORATE SOCIAL RESPONSIBILITY AND THE REPUTATION OF COMPANIES IN THE FEDERATION OF BOSNIA AND HERZEGOVINA

It is undeniable that corporate social responsibility (CSR) occupies an important place in managerial practice, but also in academic circles. Due to the strengthening of competition between companies, and the constant need for companies to be sustainable in a market and innovative sense, it becomes clear that it is necessary to integrate social responsibility into the company's business. Corporate social responsibility activities, which will be the subject of analysis, are in theory synthesized in the form of economic, legal, ethical and philanthropic activities. These corporate social responsibility activities should intuitively lead to building a positive reputation of the company. Reputation is an intangible but long-term investment. In the modern economy, where due to the speed of information transfer, it is very difficult to hide something, building a reputation is seen as one of the basic challenges of any company. The research focuses on the connection between the activities of corporate social responsibility and the reputation of large companies in the Federation of Bosnia and Herzegovina. Therefore, the paper analyzes the perception of managers about the connection of corporate social responsibility activities with the reputation of large and medium companies in the Federation of Bosnia and Herzegovina. The main goal of this paper is to examine the perception of managers about the relationship between corporate social responsibility activities and the reputation of companies in the Federation of Bosnia and Herzegovina

THE IMPACT OF NON-FINANCIAL MOTIVATION ON JOB SATISFACTION - THE CASE WITH PHYSICIANS IN THE REPUBLIC OF NORTH MACEDONIA

Health organizations are increasingly trying to guide and motivate physicians in a number of ways. The current era is competitive and healthcare organizations, regardless of size, technology and market focus, are also facing retention of physicians. To achieve prosperity, healthcare organizations use different strategies to compete with competitors. Successful healthcare organizations view their physicians as a key development resource. Physicians are an essential part that contributes to the growth and development of the healthcare organization. The main theoretical goal of this paper is to find out if and to what extent motivation affects the improvement of job satisfaction among physicians, especially in terms of non-financial motivation, pleasant working conditions, career development opportunities for physicians, and feedback with superiors. Within this paper, an empirical research will be conducted, with a total of 6 questions, in order to get an idea of ​​how much and to what extent non-financial motivation affects the satisfaction of Physicians. The choice will be the Likert scale with which the respondents will express their agreement or disagreement through a five-point scale (1 = I do not agree at all, 2 = Partially disagree, 3 = Neutral (neither agree nor disagree, 4 = Partially I agree, 5 = I completely agree). The results of this research can be used for further research on a similar topic, but also as a useful recommendation for managers or the human resources department who would like to explore the degree of motivation and job satisfaction within their organization

SENSITIVITY OF BANKS 'CAPITAL IN THE FEDERATION OF BOSNIA AND HERZEGOVINA TO CHANGES IN EXOGENOUS AND ENDOGENOUS FACTORS

ABSTRACT In order to ensure that risky assets are covered by the bank's capital, the regulator has prescribed a minimum capital adequacy ratio. The prescribed capital adequacy ratio, which in the Federation of B&H is 12%, represents ability of banks to absorb losses caused by bad placements, expressed as the ratio of capital and risk assets of the bank. The sample of this research was performed at the level of the population. The sample includes 15 banks based in the Federation of B&H and 3 banks based in the RS, which operate in the Federation of B&H. The primary goal of this paper is to try to identify exogenous and endogenous factors that affect the capital sensitivity of banks operating in the Federation of B&H. The research is focused on the period from 2015. to 2020., on a quarterly basis, and the research will explain descriptive statistics, correlation analysis and regression analysis. The research estimated two regression models, assumptions were checked and the obtained results were interpreted. The results of the first model showed that there is a statistically significant positive correlation between the leverage rate and the capital adequacy ratio, and a statistically significant negative correlation between the GDP growth rate and the capital adequacy ratio. The second model confirmed that there is a negative statistically significant correlation between the variables return on average assets (ROAA), total income / average assets (UPPA), net interest income / average assets (NIM) with the capital adequacy ratio

STRATEGIC MANAGEMENT IN THE FUNCTION OF ENTERPRISE SURVIVAL AND ECONOMIC DEVELOPMENT OF BOSNIA AND HERZEGOVINA IN CONDITIONS OF COVID-19

The focus of the paper is on the analysis of the importance and impact of strategic management and strategic decision-making on the survival, recovery and exit from the crisis of companies in Bosnia and Herzegovina, formed under the influence of coronavirus COVID 19. Many companies in Bosnia and Herzegovina were unprepared, not having a strategy at all. The aim of this paper is to point out the importance of strategic management and general strategic thinking in order to survive the companies of Bosnia and Herzegovina in crisis. The methodological concept of the research includes the method of estimating the proportion of the basic set on the basis of large samples, the method of comparative analysis, the method of deduction and the method of statistical analysis. The results of the research show that companies that have a strategy and manage strategically endured the crisis more easily. The results show a direct connection between strategic management - overcoming the crisis and recovery or growth and development of enterprises, which affects the economic development of Bosnia and Herzegovina. Such companies found a way out of the crisis more easily. Strategic management has not even led to the crisis some of them

ASSESSING THE EUROPEAN CENTRAL BANK’S UNCONVENTIONAL MEASURES - A RECURSIVE VAR APPROACH

MSc. Filip Peovski[1] PhD. Gjorgji Gockov[2]   ASSESSING THE EUROPEAN CENTRAL BANK’S UNCONVENTIONAL MEASURES – A RECURSIVE VAR APPROACH ABSTRACT             Unconventional monetary measures utilization has proven to be of great importance in maintaining monetary and economic stability after the Great Recession. However, we aim to test this conclusion through the impact of the quantitative easing implemented by the European Central Bank. Observed through generated shocks in the balance sheet of the Eurosystem as our main variable, we tested whether quantitative easing reestablished economic growth and rose price levels, mainly through lowering borrowing costs for banks, thus helping in the post-crisis recovery. To prove our hypotheses we construct a recursive VAR model estimated in levels using 2014M05-2018M12 data. The model incorporates variables such as the industrial production and the HICP, as output and price level proxies, and financial components such as the EONIA-MRO spread and the CISS index. The results show that the expansion shocks of the consolidated balance sheet have a positive temporary influence on industrial production and the HICP, but the reaction of the former seems to be 2.24 times greater. On the other hand, we find out that quantitative easing has an expected negative impact in widening the EONIA-MRO spread. Furthermore, we could not confirm the theoretically expected accommodative impact on financial stress. Keywords: Unconventional monetary measures, price stability, policy interest rates, recursive VAR model JEL Classification: C32, E43, E52, E58   [1]  Teaching and Research Assistant, Faculty of Economics – Skopje, “Ss. Cyril and Methodius” University, e-mail: [email protected] [2] Associate Professor, Faculty of Economics – Skopje, “Ss. Cyril and Methodius” University, e-mail: [email protected]