Revisiting the role of Financial Literacy on SMEs Performancethe mediating roles of firms’ risk orientation and alleviating financial constraints

  1. Daniel Ruiz-Palomo 1
  2. Julio Diéguez-Soto 1
  3. Domingo García Pérez de Lema 2
  1. 1 Universidad de Málaga
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    Universidad de Málaga

    Málaga, España

    ROR https://ror.org/036b2ww28

    Geographic location of the organization Universidad de Málaga
  2. 2 Universidad Politécnica de Cartagena
    info
    Universidad Politécnica de Cartagena

    Cartagena, España

    ROR https://ror.org/02k5kx966

    Geographic location of the organization Universidad Politécnica de Cartagena
Book:
IX Jornada Internacional AECA sobre Valoración, Financiación y Gestión de Riesgos: actas. Cuenca 2022

Publisher: Asociación Española de Contabilidad y Administración de Empresas, AECA

ISBN: 978-84-19167-36-1

Year of publication: 2022

Congress: IX Jornada Internacional AECA de Valoración, Financiación y Gestión de Riesgos (9. 2022. Cuenca)

Type: Conference paper

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Sustainable development goals

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SDG classification obtained using Aurora SDG artificial intelligence model.

Abstract

This research aims to analyse the effect of the CEO's financial literacy on SME firm performance and the mediating roles of both the CEO risk-taking orientation and the alleviation of financial constraints. Using a sample of 310 Spanish SMEs, our findings show that both the risk-taking orientation and the reduction of financial constraints playa partial mediating role in understanding the relationship between financial literacy and firm performance. Thus, when CEO is more financially literate, it might produce a higher risk-taking propensity and, simultaneously, facilitate access to external financing, which, indeed, are much more likely to generate better performance in SMEs.

Data source: Dialnet