Bridging research and industry: How Tripti Nashier applies her research insights to solve real-world financial challenges

Photo courtesy of Tripti Nashier

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Tripti Nashier, a finance leader with extensive experience at Fortune 500 companies, has contributed to financial management through her research and practical applications. Her work spans corporate finance, capital markets, and fintech, using pioneering analytical tools and quantitative techniques to optimize financial performance. 

Nashier shares her insights on how her research findings can be applied to real-world scenarios, offering valuable advice for financial managers, investors, and family-owned businesses.

Q: Your research on ownership concentration and firm performance has garnered significant attention worldwide. Can you explain this study’s key findings and how they can be applied to improve corporate governance and financial performance in real-world scenarios?

Nashier: We revealed in our study on ownership concentration and firm performance that concentrated ownership positively affects firm performance. We found that firms with higher ownership concentration exhibit better financial performance, as measured by return on assets and Tobin’s Q. This suggests that concentrated ownership can serve as an effective corporate governance mechanism, as it aligns the interests of owners and managers, reducing agency problems. 

Companies can improve their governance and performance by encouraging long-term, concentrated ownership and fostering active engagement between owners and management.

Q: In your paper “On the Investment Credentials of Bitcoin: A Cross-Currency Perspective,” you explore Bitcoin’s role in portfolio diversification. How do your findings influence the way financial managers should approach cryptocurrency investments?

Nashier: We demonstrated in our research that treating Bitcoin as an asset class and including Bitcoin in a global portfolio can enhance diversification benefits, as it exhibits a low correlation with other asset classes. We found that the risk-adjusted returns of optimal portfolios with Bitcoin were significantly higher compared to those without, across various investment strategies and currencies. With this paper, we broke the notion of treating cryptocurrencies as a payment currency and consider them as a diversifying asset class for optimizing portfolio performance.

Financial managers should consider allocating a portion of their portfolio to Bitcoin or other available crypto-assets, as it can improve overall portfolio performance. However, they should also be mindful of cryptocurrencies’ volatility and regulatory risks and carefully monitor their investments.

Q: Your work on the effect of institutional ownership on firm performance highlights the role of institutional investors in corporate governance. What practical steps can companies take to take advantage of institutional ownership for better financial outcomes?

A: We found in our study that institutional ownership positively impacts firm performance, suggesting that institutional investors effectively monitor management actions and decisions. Companies can take advantage of this by actively engaging with institutional investors, providing transparent and timely information, and seeking their input on strategic decisions. 

They should also strive to maintain a balanced mix of institutional and other types of owners to clinch effective governance and avoid potential conflicts of interest.

Q: You have developed a framework to breakdown GAAP financials for geographical analysis. Can you discuss your challenges in this process and the practical benefits this framework offers for multinational organisations?

Nashier: I found developing a framework to translate GAAP financials was challenging due to the lack of standardisation, lack of consistent data from different businesses and sources and the need to verify the framework’s applicability across different countries and industries. To create a robust and flexible framework, I had to carefully analyze various adjustments and their impact on financial elements. 

The key benefit of this framework is that it enables multinational organizations to understand the economic performance of their business units across different geographies and product lines better. This, in turn, facilitates more informed decision-making and resource allocation.

Q: Your research often involves advanced analytical methods and quantitative techniques. How do these techniques enhance the accuracy and efficiency of financial decision-making in real-world applications?

Nashier: Advanced analytical methods and quantitative techniques, such as time series analysis, moving averages, rolling forecasting, predictive modeling, allow me to process and analyze vast amounts of financial data quickly and accurately. These tools help identify patterns, trends, and anomalies that may not be apparent through traditional methods. In real-world applications, these techniques can enhance the accuracy of financial forecasting, risk assessment, and performance evaluation. They can also automate routine tasks, providing time for more strategic decision-making. 

However, it’s crucial to make certain that the insights generated by these techniques are interpreted contextually and used in conjunction with business acumen.

Q: In your study on financial integration between BRICS and developed stock markets, what were the key insights, and how can these insights help companies and investors make more informed decisions?

Nashier: I found evidence of short term static and long term dynamic financial integration between BRICS and developed stock markets, particularly in the post-global financial crisis period, in our study. I observed that markets respond to new information swiftly, thereby eliminating opportunities for abnormal risk-adjusted returns or risk diversification associated with asymmetric information processing across markets. 

However, the degree of integration varies across countries and sectors. Companies and investors should use such studies to adjust their portfolio allocation strategies, focusing on less integrated markets and sectors to maximize diversification benefits and minimize risk. They should also regularly monitor the evolving dynamics of financial integration to adapt their investment decisions accordingly.

Q: You have pioneered an automated system for revenue management. How does this innovation improve business performance, and how does it impact overall business performance?

Nashier: My automated system for revenue management uses advanced data integration and modelling techniques to accurately identify and quantify the impact of multiple factors and their changes on revenue and hence performance. This solution enables accurate and reliable financial forecasting by separating true-up-related fluctuations from underlying business trends. 

It helps decision-makers to identify and respond to critical changes, improving the efficiency of metric monitoring and analysis. This, in turn, leads to better-informed strategic planning, resource allocation, and risk management, ultimately enhancing the topline and overall business performance.

Q: Your research on family ownership and firm performance in India provides valuable insights into the dynamics of family-owned businesses. What practical advice would you give to family-owned firms looking to optimize their financial performance?

Nashier: My research suggests that family ownership can have both positive and negative effects on firm performance, depending on factors such as the level of family ownership, governance structures, and succession planning. 

To optimize financial performance, family-owned firms should establish strong corporate governance mechanisms, such as independent boards, professional management, and transparent reporting. They should also develop clear succession plans and certify that family members in leadership roles have the necessary skills and aptitude. 

Additionally, family-owned firms can benefit from maximizing the unique strengths of family involvement, such as long-term orientation and strong stakeholder relationships, while mitigating potential weaknesses, such as conflicts of interest and resistance to change.

Q: The financial allocation solution you developed addresses limitations in existing methods. Can you explain how this solution works and what its transformative impact is on resource allocation and financial performance?

Nashier: The financial allocation solution I developed is designed to overcome the limitations of traditional methods, such as the lack of data availability and the inability to accurately assign costs to different business units. 

The solution uses activity-based costing, statistical models, and simulation techniques to estimate the true financial impact of resources consumed and earnings generated by each unit. This solution enables organizations to make data-driven decisions about resource allocation, pricing, and performance evaluation by providing a more accurate and granular view of cost structures. 

This leads to improved operational efficiency, better cost alignment with value creation, and, ultimately, enhanced financial performance.

Q: Looking ahead, how do you plan to continue integrating your research insights with industry practices to solve real-world financial challenges and drive innovation in financial management?

Nashier: I aim to continue bridging the gap between academic research and industry practice by actively collaborating with companies to identify and address their most pressing financial challenges. This involves working closely with finance professionals to understand their needs, constraints, and objectives and then using my research findings to develop tailored solutions. 

I also plan to focus on emerging areas such as AI, FinTech, ESG investing, and blockchain applications, exploring how these innovations can be harnessed to drive efficiency, transparency, and value creation in financial management. 

Additionally, I aim to contribute to developing industry standards and best practices by sharing my insights through publications, conferences, and workshops, fostering a culture of continuous learning and innovation in the field.