Proposal of an innovative MCDA evaluation methodology: knowledge discovery through rank reversal, standard deviation, and relationship with stock return

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dc.contributor.authorBaydas, Mahmut
dc.contributor.authorElma, Orhan Emre
dc.contributor.authorStevic, Zeljko
dc.date.accessioned2024-02-23T14:31:10Z
dc.date.available2024-02-23T14:31:10Z
dc.date.issued2024
dc.departmentNEÜen_US
dc.description.abstractFinancial performance analysis is of vital importance those involved in a business (e.g., shareholders, creditors, partners, and company managers). An accurate and appropriate performance measurement is critical for decision-makers to achieve efficient results. Integrated performance measurement, by its nature, consists of multiple criteria with different levels of importance. Multiple Criteria Decision Analysis (MCDA) methods have become increasingly popular for solving complex problems, especially over the last two decades. There are different evaluation methodologies in the literature for selecting the most appropriate one among over 200 MCDA methods. This study comprehensively analyzed 41 companies traded on the Borsa Istanbul Corporate Governance Index for 10 quarters using SWARA, CRITIC, and SD integrated with eight different MCDA method algorithms to determine the position of Turkey's most transparent companies in terms of financial performance. In this study, we propose stock returns as a benchmark in comparing and evaluating MCDA methods. Moreover, we calculate the rank reversal performance of MCDA methods. Finally, we performed a standard deviation analysis to identify the objective and characteristic trends for each method. Interestingly, all these innovative comparison procedures suggest that PROMETHEE II (preference ranking organization method for enrichment of evaluations II) and FUCA (Faire Un Choix Adequat) are the most suitable MCDA methods. In other words, these methods produce a higher correlation with share price; they have fewer rank reversal problems, the distribution of scores they produce is wider, and the amount of information is higher. Thus, it can be said that these advantages make them preferable. The results show that this innovative methodological procedure based on 'knowledge discovery' is verifiable, robust and efficient when choosing the MCDA method.en_US
dc.identifier.doi10.1186/s40854-023-00526-x
dc.identifier.issn2199-4730
dc.identifier.issue1en_US
dc.identifier.scopus2-s2.0-85181200605en_US
dc.identifier.urihttps://doi.org/10.1186/s40854-023-00526-x
dc.identifier.urihttps://hdl.handle.net/20.500.12452/15065
dc.identifier.volume10en_US
dc.identifier.wosWOS:001132615700001en_US
dc.indekslendigikaynakWeb of Scienceen_US
dc.indekslendigikaynakScopusen_US
dc.language.isoenen_US
dc.publisherSpringeren_US
dc.relation.ispartofFinancial Innovationen_US
dc.relation.publicationcategoryMakale - Uluslararası Hakemli Dergi - Kurum Öğretim Elemanıen_US
dc.rightsinfo:eu-repo/semantics/openAccessen_US
dc.subjectFinancial Performanceen_US
dc.subjectShare Returnen_US
dc.subjectStandard Deviationen_US
dc.subjectRank Reversalen_US
dc.subjectCapital Marketsen_US
dc.subjectMcda Evaluation Methodologyen_US
dc.subjectValidation Sensitivity And Robustness Analysisen_US
dc.titleProposal of an innovative MCDA evaluation methodology: knowledge discovery through rank reversal, standard deviation, and relationship with stock returnen_US
dc.typeArticleen_US

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