World Peace in the Light of Sīrah of the Prophet Muḥammad SAW

The advancement in science and technology has made the world peace and prosperity very important at this time in the human history. We find in the human history, since it was recorded, that almost all the civilizations were very intolerant, brutal to their opponents, especially, to the believers of other religions. On the other hand, the Islamic states were the most tolerant and accommodating to other religions. This fact is proved from the early history of Islām during the period of the Prophet Muḥammad (r) and his immediate successors. Similar is the case in the later history of the Muslims, during the period of the Abbasid, the Umayyids in Spain, the Turks, the Mughal era and in the Far East. Human and economic losses in wars were very huge during the first, the second world wars, and the current wars being fought in Iraq and Afghanistan. The human and material losses are horrible. The author believes that the Prophet Muḥammad (r) ’s teachings and traditions of moderation, tolerance, human respect, freedom of religious practice are the only ways to peace and prosperity in the world.

Corporate Diversification, Cost of Capital, Financial Policies and Firms Performance: Evidence from Pakistan

Diversification has become a popular practice for firm expansion and growth. When firms go for diversification strategy, they need extra capital and they have to manage cost of capital and other financial policies. This research examines the effect of corporate diversification, cost of capital and financial policies on firms’ financial performance.The population of the study is manufacturing firms of Pakistan, with the sample being from 2004 to 2017. Two-step dynamic estimation was used for the analysis. Data was collected from DataStream. Financial performance of firms is measured through Return on Assets (ROA), Return on Equity (ROE) and Tobin’s Q. First, overall analysis of manufacturing sector was done followed by sectoral analysis. In the first and second models, Product Diversification (PD) and Geographic Diversification (GD) were used to measure corporate diversification. In the third model, the combined effect of PD and GD was analyzed. Firms’ financial policies measured as capital structure decision, dividend policy, investment policy, corporate governance, and audit quality are included in firms’ financial policies.Overall analysis reveals that both measures of corporate diversification have a significant impact on ROE and Tobin’s Q. Cost of capital, capital structure and dividend policy have a significant effect on all three measures of financial performance. Investment policy has an insignificant effect on financial performance. Analysis reveals mixed findings regarding the impact of corporate governance and audit quality on ROA and ROE. However, these variables have significant impact on Tobin’s Q. Sectoral analysis reveals mixed results depending on the nature, features and policies of the sectors. It is recommended that firms may manage diversification strategy and financial policies to make rational decision to improve the firms’ financial performance.