Explaining the Pattern of Measuring the Environmental Uncertainty and Its Effect on the Fluctuation of Companies' Financial Characteristics

Environmental uncertainty refers to the unpredictability and complexity of factors surrounding the company that can affect the company's operations, strategy, and results. Companies must navigate this uncertainty to make informed decisions and effectively adapt to changing circumstances. The main goal of this research is to explain a model for measuring companies' environmental uncertainty from the perspective of theoretical foundations and experimental research. For this purpose, using the statistical method of principal components analysis, among several criteria, a suitable criterion is selected for each component of environmental uncertainty, and in the next step, by weighting each component, the degree of environmental uncertainty of each company is measured. Then the effect of this variable is tested with the fluctuation of financial characteristics of companies. In this regard, the data of 131 companies were extracted, and multivariate regression analysis was used to test the research hypotheses. The obtained results show that with the increase of environmental uncertainty, the fluctuation of profitability, fluctuation of cash and fluctuation of debt cost of companies increases. Because in the conditions of environmental uncertainty, companies face challenges in accurately predicting demand, pricing and future costs, which can affect their profit margins, cash holdings and debt costs. In addition, the increase in environmental uncertainty has no significant relationship with the increase in the fluctuation of stock returns, the fluctuation of financial leverage, and the fluctuation of dividends paid by companies.