The use of performance measurements in the biotechnology sector

Abstract

Despite its substantial contributions to a country’s Gross Domestic Product (GDP), there is no known systematic study on the governance of the biotechnology sector and how its performance is measured. A questionnaire survey was conducted with the firms registered in the UK Biotechnology Handbook . With a response rate of 38% and rigorous analysis, the results show that, when measuring performance, managers use both the financial and nonfinancial indicators, but emphasise the financial indicators more. The financial indicators include turnover, profit margins, cash reserve and liquidity, while the nonfinancial indicators are about meeting the customers’ needs and expectations. More specifically, the managers place attention to the reporting of the environmental issues of their firms, reflecting their readiness to excel in social corporate responsibilities. The results have implications for the biotechnology sector and regulators for public policy.