Working Capital Management and Firm Performance: A Global Synthesis of Empirical Evidence

Working capital management (WCM) is a central component of financial strategy, shaping liquidity, operational continuity, profitability, and long-term value creation. Despite substantial growth in WCM research over the past two decades, the literature remains fragmented by region, industry, and methodology. This review synthesises evidence from twenty-two empirical articles published between 2010 and 2024, spanning sectors such as manufacturing, telecommunications, banking, food processing, steel, small and medium-sized enterprises (SMEs), and emerging markets. The literature indicates that efficient WCM, typically measured by the Cash Conversion Cycle (CCC), inventory and receivable periods, and working capital policies, has a significant impact on firm profitability and shareholder value. Nevertheless, outcomes vary across industries, economic conditions, and firm-specific factors. This review identifies methodological patterns, sectoral insights, contextual differences, and key research gaps. A conceptual framework is introduced to guide future empirical research and theoretical development. The findings highlight the necessity of balanced WCM strategies that optimise liquidity and enhance firm performance.