Foreign Ownership, Debt Structure and Corporate Financial Distress: A Configurational fsQCA Approach in an Emerging Market

The expansion of listed industrial enterprises in Vietnam has brought pressure on financial security, especially in debt management. However, the role of foreign investment in reducing the risk of financial distress has not been clearly defined in the context of emerging markets. This study examines the relationship between debt structure (DS) and the risk of financial distress (FD), and assesses the moderating effect of foreign ownership (FO). Data were collected from audited financial statements of listed industrial enterprises in Vietnam for the period 2019–2023 on Vietstock. The level of financial distress was measured by the Z-score and the interest coverage ratio; while debt structure was expressed through the ratio of short-term debt (SDR), long-term debt (LDR) and total debt (TDR). Analysis by the fsQCA method shows that heavy dependence on debt increases the risk of financial distress, while a reasonable structure between short-term and long-term debt improves liquidity. In particular, contrary to expected results, the moderating effect of foreign investment capital is not statistically significant. The research results provide empirical evidence for Vietnam and suggest governance and policy directions to help enterprises build a safe capital structure and enhance resilience in the context of a volatile global economy.