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Corporate governance and capital structure as driving force for financial performance: Evidence from non-financial listed companies in Pakistan

Author

Listed:
  • Zahid Bashir

    (University of Gujrat-Pakistan)

  • Ghulam Ali Bhatti

    (University of Sargodha-Pakistan)

  • Asad Javed

    (University of Gujrat-Pakistan)

Abstract

This research examines the intervention of capital structure with different characteristics of corporate governance and different measures of financial performance. Data was collected from 113 PSX listed firms ranging from 2013-2018. The study uses multiple regression approach for testing the required set of hypotheses. The results reveal that insider shareholding, and board size significantly but negatively affect financial performance whereas, audit committee’s size positively, and significantly affects financial performance. Furthermore, about 20% of CEOs hold dual positions in listed firms, which also has a positive impact on financial performance. The results also reveal that capital structure positively influences financial performance. This research adds to the literature on corporate governance and firm performance in emerging countries, particularly Pakistan.

Suggested Citation

  • Zahid Bashir & Ghulam Ali Bhatti & Asad Javed, 2020. "Corporate governance and capital structure as driving force for financial performance: Evidence from non-financial listed companies in Pakistan," Business Review, School of Economics and Social Sciences, IBA Karachi, vol. 15(1), pages 108-133, January-J.
    • Handle: RePEc:aho:journl:v:15:y:2020:i:1:p:108-133
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    File URL: https://businessreview.iba.edu.pk/articles/corporate-governance-capital-structure.pdf
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    References listed on IDEAS

    as
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    7. Khan, Sajjad Nawaz & Yaseen, Muhammad Noman & Fakhra Mustafa & Sidra Abbasi, 2019. "The Interaction Effect of Financial Leverage on the Relationship Between Board Attributes and Firm Performance; Evidence of Non-financial Listed Companies of Pakistan," Journal of Accounting and Finance in Emerging Economies, CSRC Publishing, Center for Sustainability Research and Consultancy Pakistan, vol. 5(1), pages 115-122, June.
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