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Corporate Governance And Financial Structures Of Companies In Developing Countries

Author

Listed:
  • Bogdan Dima
  • Alin Ionescu
  • Petru Tudoreanu

Abstract

The main purpose of this paper is to test the impact of corporate governance quality on the financial structure of companies using a dataset covering 35 developing countries from Central and Eastern Europe as well as from Asia. Five variables related to corporate financial structure and eleven governance quality variables provided by World Bank Database are grouped in two synthetic descriptors by involving a Principal Components Analysis approach. In order to test the existence of a possible linkage between these descriptors we used Generalized Linear Models framework. To check robustness of results, accordingly to the standard capital structure theories, we considered some control variables. The main output consists in the thesis that the financial structure of the companies is significantly influenced by the quality of corporate governance. Also, we find that the exclusion from the explanatory variables of the proportion of investments financed by other financing variable improves the robustness of the results.

Suggested Citation

  • Bogdan Dima & Alin Ionescu & Petru Tudoreanu, 2013. "Corporate Governance And Financial Structures Of Companies In Developing Countries," Annales Universitatis Apulensis Series Oeconomica, Faculty of Sciences, "1 Decembrie 1918" University, Alba Iulia, vol. 1(15), pages 1-14.
    • Handle: RePEc:alu:journl:v:1:y:2013:i:15:p:14
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    References listed on IDEAS

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    5. Dima, Bogdan & Cuzman, Ioan & Dima (Cristea), Stefana Maria & Şărămăt, Otilia, 2010. "Effects of financial and non-financial information disclosure on prices’ mechanisms for emergent markets: The case of Romanian Bucharest Stock Exchange," MPRA Paper 27169, University Library of Munich, Germany.
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    Citations

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    Cited by:

    1. Rodica Baciu & Brezeanu Petre, 2018. "Impact Of Financial Structure On Return On Equity: Evidence From Wholesale Of Motor Vehicle Parts And Accessories Industry," Eurasian Journal of Economics and Finance, Eurasian Publications, vol. 6(4), pages 38-47.
    2. Brogi, Marina & Lagasio, Valentina, 2022. "Better safe than sorry. Bank corporate governance, risk-taking, and performance," Finance Research Letters, Elsevier, vol. 44(C).
    3. Ionescu Alin & Tudoreanu Petru, 2014. "The Impact Of Corporate Governance Dimensions On Financial Structure Of The Companies In Developing Countries," Annals - Economy Series, Constantin Brancusi University, Faculty of Economics, vol. 6, pages 23-29, December.
    4. Ionescu Alin, 2015. "The Impact Of Corporate Governance Quality On Companies Performance In Developing Countries," Annals - Economy Series, Constantin Brancusi University, Faculty of Economics, vol. 4, pages 250-254, August.
    5. Gabriela Lucia SIPOS & Alin IONESCU, 2017. "The Influence of Corporate Governance on Innovation Dimensions – Case Study of European Emergent Countries," ECONOMIC COMPUTATION AND ECONOMIC CYBERNETICS STUDIES AND RESEARCH, Faculty of Economic Cybernetics, Statistics and Informatics, vol. 51(4), pages 159-172.

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    More about this item

    Keywords

    Corporate Governance; Financial Structure; Indexation Model; Developing Countries;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance

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