Abstract

Value creation for a firm is a function of identifying and managing value drivers. This study aims to understand the drivers of value creation for GCC listed firms. The paper proposes a model for value creation through the application of Partial Least Square Structural Equation Modeling (PLS-SEM) .The model proposes value creation of a firm as a function of critical drivers like size of firm, dividend policy, investment policy, capital structure and risk characteristics. Higher the leverage for the firm, lesser will be the value creation for the firm. Investors are skeptical about whether firms with high leverage would create value. Firm size is negatively related to value creation.

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