Abstract
With the recent developments in the discipline of corporate governance, concern for the Board of Directors has increased significantly. Even though there are a number of extensive researches in the field, the understanding of the board and its impacts on corporate Financial Leverage is still limited. This research investigated the linkage between some corporate governance characteristics and corporate Financial Leverage in an emerging market, Sri Lanka. The researchers have used a sample of 100 non – financial highly market capitalized firms selected from the most active trading listed Companies in Colombo Stock Exchange (CSE) covering the period from 2011 to 2019 with 900 observations. The Fixed effect multiple regression models (OLS) have used to analyze the data. Results show that proportionate of board non-executive directors and independent directors positively significantly affect the corporate financial leverage and CEO Duality and Board tenure have negatively significantly affected the corporate financial leverage.
Highlights
This research investigates the linkage between board characteristics and corporate financial leverage of nonfinancial listed companies in the Colombo Stock Exchange (CSE)
Based on the research gap identified, this study investigates the affect of board characteristics on corporate financial leverage of non-financial companies listed in Colombo stock exchange
This research focused on the factors influencing corporate Financial Leverage of an entity that are public listed in Colombo stock exchange
Summary
This research investigates the linkage between board characteristics and corporate financial leverage of nonfinancial listed companies in the Colombo Stock Exchange (CSE). With the significant developments in the discipline of corporate governance, concern for the board of directors has increased significantly. Financial planning is a mechanism where, how the organization determines their capital requirements by considering internal and external factors. This is how an organization framing of financial policies about their working capital requirements and potential investments. Financial fund forecasting establishes guideline for change and growth in a firm, which concern the major elements of a firm’s financial and investment policies without examining the individual component of those policies in details.
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