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Does Corporate Governance Influence Leverage Structure in Bangladesh?

Author

Listed:
  • Mohammad Nazim Uddin

    (Department of Business Administration, International Islamic University Chittagong, Kumira 4314, Bangladesh)

  • Mohammed Shamim Uddin Khan

    (Department of Finance, University of Chittagong, Chittagong 4331, Bangladesh)

  • Mosharrof Hosen

    (Faculty of Business and Finance, Universiti Tunku Abdul Rahman, Perak Campus, Kampar 31900, Malaysia)

Abstract

This paper examines the regulation of corporate governance on leverage structure decision-making in Bangladesh from 2003 to 2017. Appropriate panel methods are employed to control the problems of serial correlation, heteroskedasticity, and the cross-sectional nature of manufacturing companies. The study finds that corporate governance attributes such as board size, managerial ownership, and duality are the dominant factors for leverage decision-making. The results also indicate that control variables such as firm size and profitability have an influential role on leverage decision-making in Bangladesh. Our findings substantiate the idea that political and family connections to corporate governance structure greatly influence the leverage decision-making of corporate firms in Bangladesh.

Suggested Citation

  • Mohammad Nazim Uddin & Mohammed Shamim Uddin Khan & Mosharrof Hosen, 2019. "Does Corporate Governance Influence Leverage Structure in Bangladesh?," IJFS, MDPI, vol. 7(3), pages 1-16, September.
    • Handle: RePEc:gam:jijfss:v:7:y:2019:i:3:p:50-:d:267085
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