Capital structure and corporate governance mechanisms : Evidence from the MENA region

Dissertant

Bin Ghazi, Anas

Thesis advisor

Hammud, Rhizlane

University

Al Akhawayn University

Faculty

The School of Business Administration

University Country

Morocco

Degree

Master

Degree Date

2001

English Abstract

This paper brings new insights into the nature of the relationship between the firm’s governance mechanisms and its capital structure.

Using dividend policy, choice of auditors, ownership structure and asset tangibility as proxies for corporate governance mechanisms, this paper documents the effect of each of those proxies on the capital structure of a firm.

Based on a sample of firms from the MENA region (Middle East and North Africa), during the period between 2005 and 2009.

The first 3 proxies are found to have a negative relationship with the capital structure of the firm while assets’ tangibility is found to have a positive relationship.

We argue that those results are consistent with the substitution hypothesis which suggests that both debt and corporate governance are there to alleviate agency costs and that firms with good governance should have less leverage.

The main reason behind those results is that in firms with good governance, the need for debt to act as a tool for controlling agency costs may be lower than in firms with weak governance.

Main Subjects

Financial and Accounting Sciences

Topics

• Accounting
• Capital
• North Africa
• Middle East
• Corporate governance

No. of Pages

31

Table of Contents

• APA
• MLA
• AMA

Language

English

Data Type

Arab Theses

Record ID

BIM-625361