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Home > The Role of Corporate Governance on Firm’S Performance and Financial Distress: Evidence from Pakistani Manufacturing Firms

The Role of Corporate Governance on Firm’S Performance and Financial Distress: Evidence from Pakistani Manufacturing Firms

Thesis Info

Access Option

External Link

Author

Shahab Ud Din, ,

Program

PhD

Institute

COMSATS University Islamabad

City

Islamabad

Province

Islamabad.

Country

Pakistan

Thesis Completing Year

2018

Thesis Completion Status

Completed

Subject

Management Sciences

Language

English

Link

http://prr.hec.gov.pk/jspui/bitstream/123456789/13502/1/6-Thesis-Full%20Version.docx

Added

2021-02-17 19:49:13

Modified

2024-03-24 20:25:49

ARI ID

1676725126534

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Financial distress has been considered as an important area of research for academicians and managers. Despite this, the role of corporate governance in financial distress in Pakistan lacks empirical evidence yet. This research examines the role of corporate governance practices on financial performance and the likelihood of financial distress for a cross section of 146 companies listed at the Karachi Stock Exchange for the period of 2003-2012. The analytical framework is based on the agency and stewardship theories. Corporate governance variables are operationalized in terms of ownership structure, and board structure. Additionally, ownership structure is measured through institutional ownership, insider ownership, foreign ownership, and government ownership. Board independence, board size and CEO duality is used to measure board structure. For firm’s financial performance, accounting-based measures such as return on asset (ROA) and return on equity (ROE), and market-based performance measures such market to book ratio (MBR) and Tobin’s Q (TQ) are used. The Altman Z-score is used as a proxy for financial distress. The dynamic panel generalized method of moment (GMM) is applied to investigate the association between corporate governance practices and firm’s financial performance, while pool logistic regression is deployed to examine the role of corporate governance practices on the likelihood of corporate financial distress. The empirical results reveal positive and significant relationship between institutional ownership, insider ownership, government ownership and financial performance of the selected companies during the period 2003-2012. A positive relationship between the internal corporate governance practices (that is, Board independence and Board size) and corporate financial performance was also observed. The results further reveal that in the presence of board independence, CEO duality has a positive and significant impact on both the accounting-based and market-based financial performance of the sampled companies in Pakistan. Furthermore, we also observed a positive and significant relationship between insiders’ ownership and the likelihood of corporate financial distress. The findings also reveal significant negative impact of foreign ownership and board independence on the likelihood of financial failure. It is also observed that firm-specific variables such as profitability, liquidity and size have a decisive role in determining the likelihood of corporate financial distress. In overall term, this study provides useful information for corporate managers, policy makers and investors about the corporate governance practices, financial performance and the likelihood of financial distress in Pakistan.”
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ڈاکٹر محمد حمیداﷲ

آہ! فاضل گرامی ڈاکٹر محمد حمیداﷲ رحلت فرما گئے
افسوس صد افسوس کہ وہ فرزند اسلام نہیں رہا، جس کی اذانِ توحید سے مغرب کی وادیاں گونج رہی تھیں اور ہزاروں نفوس ایمان و اسلام کی دولت سے بہرہ ور ہورہے تھے، وہ سرچشمہ ہدایت بند ہوگیا جس سے مریضانِ کفر و ضلالت شفایاب ہورہے تھے، واحسرتاکہ دین و دانش کا وہ آفتاب غروب ہوگیا جس سے مشرق و مغرب دونوں ضیابار تھے اور تاریکیوں میں بھٹکنے والے راہ یاب ہورہے تھے، علم کا وہ بے کراں سمندر راکد ہوگیا جس سے اسلام کا درخت سرسبز و شاداب تھا، دریاے تحقیق کا وہ شناور اور غواص چلا گیا جو یورپ کے کتب خانوں میں اپنے آبا کی موجود کتابوں سے علم کے جواہر نکالتا تھا، وہ پیکرِ علم و فن روپوش ہوگیا جو ابرنیساں بن کر پون صدی سے موتی لٹارہا تھا، حکمت و معرفت کا وہ مجمع البحرین دنیا سے رخصت ہوگیا جو مشرق کے علمی میخانوں سے بھی سرشار تھا اور مغرب کے میکدہ حکمت سے بھی مخمور تھا، وہ ہستی نہیں رہی جس کے فیض و کمال کا سکہ بلادِ مشرق اور عالمِ اسلام ہی میں نہیں، یورپ و امریکہ میں بھی چل رہا تھا، حیف صدحیف اس ذات گرامی کا خاتمہ ہوگیا جس کا دماغ نادر معلومات کا خزینہ اور سینہ علومِ نبوی کا سفینہ تھا، جس کا قلم دشمنانِ اسلام کی علمی خیانتوں اور عیاریوں کو بے نقاب کرتا تھا اور اسلام اور اسلامی تعلیمات کی حقانیت و صداقت کو آشکار کرتا تھا، آہ ثم آہ کہ وہ سراپا علم و تحقیق روپوش ہوگیا جو تاریخ اسلام اور سیرت نبوی کے اولین مصادر اور مسلمانوں کے نایاب اور گم شدہ علمی اندوختوں کو ڈھونڈ نکالتا تھا، وہ وجودِ مقدس خاموش ہوگیا جس نے پیرس میں بھی آداب سحر خیزی نہیں چھوڑے، جس...

The Effects of Global Warming: The Case Study of Karachi’s Heat Waves & Its Implication

Our home Earth a beautiful place to live, Allah created earth for his lovable creature but human being is destroying the beautiful earth for his own comfort. And now we're experiencing the consequences, such as rising temperatures. The interaction of rising global temperatures over the nation's land and oceans is known as "Intercontinental weather evolution." Evolution in world’s weather is an outcome of worldwide increase in temperature, and it includes greater temperatures, moisture, precipitation, condensation, and weather systems – along with variations in the occurrence and severity of these variables. It also threatens life on this planet physically and emotional.  Climate change destroying city Karachi too. In 2015 Karachi faced deadly heat wave any around 1200 died. Pakistan’s government take action to control global warming but it's not enough caused a city over 14.91 million (2017), it will need more attention and take action to control the situation of global warming. We can also control consequences of global warming by adopting and reducing few things from our Life otherwise our future will be dark as a black hole in space.

Response of Maize Zea Mays L. to Foliar Application of Boron and Calcium under Drought Stress

Premise of the research- Drought stress perturbs the normal mineral-nutrient relations of plants that lead to reduced plant growth and results significant losses in crop yields. Various plant minerals have been known to be involved in stress amelioration, however reports regarding the effects of boron (B) and calcium (Ca2+) on maize (Zea mays L.) under drought are scant. Methodology- A series of laboratory, wire-house and field experiments were conducted. In laboratory experiments eight spring maize hybrids were germinated in petri plates under polyethylene glycol (PEG-6000) induced osmotic stress @ -0.2, -0.4, -0.6 and -0.8 MPa, and two water stress levels at 100% water-holding capacity (WHC) and 30% WHC. The wire-house / rain-out shelter study was done to optimize the foliar rate for B and Ca2+ supplies; one drought-tolerant (Dekalb-6525) and sensitive (Yousafwala Hybrid) maize cultivars selected from previous laboratory experiments were sprayed with distilled water (control) and B solutions at 2, 4 and 6 mg L-1 and Ca2+ solutions at 20, 40 and 60 mg L-1 under normal and water-deficit conditions. Furthermore, one drought tolerant and sensitive maize hybrids were sprayed with optimized rate of B (4 mg L-1), Ca2+ (40 mg L-1) and their combinations to evaluate their growth, physiological, biochemical and yield responses under both normal and water deficit conditions in a wire-house and field experiment. Pivotal results- The maize cultivars tested on the basis of germination and seedling growth revealed that cultivar, Dekalb-6525 performed better under water-deficit conditions, therefore categorized as drought-tolerant, whereas Yousafwala Hybrid was identified as drought-sensitive on the basis of its poor performance. Drought stress brings considerable growth inhibition and disturbance in gas exchange characteristics, leaf water relations, light harvesting pigments and osmolyte accumulation by increasing malondialdehyde (MDA) content and imbalancing of antioxidant system. Foliar treatment of B (4 mg L-1), Ca2+ (40 mg L-1) and their combinations considerably improved maize growth, photosynthesis, chlorophyll contents, water status as well as activities of antioxidants along with a decline in MDA accumulation in both cultivars under water-deficit conditions. However, optimum mineral nutrient supply markedly reduced accumulation of proline and total soluble proteins. In addition, foliar sprays of Ca2+ and B+Ca2+ substantially improved the content of total free amino acids and total soluble sugars, however B application noticeably reduced their accumulations as compared to control. Drought treatment considerably reduced the uptake of B and Ca2+, whereas foliar sprays of these nutrients alone and in combinations notably increased their concentrations in maize leaf tissues. Considerably improved growth rate, photosynthesis, water status, pigment contents, osmolyte accumulation as well as increased antioxidant activities along with decline in MDA accumulation was found to be key contributors to a stress-tolerant genotype to thrive under limited-water supply. Afterwards in a field study, foliar B and Ca2+ supplies significantly improved the vegetative and reproductive growth of both cultivars and caused improve grain weight and yield. Conclusion- From this study, it was likely to suggest that screening for drought tolerance at initial growth phases and their further improvement by foliar B and Ca supplies are effective approaches to make plants vigorous to thrive under limited water supply.