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2. PHD Thesis / Tesis PHD
3. Graduate School of Business / Pusat Pengajian Siswazah Perniagaan

Title:	Leverage, Family Firms And Ethnicity: Evidence Of Malaysian Non-Financial Public Listed Firms
Authors:	Noorhayati Yusof Ali (P40360)
Supervisor:	Puan Yatim, Associate Professor Dr.
Keywords:	Leverage Firms And Ethnicity Family Firms And Ethnicity Malaysian Non-Financial Public Listed Firms Family-owned business enterprises--Management--Malaysia
Issue Date:	28-Nov-2013
Description:	Literature has addressed the reciprocal nature of the family and the business within the family-firm setting. This reciprocal relationship contributes to several distinctive features commonly found in family businesses. These features include strong family ties, undiversified family holdings, and strong desire to pass the firm onto subsequent successors and higher concerns to retain family control and reputation. Recent family business literature also suggests that the capital structure decision is important for family business. Therefore, one would argue that a firm’s organizational attributes such as those found in the family firms are likely to influence leverage levels in these firms. Agency theory suggests that family firms have a lower agency problems because owner-managers’ interests are likely to be more aligned, thus giving creditors greater confidence to lend. Hence, family firms have a greater incentive to use more debts as their financing source. Although there is growing empirical evidence on ownership and capital structures, prior studies largely employed data from developed capital market with robust institutional structures. Evidence of family firms and capital structure in countries with weak institutional structures remain very much unexplored. The aim of this study, therefore, is to examine the extent of capital structure decisions in family firms in Malaysia, a country with weak institutional structures. Drawing on the existence evidence that corporate ownership of Malaysian firms can be clearly identified along ethnic lines, this study also examines the effect of ethnicity that has been shown to influence corporate financing decisions in Malaysia. This study employs a cross-sectional analysis of 727 listed firms for the financial year of 2009, where dependent variable of leverage is measured by book value of debt ratio. Family ownership is measured by the percentage of ownership of the controlling family in a firm whilst ethnicity is represented by the proportion of board of directors determined by names of directors. Multiple regression analysis is used to estimate the associations between variables proposed in the hypotheses. The finding of this study is inconsistent with agency theory where family firms and leverage is found negatively associated. The study also finds a strong positive association between leverage and Bumiputera family-controlled firms. This study is unique, for it deals with the issue of capital structure determinants outside developed countries. It offers an alternative explanation for the leverage variations and provides evidence on the universality of the capital structure theory as it does not seem to work in all institutional contexts.,PhD
Pages:	121
Call Number:	HD62.25 .N645 2013
Publisher:	UKM, Bangi
Appears in Collections:	Graduate School of Business / Pusat Pengajian Siswazah Perniagaan

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