Authors : Shafie Mohamed Zabri, Wan Fauziah Wan Yusoff, Ahmad Kaseri Ramin and Karen See Sin Ling
Abstract: Corporate Governance (CG) in Malaysia has been improved after the Asian financial crisis in 1997. Good CG will provide companies with better financial decision, including capital structure. Therefore, this research is focusing on the Top 100 public listed companies in Malaysia to investigate current practice of CG and to determine whether there is a relationship between CG practices (board size and independence) and firm’s capital structure which is measured by debt ratio and debt to equity ratio. Secondary data from company’s annual report covering 5 years periods of 2008-2012 were used. Descriptive and correlation analysis were utilized to analyze the data. Results show that the Top 100 public listed companies are found to be complying with the practices of a good CG in their business. Results also proved that there is no relationship between firm’s corporate governance practices and their capital structure. Findings of this study shed new informative knowledge on CG practices among public listed companies in Malaysia and the relationship between CG practices with the firm’s capital structure.
Shafie Mohamed Zabri, Wan Fauziah Wan Yusoff, Ahmad Kaseri Ramin and Karen See Sin Ling, 2016. Corporate Governance Practices and Firm’s Capital Structure. International Business Management, 10: 3973-3981.