Rethinking agency theory in developing countries: A case study of Pakistan

Yusuf, Fatima; Yousaf, Amna; Saeed, Abubakr

doi:10.1016/j.accfor.2018.10.002

Cited by 41 publications

(37 citation statements)

References 76 publications

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“…Within emerging economies, their institutional contexts are predictably different from those observed in developed economies were CG originates (Young et al , 2008; Kimani et al , 2015). Accordingly, the institutional contexts of emerging countries make agency contracts’ problematic due to institutional environments which do not lend themselves to application of international best practices on CG (Young et al , 2008; Yusuf et al , 2019). We contend that examining CG issues within emerging economies from a quantitative methodological viewpoint, limits richness in understanding the features of CG practices in these countries.…”

Section: Methodsmentioning

confidence: 99%

“…In contrast, however, several researchers argue that the traditional model of agency problem is appropriate for well-developed and efficient capital markets but cannot be suitably applied to markets in developing countries characterised by concentrated ownership (Young et al , 2008; Gilson, 2007, Yusuf et al , 2019). These researchers argue that in an institutional context characterised by concentrated ownership, there is no real separation between ownership and control, rendering such governance arrangements ineffective in such a context (Hoffman et al , 2016).…”

Section: Literature Reviewmentioning

confidence: 99%

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Anglo-American governance adoption in non-Anglo-American settings

Areneke¹,

Yusuf²,

Kimani³

2019

MAJ

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Section: Methodsmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Anglo-American governance adoption in non-Anglo-American settings

Areneke¹,

Yusuf²,

Kimani³

2019

MAJ

Self Cite

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“…Despite facing all these issues, Pakistan is a law-abiding country that sturdily focuses on the protection and safety of shareholders the development of the stock market [ 71 ]. Pakistan has important capital and financial market have numerous social and political practices as a comparison to other developed economies [ 92 ]. Additionally, the world is facing global warming threats and scholars believed that the industrial sector is the major cause of environmental problems [ 93 ].…”

Section: Research Approachmentioning

confidence: 99%

The Moderating Role of Corporate Social Responsibility in the Association of Internal Corporate Governance and Profitability; Evidence from Pakistan

Javeed

Jiang

et al. 2021

IJERPH

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At present, climate and other environmental problems are arising because of the development of the industrial sector at a large level. The industrial sector is supposed to be a major cause of climate change problems that lead to global warming. Therefore, corporate social responsibility (CSR) with the help of corporate governance is an imperative approach to control these social problems. Consequently, in the context of the organizational and management theory, agency theory, and the stakeholder theory, this study focuses on important factors of internal corporate governance such as chief executive officer (CEO) power, the board size, independence, ownership concentration, managerial ownership, and audit quality for improving the profitability of firms. Moreover, this study considers corporate social responsibility as a controlling and moderating factor for firm performance and internal corporate governance. We employed ordinary least square (OLS) for endogeneity testing, fixed effect (FE), generalized method of moments (GMM), and feasible generalized least square (FGLS) on data of Pakistani firms for the period of 2010–2019. The results of this study demonstrate the following outcomes: firstly, all internal corporate governance factors are positively linked with firm performance; secondly, corporate social responsibility (CSR) is the most valuable tool for improving profitability. Importantly, this study suggests that all internal corporate governance factors are positively linked with firm performance because of the interactive role of corporate social responsibility (CSR). This study practically contributes to the literature by suggesting the imperative role of corporate social responsibility (CSR) for internal corporate governance, which may help to reduce climate and social problems.

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“…Our preliminary sample consists of all Singaporean non-financial listed firms of SGX Mainboard. We exclude Financial industries (SIC codes, 6000-6999), Utilities (SIC codes, 4900-4999), and firms listed on the SGX Catalist, subject to differences in listing and regulatory requirements (Bauer, Frijns, Otten, & Tourani-Rad, 2008;Du & Dai, 2005;Nguyen et al, 2015;Schultz, Tan, & Walsh, 2010;Yusuf, Yousaf, & Saeed, 2018). In addition, we excluded all those firms whose ownership or shareholders' voting data is incomplete, as it's not possible to track the pyramidal ownership until to have access to ultimate controlling shareholders.…”

Section: Data and Samplementioning

confidence: 99%

Shareholders' control rights, family ownership and the firm's leverage decisions

Amin

Liu

2020

International Review of Financial Analysis

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We investigate the association between controlling shareholders' ownership (CS_Own) and firms' leverage decisions in the Singaporean context. We examine whether the impact of ownership concentration on leverage differs across excess and lower control. We report that shareholders with excess control prefer leverage financing for an optimal capital structure and focus on value maximisation rather using leverage as a tool of minority shareholders' expropriation. Our analysis shows that firms capital structure significantly influences by the coalition of shareholders particularly decisions about leverage financing in addition to the firms' specific characteristics and institutional arrangements. Our empirical evidence shows that controlling shareholders with a lower fraction of equity are more concerned about limited holding thus prefer leverage over equity financing to inflate their equity stake to protect them from the potential takeovers and mergers. We report that capital structure decisions in Singapore are linked with the trade-off between the controlling shareholders' target of mitigating firm risk and their non-dilution entrenchment needs. Further, we found an inverted U-shaped association between control ownership and leverage financing. In terms of moderating effect of family-controlled ownership, our findings exhibit that leverage financing is less pronounced for family firms in Singapore due to the under-diversified investment portfolio.

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Rethinking agency theory in developing countries: A case study of Pakistan

Cited by 41 publications

References 76 publications

Anglo-American governance adoption in non-Anglo-American settings

Anglo-American governance adoption in non-Anglo-American settings

The Moderating Role of Corporate Social Responsibility in the Association of Internal Corporate Governance and Profitability; Evidence from Pakistan

Shareholders' control rights, family ownership and the firm's leverage decisions

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