Governance Mechanisms and Financial Structure
Corporate governance raises broad debate in the world among researchers and policymakers. In the United Kingdom and the United States, the focus is on the deficiencies of the market system in terms of effective corporate governance. In continental Europe, there is concern that current corporate governance systems hinder innovation and growth. In Eastern Europe, privatization raises the question of how private firms should be governed. China is experimenting with some forms of corporate governance that combine features of the market system with public ownership. Notwithstanding all these debates, observations about the effects of different corporate governance systems remain fragmented. In the area of corporate governance, the facts have been swept away by judgments.The central question that we seek to address here relates to the main governance mechanisms to be identified for the Tunisian governoratesThis article is organized around the two main parts. In the first part, we will summarize the main previous empirical works that have dealt with governance mechanisms and the choice of a financial structure. In the second part, we will empirically validate these governance mechanisms of the twenty-eight firms listed on the Securities Exchange in Tunisia during the period from 2012 to 2016.
In this article, we referred to the main previous works that dealt with governance mechanisms and their effect on the choice of financial structure of the company. We have noticed that these mechanisms exert both a positive or negative impact on wealth and the creation of added values for firms. We have empirically verified these mechanisms from a sample of twenty-eight Tunisian financial and non-financial firms during a period. Study period from 2012 until 2016 on annual frequencies. We have analyzed statistics and found that the majority of the explanatory variables of finance and governance follow non-linear laws. Also, we have that all the explanatory variables and the endogenous variable have good linear adjustments with respect to the adjustment lines. We studied the governance mechanisms and the choice of the financial structure through a static panel relationship and we checked from the specification tests that this panel specified with individual effects. We estimated this relation by the techniques within and GLS. This estimate gives expected and significant results at the risk level of 1%, 5% and 10%. We have distinguished that the individual effects are random since the Hausman statistic is lower than the chi-square value at 8 degrees of freedom. The Hausman Arbitration Test validated that constants or special characters are varied over time. Hence, the governance mechanisms and the choice of the financial structure will be modified over time and the sample. The limits of research have two origins: the lack of data relating to the various indicators and the lack of transparency of the local authorities regarding the presentation of the data.
Arabian Journal of Business and Management Review
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