Abstract
This study examines the relationship between Corporate
Governance and Foreign Institutional Investment. For this
purpose, nine years’ data from 2006-2014 is taken of forty five
Pakistani companies listed on Karachi Stock Exchange (Now
Pakistan Stock Exchange-PSX) having foreign investment, is
studied. The effect of different Corporate Governance variables
like non-executive directors, independent audit committee,
board size, inside ownership, and CEO duality on the foreign
institutional investment is studied. Firm size, market to book
ratio, return on equity, liquidity, dividend yield, leverage and
firm age were taken as control variables. To analyze the data,
the study uses Panel data regression techniques. The findings
showed that there is a negative impact of CEO duality,
concentrated ownership, and dividend yield on foreign
institutional investment, whereas, firm size, board size, age, and
liquidity have a positive effect on foreign institutional
investment. But all other variables, such as non-executive
directors, independent audit committee, return on equity,
market to book value, and leverage are found to have an
insignificant effect.
Khalid Mahmood Ahmad, Nadeem Ayub Bhutta, Khizar Iftikhar, Abid Rasheed. (2018) The Role of Corporate Governance in Attracting Foreign Institutional Investors: A study of Pakistani Listed Companies, Paradigms , Vol 12, Issue 1.
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