-
Journal menu
- General information
- Editorial Board and External Reviewers
- Journal Policies
- Publication Ethics and Malpractice Statement
- Instructions for authors
- Paper reviewing
- Article processing charge
- Feedback from stakeholders
- Journal’s Open Access statement
- Order hard copies of the journal
- 50 most cited papers in the journal
Corporate governance determinants of capital structure: Evidence from manufacturing firms on the Ghana Stock Exchange
Download This Article
Ellis Kofi Akwaa-Sekyi 
, Nancy Nuako, Lord Kelvin Kofi Atisu
This work is licensed under a Creative Commons Attribution 4.0 International License.
Abstract
This study examines the impact of corporate governance determinants on the capital structure of manufacturing firms listed on the Ghana Stock Exchange (GSE). Using a purposive sampling of 15 manufacturing firms, we collect secondary data for 14 years. We employ a system generalized method of moments (GMM) approach to address endogeneity issues. Apart from firms using more short-term debt financing than long-term debt, we report a significant positive relationship between managerial and institutional ownership and capital structure. There is a statistically significant and positive relationship between ownership concentration on both the short- and long-term debt ratios. Regarding company financial management, the study offers several recommendations and practical implications. Our findings have implications for improved management performance and corporate governance policies that lead to value-relevant capital structure decisions. The study also provides empirical support for the idea that firms might benefit from reduced agency costs and lower cost of capital if they implement appropriate corporate governance mechanisms. We provide support for the agency and pecking order theories. Future research could consider broader corporate governance variables and optimal capital structure.
Keywords: Capital Structure, Corporate Governance, Ghana Stock Exchange, Manufacturing Firms, Ownership Structure
Authors’ individual contribution: Conceptualization — E.K.A.S. and N.N.; Methodology — E.K.A.S. and N.N.; Validation — E.K.A.S. and L.K.K.A.; Data Curation — N.N.; Formal Analysis — N.N. and L.K.K.A.; Writing — E.K.A.S., N.N., and L.K.K.A.; Supervision — E.K.A.S.
Declaration of conflicting interests: The Authors declare that there is no conflict of interest.
JEL Classification: D21, G32, L60
Received: 07.11.2023
Accepted: 18.06.2024
Published online: 20.06.2024
How to cite this paper: Akwaa-Sekyi, E. K., Nuako, N., & Atisu, L. K. K. (2024). Corporate governance determinants of capital structure: Evidence from manufacturing firms on the Ghana Stock Exchange. Corporate Ownership & Control, 21(3), 8–19. https://doi.org/10.22495/cocv21i3art1
