OWNERSHIP STRUCTURE AND DEBT POLICY OF TUNISIAN FIRMS

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Abstract

The relation between corporate governance and the financial decisions presents a rich subject but less pronounced in corporate finance. The purpose of this article is to study the impact of the ownership structure on the debt policy of the Tunisian companies. From the econometric tests applied to Tunisian data of panel, the results obtained corroborate the assumptions of the entrenchment theory. The ownership structure is unable to orient the management of the leaders towards the maximization of the shareholders’ richness. The companies with concentrated property don’t use the debt like mean to encourage the leader to act according to their interests. The remuneration system does not encourage the leaders to privilege the financing of the investments by debt. The presence of the financial institutions in the capital of the Tunisian companies does not influence the policy of financing of the company. They don’t exert a particular role of control on the management of the leaders in place by the debt.

Keywords: Ownership Concentration, Shareholding of the Leader, Financial Institutions, Debt Policy

How to cite this paper: Hentati, F., & Abdelfettah, B. (2012). Ownership structure and debt policy of Tunisian firms. Corporate Ownership & Control, 9(4-2), 253-261. https://doi.org/10.22495/cocv9i4c2art6