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The Relationship between Ownership Structure and Capital Structure

Evidence from Chemical Sector of Pakistan

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  • Sadia MurtazaORCID iD verified by the author (show author details)

    Sadia Murtaza

    National College Of Business Administration & Economics, Lahore, Pakistan, Pakistan

    0000-0003-1459-6397

    Corresponding author

    • Irsa Azam (show author details)

      Irsa Azam

      University of Gujarat, Pakistan, Pakistan

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      Murtaza, S., & Azam, I. (2019). The Relationship between Ownership Structure and Capital Structure: Evidence from Chemical Sector of Pakistan. SEISENSE Journal of Management, 2(4), 51-64. https://doi.org/10.33215/sjom.v2i4.162

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      Abstract

      Objective – The main objective of this study is to measure the relationship between ownership structure and capital structure by using the chemical sector of Pakistan.

      Design – This study is used the panel data and retrieved from the annual reports of the chemical sector of Pakistan for the time period of 2012 to 2017.

      Findings – The finding the statistical analysis shows that ownership structure has a significant positive relationship on capital structure. Which mitigate the agency conflicts among managers and shareholders, because the majority of the shareholders would like to have a higher level of debt over equity financing.

      Policy Implications – The findings of this study also can be helpful to the policymakers, investors and financial institution in designing ownership structures and financing decisions for firms. 

      Originality – This is the first study that examined the relationship between ownership structure and capital structure in the context of the chemical sector of Pakistan.

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      Copyright (c) 2019 Sadia Murtaza, Irsa Azam

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      This work is licensed under a Creative Commons Attribution 4.0 International License.

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      Vol. 2 No. 4 (2019): SEISENSE Journal of Management View Issue

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      2025-122026-11

      Article history

      1. ReceivedMay 10, 2019
      2. AcceptedMay 29, 2019
      3. Published June 1, 2019

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