Impact of board attributes and managerial ownership on cash holdings: empirical evidence using GMM and quantile regressions
ISSN: 1472-0701
Article publication date: 25 October 2022
Issue publication date: 24 April 2023
Abstract
Purpose
The purpose of this study is to examine the impact of board attributes and managerial ownership on cash holdings.
Design/methodology/approach
The present study examines a sample of 70 listed firms in Saudi Arabia observed during the period stretching from 2006 to 2016. To test the hypotheses, the authors used generalized method of moments and quantile regressions.
Findings
The empirical results reveal that corporate governance (CG) mechanisms are inefficient in the Saudi context. In fact, the authors found that board size, board independence, duality and managerial ownership impact positively and significantly cash holdings. Additionally, quantile regressions confirm the results that at certain thresholds, CG mechanisms are not efficient in protecting shareholders’ interests. Shariah compliance is found to moderate negatively and significantly the studied relationship.
Originality/value
This study helps to not only clarify and help decision-makers to see the importance of corporate cash management but also to identify the limits of the CG mechanisms put in place.
Keywords
Acknowledgements
The authors are grateful to anonymous reviewers and to editors for their valuable comments and suggestions.
Funding: This research received no external funding.
Conflicts of interest: The authors declare no conflict of interest.
Citation
Talbi, D. and Menchaoui, I. (2023), "Impact of board attributes and managerial ownership on cash holdings: empirical evidence using GMM and quantile regressions", Corporate Governance, Vol. 23 No. 4, pp. 723-741. https://doi.org/10.1108/CG-04-2021-0145
Publisher
:Emerald Publishing Limited
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