Paper Title :Factor Influencing Impact of Corporate Governance on working Capital Management: Concept Paper

Author :Mohd Fairuz Adnan, Nurhazrina Mat Rahim, Yusri Hazrol Yusoff, Mohd Nizal Haniff

Article Citation :Mohd Fairuz Adnan ,Nurhazrina Mat Rahim ,Yusri Hazrol Yusoff ,Mohd Nizal Haniff , (2023 ) " Factor Influencing Impact of Corporate Governance on working Capital Management: Concept Paper " , International Journal of Management and Applied Science (IJMAS) , pp. 24-28, Volume-9,Issue-2

Abstract : According to a SME‟s Annual Report, the vast majority of company (93%) view working capital management as a crucial contributor to the financial sector's effect over the next five years. This has certainly changed the economy, technology, and politics in various aspects of business. This financial revolution affects almost all industries, especially in Malaysia. This article focuses on Malaysia's to understand the factor influencing in working capital management for establish in future. The factor study in three categories: (1) CEO Tenure, (2) Board Size, and (3) CEO Duality. A conceptual framework was formed on the factors influencing in Malaysia by using the Agency Theory. This study aims to establish a relationship between Malaysia's working capital management. Keywords - CEO Tenure, CEO Duality, Board Size, Working Capital Management Agency Theory. I. INTRODUCTION In financial management, corporate governance and working capital management (WCM) are treated as very important subject (Abbas, et. al., 2019). However, many researchers studied on the influence of corporate governance but only few of them connecting it with working capital management (WCM) efficiency (Ahmad, et. al., 2018). Particularly in Malaysia, there has been little concentration given on the relationship between corporate governance attributes and WCM of the companies. Many studies focus on relationship between working capital management and firm‟s performances rather than the corporate governance‟s perspective. Unfortunately, inefficient management of working capital encouraged by inadequate governance practices has a negative effect on the wealth of shareholders (Abbas et al., 2019). Therefore, the present study intends to analyze the impact of corporate governance represented by CEO tenure, CEO Duality, Board size and Audit committee on WCM represented by current ratio and cash conversion cycle of 35 Selangor based companies which are listed under FTSE Bursa Malaysia Top 100 Index. These companies were identified as Selangor based companies by observing its principal place of business, business address, head office, headquarters, and corporate office. This research extends the work of Gill & Biger, (2013) and Ahmad et al., (2018) which suggested future researchers to investigate the generalization of their study beyond American manufacturing firms and Pakistan listed firms. Research is

Type : Research paper

Published : Volume-9,Issue-2

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