Impact of Corporate Governance on Financial Practices of New Zealand Companies

  • Hardjo Koerniadi Department of Finance, Auckland University of Technology
Keywords: corporate governance, financing policy, cost of capital

Abstract

This study examines the effects of firm level corporate governance on financing policies

of New Zealand firms. Using a unique self-constructed corporate governance index and

employing the methodology of Fama and French (1999) of financing of firms, we can report

that firms with weak corporate governance generally issue more debt and have significantly

higher cost of capital than do firms with strong governance. It is further observed that

corporate governance does not have significant impact on dividend policy in New Zealand.

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Author Biography

Hardjo Koerniadi, Department of Finance, Auckland University of Technology

Hardjo Koerniadi is a Senior Lecturer at the Faculty of Business and Law, Auckland University of Technology, New Zealand

Published
2013-11-30
How to Cite
Koerniadi, H. (2013). Impact of Corporate Governance on Financial Practices of New Zealand Companies. Applied Finance Letters, 2(2), 14-19. https://doi.org/10.24135/afl.v2i2.14
Section
Articles submitted to regular issue