Does board capital affect the corporate financial distress level? A study from Malaysia

Authors

  • Rayenda Brahmana Faculty of Economics and Business, Universiti Malaysia Sarawak, Kota Samarahan, Sarawak 94300, Malaysia
  • Lik-Jing Ung Faculty of Economics and Business, Universiti Malaysia Sarawak, Kota Samarahan, Sarawak 94300, Malaysia
  • Jiet-Siong Kiu Faculty of Economics and Business, Universiti Malaysia Sarawak, Kota Samarahan, Sarawak 94300, Malaysia

Keywords:

banking, board capital, corporate finance, financial distress

Abstract

This study examined the relationship between board capital and the financial distress level for a sample of listed banks in Malaysia from 2003 to 2013. Using robust panel regression with 88 pooled firm-year observations, we found that board capital and leverage are statistically significant with banking financial distress in Malaysia. The results imply that the knowledge of directors such as experience, education, and networking can improve the firm’s management and avoid the firm facing a financial distress problem. Lastly, this study provides useful information to assist shareholders in choosing board directors regarding reducing the risk of financial distress.

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Published

31-10-2019

How to Cite

Brahmana, R., Ung, L.-J., & Kiu, J.-S. (2019). Does board capital affect the corporate financial distress level? A study from Malaysia. Kasetsart Journal of Social Sciences, 40(3), 695–702. Retrieved from https://so04.tci-thaijo.org/index.php/kjss/article/view/242338

Issue

Vol. 40 No. 3 (2019): September-December

Section

Research articles

License

This is an open access article under the CC BY-NC-ND license http://creativecommons.org/licenses/by-nc-nd/4.0/