OWNERSHIP STRUCTURE OF FAMILY-OWNED FIRMS AND DEBT FINANCING. EVIDENCE ON SHARI’AH-COMPLIANT FIRMS IN MALAYSIA
This study examines the impact of ownership structure on the debt
financing of 556 Shari’ah compliant firms in Malaysia from
2000-2015. This study reveals that the nature of family-owned firms
does have great influence in the debt financing decisions and being
closely guided by the Shari’ah principles with the restriction imposed
on the debt consumption level allowed seem to have significant effect
on the debt financing of Shari’ah-compliant firms understudy as well.
Fear of the dilution of controlling power over the firms for these
family owned and the characteristics of Shari’ah-compliant being
governed by certain Shari’ah regulation have significant influence on
debt consumption in the capital structure. Certain significant
determinants seem to enhance the unique nature of these firms
regarding the debt financing decision. This study contributes to the
literature by providing insights of the factors affecting the debt
financing of family owned, Shari’ah-compliant firms in Malaysia.