Firm, Executives and Capital Structure: A Positivist Research
Posted: 19 May 2020
Date Written: April 22, 2020
Abstract
Capital structure, pension, credit rating, and CSR performance has been broadly discussed in the field of corporate finance. To research and discuss the questions of the impacts and relations between capital structure, pension, credit rating and CSR performance, this paper tries to find the answer through two dimensions: the firm side and the executives' side. Based on the positivist approaches delivered by past studies, this paper will be conducted under a positivist paradigm. Gender, age and salary are the three significant executive characteristics determining firm structure on top of profitability, liquidity and asset tangibility. Further, in the researched time period and selected companies, the pension plan is a substitute for external debt. From the result of the CSR-linked compensation model, again profitability, asset tangibility, liquidity, executive's salary, and executive's total compensation are the variables that are significant. Through the uni-variate analysis, multivariate analysis and building models to test and fit different dependent, at the same time testing the multi-collinearity and endogeneity we found that although theories of capital structure, cost of capital, agency problems and stakeholder expectations have contradictions and are inconsistent, they fill up the gap between each other and verify the relationships between the firm characteristics and executive's characteristics in the field of corporate finance.
Keywords: Firm Characteristics, Executive Characteristics, Capital Structure, Corporate Pension, Credit Rating, Corporate Social Responsibility
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