Corporate Governance Practices and its Impact on Working Capital Management: Evidence from Sri Lanka

Research Journal of Finance and Accounting, 4(3), 23-31, 2013

10 Pages Posted: 8 Jun 2014

Date Written: 2013

Abstract

The main objective of the study is to find out the impact of corporate governance practices on Working capital management. Secondary literature reviews and Secondary data collection methods were used to conduct the study. Twenty five listed manufacturing firms were selected as sample size in Colombo Stock Exchange for the period from 2007 to 2011. Multiple Regression Analysis was utilized to find out the significant impact of corporate Governance practices on the Working Capital Management. The results revealed that there is a significant impact of corporate Governance practices on current liabilities to total assets in working capital management. In contrast, the cash conversion cycle and the current assets to total assets are not influenced by the corporate governance practices. Based on the findings, we recommended to the policy makers in the corporate governance practices to establish the models of corporate governance that must be suitable to the manufacturing sector in Sri Lanka to ensure the survival, solvency, and profitability of the business.

Keywords: Corporate Governance practices, Manufacturing companies, Working Capital Management Efficiency

Suggested Citation

Achchuthan, Sivapalan and Rajendran, Kajananthan, Corporate Governance Practices and its Impact on Working Capital Management: Evidence from Sri Lanka (2013). Research Journal of Finance and Accounting, 4(3), 23-31, 2013. Available at SSRN: https://ssrn.com/abstract=2447155

Sivapalan Achchuthan (Contact Author)

University of Jaffna ( email )

Thirunelvely
Jaffna
Jaffna, Northern 40000
Sri Lanka
0094 - 0778364899 (Phone)

Kajananthan Rajendran

University of Jaffna ( email )

Sri Lanka
Jaffna, North 40000
Sri Lanka

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