Abstract:

The purpose of this study was to examine whether corporate governance attributes
Such as board size, independent directors and CEO duality affect the firm’s financial leverage choices of Pakistani firms. Multiple regression analysis was used to estimate the relationship between corporate governance measures and firm’s financial leverage choices (total debt ratio) of non-financial firms listed in Pakistan Stock Exchange (PSX), Pakistan, over the period 2011 to 2016. The results suggested that board size, independent directors and CEO duality were positively statistically significant related to the total debt ratio. Although Pakistani firms have weak internal corporate governance mechanisms compared to firms in developed countries, yet the empirical discoveries suggested that corporate governance attributes explain the part of financing behavior of Pakistani firms.