Sukuk Based Financing and Corporate Governance: Case Study of Iranian Sukuk Issuer Companies

Authors

Faculty Member, Faculty of Islamic Studies and Economics, Imam Sadiq University, Tehran, Iran

Abstract

In reviewing the research literature, there are many studies that have analyzed the relationship between different methods of financing and corporate governance. Some believe that good corporate governance companies are more successful in equity financing and, in contrary, some others believe in positive relationship between corporate governance and debt finance. In this paper, to analyze the relations between Sukuk financing and corporate governance, we tried to differentiate between the financier and company points of view in the financing decisions of different corporate governance quality companies. According to the results, in contrary to conventional financing, in both views, there is a positive relationship between Sukuk issuance and the corporate governance. As a case study, we also analyzed the corporate governance characteristics of Sukuk issuing companies in Iran during 2011 to 2016. The results from model estimation confirmed theoretical conclusion and corporate governance variables had positive and significant effects on the Sukuk issuance among Iranian Sukuk issuer companies.

Keywords

References

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Journal of Economic Essays; an Islamic Approach
Volume 16, Issue 31 - Serial Number 31
October 2019
Pages 137-159

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