The Impact of the Ownership Structure and the Quality of Financial Information on the Cost of Debt of Tunisian Firms

Abdelkader Derbali^1, and Manel Ben Ayeche²

¹Depatment of Finance, Higher Institute of Management of Sousse, University of Sousse, Tunisia

²Department of Economy, Faculty of Economic Sciences and Management of Sousse, University of Sousse, Tunisia

Cite this paper:
Abdelkader Derbali and Manel Ben Ayeche. The Impact of the Ownership Structure and the Quality of Financial Information on the Cost of Debt of Tunisian Firms. International Journal of Econometrics and Financial Management. 2015; 3(2):57-63. doi: 10.12691/ijefm-3-2-2

Abstract

The objective of this paper is to highlight the interaction of the board with other internal governance mechanisms such as ownership structure, the quality of financial reporting and the cost of debt. The relationship between the ownership structure and the quality of financial information on the one hand and the other debt cost was well treated in the financial literature. Tests conducted on a sample of 28 Tunisian firms show that the ownership structure and the quality of financial information plays an important role in determining the characteristics of the cost of debt. The results also indicate that the cost of debt is related to factors from the board, the size of the company and the stock exchange listing.

Keywords:
corporate governance board of directors ownership structure debt tunisian firms

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