Board Financial Expertise and Debt Policy

Abstract

This study examines whether board financial expertise affect firm leverage for the sample of Pakistan non-financial listed firms. Using panel data for the year 2010-2015, we examine the relationship between financial expertise on board and firm leverage. We find a significant positive relationship between presence of financial expertise on board and firm leverage. To control possible endogeneity, this study employs propensity score matching and found similar results. This study is important as it exhibits that the presence of financial expertise on board affects firm economic decision beyond reporting quality accuracy