The Impact of Board Gender and Multiple Directorship on Cash Holdings: Evidence from Jordan

Abstract

This study examined the influence of corporate governance on company cash holding by explaining the relationship between board gender, multiple directorship and cash holding using a sample of 87 non-financial companies including industrial and service companies that listed on the Amman Stock Exchange from 2011 to 2017. By using Ordinary Last Square regression model (OLS). The findings indicate that board gender, multiple directorship positively influence cash holdings, supporting the agency theory. The findings of this study contribute to the formulation of better corporate governance policies that can help improve corporate cash holdings. This study has several empirical implications for policy makers in Jordan; it is important for policy makers to improve the role of the board of directors in monitoring the firm. One possible way of doing so is to encourage firms in Jordan to employ female that can provide better monitoring services and also firms can benefit from their experiences. In addition, these rules and regulations need to be activated by the policy makers to ensure that firms comply with their requirements. Moreover, developing countries are in need of providing better compliance with international governance standards. This can be done by adopting good governance practices, improving shareholder rights and activating laws and regulations that govern firms’ performance.