Do Muslim CEOs and Muslim stakeholders prefer Islamic debt financing?

This study examines the relationship between religiosity and Islamic debt financing based on Malaysian non-financial listed firms from 2012 to 2018. We find that Muslim CEOs allocate more Islamic financing in their debt financing compared to non-Muslim CEOs, which support the upper echelons theory....

Full description

Saved in:
Bibliographic Details
Published in:Global finance journal 2022-11, Vol.54, p.100625, Article 100625
Main Authors: Brahmana, Rayenda Khresna, You, Hui Wei
Format: Article
Language:English
Subjects:
Islamic debt financing
Muslim CEO
Muslim stakeholders
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:This study examines the relationship between religiosity and Islamic debt financing based on Malaysian non-financial listed firms from 2012 to 2018. We find that Muslim CEOs allocate more Islamic financing in their debt financing compared to non-Muslim CEOs, which support the upper echelons theory. However, we find that the sociological pressure from Muslim Stakeholders display no significant effect on Islamic financing. Interestingly, we further find that Islamic debt financing will incline no matter whether the Muslim population is high or low if the CEO was a Muslim. This implies that our findings support the upper echelon theory, but not the stakeholder orientation theory.
ISSN:1044-0283
1873-5665
DOI:10.1016/j.gfj.2021.100625