Role of Corporate Governance to Restrict Tunneling Activities of Foreign Institutional Investors in the Pakistan Stock Market

The research objective is to determine the curvilinear influence of trading of foreign institutional investors (FIIs) on the extent of tunneling, while corporate governance moderates this relationship. Data was gathered from 50 non-financial firms for 11 years (2009 to 2019) from the Securities and...

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Bibliographic Details
Published in:The International trade journal 2023-07, Vol.37 (4), p.389-400
Main Authors: Ahmed, Tanvir, Malik, Qaisar Ali, Butt, Babar Zaheer, Aksar, Muhammad
Format: Article
Language:English
Subjects:
Corporate governance
curvilinear (inverted U-shaped) relationship
Foreign investment
Governance
Institutional investments
International trade
Investors
Policy making
Stock exchanges
Stockholders
trading of foreign institutional investors
Tunneling
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Summary:The research objective is to determine the curvilinear influence of trading of foreign institutional investors (FIIs) on the extent of tunneling, while corporate governance moderates this relationship. Data was gathered from 50 non-financial firms for 11 years (2009 to 2019) from the Securities and Exchange Commission of Pakistan. The generalized method of moments (GMM) was applied and results supported the objectives of this study. Involvement of FIIs may contribute to the enhancement of market discipline but may also create problems. Thus, policymakers require protecting the rights of minor shareholders against adverse influence.
ISSN:0885-3908
1521-0545
DOI:10.1080/08853908.2022.2134947