Capital Structure as a Mediating Factor in the Relationship between Uncertainty, CSR, Stakeholder Interest and Financial Performance

Ahmed Hunjra (), Peter Verhoeven and Qasim Zureigat
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Peter Verhoeven: School of Economics and Finance, QUT Business School, Brisbane 4000, Australia
Qasim Zureigat: Sulaiman AlRajhi School of Business, Sulaiman AlRajhi University, Al Bukayriyah 51941, Al Qassim Province, Saudi Arabia

JRFM, 2020, vol. 13, issue 6, 1-18

Abstract: We examine the mediating role of capital structure in the perceived relationship of uncertainty, corporate social responsibility (CSR), stakeholder interest and financial performance. We collect data through questionnaires, and survey the Chief Financial Officers (CFOs) of the service sector of Pakistan. We apply Structure Equation Modeling (SEM) for data analysis. We find that CFOs perceive uncertainty, CSR and stakeholder interest to have both direct and indirect impacts on financial performance. In particular, we find evidence of the mediating effect of capital structure in the relationship. Our findings imply that firms screen out uncertain situations while making capital structure decision and pursuing CSR-related activities.

Keywords: capital structure; uncertainty; CSR; stakeholder interest; financial performance (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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