Impact of Corporate Governance Practices on Market Liquidity

Abstract

The study is assessing the impact of corporate governance practices on market liquidity. Thus, fourteen companies in the cement sector listed in PSX are investigated. The grounded theory is used as the theoretical base for this study to conduct analysis and to present the study findings. For analysis, we have used the data from 2004 to 2017. Corporate governance is empirically measured i-e independence of the board, independent audit committee, duality status of CEO, and institutional ownership. While the turnover ratio is used for market liquidity measurement. The data is a panel in nature and the study is following a positivist approach. So, the fixed-effect model is used to conclude the findings. Hence, audit committee independence, CEO duality, and institutional ownership have a significant effect on the market liquidity of the cement sector. And board independence has an insignificant effect. The originality of the study is in its scope itself.