Jordan Journal of Business Administration | 2026
Authors: Alhmoud T.; Abu-Abbas B.; Al-Omarf M.
DOI: 10.35516/jjba.v22i1.898
Journal: Jordan Journal of Business Administration
Year: 2026
Publisher: University of Jordan,Deanship of Scientific Research
Document Type: Article
Open Access: All Open Access; Gold Open Access
Cited by: 0
This study utilizes panel data from 50 industrial corporations listed in the Amman Stock Exchange (ASE) during the period from 2012 to 2020 to investigate the relationship between capital structure, as measured by debt ratio, short-term debt to total assets, and long-term debt to total assets, governance as measured by the board of directors' size, ownership structure, and corporation's performance, measured by return on assets and earnings per share. A random effect regression analysis is conducted to test the study's hypotheses. The findings revealed that financial leverage has a negative association with firm performance. This negative relationship is observed with total leverage, short-term leverage, and long-term leverage. Additionally, the study found that both the board of directors' size and foreign ownership have a negative relationship with firm performance. These results have significant implications for governments, practitioners, and management, especially in emerging markets like Jordan. In all the models used in this study, the Breusch and Pagan results reject the null hypothesis stating that there are significant differences across the years, the modified Wald test for heteroscedasticity rejects the null hypothesis of heteroscedasticity, and the Variance Inflation Factor (VIF) test indicates no impact of multicollinearity. © 2026 DSR Publishers/The University of Jordan. All Rights Reserved. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY-NC) license (https://creativecommons.org/licenses/by-nc/4.0/)
BOD size; Capital structure; Ownership structure; Performance