Corporate Governance practices and Working Capital Management Efficiency: Special Reference to Listed Manufacturing companies in SriLanka

Abstract

The main objective of the study is to find out the significant difference between corporate governance practices on working capital management efficiency in listed manufacturing firms in SriLanka. Secondary literature reviews and Secondary data collection methods were used to conduct the study. Twenty five listed manufacturing firms were selected as sample size in Colombo Stock Exchange for the periods 2007, 2008, 2009, 2010 and 2011. Independent sample one – way Anova (f-test) and Independent sample t-test have been utilized to find out the significant difference between corporate governance practices on working capital management efficiency. The results revealed that there is no significant mean different between the levels of working capital management efficiency among corporate governance practices as board committees, board meetings and proportion of non executive director except board leadership structure. Based on the findings, we recommended that the effective policies in the working capital management must be formulated through the corporate governance practices in the listed manufacturing firms in SriLanka.

Keywords: Corporate Governance practices, Manufacturing companies and Working Capital Management Efficiency.