Barine Nkonge Habakkuk

Shareholders of listed firms are guaranteed reasonable security prices due to enhanced firm value, which translates to global wealth creation. However, firms’ value has declined globally. Therefore, this paper uses a causal-comparative design and panel data regression model to explore the nexus between corporate governance, asset structure, and value of Kenyan-listed firms from 2010 to 2019. Secondary data were extricated from audited financial reports of 51 firms. As hypothesized, the results show a positive relationship between board composition and firm value with a regression coefficient (0.17, p < .05). The composition of the audit committee is positively associated with firm value with a regression coefficient of (0.629, p < .05). A tangible and notable correlation exists between protecting shareholders’ rights and firm value with a regression coefficient of (0.28, p < .05), while financial disclosure was significant with a regression coefficient of (1.15, p < .05). Plant, property and equipment positively and significantly affect firm value with a regression coefficient of (2.10, p < .05), while financial assets had (0.28, p < .05), which was significant. Current assets positively and significantly affect firm value with a regression coefficient of (1.87, p < .05). Finally, the results reveal a positive but insignificant correlation between firm size and value with a regression coefficient of (0.22, p < .05), while the relationship between firm age and value is negative but insignificant with a regression coefficient of (–0.003, p < .05). The study recommends that sufficient managerial effort be directed towards corporate governance and asset structure to maximize shareholder value.

Firm value shows the performance of a firm while reflecting the present value of the firm’s future cashflows, hence affecting investment decisions. Therefore, this paper explores the relationship between asset structure, leverage, and firm value of 51 listed companies between 2010 and 2019 using secondary data collected from audited financial statements. The study applies panel data regression models and the causal-comparative research design. The quantitative data are analyzed using multiple regression. The result shows that plant, equipment, property, current, and financial assets influence the firm value positively. Nonetheless, the quotient of current to total assets was reported to yield the highest beta coefficient, implying that significant firm value creation is realized for every additional current asset held, weighed against the quotient of additional equipment, property, and plant to the value of total assets. Leverage had an insignificant influence on the value of firms, implying that no maximization of value is attainable in manufacturing firms through the astute use of borrowed funds. The study recommends that finance pundits consider firms’ asset structure and the use of borrowed funds when formulating financial and investment policies. The study enriches the scholarly world by developing a model for establishing the value of listed firms.