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Abstract of Emerging Trends in Scientific Research, 2014, Vol.1
DOI: 10.18488/journal.1002/2014.1/1002.1
1st
International Conference on Emerging Trends in
Scientific Research
15-16 March, 2014
Pearl International Hotel Kuala Lumpur, Malaysia
Conference Website: www.pakrdw.com
95
Paper ID: 393/14/1
st
ICETSR
Independent Directors’ Resource Provision Capability in
Publicly-Listed Companies in Malaysia
Saeed Pahlevan Sharif1
--- Khong Kok Wei2
1,2
Business School, Taylor's University Subang Jaya, Malaysia
Abstract
This paper by considering concentrated ownership and corporate culture in Malaysia
argues that independent directors in Malaysian publicly listed companies plays a
significant role in providing resources that companies need for their operation and their
role is more salient during the crisis period. We select 289 samples randomly from
publicly listed companies on Bursa Malaysia for the pre-crisis (2007) and the crisis (2008)
periods. Hypotheses are tested by using paired sample t test with bootstrapping
technique. The results show that when companies faced the global financial crisis, they
appointed new independent directors on the board. More specifically, they appointed
independent directors who are capable to link the company to the government and
expand the companies’ networks with other large companies. Besides, after the crisis,
companies did not increase number of independent directors who are bankers, lawyers,
or have social connections as accessing to these kinds of resources is not priority in the
crisis period.
Keywords: Resource dependence theory, Resource provision capability, Independent directors, Malaysia,
Global credit crisis.

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Independent Directors’ Resource Provision Capability in Publicly-Listed Companies in Malaysia

  • 1. Abstract of Emerging Trends in Scientific Research, 2014, Vol.1 DOI: 10.18488/journal.1002/2014.1/1002.1 1st International Conference on Emerging Trends in Scientific Research 15-16 March, 2014 Pearl International Hotel Kuala Lumpur, Malaysia Conference Website: www.pakrdw.com 95 Paper ID: 393/14/1 st ICETSR Independent Directors’ Resource Provision Capability in Publicly-Listed Companies in Malaysia Saeed Pahlevan Sharif1 --- Khong Kok Wei2 1,2 Business School, Taylor's University Subang Jaya, Malaysia Abstract This paper by considering concentrated ownership and corporate culture in Malaysia argues that independent directors in Malaysian publicly listed companies plays a significant role in providing resources that companies need for their operation and their role is more salient during the crisis period. We select 289 samples randomly from publicly listed companies on Bursa Malaysia for the pre-crisis (2007) and the crisis (2008) periods. Hypotheses are tested by using paired sample t test with bootstrapping technique. The results show that when companies faced the global financial crisis, they appointed new independent directors on the board. More specifically, they appointed independent directors who are capable to link the company to the government and expand the companies’ networks with other large companies. Besides, after the crisis, companies did not increase number of independent directors who are bankers, lawyers, or have social connections as accessing to these kinds of resources is not priority in the crisis period. Keywords: Resource dependence theory, Resource provision capability, Independent directors, Malaysia, Global credit crisis.