Unravelling financial policy linkages and corporate governance

The main purpose of this study is to explore the casual relationships among investment, financing and dividend policies for listed electronic companies in Taiwan. We further examine whether the causal relationships would vary with different corporate governance structures. We find that the firms' investment expenditures positively affect their leveraged financings. The results also show that there is a positive interaction between the investment expenditures and the dividend payments. In addition, a negative relationship is found between leveraged financings and dividend payments. Moreover, the causal relationships among the three financial policies remain unchanged under different corporate governance structures.