Corporate Governance, Leverage, and Stock Returns of Non-Financial Listed Firms in the ASEAN Region: The Moderating Role of Firm Growth

A well-structured board, with diversity, independence, and strong audit committee supervision, can enhance shareholder value by improving monitoring, decision-making, and investor trust, ultimately leading to higher returns However, empirical research has revealed a more subtle perspective, with various relationships that can be positive, inconclusive, or negative.highlighted the importance of further studies on the moderating factors that help explain these diverse findings.This study examines the moderating role of firm growth on the effects of corporate governance mechanisms and leverage on the stock returns of non-financial listed firms in the ASEAN region.Data were obtained from six countries in the ASEAN region comprising 412 firms covering to 2012-2022 from the LSGE-Eikon database.This study reveals a positive relationship between board independence, gender diversity, and robust audit committees and returns, emphasising the importance of strong governance in aligning interests and reducing agency costs.It also highlights the role of firm growth in influencing governance elements, and emphasizes the link between strategic leverage and growth expectations.Establishing robust independent audit committees and sharing financial information consistently is recommended to promote openness and confidence.This study implies that businesses with strong corporate governance, particularly those with higher price-to-book ratios, experience better supervision and decision making.