How Controlling Shareholders Impact Debt Maturity Structure in Taiwan


  • We are grateful to two anonymous reviewers for their valuable comments on our study. In addition, we offer thanks to Richard Levich for his helpful editorial comments. Finally, we extend gratitude to Asia University for research support.


Using data on listed companies in Taiwan from 1998 to 2009, our study investigates how controlling shareholder structure can affect debt maturity structure. The results indicate a significant negative relationship between ownership and debt maturity in the sample companies when control rights are lower than required control shareholdings. Conversely, the results also demonstrate that the separation of control from ownership displays a significant positive impact on debt maturity for controlling shareholder structure when control rights exceed cash-flow rights. Overall, our results show that there is an inverted U-shaped non-linear relationship between control rights and the duration of liabilities in the control structure of ultimate controlling shareholders. Further, the consequence is that we find the required control shareholdings ratio serves as an important criterion in analyzing it, when dividing the control rights structure based on controlling shareholders into different combinations.