The Nexus of Free Cash Flow and Asset Utilization: Moderating Effects of Gender Diversity and Board Independence

Abstract

The study examines a moderating effect of gender diversity and board independence on a company's assets and free cash flow andthe relationship between asset utilization and free cash flow. The data has been obtained from the listed companies of the PSX-100 index for2004-2019. The study employed various statistical tools like descriptive statistics, correlation analysis, and pooled regression, with a random effect model. The findings stated that that gender diversity moderates the relationship between asset utilization’ and Free cash flow. The findings also show that firms with higher gender diversity covering free cash flow positively impact the asset utilization of firms. The board independence has less effectiveness for monitoring the various levels of administrative ownership. As free cash flow increases, high board independence allows managers to less efficient asset utilization.