Does Societal Trust Influence Corporate Debt Maturity? International Evidence

ABSTRACT This article analyses data from 26 countries to examine the effects of societal trust levels on corporate debt maturity. Empirical evidence shows that companies operating in countries with higher societal trust exhibit longer debt maturities. The study also investigates the moderating role of investor protection on the relationship between societal trust and debt maturity, particularly focusing on the effectiveness of legal institutions, legal strength, and political stability. The results reveal that firms in countries with stronger investor protections experience a more pronounced positive impact of societal trust on debt maturity. Additionally, the study addresses potential endogeneity issues, firm fixed effects, and self‐selection biases to ensure that the results are consistent and reliable.