The Effect of Ownership Structure and Board Composition as Corporate Governance Mechanisms on Coroporate Value

Please enable javascript in your browser.

Sadighian, Amir Hossein | 2009

681 Viewed

Type of Document: M.Sc. Thesis
Language: Farsi
Document No: 39424 (44)
University: Sharif University of Technology
Department: Management and Economics
Advisor(s): Mashayekhi, Ali Naghi
Abstract:
In this research we examine the effects of internal corporate governance mechanisms on shareholder value of 247 firms that were accepted in Tehran Stock Exchange. The main focus is on ownership structure and board composition. Owners with different identities affect shareholder value both directly and to some extent indirectly (through affecting board composition). We measured firm value using 2 different measures: relative growth of share price and market to book value of the firm. Controlling for industry effects, considering different levels of competitiveness, we find that private owners affect firm value more positively than governments and so do institutional investors more than industrial groups. However due to Iran's high level of ownership concentration we find no meaningful relationship between ownership concentration and firm value. Also increase in the ratio of unemployed board members has a negative effect on firm value. Finally we find some meaningful substitution effects between owners identity and board composition. Private owners tend to use more unemployed members on their board
Keywords:
Ownership Structure ; Board Composition Structure ; Corporate Governance ; Corporate Performance ; Corporate Value ; Internal Control Mechanism

No TOC