Authors : Davoud Jalilizadeh and Mohammad Reza Karimi Pouya
Abstract: Corporate governance aims to reduce the agency problem. Now a days, this is a commonly accepted fact in the finance literature that risk management can lead to conflict between the companies’ managers and shareholders. Therefore, corporate governance mechanisms are used to reduce conflicts between managers and shareholders. This study examines the effect of corporate governance structure on risk management in 134 companies listed in Tehran Stock Exchange using panel data over 2008-2013. Institutional ownership was considered as independent variable and systematic risk, liquidity risk and financial risk as dependent variables of the study. Multiple regression and Ewievs6 Software were used to test the research hypotheses. The results of the research hypotheses suggest that there is no significant relationship between systematic risk, liquidity risk and financial risk and institutional ownership. Therefore, institutional ownership could not direct risk management behavior. This could pave the way for important economic decisions for different groups of stakeholders, especially investors because the determining factors derived from troubleshooting not only helps to explain corporates behavior in the past but also provides a tool to predict the movement and future path in this area.
Davoud Jalilizadeh and Mohammad Reza Karimi Pouya, 2016. Evaluation the Effect of Corporate Governance on Risk Management in Accepted Companies in Tehran Stock Exchange. International Business Management, 10: 4050-4058.