The Effect of Institutional Shareholders on the Relationship between CEO Power and Capital Structure in Companies

Document Type : Original Article

Authors

1 Associate Prof, Department of Accounting, Tarbiat Modares University, Tehran, Iran.

2 Ph.D. Candidate in Accounting, Kish International Campus, University of Tehran, Iran.

3 MSc. of Accounting, KAR Higher Education Institute, Qazvin, Iran.

Abstract

The main purpose of this study is to investigate the effect of institutional shareholders on the relationship between CEO power and capital structure decisions in companies listed on the Tehran Stock Exchange. The statistical population of the research is the companies listed on the Tehran Stock Exchange and the research period is from 2011 to 2018. To test the research hypotheses, 106 companies were selected by systematic elimination method. The research method used is descriptive post-event and the combined data method was used to analyze the data and the multiple regression method was used to test the hypotheses. The results of the test showed that there is a positive and significant relationship between CEO power and the book value leverage, market value leverage, and short-term leverage. Also, there is a negative and significant relationship between the CEO power and the long-term leverage. In addition, institutional shareholders have a moderating effect on the relationship between CEO power and market value leverage.

Keywords

References

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