Examining the Impact of Board Structure on Stock Returns and Earnings Management: The Moderating Role of IT Governance in Tehran Stock Exchange Firms

Subject Areas : • Emerging technology in the field of Accounting and its future

Mehdi Rezaei ^{1 *} , Marzieh Faqih ² , Roghayeh Shamsaee ³

1 - Assistant Professor, Department of Accounting, Faculty of Business and Economics, Persian Gulf University, Bushehr, Iran.
2 - Ph.D. Student, Department of Accounting, Bushehr Branch, Islamic Azad University, Bushehr, Iran
3 - Ph.D. Student, Department of Accounting, Bushehr Branch, Islamic Azad University, Bushehr, Iran

Received: 2025-02-02 Accepted : 2025-04-04 Published : 2025-04-21

Keywords: Board Structure, IT Governance , Profit Management , Stock Return,

Abstract :

Objectives: This study examines the impact of board structure on stock returns and earnings management, considering the moderating role of information technology (IT) governance in companies listed on the Tehran Stock Exchange. By exploring these relationships, the research aims to provide insights into how corporate governance mechanisms and IT governance influence financial performance and reporting quality.

Methodology/Design/Approach: The research is applied in nature and follows a correlational-descriptive methodology. The statistical population consists of firms listed on the Tehran Stock Exchange, with a research sample of 110 companies observed over eight years from 2015 to 2022. Multivariate regression analysis with panel data was conducted using Eviews software to test the research hypotheses.

Findings: The results indicate a significant relationship between board independence and stock returns, as well as between board size and stock returns. IT governance moderates these relationships, strengthening the positive effect of board independence on stock returns while intensifying the negative effect of board size on stock returns. Additionally, board independence has a significant positive effect on earnings management, whereas board size has a significant negative effect. IT governance also moderates the relationship between board structure and earnings management, influencing the extent to which board characteristics impact financial reporting practices.

Innovation: This research contributes to the literature by integrating IT governance into corporate governance studies, highlighting its moderating effect on the relationship between board structure, stock returns, and earnings management. The findings provide valuable implications for managers, investors, and regulators, emphasizing the importance of board composition and IT governance in evaluating corporate performance and making informed investment decisions.

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