The Role of Corporate Governance and Market Discipline on Firms Productivity

Subject Areas :

Farzin Rezaei ¹ , Minoo Mohammadizadeh ²

1 - عضو هئیت علمی و استادیار حسابداری دانشگاه آزاد اسلامی واحد قزوین،دانشکده مدیریت و حسابداری
2 - کارشناس ارشد حسابداری ،موسسه آموزش عالی کار دانشگاه قزوین

Received: 2015-09-26 Accepted : 2015-09-26 Published : 2014-03-21

Keywords: Corporate governance, Firm’s total productivity, Market discipline, Market power,

Abstract :

Thisstudyexamines therole ofcorporate governanceandmarket disciplineon firm,s productivityinTehran Stock Exchange.Corporate governance has a significant effect on the firms total productivity and also a strong substitution between corporate governance and the market competition exists, this means that competition reduces agency problems, so when companies are facing extremely competitive manufacturing market, the corporate governance less effect on the firm,s total productivity is involved. We thus analyzed the financial information of 92 companies listed in the Tehran Security Bourse within the period 2004-2009. Required datausing library studies andsoftwareRahavardnovincollected.To test the hypothesis of correlation analysis and panel data and applying multivariate regression model with fixed effects with variable delay auto regression method in Eviews and SPSS statistical software was used. The research findings show that the positive and significant relationship between ownership concentration and total productivity has, also the relation between non-executive directors and total productivity is positive and significant and the relationship between board size and total productivity although is positive, but is not significant. Between corporate governance and total productivity characteristics, concentrator marketdiscipline, onlyrelationship between board size and total productivity debilitated andthe adjustment on other relationships did not exist.