The Role of Internal and External Dimensions of Corporate Governance on the Relationship between Information Asymmetry and Investment Efficiency

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MANSOURFAR GHOLAMREZA; Joudi Samira; Poursoleiman Ehsan

مرکز اطلاعات علمی Scientific Information Database (SID) - Trusted Source for Research and Academic Resources

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Journal: FINANCIAL RESEARCH Year:2020 | Volume:22 | Issue:2 Page(s): 227-248

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Title

The Role of Internal and External Dimensions of Corporate Governance on the Relationship between Information Asymmetry and Investment Efficiency

Author(s)

MANSOURFAR GHOLAMREZA | Joudi Samira | Poursoleiman Ehsan | Issue Writer Certificate

Keywords

Investment efficiencyQ1

Information asymmetryQ2

Internal corporate governanceQ1

External corporate governanceQ1

Abstract

Objective: This research is aimed at investigating the impact of internal and External corporate governance on the relationship between Information asymmetry and Investment efficiency. Methods: For the purpose of analyzing the research hypothesis, 106 publicly traded firms on the Tehran Stock Exchange, between 2009 and 2018, have been selected using the elimination method. The analysis of the hypotheses was carried out by using a multivariate regression model with panel data method and employing the fixed effects approach. Results: According to theoretical bases and research finding, Information asymmetry has a negative and significant relationship with Investment efficiency. Also, corporate governance variables, in both external and internal governance, and both variables of Information asymmetry and both dimensions of corporate have a positive and significant relationship with Investment efficiency. Conclusion: The results of the research show that the existence of asymmetric information and ambiguity in financial information may lead to inefficient investments. Hence, one of the ways to reduce Information asymmetry and increase Investment efficiency is enhanced corporate governance quality. According to the existing principle, current expectations, and the findings of this study, the interaction of information and corporate governance have a positive and significant relationship with Investment efficiency. This means that in the condition of Information asymmetry, the existence of internal and External corporate governance reduces inefficient investments and urges managers to make optimal and efficient investment decisions.

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APA: Copy

MANSOURFAR, GHOLAMREZA, Joudi, Samira, & Poursoleiman, Ehsan. (2020). The Role of Internal and External Dimensions of Corporate Governance on the Relationship between Information Asymmetry and Investment Efficiency. FINANCIAL RESEARCH, 22(2 ), 227-248. SID. https://sid.ir/paper/361777/en

Vancouver: Copy

MANSOURFAR GHOLAMREZA, Joudi Samira, Poursoleiman Ehsan. The Role of Internal and External Dimensions of Corporate Governance on the Relationship between Information Asymmetry and Investment Efficiency. FINANCIAL RESEARCH[Internet]. 2020;22(2 ):227-248. Available from: https://sid.ir/paper/361777/en

IEEE: Copy

GHOLAMREZA MANSOURFAR, Samira Joudi, and Ehsan Poursoleiman, “The Role of Internal and External Dimensions of Corporate Governance on the Relationship between Information Asymmetry and Investment Efficiency,” FINANCIAL RESEARCH, vol. 22, no. 2 , pp. 227–248, 2020, [Online]. Available: https://sid.ir/paper/361777/en

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