Document Type : Original Research Paper
Authors
1 Department of Business Management, Faculty of Management, West Tehran Branch, Islamic Azad University, Tehran, Iran
2 Department of Economics, Faculty of Islamic Studies and Economics, Imam Sadegh University, Tehran, Iran
Abstract
Objective: In the last decade, attention to the dimensions of corporate governance in theoretical researches in the field of economic institutions and especially insurance companies has been of great importance. The aim of the research is to investigate the effect of corporate governance mechanisms on the wealth of insurance companies admitted to the stock exchange by using the efficient model and analyzing the results with the theories of this field.
Methodology: The effect of selected components of corporate governance (ownership concentration, non-executive board members, managerial ownership, and job segregation) and four financial performance variables (profitability, liquidity, size and growth of companies) on the financial solvency of insurance companies using panel data regression, model It deals with generalized torque and artificial neural networks in the period from 1390 to 1395.
Findings: The results of this research confirm the relationships between wealth and the components of ownership concentration and the presence of a non-commissioned member of the board of directors in the field of corporate governance, as well as profitability and size variables in the field of financial performance of insurance companies in all three models. Also, the results, in addition to confirming the agency theory, show that the effectiveness of non-linear models in explaining the relationships of financial wealth and the components of corporate and financial governance of companies is more than linear models.
Conclusion: Large shareholders have more incentives to monitor management, because the costs associated with management monitoring are less than the expected benefits of large shareholders in the company. In companies with centralized ownership, major shareholders can act as supervisors who are able to increase the quality of management and also improve the efficiency level of the company. Profitability (return on assets) arising from non-operating incomes in insurance companies can lead to an overall improvement in the wealth of companies. Also, large insurance companies tend to provide more information than smaller companies to external investors, and this increases the use of equity-based financing.
Keywords
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