A comparative approach of the effect of CEO power on stock price changes in strategic and non-strategic industries of the Tehran Stock Exchange

Document Type : Research Paper

Authors

1 کرمان بزرگ راه امام خمینی-میدان پژهش دانشگاه شهید باهنر-دانشکده مدیریت و اقتصاد

2 Department of Accounting, Faculty of Management and Economics, Shahid Bahonar University of Kerman, Kerman, Iran

3 azad university

10.22103/jdc.2024.23726.1488

Abstract

Objective: Stock price changes are a crucial topic for all investors, especially those with long-term goals who are sensitive to share prices and fluctuations. These changes provide valuable information for evaluating companies, comparing their performance with others, assessing efficiency, and ultimately influencing investors' decisions. Therefore, the aim of this research is to compare the impact of CEO power on stock price changes in both strategic and non-strategic industries on the Tehran Stock Exchange, focusing on companies listed on the exchange.

Method: To test the hypotheses of the research, financial information from 120 companies admitted to the Tehran Stock Exchange between 2014 and 2022 was utilized. The companies were categorized into strategic and non-strategic industries. Following the measurement of the research variables, multivariate linear regression analysis, robust regression tests, and regression analysis graphs were employed to test the research hypotheses.

Conclusion: The research results indicate that the CEO's power does not significantly affect stock price changes in strategic industries. The rejection of the hypothesis suggests that the CEO's role as an executive director in capital market companies has no impact on stock price changes. Additionally, the results of the second hypothesis test also demonstrated that the CEO's power does not significantly influence stock price changes in non-strategic industries.

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History

  • Receive Date: 08 July 2024
  • Revise Date: 28 July 2024
  • Accept Date: 03 August 2024

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