The Effect of Management Ownership Adjustments and Its Changes on A Company’s Value

Abstract

In recent decades, the effect of management ownership on a company's value has been a fundamental and noteworthy subject in companies' organization and financial researches. In the current research, the effect of management ownership adjustments and its changes on a company's value has been studied. In this regard, all the collected data were used from 52 companies that were accepted in Tehran Stock Exchange during the years 2006 to 2011. Management ownership and its transformations have been considered as independent variables in this research. The dependent variable that has been studied is the company's value. Multiple regression and panel data methods have been used to test the hypothesis. Two hypotheses have been developed to accomplish this research: in the first one, the effect of management ownership adjustments on a company's value has been studied. The first hypothesis result shows its acceptance in the significance level of 95%. In the second hypothesis, the changes of management ownership have been studied. The results of this hypothesis test showed that management ownership changes and transformations have a meaningful effect on a company's value.