Surveying of the Relationship between Investment Level and Corporate Governance Mechanisms with Firm Value

Abstract

the present study seeks to examine the relationship between investment level and corporate governance mechanisms with corporate value in companies listed at Tehran Stock Exchange. Independent variables include investment level and corporate governance mechanisms which, in turn,comprises in dependent directors, ownership concentration, institutional ownership, auditor type and free floating shares.firm value is our dependent variable measured by Tobin-Q index. Also,control variables such as firm size, leverage, and growth opportunity are used. The study is an applied research withcorrelative, post-event methodology. Population of the study includes 104 companies listed at Tehran Stock Exchange during 2003 to 2011 using screening method. Normal least squares regression model is used for testing hypotheses. Results indicate that level of investment has no effects on firm value in general companies in sense.Also, from among corporate governance mechanisms in general companies , independent directors has positive and significant, while auditor type has negative and significant, effects on firm value, And other corporate governance mechanisms have  no effect on firm value.

Key words: investment level, corporate governance mechanisms, firm value.