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Analyzing the Relationship Between Institutional Ownership and Systematic Risk with Emphasis on the Role of Corporate Governance: Using GMM and EGLS Methods
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Hossein Ameri *    |
| Department of Accounting, Faculty of Economics and Administrative Sciences, University of Mazandaran |
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Abstract: (20 Views) |
| This study investigates the moderating role of corporate governance in the relationship between institutional ownership and systematic risk in Iran's capital market. The statistical population consists of all companies listed on the Tehran Stock Exchange. A total of 632 firm-year observations were examined over the period 1395-1402. To analyze the data, two regression models were employed: the Generalized Method of Moments (GMM) and the Estimated Generalized Least Squares (EGLS). The results indicate that institutional ownership has a positive and significant effect on systematic risk, suggesting that higher institutional ownership is associated with increased systematic risk in firms. Furthermore, corporate governance plays a moderating role in this relationship. Specifically, effective corporate governance mechanisms can mitigate the adverse impact of institutional ownership on systematic risk. These findings are confirmed by both the GMM and EGLS models with statistically significant coefficients at the 95% confidence level. Overall, the study highlights that strengthening corporate governance can contribute to reducing systematic risk in Iran's capital market. The findings offer useful insights for managers and policymakers aiming to improve governance frameworks and manage risk more effectively. |
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| Keywords: Corporate Governance, Institutional Ownership, Systematic Risk, GMM Model, EGLS Model. |
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Full-Text [PDF 1094 kb]
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Type of Study: Research |
Subject:
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