Managerial Ability and Investors Protect: Test of Stimulating Decision-Making Functions by Devil's Advocate Theory
The efforts of the developers of capital market laws and regulations over the past years have been aimed at increasing the level of information transparency to create more symmetry between companies and shareholders so that they can be more attractive to investors to invest in the stock market. But...
| Main Authors: | , , , , |
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| Format: | Article |
| Language: | English |
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Iran Finance Association
2022-05-01
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| Series: | Iranian Journal of Finance |
| Subjects: | |
| Online Access: | https://www.ijfifsa.ir/article_150075_76419d6290d945e43f9103f0fc8d6180.pdf |
| _version_ | 1798016561499340800 |
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| author | Mohammad Mehdi Mohammadi Mehdi Safari Gerayli Maryam Shahri Hasan Valiyan Farhad Dehdar |
| author_facet | Mohammad Mehdi Mohammadi Mehdi Safari Gerayli Maryam Shahri Hasan Valiyan Farhad Dehdar |
| author_sort | Mohammad Mehdi Mohammadi |
| collection | DOAJ |
| description | The efforts of the developers of capital market laws and regulations over the past years have been aimed at increasing the level of information transparency to create more symmetry between companies and shareholders so that they can be more attractive to investors to invest in the stock market. But given the interplay of individual characteristics of corporate decision-makers with the interests of shareholders and investors, it seems that focusing on behavioral functions in the area of promoting managerial ability can more effectively lead to increased protection of shareholder interests. The purpose of this study is to investigate the effect of management ability on the protection of investors based on the development of the theory of the devil's advocate. Therefore, the present study, using the structural equation modeling approach and partial least squares analysis (PLS), while fitting the model's desirability, examined the impact of management ability on protecting investors. In this study, in order to measure the in-field variable, ie protection of shareholders' interests, a researcher-made questionnaire was created through meta-analysis with the participation of 15 research experts. Then the criterion of Demirjan et al (2013) was used to measure managerial ability as an exogenous variable in partial least squares analysis. The researcher-made questionnaire was sent to 142 CEOs of companies listed on the Tehran Stock Exchange, and finally, after many follow-ups, 105 questionnaires were completed and returned and used as a final sample for analysis. After ensuring the acceptable fit of the measurement and structural models of the research, according to the theory of the devil's advocate, the results showed that the ability of management has a positive and significant effect on protecting the investors. Managerial ability, as one of the specialized decision-making capacities, puts the company on the path of effective interaction with stakeholders and provides the ground for investors to Protect in companies' priorities to gain their trust. |
| first_indexed | 2024-04-11T15:51:39Z |
| format | Article |
| id | doaj.art-c3a9d485172a436ea7094389d76bacf6 |
| institution | Directory Open Access Journal |
| issn | 2676-6337 2676-6345 |
| language | English |
| last_indexed | 2024-04-11T15:51:39Z |
| publishDate | 2022-05-01 |
| publisher | Iran Finance Association |
| record_format | Article |
| series | Iranian Journal of Finance |
| spelling | doaj.art-c3a9d485172a436ea7094389d76bacf62022-12-22T04:15:16ZengIran Finance AssociationIranian Journal of Finance2676-63372676-63452022-05-01638311510.30699/ijf.2022.296805.1254150075Managerial Ability and Investors Protect: Test of Stimulating Decision-Making Functions by Devil's Advocate TheoryMohammad Mehdi Mohammadi0Mehdi Safari Gerayli1Maryam Shahri2Hasan Valiyan3Farhad Dehdar4Ph.D Candidate, Department of Accounting, Shahrood Branch, Islamic Azad University, Shahrood, Iran.Associate Professor, Department of Accounting, Bandargaz Branch, Islamic Azad University, Bandargaz, IranAssistant Professor, Department of Accounting, Shahrood Branch, Islamic Azad University, Shahrood, IranAssistant Professor, Department of Accounting, Shahrood Branch, Islamic Azad University, Shahrood, Iran.Assistant Professor, Department of Accounting, Shahroud Branch, Islamic Azad University, Shahrood, Iran.The efforts of the developers of capital market laws and regulations over the past years have been aimed at increasing the level of information transparency to create more symmetry between companies and shareholders so that they can be more attractive to investors to invest in the stock market. But given the interplay of individual characteristics of corporate decision-makers with the interests of shareholders and investors, it seems that focusing on behavioral functions in the area of promoting managerial ability can more effectively lead to increased protection of shareholder interests. The purpose of this study is to investigate the effect of management ability on the protection of investors based on the development of the theory of the devil's advocate. Therefore, the present study, using the structural equation modeling approach and partial least squares analysis (PLS), while fitting the model's desirability, examined the impact of management ability on protecting investors. In this study, in order to measure the in-field variable, ie protection of shareholders' interests, a researcher-made questionnaire was created through meta-analysis with the participation of 15 research experts. Then the criterion of Demirjan et al (2013) was used to measure managerial ability as an exogenous variable in partial least squares analysis. The researcher-made questionnaire was sent to 142 CEOs of companies listed on the Tehran Stock Exchange, and finally, after many follow-ups, 105 questionnaires were completed and returned and used as a final sample for analysis. After ensuring the acceptable fit of the measurement and structural models of the research, according to the theory of the devil's advocate, the results showed that the ability of management has a positive and significant effect on protecting the investors. Managerial ability, as one of the specialized decision-making capacities, puts the company on the path of effective interaction with stakeholders and provides the ground for investors to Protect in companies' priorities to gain their trust.https://www.ijfifsa.ir/article_150075_76419d6290d945e43f9103f0fc8d6180.pdfmanagement abilityprotection of investorsthe devil's advocate theory |
| spellingShingle | Mohammad Mehdi Mohammadi Mehdi Safari Gerayli Maryam Shahri Hasan Valiyan Farhad Dehdar Managerial Ability and Investors Protect: Test of Stimulating Decision-Making Functions by Devil's Advocate Theory Iranian Journal of Finance management ability protection of investors the devil's advocate theory |
| title | Managerial Ability and Investors Protect: Test of Stimulating Decision-Making Functions by Devil's Advocate Theory |
| title_full | Managerial Ability and Investors Protect: Test of Stimulating Decision-Making Functions by Devil's Advocate Theory |
| title_fullStr | Managerial Ability and Investors Protect: Test of Stimulating Decision-Making Functions by Devil's Advocate Theory |
| title_full_unstemmed | Managerial Ability and Investors Protect: Test of Stimulating Decision-Making Functions by Devil's Advocate Theory |
| title_short | Managerial Ability and Investors Protect: Test of Stimulating Decision-Making Functions by Devil's Advocate Theory |
| title_sort | managerial ability and investors protect test of stimulating decision making functions by devil s advocate theory |
| topic | management ability protection of investors the devil's advocate theory |
| url | https://www.ijfifsa.ir/article_150075_76419d6290d945e43f9103f0fc8d6180.pdf |
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