Examining the Effect of Organizational Strategic System’s Traits on Financial Performance

Amir Shams Koloukhi () and Somayeh Pordareh ()
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Amir Shams Koloukhi: Department of Management, Torbat-e-Jam Branch, Islamic Azad University, Torbat-e-Jam, Iran
Somayeh Pordareh: Young Researchers and Elite Club, Neyshabur Branch, Islamic Azad University, Neyshabur, Iran

European Journal of Studies in Management and Business, 2017, vol. 2, 50-59

Abstract: This study examined the relationship of organizational strategic system’s traits including family management, CEO compensation, and tenure of managing director with corporate financial performance. To measure financial performance, Tobin’s Q and ROA measures were used. Financial performance can be affected by different factors among which organizational strategic system´ s traits can be the most important ones. To do this research, 193 listed firms in Tehran Stock Exchange were studied from 2011- 2015. For testing data consistency, Hardi test, for testing the hypotheses, panel regression, and for selecting among combined models, fixed and random effects, Hausman test were used. Results showed a negative and significant correlation of family management and financial performance with both Tobin’s Q and ROA. In addition, there was no significant correlation between CEO compensation and financial performance when the performance measure was Tobin’s Q, but when it was ROA, there was a significant correlation between them. Moreover, there was no significant correlation between tenure of managing director and financial performance with both Tobin’s Q and ROA.

Keywords: Financial Performance; Organizational Strategy; Family Management; CEO Compensation; Tenure of Managing Director (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:bco:mbrqaa::v:2:y:2017:p:50-59

DOI: 10.32038/mbrq.2017.02.05

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