The effect of corporate governance mechanisms on the relationship between institutional investors and inventory management

Presenting information which is useful for investors، creditors، and other current and potential users in decision makings related to investment and validating and other decisions is one of goals in financial reporting. The aim of this research is to study corporate governance mechanisms including managerial ownership، structure of board of directors، and board size on the relationship between institutional investors and inventory management in firms enlisted in Tehran Stock Exchange. To analyze data we have used a multiple variable regression by using generalized moments. Statistical sample in this research entails 47 companies which were enlisted in Stock Exchange during the time period between 2006 and 2011. Control variables in this research were firm growth، firm size، financial leverage، profitability، capital intensity، age، and private ownership. Results of analyzing data showed that managerial ownership affected the relationship between institutional investors and inventory management meaningfully. But structure and size of board of directors did not have any meaningful effects on the relationship between institutional investors and inventory management.