Investigating the influence of Corporate Governance on relationship of free cash flow and return in Tehran Stock Exchange

the Conflict between management and share holders about payment of cash to shareholders is higher especially in the firms with large free cash flow. If free cash flow invested efficiency,the revenue and stock return will be increase. In this study effect of corporate governance, which regulate agency problem, investigate on relationship between free cash flow and stock return.
Analysis data for enterprise accepted in Tehran Stock Exchange for the period 2006 to 2013 shows institutional ownership have negative and significant effect on free cash flow and stock return and concentrations of ownership have positive and significant effect on the free cash flow and the stock return. Also, the results show board independence has no significant effect on the free cash flow and the stock return. Generally result show good corporate governance can decrease the agency costs of free cash flows.