Investigating the Impact of Managerial Ability on External Financing Policy with the Mediating Role of Financial Constraints

Articles in Press

Document Type : Research Paper

Authors

1 Master in Financial Management, Faculty of Economics, Management and Accounting, Yazd University, Yazd, Iran.

2 Associate Professor Yazd University, Faculty of Economics, Management and Accounting, Yazd University, Yazd, Iran.

10.22103/jak.2025.24375.4116

Abstract

Purpose: The purpose of this research is to investigate the effect of management ability on foreign financing policy with the mediating role of financial constraints among companies listed on the Tehran Stock Exchange.

Method: Using the systematic elimination method, a sample of 130 companies admitted to the Tehran Stock Exchange in the period of 2014 to 2022 was selected and analyzed. After measuring the variables and statistical analysis related to the combined data, the research hypotheses were tested in the form of 10 models and with the GLS regression method by version 12 of Eviews software.

Findings: The results of this research showed that companies managed by more capable managers tend to reduce loan financing and increase equity financing, and these results are stronger for companies that do not have financial constraints.

Conclusion: Companies that are managed by more capable managers can reduce financial restrictions in the company by reducing information asymmetry and agency problems, and finally by reducing the cost of external financing, the use of this method Facilitate financing. Also, the evidence shows that managers who have higher management ability can increase the disclosure of financial information and thereby reduce the information risk and representation problems in the financial market and thus facilitate the issuance of shares.

Keywords

Journal of Accounting Knowledge

Articles in Press, Accepted Manuscript
Available Online from 28 April 2025

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History

  • Receive Date: 25 November 2024
  • Revise Date: 28 January 2025
  • Accept Date: 28 April 2025

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