The analysis of the impact of the CEO power on the investment-cash flow sensitivity

الملخص EN

The investment-cash flow sensitivity is an issue that has recently become the focus of financial researchers; therefore, the purpose of the present study is to investigate the impact of the CEO Power on the investment-cash flow sensitivity of the Companies listed in Tehran Stock Exchange.

To this end, the hypothesis (1) was developed and then, the data of the 104 companies listed in Tehran Stock Exchange, belonging to the time era extending from 2014 to 2020, were analysed.

The number of the data collected for this study was 728 years -company.

The research regression pattern was examined using the panel data and adopting a fixed impacts approach.

The obtained results suggest that CEO power has a negative and significant impact on the investment-cash flow sensitivity.

Thereby, the results of this work demonstrate that the CEO power lowers the investment-cash flow sensitivity through the reduction of agency costs, aligning the interests of managers and investors, reducing managers' malfeasance, improving operational decisions and enhancing the quality of reporting.