Corporate Governance Quality and Stakeholder Management: The Mediating Role of the Likelihood of Fraudulent Reporting

Document Type : Research Paper

Authors

1 Master of Accounting, Urmia University, Urmia, Iran.

2 Assistant Prof. of Accounting, Department of Accounting, Faculty of Economics and Management, Urmia University, Urmia, Iran

3 Associate Professor of Finance, Urmia University, Urmia, Iran.

Abstract

Purpose: examining the causes and conditions of financial scandals in companies shows that the lack of effective control over managers and imperfect governance of shareholders over how to manage affairs, along with delegating unlimited authority to management, provides grounds for fraud and fraudulent reporting. Fraudulent reporting diverts the company's interests to specific groups, thus intensifying the conflict of interests of the stakeholders. Therefore, the present study examines the impact of corporate governance quality on stakeholder management with an emphasis on the mediating role of fraudulent financial reporting.
Methodology: The research sample includes 96 companies listed in Tehran Stock Exchange between 2010 and 2020 that investigated using multiple regression.
Results: Findings showed that there is a direct and significant relationship between the quality of corporate governance and the second method of stakeholder management, but this relationship is not significant in the first method of stakeholder management. and there is a significant inverse relationship between the quality of corporate governance and the likelihood of fraudulent reporting; It was also found that there is an inverse and significant relationship between the possibility of fraudulent reporting and the second method of stakeholder management. Consequently, the mediating role of the possibility of fraudulent reporting in the relationship between the quality of corporate governance and the second method of stakeholder management is also confirmed.

Keywords

Main Subjects

References

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Journal of Accounting and Social Interests
Volume 13, Issue 3 - Serial Number 50
November 2023
Pages 115-142

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History

  • Receive Date: 15 January 2022
  • Revise Date: 25 April 2023
  • Accept Date: 26 April 2023

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