Analyzing the effect of Board Characteristics on Manager’s Optimism

چکیده مقاله

This research examined the effect of board characteristics on manager’s optimism. Board characteristics include board size, borad independence and board leadership. The statistical sample includes 227 companies listed in Tehran Stock Exchange over the period 2011 - 2015. Data gathering is based on panel data method that includes firm-year observations. The binary logit regression method used to test the hypotheses. The evidences indicated that optimistic managers have an aggressive approach in earnings forecast process, while pessimistic managers have a conservative approach in earnings forecast process. The results showed that only board independence has a meaningful and negative effect on manager’s optimism. This result also confirmed using the test for equality of means between series. It means that board independence is less in firms which facing optimistic managers. But board size and board leadership have no meaningful effect on manager’s optimism. Other results showed that managers in firms which have high growth, less leverage and larger size are less optimistic. However, age and return on equity have no meaningful effect on manager’s optimism.

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