Studying the Impact of Stakeholder Management on Dividends and Firm Value

Document Type : Research Paper

Authors

1 Assistant Prof. in Accounting, Haeri University of Meybod, East Azerbaijan, Iran

2 Prof. in Accounting, Faculty of Management and Economic, Shahid Bahonar University, Kerman, Iran

3 Associate Prof. in Accounting, Faculty of Management and Economic, Shahid Bahonar University, Kerman, Iran

Abstract

Business environment at now provides basis for application and integration stakeholder theory with agency theory in managerial and financial strategies. In this regard, balance creation between the interests of all stakeholders is important. The purpose of this study is to evaluate the impact of stakeholder management on dividends and firm value in consistent with the analysis of agency theory and stakeholder theory. To determine stakeholder management, cash flows paid to each of the stakeholders are used as the basis. For this purpose, a sample of 220 companies listed in the TSE is selected from 2010 to the 2015. Data has been examined using regression analysis. Research evidence shows a significant positive relationship between stakeholder management and dividends, also negative relationship between stakeholders management and market value of the firm. These results suggest that stakeholder management is also done in the interests of shareholders.

Keywords

References

Accounting Standard Committee. (2015). Accounting standard. Audit Organization, Tehran. (in Persian)
Agle, B.R., Donaldson, T., Freeman, R.E., Jensen, M.C. (2008). Dialogue: Toward Superior Stakeholder Theory. Business Ethics Quarterly, 18(2), 153-190.
Benson, B. W. & Davidson, W. N. (2010). The Relation between Stakeholder Management, Firm Value, and CEO Compensation: A Test of Enlightened Value Maximization. Financial Management, 39(3), 929-963.
Bohren, O., Josefsen, M. G. & Steen, P. E. (2012). Stakeholder conflicts and dividend policy. Journal of Banking & Finance, 36(10), 2852–2864.
Clarkson, M.B.E. (1995). A Stakeholder Framework for Analyzing and Evaluating Corporate Social Performance. Academy of Management Review, 20(1), 92-117.
Crane, A., Graham, C. & Himick, D. (2015). Financializing Stakeholder Claims. Journal of Management Studies, 52 (7), 878-906.
Donaldson, T. & Preston, L. E. (1995). Stakeholders Theory of the Corporation: Concepts, Evidence, and Implications. Academy of Management Review, 20(1), 65–91.
Easterbrook, F. (1984). Two agency-cost explanations of dividends. American Economic Review, 74(4), 650–659.
Freeman, R. E. (1984). Strategic Management. A Stakeholder Approach. Pitman, Boston.
Freeman, R.E., Wicks, A.C. & Parmar, B. (2004). Stakeholder Theory and The Corporate Objective Revisited. Organization Science, 15(3), 364-369.
Friedman, A.L. & Miles, S. (2006). Stakeholders. Oxford, UK, Oxford University Press.
Harrison, J.S. & Wicks, A.C. (2013). Stakeholder Theory, Value, and Firm Performance. Business Ethics Quarterly, 23(1), 97-124.
Harrison, J.S., Boss, D.A. & Philips, A. (2010). Managing For Stakeholders, Stakeholder Utility Functions, and Competitive Advantage. Strategic Management Journal, 31(1), 58-74.
Hill, C. L. & Jones, T. (1992). Stakeholder-Agency Theory. Journal of Management Studies, 29(2), 131-154.
Isaee Tafreshi, M. & Yahyapour, J. (2013). Stakeholder Theory with a View on Regulations of Stock Companies. Quarterly Journal of Securities Exchange, 23(6), 139-167. (in Persian)
Jensen, M.C. (2001). Value Maximization, Stakeholder Theory, and the Corporate Objective Function. Journal of Applied Corporate Finance, 14(3), 8-21.
Jensen, M.C. (2010). Value Maximization, Stakeholder Theory, and the Corporate Objective Function. Journal of Applied Corporate Finance, 22(1), 32-42.
Konsik, R. (1987). Greenmail: a study of board performance in corporate governance. Administrative Science Quarter, 32(2), 163-185.
Rahgozar, R. (2006). An Empirical Study on Value-Based Performance Measures, Stakeholder Satisfaction, and Stock Prices. Iranian Accounting & Auditing Review, 13(4), 8-27.
Roberts, R. W. (1992). Determinants of Corporate Social Responsibility Disclosure: An Application of Stakeholder Theory. Accounting Organizations and Society, 17 (6), 595-612.
Shankman, N. A. (1999). Reframing the debate between agency and stakeholder theories of the firm. Journal of Business Ethics, 19(4), 319-334.
Solomon, J. & Solomon, A. (2004). Corporate Governance and Accountability. John Wiley and Sons Ltd.
Wang, H. D., Sengupta, S. (2016). Stakeholder relationships, brand equity, firm performance: A resource-based perspective. Journal of Business Research, 69(12), 5561-5568. 
Accounting and Auditing Review
Volume 24, Issue 3
2017
Pages 371-394

Files

Share

How to cite

Statistics