Ownership Structure and Disclosure Quality: Case of Iran

Abstract

Abstract The paper investigates the relationship between ownership structure and disclosure quality. The investigation has been performed using panel data procedure for a sample of 80 Iranian listed companies on the Tehran Stock exchange during 2010-2014. The license of the firms’ disclosure quality which is published by Tehran Stock Exchange is used to measure the disclosure quality, and for better understanding of the ownership structure, this structure is divided into two classes of government and managerial ownership. The results of the study revealed that managerial ownership has a negative and significant effect on disclosure quality, but no significant relationship was observed between governmental ownership and disclosure quality. The results show that the governmental ownership does not affect the quality of disclosure, meaning these companies have a low attention and concern on the quality of their disclosures. Adversely, private companies because of the need to absorb capital from market try to enhance the quality of their disclosures.