Abstract
The aim of this study is to investigate the relationship between financing constraints and the cost of equity of listed companies on the Tehran Stock Exchange during 2010-2014. The results showed that the impact of cash flows on the company's cash balance changes in both groups of companies with/without the divergence in the right to control. In other words, financing constraint is significant on the financial supply of both companies. By comparing the impact factors of these variations, we observed that the control right divergence of controlling shareholder leads to increased financing constraints. The results also indicated that the divergence of the control right of shareholders from the right to control cash flow can lead to an increased cost of equity.
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