The relationship between transparency and financial performance in Iraqi corporations

Azam Abdel Hakeem Khalid

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Type :	article
Subject :	HG Finance
Main Author :	Azam Abdel Hakeem Khalid
Additional Authors :	Talal Mohammed Aljajawy Anmar Adnan Khudhair Norlia Mat Norwani
Title :	The relationship between transparency and financial performance in Iraqi corporations

Place of Production :	Tanjong Malim
Publisher :	Fakulti Pengurusan dan Ekonomi
Year of Publication :	2019
Corporate Name :	Universiti Pendidikan Sultan Idris
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Abstract : Universiti Pendidikan Sultan Idris

This study aimed to examine the relationship between transparency and corporate financial performance. This study based on a sample of 25 corporations listed on Iraq stock exchange (ISX). Information related to research variables is for 2014-2017 (4-year period). To investigate the association between variables of this research, the transparency (ownership structure and stakeholder’s rights (OWSR), financial and nonfinancial information (FNF) and board of directors (BOD) dimensions) as independent variable and corporate financial performance based on accounting data, return on assets (ROA), return on equity (ROE) and return on investment (ROI) as dependent variable are considered. In this study, to analyze research data and the models estimation, the Ordinary Least Square (OLS) regression test was used. For this purpose, 80 items were analyzed in three indictors which are ownership structure and stakeholder’s rights, financial and non-financial information and board structure using a zero-one procedure, these three items were extracted to determine their level of transparency and to investigate the association between variables of this research. Using transparency indexes specified in Standard and Poor's model, ownership structure and stakeholder’s rights, financial and non-financial information and board of directions. In this study, corporation financial performance measures such as accounting profits ratios e.g. are targeted. Based on the research results, there is a positive significant relationship between the OWSR and FNF transparency and financial performance criteria of corporations based on ROA. On the other hand, in the second and third equation (with ROE and ROI as dependent variables), FNF has significant and positive impact and BD has meaningful and negative impact on dependent variables. This study will provide literature evidences as record about transparency indexes and corporate financial performance in Iraq to empirical as well as theoretical prospective researcher.

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