A study on relationship between rewarding board of directors and share liquidity

This paper presents an empirical investigation to study the relationship between the liquidity and the reward of board of directors on 136 selected firms listed on Tehran Stock Exchange over the period 2007-2011.The study considers nine different factors including return on assets (ROA), return on equities (ROE), Q-Tobin, changes of ROA and ROE, etc. In our study, there is a direct relationship between firm sizes with reward of boardʹs directors. In addition, there is a direct relationship between changes of ROE with reward of boardʹs directors. Moreover, there is a direct relationship between changes of operational cash flow with reward of boardʹs directors. Finally, there is a direct relationship between changes of Q-Tobin ratio with reward of boardʹs directors but the relationship was reverse for some years. These evidences confirm that there was a meaningful relationship between rewarding board of directors and share liquidity.