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Board of Directors Characteristic and Cost of Debt in Tehran Stock Exchange
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This study investigates the effect of board composition on debt cost of firms listed in Tehran Stock Exchange (TSE). To do so, 90 firms are selected to be studied during the period of 2008 to 2012 using panel data and regression model. Board composition involved in this study are outside board, board size and board independence. Results show that there is a negative and significant relationship between outside board and debt cost. Board size has positive significant relationship and board independence has no significant relationship with debt expense. Control variables of return of assets, return of equity and debt size have a negative relationship and market to book value, financial leverage and firms size have a positive and significant relationship with debt cost.
Keywords
Board Size, Board Independence, Debt Expense, Independence Size of Board of Directors.
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