The Effect of Risk Management on Financial Performance of the Companies Listed in Tehran Stock Exchange: The Mediating Role of Intellectual Capital and Financial Leverage

Risk management is one of the new approaches to improve performance of organizations in terms of environmental uncertainty used. Risk management means the systematic application of management policies, procedures, and processes related to the activities of analysis, risk assessment and control. Given the mediating role ofintellectual capitalandfinancial leverage, present study aims to investigate the impact of risk management on financial performance. The study population consisted of some companies listed in Tehran Stock Exchange during 2008- 2013. The findings of the study show that effective risk management has positive impact on return on asset and market value growth. Financial leverage simply plays a mediating role in relationship between effective management of risk and return on assets. Mediating role of intellectual capital was also merely verified regarding the relationship between effective risk management and market value growth.