The Impact of Myopic and Optimistic Management Behaviors on the Transparency of Financial Information

The behavioral bias of managers in terms of myopia and optimism leads to behavioral bias, which further exacerbates information asymmetry and agency problems in companies. In fact, the reason for such behaviors is the personal motivation of managers to achieve their goals and maintain their positions, which makes them not to seek transparency of financial information. The present study examined the effect of myopic and optimistic management behaviors on the transparency of corporate financial information. According to the study variables measurements, the sample size consisted of 97 companies listed on the Tehran Stock Exchange for the period of 2009-2016. A multivariable regression model was used to analyze the research hypotheses. The results of the research hypotheses showed that managers' optimistic behavior reduces the transparency of corporate financial information. This finding shows that managers are over-optimistic and do not seek transparency of financial information due to bias. Other results of the study showed that managers' myopic behavior negatively affects the transparency of corporate financial information. The findings suggest that managers consider short-term performances due to personal motivations and to achieve their goals and do not seek transparency of financial information.