The Effect of Managers' Short-Term Attitude on Environmental Investment with the Mediating Role of Weak Internal Control

Document Type : Original Article

Authors

1 Assistant Professor., Department o Accounting, Va.C.,Islamic Azad University, Varzaghan, Iran

2 MSc., Faculty of Accounting, Siraj Institute of Higher Education, Tabriz, Iran.

Abstract

Objective: One of the main challenges in the field of sustainability and business is how managers’ short-term perspectives affect long-term investment decisions in the field of the environment. Short-term perspectives, which are often rooted in capital market pressure for quick profits and concerns about stock prices, can negatively affect environmental investments in various ways. In recent years, greenhouse gas emissions and increased pollution of water, soil, and air, as well as the excessive increase in corporate waste, have caused concerns among society and economic activists. One of the factors affecting the lack of attention of companies to environmental issues is the short-term perspective of managers. The present study the Effect of Managers' Short-Term Attitude on Environmental Investment with the Mediating Role of Weak Internal Control.
Methods: This research is practical in terms of purpose & in terms of methodology, the correlation is of the causal type (after event). The systematic elimination sampling, 152 companies were selected as sample & were investigated in the period of 7 years between 2017 & 2023. The method used to collect information is a library & data are collected for measuring variables from the codal website & corporate financial statements & in Excel, basic calculations have been made then, to test the hypotheses of the software stata was used.
Results: The results of the research show that managers' short-term attitude has a negative effect on environmental investment. However, managers' short-term attitude has a positive effect on weak internal controls. However, weak internal controls have a negative effect on environmental investment. Managers' short-term attitude has an effect on environmental investment with the mediating role of weak internal controls.
Conclusion: Companies whose managers have a short-term perspective choose a lower level of environmental investment. That is, the short-term perspective of CEOs inhibits environmental investment. Also, the short-term perspective of managers increases the quality of internal controls. Weak internal controls have an impact on environmental investment, and this relationship is negative. There is an indirect effect of managers' short-term perspective on environmental investment through weak internal controls, and weak internal controls can mediate the relationship between managers' short-term perspective and the company's environmental investment.
Innovation: This study examines the effect of managers' short-term perspective on environmental investment of listed companies, focusing on the mediating role of weak internal controls. Given the research gap in this field, this innovative study seeks to fill the knowledge gap and develop new theoretical foundations in this area. With the aim of providing a more comprehensive explanation of the drivers of environmental investment, it will contribute to a deeper understanding of managers' short-term attitudes and their effects on the environment and the need for managers to be educated.

Keywords

References

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Journal of Finance and Corporate Sustainability
Volume 1, Issue 2 - Serial Number 2
February 2026
Pages 170-195

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History

  • Receive Date: 29 December 2025
  • Revise Date: 07 February 2026
  • Accept Date: 10 February 2026
  • First Publish Date: 10 February 2026
  • Publish Date: 21 January 2026

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