The Empirical Research Of The Influence Of The Quality Of Information Disclosure On Companies’ Inefficiency Investment

As one of the company’s three financial activities, investment is the key toprofits of the company, determining the size of the interests of shareholders. Only byinvesting activities, the company can obtain return. Therefore, the efficiency of thecompany’s investing activities is directly related to the ability of the company tomaximize value, but also the relationship between the shareholders to receivemaximum benefits. Investment has also been a hot research by scholars at home andabroad. However, most of the literature majors on the effects of the cash dividends,liabilities governance and corporate governance to the efficiency of investment. Withfurther research, there has appeared some research studying the quality of theinformation disclosure on corporate investment efficiency. But most of these studiesonly follow with interest the influence of the quality of mandatory informationdisclosure to the company’s investment efficiency, ignoring the role of the quality ofvoluntary information disclosure, to a certain extent, which affected the results of thecomprehensive. How the comprehensive quality of the voluntary and mandatorydisclosure of information affect investment efficiency remains to be investigated.In order to solve the problem that has been put forward, the paper studies theinfluence of the comprehensive quality of the voluntary and mandatory informationdisclosure on investment efficiency. Firstly, we elaborate the formation process of thecompany investment decisions. On this basis, the paper discusses the reasons that leadto the non-efficiency investments. Then, the paper analyzes the role of informationdisclosure on the capital market and function of Information disclosure in corporategovernance, constructing the channel of information disclosure quality that constrainscompany’s non-efficiency investments. After that, the paper, using evaluationinformation results of the Shenzhen Stock Exchange to measure listed company’scomprehensive quality of information which include voluntary and mandatoryinformation disclosure and Richardson model to measure investment efficiency, studyhow the voluntary and mandatory information disclosure quality work together toaffect investment efficiency. The results show as follows: High quality of informationdisclosure can reduce the overinvestment and underinvestment of company; withother conditions unchanged, high quality of information disclosure can reduce morethe overinvestment of the companies with high free cash flow; with other conditionsunchanged, high quality of information disclosure can reduce more theoverinvestment of the companies with more serious financial constraints.