The Market Reaction Of Listed Company Executives’ Crime Notices

In recent years, the crime of listed company executives has caught the attention of the society from all walks of life. Many scholars have researched the crime of listed company executives from different angles, the regulators are also introduced and the development of relevant rules or laws to curb the phenomenon occurs. We take the executives of listed company crime bulletin as the breakthrough point of this thesis, and study investors will be how to treat the crime of executives of listed companies, different types, different status of executives of listed companies and different position, whether it will affect the behavior of the investors, at the same time, investors in the face of listing corporation executives crime, whether its investment behavior will change,This thesis includes six parts in total. The first part mainly introduces the background, significance, content, and methods of the research. The second part is the views of related literatures, this part include the study of executive crime and the market reaction to announcements of major matters, By reading the relevant literature, we found that the domestic and foreign scholars on the study emphasis for executive criminal behavior differences, the foreign research pays more attention to theoretical analysis and emphasis on executives at the root of crime and essential, but the domestic research is through the phenomenon to analysis the cause of the problem, not the root depth theory. The third part is present situation analysis of executives’crime, on the base of the above, discussed the main reason of executives’crime. This paper mainly use descriptive statistics to analysis the crime of listing corporation executives, further analysis of the characteristics of the companies involved in the industry, geographic, financial, corporate governance and other aspects. On this basis, we analyzed the basic characteristics of the executives involved in the case and the charges involved. From analysis of the current situation, we find that our listed companies involved in the case is the presence of industry and regional differences, and in front of the case, the company of the relevant performance indicators has been downward trend obviously, the performance indicators in the announcement at a minimum, and the effect won’t disappear quickly, there is a certain continuity. Analysis from a governance perspective, the state-owned listed companies accounted for more than half of the enterprises involved, the enterprises involved a single big phenomenon is obvious, after executives of the crime, the governance of listed companies have a certain degree of improvement. Analyzing criminal executive’s individual characteristics, this paper found that executives listed companies crime age concentrated in41-55, and have high degree and title, further analysis found that the executives involved more focused on chairman, lasted for4years on average. Analysis from the charge, we found that executives listed company executives charges involved mainly focus on corruption charges, and securities crimes. The fourth part is the basic theory of the market reaction analysis and research hypotheses, this study is based on the basic theory of the efficient market hypothesis, the relationship between information and the stock price, on the above bases, analysis of the mechanism of the listing announcement the market reaction to crime. On the basis of the theory and mechanism of action, we put forward some hypotheses. The fifth part is the empirical study, this chapter mainly divides into two parts, one parts is event study method-based listed company executives in the period of notice to the market reaction as well as the announcement after the market reaction if there are obvious differences, the other part is a multiple regression analysis of the listing corporation executives crime before and after the announcement of announcement on the market reaction differences based on factor. Through the empirical analysis we get the following conclusions, executives of listed companies crime announcement caused a significant negative market reaction to the announcement date, and different position status, features, equity and other cases, the differences between the average excess returns, using paired T-test found that there are obvious differences in the market reaction before and after the period of notice, the specific performance of a significant difference in the presence of three days, five days after the announcement sample at an average cumulative excess return. Through regression analysis, we found that the regression results significantly poorer, further analysis found that market investors pay more attention to the event itself, rather than to consider other factors. The last part concluded a brief summary, the inadequacies of this article, and the recommendations.