Management Authority、Quality Of Information Disclosure And Investment Efficiency

The quality of information disclosure can improve agency problems andasymmetric information problems between investors or stockholders and managementlayers, which would make the investors have a better and faster comprehension on thereal situation about the daily operation and management. On the basis of the situationmentioned above, the investors would pour much more energies and time into theoperation and management of the company. At the same time, the investors would tryto mitigate the phenomenon of non-efficiency investments by strengtheningsupervision on the managers. Resultantly, the efficiency would promote drastically.Excessive management authority would strengthen agency problem and asymmetricinformation problems and lead to a series of problems like rent-seeking and earningsmanipulation. These problems would affect the daily management activities in somedegree. Obviously, management authority will have a negative effect on theconnection of quality of information disclosure and investment efficiency. We startour research with this negative effect.In this paper, we use companies listed on the Shenzhen Stock Exchange assamples, Richardson model-based measurement of investment efficiency, and, fromthe perspective of management authority, we research the relationship between thequality of information disclosure and investment efficiency. The empirical resultsshow that the quality of information disclosure can enhance the efficiency ofinvestment, no matter the enterprises are in underinvestment or in overinvestment.Disclosure Quality and efficiency of investment in positive correlation between lowercase management authority is more obvious, but in enterprises which are inoverinvestment, this relationship is uncertain. Besides, the regression results tell usthat almost two thirds of Chinese listed companies are in underinvestment. Comparedwith the data of last several years, we find that this phenomenon exists all the timewithout obvious improvement. In a word, we should not treat these factors discretely,but consider these factors comprehensively. Specifically, more attention should bepaid to this factor of management authority, through the rational allocation ofcorporate management authority, optimize the corporate governance structure, thusimprove the efficiency of investment and create more benefit for company and all thestakeholders(especially for the stockholders).