The Influence Of CFO And Non Executive Directors On Executive Corruption

Since the eighteen major,the party and the country launched anti-corruption action,the existence of corruption has seriously affected the healthy development of China’s economy,which had an adverse impact on the society,If corruption is not governed and allowed to develop,it will be a stumbling block to the development of our country.And corruption is not just in the bureaucratic system,From the exposure cases of corruption,the management of the company is as serious as corruption.The corruption of the executive has encroached on the interests of the shareholders and reduced the value of the company.Therefore,how to effectively suppress executive corruption is a problem worthy of consideration.The corrupt behavior of the company executives is mainly due to the dissymmetry of information produced by the separation of the owners from the operators in the modern company.Because of the existence of information asymmetry and the lack of effective supervision in the management,the corruption of senior executives will be promoted.Therefore,how to reduce the information asymmetry between the two sides and strengthen the supervision of the management will be the key to the governance of corruption.Through combing the existing literature,we find that CFO itself has the advantage of internal information,and CFO can impact on the company.Therefore,it is worth discussing and analyzing whether it is possible to remove the phenomenon of asymmetric information between the two parties through the entry of CFO to the board of directors to suppress the occurrence of corruption.At the same time,how can the board of directors play a better role in restraining the corruption of the executive when the independent director does not have a proper role? The non executive director is independent of the management as an external director,and the literature has confirmed that the non executive director has an impact on the independence of the board of directors.Is it possible for non executive directors to increase the supervisory function of the board of directors to suppress the occurrence of executive corruption?This thesis analyzes the influence of CFO and non executive directors on executive corruption from two aspects of theory and demonstration.Whether there are differences in the influence of two factors on executive corruption under different property rights.Based on the principal-agent theory,the friendly board theory and the rent-seeking theory,this thesis systematically analyzes the relationship between CFO,non-executive directors and executive corruption,and puts forward relevant hypotheses.Then,based on the above analysis,taking the listed companies in Shanghai and Shenzhen A shares in 2012-2016 as samples,the research hypotheses were confirmed by descriptive statistics,correlation analysis and two element logistic regression analysis.At the same time,whether there is a difference between CFO and non executive directors on executive corruption in the nature of property rights.Through the empirical test,the following conclusions are drawn:(1)CFO has a significant negative correlation with executive corruption,when CFO enters the board of directors,the corruption of the company’s executives is effectively suppressed.(2)Non executive directors have a significant negative correlation with executive corruption,with the increase in the proportion of non executive directors,the case of executive corruption will be significantly reduced.(3)The influence of CFO and non executive directors on executive corruption is not affected by property rights.There is no difference in the impact of CFO and non executive directors on executive corruption in the case of different property rights.Based on the above conclusions,we believe that CFO should have more opportunities to enter the board of directors and help the board improve governance efficiency.At the same time,non-executive directors should get more attention and more research on their role in corporate governance.