Research Of The Impact Of Board Diversity On Stock Price Crash Risk

Stock price crash risk is a kind of risk factor which is widespread and influential in financial market,which causes the huge wealth loss of investors and seriously disrupt the healthy operation of the whole capital market.The insiders use information asymmetry to conceal negative news is an important reasons which formed stock price crash risk.Thus,reducing stock price crash risk can be improved from the angle of company's internal governance.In the framework of agency theory,board diversity as an alternative mechanism of corporate governance,can improve the efficiency of supervision,to alleviate the internal and external information asymmetry.Therefore,this paper attempts to explore whether the board diversity of listed companies can significantly reduce future stock price crash risk.This paper uses 2006-2012 A-share listed companies in China as a research sample to study the impact of board diversity on stock price crash risk.On this basis,this paper also carried out the relevant heterogeneity analysis.Research findings:(1)The board diversity of the company is significantly negatively correlated with future stock price crash risk,indicating that board diversity is conducive to reducing future stock price crash risk.(2)The better the external legal environment of the company,the lower the negative correlation between board diversity and stock price crash risk,shows that board diversity can play an important role in protecting investors in areas where the external legal environment is poor.(3)In the state-owned enterprises,the negative correlation between board diversity and stock price crash risk is more obvious;while board diversity of private enterprise is negatively correlated with future stock price crash risk,but not significant.(4)The agency conflict associated with board supervision is a potential mechanism for board diversity playing its role in the company's future stock price crash risk.The research of this paper has practical significance to improve the internal governance of the company,reduce future stock price crash risk and stabilize the capital market.