Do Returnee Executives Mitigate Stock Price Crash Risk?

The stock price collapse risk refers to the phenomenon that the company's stock price fell sharply in a short period of time without obvious signs.Since the reform and opening up,China's economy has grown rapidly,and the stock market has continued to develop since its establishment in 1990.However,due to the late establishment of China's stock market,various mechanisms are still not perfect,which makes the stock price crash frequently occur.The stock price crash not only hit the confidence of market investors,harmed the interests of shareholders,affected the order of the capital market and even jeopardized the security of the entire financial system.Therefore,the research on the influencing factors of stock price collapse has been closely watched by policy makers and scholars.However,Research on linking the personal characteristics of executives to the company's stock price collapse risk is still rare.The article explore the impact of returnee experience on the company's future stock price crash risk.Compared with local executives,returnees have better human capital and social capital,such as broad international perspective,advanced professional knowledge,professional management skills,extensive overseas resources and good industry reputation,so we think Returnees are more forward-looking in investment decisions and can curb excessive investment by companies;and returnees have received good education or management practices in developed countries or regions,and their thinking and management concepts are more international and market-oriented.Based on this paper,it is expected that returnees can reduce the company's share price collapse risk by inhibiting excessive investment and improving the company's information quality.The results show that the risk of stock price collapse of the company managed by returnees(whether CEO or non-CEO)is significantly reduced;the return of the company's share price collapse to private companies,less analysts and weaker external auditors The performance is more obvious;the mechanism analysis shows that returnees executives reduce the company's share price collapse risk by inhibiting the company's excessive investment and improving the company's information quality.This paper enriches the research on the factors affecting the stock price crash and provides a new perspective,and also expands the research scope of the economic consequences of returnees.The research conclusions have certain reference significance for implementing the introduction policy of returnees,preventing the company's future stock price collapse risk,and promoting the healthy development of the capital market.