Study On The Influence Of Directors' And Officers' Liability Insurance On Corporate Performance

Focusing on the theme of ''demand motivation for directors' and officers' liability insurance'',deep research has been carried out in domestic and foreign scholars,which from a theoretical level based on different hypotheses.The study of whether directors' and officers' liability insurance can improve corporate performance has also been involved,but few scholars have explored its impact from the perspective of double agency costs.In fact,due to the lack of legislation,this type of insurance was not ideal in the early stages of China's development.With the continuous improvement of the capital market and the enhancement of investor awareness of rights protection,directors,supervisors and senior management personnel,as the direct responsibility subjects of corporate governance,are facing the unprecedented risks of liability and litigation,it has undoubtedly caused the industry's attention to directors' and officers' liability insurance.As an emerging corporate governance mechanism,can directors' and officers' liability insurance play a role in influencing corporate performance? What way does it take to make an impact? What is the governance effect of directors' and officers' liability insurance under different control rights?These issues need further study.In view of this,based on the theory of double principal-agent theory and information asymmetry theory,this article attempts to answer the above questions from the perspective of corporate governance.By selecting the financial data of China's A-share listed companies from 2011 to 2018,manually collecting the disclosure data of directors' and officers' liability insurance,then using a combination of normative research and empirical research,first of all,examine the impact of directors' and officers' liability insurance on corporate performance and the governance effect under different control rights.Secondly,the double agency cost is introduced to study the transmission path of directors' and officers' liability insurance.Finally,in order to ensure the reliability of the research results,robustness test of the data through propensity score matching(PSM).After analysis this paper obtained the following research conclusions:(1)The purchase of directors' and officers' liability insurance has a positive impact on business operations and can significantly improve corporate performance;(2)The positive impact of directors' and officers' liability insurance on corporate performance under non-state-owned control ismore obvious than that of state-owned holding companies;(3)Directors' and officers' liability insurance can significantly reducing the two kinds of agency cost of listed companies,which is an effective corporate governance mechanism;(4)Two kinds of agency cost plays a partial intermediary role in the relationship between directors' and officers' liability insurance and corporate performance.This paper starts with the double principal-agent cost and verifies the transmission path of the impact of directors' and officers' liability insurance on corporate performance,expanding the research scope of related fields.The specific suggestions on improving the legislative system of directors' and officers' liability insurance and optimizing the corporate governance structure are of great significance for improving the modern enterprise system and promoting the construction of governance structure and governance mechanism of listed companies.