Research On The Governance Effect Of Equity Structure,Institutional Investors' Shareholdings On Earnings Management

For a long time,earnings management is a stubborn disease that is hard to eradicate in the capital market of our country.Earnings management misleads the decision-making of investors,damages the effectiveness of capital market,reduces the efficiency of resource allocation,and hinders the effective operation of social economic mechanism.There are many reasons for earnings management,but one of the important reasons is that the equity structure of the company is not reasonable,and the power of the major shareholders is lack of a powerful balance mechanism.Therefore,the introduction of institutional investors to check and balance the power of major shareholders and reduce the behavior of earnings management has become a system choice for market regulators.On the research of earnings management,based on the research of earnings management concept,classification and motivation,the influence of equity structure and institutional investor's shareholdings on earnings management level has also been studied,but the regulatory role of institutional investor's shareholdings in the influence of equity structure on earnings management has not been studied.This paper studies the equity structure from two aspects of equity concentration and property right nature.Earnings management is divided into accrual and real earnings management.This paper continues to explore the impact of equity structure on earnings management,the impact of institutional investors' shareholdings on earnings management,and the regulatory role of institutional investors' shareholdings in the impact of equity structure on earnings management.This paper selects 12,869 observation samples from A-share listed companies from 2014 to 2018 for empirical research.The results show that:(1)When the equity is dispersed,the accrual and real earnings management level are relatively high.When the equity is relatively concentrated,the two kinds of earnings management can be suppressed.When the equity is concentrated,the accrual and the real earnings management level will increase;(2)Non-stateowned companies tend to use more accrual earnings management,state-owned companies tend to use more real earnings management;(3)Institutional investors' shareholdings can suppress the accrual and the real earnings management level of listed companies;(4)Institutional investors' shareholdings can promote the governance effect of equity concentration on the accrual and the real earnings management,and this relationship is more significant in state-owned companies.The innovation of this paper is to study the influence of equity structure on earnings management and introduce institutional investors' shareholdings as a regulatory variable,and study the regulatory effect of institutional investors' shareholdings in the process of equity structure on earnings management.Research shows that the increase in the shareholding ratio of institutional investors can improve the equity structure and promote the effect of equity concentration on the governance effect of earnings management.This paper studies the impact of equity concentration and institutional investors' shareholdings on accrual and real earnings management,and returns according to different property rights groups,the equity structure includes two aspects: equity concentration and property right nature.