Investors’ Corporate Site Visits,Market Environment And Debt Financing Cost

Sufficient capital is indispensable to the long-term development of the enterprise.At present,China’s market economy is not perfect,to meet the equity financing of all enterprises there are difficulties,so many enterprises will choose debt financing channels.In the background of China’s financial industry “Deleveraging”,many enterprises are facing such problems: financing difficult and expensive.For a long time,most studies of the governance mechanisms of corporate debt financing cost focus on internal governance,external audit and media.In this context,we try to seek a solution to the problem of information asymmetry between the creditors and the corporate executive.In recent years,investors’ corporate site visits have also attracted the attention of various parties increasingly,as one of the significant way for investors to obtain private information inside listed companies,and thus reduce the cost of corporate debt financing?Selecting the listed companies on the main board of Shenzhen Stock Exchange from 2013 to 2019 as the sample,it brings the impact of investors’ corporate site visits on the debt financing costs to the test empirically,and introduce the market environment,studies the adjustment of the market environment on the investors’ corporate site visits and corporate debt financing cost deeply.The results show that:(1)The investors’ corporate site visits helps to reduce the company’s debt financing cost,that is,the more the investors’ corporate site visits,the more institutions involved in the investors’ corporate site visits,the lower the company’s debt financing cost.(2)Compared with the regions with poor market environment,the effect of investors’ corporate site visits research on reducing the cost of corporate debt financing is more significant in the regions with better market environment.At the same time,the conclusion of this paper is still valid after changing the measurement mode of variables and solving the endogenous problem.In addition,it further studies whether information disclosure plays an intermediary role between investors’ corporate site visits and debt financing cost,as well as under different property right nature and internal control,the results show that information disclosure plays an intermediary role.The effect of investors’ corporate site visits on reducing the cost of corporate debt financing is more significant in non-state-owned enterprises,and the relationship between investors’ corporate site visits and internal control is complementary.The conclusion of this paper shows that investors can exert external governance function through field research activities,and provide an effective external way to reduce debt financing costs.This study will help investors,enterprises and regulators to have a deeper understanding of the governance function of investors’ corporate site visits and arrange this activity reasonably.