Controlling Shareholder Equity Pledge,Information Transparency And Stock Price Collapse Risk

In 2013,equity pledge repurchase became a standard business of securities brokerages,lowering the threshold of equity pledge.The advantages of simple procedures,low interest rate,restricted shares can also pledge equity pledge scale ushered in explosive growth.The stock market crash in 2015 made the stock prices of many listed companies fall below the liquidation line,and the stock pledge explosion occurred frequently,which damaged the interests of small and medium investors and even caused systemic risks.In 2018,in order to alleviate the stock pledge crisis and further regulate the stock pledge business,Shanghai and Shenzhen Stock Exchanges and Zhongdeng Co.,Ltd.jointly issued new regulations on equity pledge,which put forward restrictive conditions in terms of the use of funds,pledge rate,party integrating and party financing.Maintaining a high level of information transparency is helpful to reduce the information asymmetry between controlling shareholders and small and medium investors,protect the interests of investors,and is conducive to the long-term healthy development of the stock market.The collapse of stock price is a financial anomaly that cannot be explained by modern traditional finance theory.So does equity pledge play a role in promoting or inhibiting the collapse of stock prices,and what role does information transparency play in the paths of action?This thesis takes the data of Chinese A-share listed companies from 2013 to 2021 as samples,takes the negative return skewing coefficient and the ratio of earnings up and down as proxy variables of stock price crash risk,takes the dummy variable of equity pledge as proxy variable of the controlling shareholder’s equity pledge,and measures the transparency index of corporate information by comprehensively calculating five indicators.Through the method of empirical analysis,this thesis studies the relationship between equity pledge and stock price crash risk and the role of information transparency in their influence path.The empirical results show that: when other conditions are given,equity pledge of controlling shareholders is positively correlated with the risk of stock price crash.When other conditions are given,equity pledge of controlling shareholders is negatively correlated with corporate information transparency.Information transparency plays a shrouding role in the influence path of controlling shareholders’ equity pledge on stock price crash risk,that is,during the period of controlling shareholders’ equity pledge,the reduction of corporate information transparency will reduce the risk of stock price crash.In the further analysis of this thesis,we also get the following conclusions: During the period of controlling shareholders’ equity pledge,the risk of stock price collapse of state-owned companies is lower than that of non-state-owned companies;Real earnings management in the controlling shareholder equity pledge and stock price crash risk indirect performance of the specific performance of the masking effect.Based on the above conclusions,this thesis provides reference opinions for listed companies,pledgees,regulatory authorities and other parties,that is,listed companies,pledgees and regulatory authorities should form regulatory forces to closely supervise the equity pledge behavior of controlling shareholders and improve information transparency.The regulatory authorities can construct a comprehensive evaluation system of information transparency to provide basis for investors to make reasonable investment decisions,reduce the risk of stock price crash,and promote the realization of benign and sustainable development of equity pledge.