This paper aims to clarify the relationship between key audit matters (KAMs) disclosure and corporate financialization. The findings reveal that key audit matters (KAMs) disclosure can provide incremental information value, thereby impeding corporate financialization in China. Moreover, this effect is more pronounced in the samples with low media attention, low shareholding of institutional investors, and non-state-owned enterprises. Further research indicates that reducing managerial myopia and easing financing constraints serve as key channels through which key audit matters (KAMs) disclosure affects corporate financialization. This study provides empirical evidence on efficiently preventing excessive financialization of enterprises, as well as some insights for mitigating systemic financial risks from the key audit matters (KAMs) disclosure perspective.

This study analyzes the network structures of institutional shareholders and examines the influence of institutional investor cliques on corporate innovation. Our empirical results reveal that institutional investor cliques significantly enhance both innovation input and output. To mitigate endogeneity concerns and establish causality, we adopt multiple empirical strategies. Further evidence suggests that the beneficial impact of institutional investor cliques on firm innovation can be attributed to increased innovation investment efficiency, enhanced employee productivity, reduced information asymmetry, and decreased managerial myopia. Additionally, we find that the positive effect of institutional investor cliques on firm innovation is more pronounced in non-state-owned enterprises and is particularly evident in firms with severe agency conflicts, CEO duality issues, highly competitive product markets, and for firms that have low stock liquidity.

The scale expansion of low-carbon industries and the green transformation of carbon-intensive industries are two sides of the same coin in achieving the “dual carbon” goals. However, research on transition finance supporting the upgrading of traditional existing carbon-intensive industries remains insufficient. The key to examining the effectiveness of transition finance lies in distinguishing whether the supported enterprises are engaging in greenwashing or green evolution. Based on data of Chinese A-share listed companies in the carbon-intensive industries, an empirical study is conducted and offers the following findings: (1) Transition finance not only does not increase greenwashing but also promotes comprehensive green innovation in carbon-intensive enterprises. (2) In terms of the influencing mechanism, transition finance exerts “resource effects” and “signaling effects,” promoting green innovation by improving debt maturity mismatch and attracting green institutional investors. (3) Heterogeneity analysis shows that the positive impact of transition finance on green innovation is particularly pronounced among enterprises in the eastern region, state-owned enterprises, and those with lower levels of managerial myopia. (4) Further industry spillover effects analysis reveals that transition finance empowers green innovation within industries though peer effects and competitive effects. The findings are essential for understanding the effectiveness of transition finance and offer valuable insights for policymakers.

We investigate the unintended real effects of regulator-led minority shareholder activism on corporate innovation. We use manually collected data from the China Securities Investor Services Center (CSISC), a novel regulatory investor protection institution controlled by the China Securities Regulatory Commission (CSRC) that holds 100 shares of every listed firm. We find that by exercising its shareholder rights, the CSISC substantially curtails the innovation output of targeted firms. This effect is amplified in cases involving a high level of myopic pressure and few innovation incentives. We further observe variation in the real effects of different intervention methods. Textual analysis reveals that CSISC intervention with a myopic topic and negative tone contributes to a decrease in innovation. The results of a mechanism analysis support the hypothesis that regulator-led minority shareholder activism induces managerial myopia and financial constraints, impeding corporate innovation. Furthermore, CSISC intervention not only diminishes innovation output but also undermines innovation efficiency. In summary, our findings suggest that regulator-led minority shareholder activism exacerbates managerial myopia to cater to investors and financial constraints, ultimately stifling corporate innovation.

From 2013 to 2015, China lifted the ban on margin trading for designated stocks based on apublic ranking index. Using a regression discontinuity design that exploits the threshold rules, I find that margin trading eligibility causes the stock share turnover and prices to increase. Moreover, firms react to this speculative pressure by manipulating earnings and reducing long-term investment. These effects are stronger for firms that are more prone to investor short-termism ex-ante. Consistent with managerial myopia, marginable firms later experience a decline in operating performance. My results suggest that margin traders, as short-term speculators, pressure the manager to focus on current earnings and take myopic actions.