Exploring the effects of board governance and information disclosure on stock price stability

Abstract

This paper utilizes sample data from publicly listed companies between 2007 and 2023 to conduct an in-depth analysis of how board governance and information disclosure affect stock price stability. The study finds a significant positive correlation between board governance and stock price stability. Furthermore, dividend policy plays a partial mediating role in the effect of board governance on stock price stability. Heterogeneity analysis shows that the positive influence of board governance on stock prices is more pronounced in companies with a higher proportion of institutional ownership and in high-tech firms. Regarding information disclosure, the study confirms its positive contribution to stock price stability, with financing constraints serving as a partial mediator. The research further reveals significant differences in how information disclosure influences stock price stability across companies with different ownership structures and financial conditions, with the effect being particularly pronounced in non-state-owned and high-leverage firms.