International Review of Finance最新文献

This paper investigates whether individual CEOs and CFOs have fixed effects on firm-level future stock price crash risk. We find that both CEOs and CFOs exhibit such fixed effects, and these effects remain robust across various tests. Additionally, we observe that CEOs' fixed effects are stronger than those of CFOs. And there is some marginal evidence that the executives' fixed effects are less pronounced in firms with better information environment quality. Finally, consistent with the influence of managers' fixed effects, we find that CEOs' professional qualifications (e.g., MBA, JD, and CPA) and CFOs' family status and military experience are associated with stock price crash risk.

This paper examines the impact of mandatory information disclosure regulation on corporate cash holding decisions, a fundamental component of working capital management. Using industry-specific information disclosure guidelines as a quasi-natural experiment that introduces shocks to disclosure practices across different sectors, we find that the implementation of these regulations leads to a significant reduction in corporate cash holdings. We identify two mechanisms underlying this effect. Specifically, the implementation of the information disclosure regulation lowers agency costs and reduces the operational risks faced by firms, leading to lower cash holdings. Heterogeneity analysis shows that the negative relation between information disclosure regulation and corporate cash holdings is stronger among firms facing greater financial constraints, those with more effective internal controls, firms in highly competitive industries, and those operating in high-tech sectors. The reduction in corporate cash holdings driven by information disclosure regulation enhances firms' sustainable development capacity and alleviates underinvestment problems, supporting more efficient resource allocation and effective working capital management.

This study examines the relationship between CEO behavioral integrity (BI)—defined as the consistency between a leader's words and actions—and a firm's implied cost of equity capital (COEC). Drawing on the managerial style literature, we conceptualize BI as a distinct, communication-based trait that reflects the credibility of executive decision-making. Using textual analysis, we construct a proxy for CEO BI from the causal and explanatory language contained in shareholder letters of S&P 500 firms between 2013 and 2018. The results reveal a significant negative association between CEO BI and COEC across seven alternative measures. This relation remains robust after addressing endogeneity through both a CEO-turnover falsification test and an instrumental-variable approach based on peer-industry BI. The effect is more pronounced when the information environment is less transparent, firm-level risk is higher, and CEOs possess greater power. Further analysis indicates that aggressive earnings management and lower accounting quality mediate the effect, suggesting that BI operates through information-risk channels. Overall, the findings show that shareholders demand a higher risk premium and incur greater monitoring costs when CEOs exhibit low behavioral integrity, underscoring the market's valuation of managerial credibility as a priced governance attribute.

This study examines whether environmental regulation targeting downstream customers induces carbon emission reductions among upstream suppliers, using data from China's A-share listed firms. The results reveal that environmental regulation generates a significant carbon reduction spillover effect across the supply chain via regulation pressure transmission. Key mechanisms driving this effect include green reputation pressure, supply chain stability pressure, and operational pressure. Moreover, the resulting emission reduction spillover reinforces supply chain relationships. These findings offer valuable insights for promoting green and low-carbon transformation throughout supply chains and contribute to the design of integrated environmental policies.

This study examines the effect of climate risk information disclosure on corporate debt financing costs in the context of China's low-carbon transition. Using a panel of Chinese A-share listed firms from 2013 to 2021, we construct a localized climate risk disclosure index based on Word2Vec and textual analysis of annual reports. The results show that higher-quality climate risk disclosure significantly lowers firms' debt financing costs. Mechanism analyses indicate that this effect operates through reduced information asymmetry, driven by stronger external supervision and improved internal governance. Further analyses reveal that the effect is more pronounced for state-owned enterprises, firms in heavy-polluting industries, and companies led by executives without environmental backgrounds. Moreover, transition risk disclosures exert a stronger cost-reducing effect than physical risk disclosures. Overall, this study provides micro-level evidence on the financing implications of climate risk communication and offers policy insights for improving climate disclosure frameworks in emerging markets.

In this paper, we first develop a theoretical model to demonstrate that systematic volatility—and thus stock price synchronicity, as measured by R² in an asset pricing model—decreases with enhanced corporate disclosures in the market. We show that if investors can infer a firm's future performance from noisy signals in the market, systematic volatility, and consequently stock price synchronicity, will decline as earnings news helps resolve market-wide uncertainty. We empirically test this prediction by comparing R² values during earnings announcement seasons with those during non-announcement seasons and find significantly lower R² values in the earnings season. Furthermore, we show that the decline in stock price synchronicity is driven primarily by a reduction in systematic volatility rather than by an increase in idiosyncratic volatility. We also find that the drop in synchronicity is less pronounced among firms with generally higher information quality—since their earnings news is relatively less informative—but more pronounced in the month when the first industry bellwether firm announces earnings. Finally, we document that stock price synchronicity begins to decline immediately after the first earnings announcement in an industry and reverts following the last announcement. Overall, our paper provides new evidence in support of the information-based interpretation of stock return synchronicity and highlights the importance of the systematic component of stock volatility for future research.

This paper investigates how nonverbal elements of central bank communication—specifically, the vocal tone of Federal Reserve (Fed) Chairs during Federal Open Market Committee (FOMC) press conferences—shape cryptocurrency market behavior across different phases of the business cycle. Using vocal tone measures extracted from speech audio and controlling for the Fed's textual sentiment and policy actions, we find that tone conveys information beyond what is contained in the Chair's words. A more positive vocal tone raises cryptocurrency prices during economic expansions but has the opposite effect during contractions. These asymmetric responses suggest that, in stable economic conditions, an optimistic tone strengthens investor confidence and encourages greater risk-taking, whereas during downturns, heightened uncertainty and risk aversion dominate, leading market participants to shift away from speculative assets such as cryptocurrencies. Overall, our findings reveal that nonverbal communication functions as a meaningful and state-dependent channel through which monetary policy affects the cryptocurrency market.

This paper investigates portfolio selection and risk control between individuals and an insurer in a frame of stochastic Stackelberg differential game. In the Stackelberg game, the insurer plays as the leader who determines the price of insurance, and individuals play as the followers deciding how much insurance they should buy. On one hand, we suppose that there are $��n�$ homogeneous individuals in the market who can purchase insurance from one insurer. Each individual aims to achieve optimal consumption, insurance, and investment policies while considering premium prices and the performance of financial market. On the other hand, the insurer can adjust premium prices and investment policies in response to the individuals' insurance demands and the performance of financial market. Both individuals and the insurer aim to maximize their expectation of utilities. By employing the dynamic programming principle, we obtain closed-form solutions for optimal policies and value functions. The results show that the correlation between financial market and insurance market has a significant impact on the optimal strategy. A strong negative correlation would lead to an inefficient insurance market, but full insurance demand occurs for strong positive correlated markets. Most interestingly, our result indicates that insurance demand can effectively increase individuals consumption level and investment level on risk assets for positive correlated markets. Finally, we also find the equilibrium insurance price decreases and the equilibrium insurance demand increases with respect to the size of insurance market for positive correlated markets.

This paper investigates the impact of environmental regulation on corporate trade credit financing using the exogenous passage of industry-level cleaner production standards in China. The results of a staggered difference-in-differences model show that firms in regulated industries receive more trade credit. Further channel analysis shows that environmental regulation increases firms' usage of trade credit by increasing financial pressure and requirements for suppliers' product quality assurance. The effect is more pronounced for firms with greater initial bargaining power and stricter supervision. Moreover, we find that the increased trade credit associated with environmental regulation increases corporate green innovation, operating performance, and mitigates financial distress. Finally, we find that there is downstream propagation of product quality assurance, particularly for firms that rely heavily on downstream partners.

Based on the key focus areas in independent directors' performance reports, we investigate the impact of independent director (ID) diligence on equity capital cost using a sample of listed companies in China from 2015 to 2022. We find that firms with more diligent IDs experience significantly lower cost of equity. The effect is especially pronounced when IDs focus on investor return, external guarantees and capital occupation, and the usage of raised funds. Mechanism tests suggest that ID diligence reduces the cost of equity capital by alleviating two types of agency problems and improving information transparency. The impact of ID diligence on the cost of equity capital is stronger in firms with higher fraud risk, weaker equity balance, and lower external attention. The economic consequence tests further show that ID diligence can relieve financing constraints and increase firm value. Our findings inform regulators, investors, IDs, and other stakeholders interested in the economic consequences of ID performance.