一、主讲学生与论文题目：

1. 逯晓玮（2016级博士生）：Litigation Risk, Political Connections, and Corporate Governance

2. 王科（2017级博士生）：Essays in Corporate Risk

1）CEO Career Concerns and ESG Controversies

2）CEO Career Concerns and Risk Aversion

3）Director Nomination Eligibility Criteria and Stock Price Crash Risk

二、时间：2023年6月4日（周日）下午14:00-17:00

三、地点：腾讯会议

四、点评与讨论教师：

吴锴 中央财经大学金融学院 副教授

夏聪 中央财经大学金融学院 助理教授

朱菲菲 中央财经大学金融学院 助理教授

五、主持人：吴锴 中央财经大学金融学院 副教授

六、论文摘要

1. Litigation Risk, Political Connections, and Corporate Governance

This study first document models that measure litigation risk in China and to benchmark these models against the industry measure widely used in the literature. Moreover, I examine the impact of litigation risk on corporate investment policies, and in shaping corporate performance. I document a negative association between litigation risk and corporate investment expenditures, and also a negative relationship between litigation risk and corporate performance. Lastly, I investigated the mediating impact of the political connection factor, concluding that having political connections to the government could mitigate the negative impacts of litigation risk on corporate investment policy, and also mitigate the negative impacts caused by litigation risk on corporate performance.

2. Essays in Corporate Risk

1）CEO Career Concerns and ESG Controversies

We use Regression Discontinuity Design (RDD) to identify the causal impact of CEO career concerns on ESG controversies. Using the ex-ante predicted dismissal probability as a proxy for career concerns, we exploit narrowly missing the Relative Performance Evaluation (RPE) target as an exogenous shock to CEO career concerns in the RDD setting. Our results suggest that career-concerned CEOs who narrowly miss the RPE target suffer less from negative exposures to ESG reputational risks in the subsequent year than otherwise similar CEOs who barely beat the target. This effect is more pronounced for firms with higher earnings volatilities and idiosyncratic risks. However, the decreases in ESG reputational risks induced by career concerns are not associated with improved ESG performances. On the contrary, CEO career concerns could worsen the overall ESG performances. Our findings imply that career-concerned CEOs prioritize ESG reputational risk management that produces immediate effects while neglecting actual ESG engagement that requires long-term commitments.

2）CEO Career Concerns and Risk Aversion

We employ a Regression Discontinuity Design (RDD) to ascertain the causal impact of CEO career concerns on corporate risk aversion behavior. Utilizing the ex-ante predicted dismissal probability as a proxy for career concerns, we exploit narrowly missing the Relative Performance Evaluation (RPE) target as an exogenous shock to CEO career concerns within the RDD framework. Our findings suggest that CEOs with heightened career concerns exhibit greater risk aversion in the subsequent year compared to their counterparts without such concerns. This effect is particularly pronounced for insecure CEOs with shorter tenures and a larger proportion of deferred salary. Further examination of corporate policies reveals that career-concerned CEOs undertake fewer investments, maintain higher cash reserves, and distribute increased dividends, implying that risk-averse CEOs allocate a greater share of firm resources to low-risk assets in order to mitigate overall firm risk.

3）Director Nomination Eligibility Criteria and Stock Price Crash Risk

This paper finds statistically significant evidence that adopting Director Nomination Eligibility Criteria (DNEC) mitigates stock price crash risk. We hand-collect DNEC information from thousands of Chinese corporate charters and measure its impact on stock price crash risk over time. Additionally, we employ two novel instrumental variables to establish a causal link between higher DNEC and lower stock price crash risk. Our mechanism analysis shows that higher DNEC reduces stock price crash risk through four channels: reducing the nomination threat, changing the structure of investors, restructuring director board members, and altering information disclosure transparency level. Further heterogeneous analysis indicates that this effect is more pronounced in firms with Non-SOEs, lower executive control, more volatile stock price, and more retail investors.

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撰稿：张莹

审核：魏旭