Aug 2026· International Journal of Financial Studies· 0 citations· 31 references
Abstract
Against the backdrop of escalating financial regulation in China, this study examines how regulatory enforcement intensity affects corporate liquidity risk among A-share listed non-financial firms over 2015–2024. We construct a composite regional regulatory intensity index (Enforce) integrating the frequency and monetary magnitude of administrative penalties issued by local securities regulators and employ firm- and year-fixed-effects panel regressions with the current ratio (CR) as the primary liquidity measure. We find that tighter regulatory enforcement significantly depresses the current ratio, consistent with a compliance-cost channel that constrains short-term debt-servicing capacity. Mediation analysis—conducted separately for each ESG sub-dimension and verified via bootstrap tests—reveals that the corporate governance dimension (G) generates a significant positive indirect effect (consistent partial mediation), the social responsibility dimension (S) generates a significant negative indirect effect (competing partial mediation), and the environmental dimension (E) yields no statistically significant indirect effect. Ownership-type heterogeneity tests confirm that non-state-owned enterprises (non-SOEs) are substantially more sensitive to regulatory tightening than state-owned enterprises (SOEs). Moderation analysis further shows that financial leverage plays a non-monotonic role: the regulation–liquidity effect is negative at low leverage levels and reverses to positive above an estimated threshold (Lev ≈ 0.56). Robustness is established through subsample regressions and a lagged-variable endogeneity test. These findings enrich the institutional finance literature and provide evidence-based guidance for differentiated regulatory policymaking.
Preventing systemic financial risk is a cornerstone of economic security and social stability, as well as a fundamental prerequisite for the sound operation of the financial system and high-quality economic development. Treating the New Asset Management Regulations as a policy shock, this study constructs a generalized difference-in-differences (DID) model using panel data for Chinese non-financial listed companies from 2008 to 2023 and systematically examines the mechanisms and heterogeneous effects of stringent financial regulation on corporate leverage manipulation. The results show that, through look-through regulation, the New Asset Management Regulations effectively compress the scope for shadow-banking arbitrage and directly reduce corporate leverage manipulation. The policy also significantly restrains leverage manipulation by directing credit resources toward more efficient uses, improving the quality of corporate information disclosure, and enhancing financing efficiency. The inhibitory effect is particularly pronounced among firms with relatively high allocations to financial assets. Heterogeneity analysis further indicates that the effect is stronger in regions with greater financial deepening, in industries with lower market concentration, and in firms whose managers possess stronger financial expertise. Accordingly, this study recommends deepening differentiated look-through regulation, improving coordination in the regional allocation of financial resources, and strengthening internal corporate governance to establish a long-term mechanism for curbing leverage manipulation and to reinforce the foundations of systemic financial-risk prevention.
Tingting Zhou, Junchi Chu, Jiawei Wang· Journal of Economics and Man...· 0 citations
This study examines the relationship between financial flexibility and firm performance, and the moderating role of corporate-governance mechanisms, using a large panel of Chinese A-share non-financial listed companies over 2017–2024. Financial flexibility reflects a firm’s capacity to access and deploy financial resources under uncertainty and is increasingly viewed as central to corporate resilience and value creation. Employing panel regressions with firm and year fixed effects, this study finds that financial flexibility is positively and significantly associated with Tobin’s Q and return on assets as measures of firm performance. Further analysis shows that this relationship is contingent on governance structures: ownership concentration and CEO duality weaken the positive association, while board independence is associated with a marginally significant strengthening of it. Marginal-effect analyses indicate that governance mechanisms systematically condition the value of financial flexibility. A dynamic system-GMM specification qualifies these findings: once persistence and reverse causality are modeled, the unconditional flexibility coefficient turns negative, underscoring that the fixed-effects estimates should be read as associations whose sign and magnitude depend on governance and on how endogeneity is treated. These findings contribute to the literature by integrating financial flexibility and corporate governance in a single analytical framework, highlighting governance as a key boundary condition for the effective use of financial slack. The results carry implications for managers, investors, and policymakers, emphasizing balanced ownership structures, leadership separation, and independent boards in enhancing the performance benefits of financial flexibility in emerging markets.
Xuan Cao, Norfaiezah Sawandi, Saudah Ahmad· Risks· 0 citations
Firm value reflects investors’ assessment of a company’s financial prospects, risk, and long-term value creation. This study examines the effects of capital structure and corporate social responsibility (CSR) disclosure on firm value and investigates whether profitability moderates these relationships. Using a quantitative explanatory design, the study analyzes secondary data from 21 firms listed on the Indonesia Stock Exchange during 2022–2024, resulting in 63 observations. Firm value is measured by Price-to-Book Value (PBV), capital structure by Debt-to-Equity Ratio (DER), CSR disclosure by an index based on the Global Reporting Initiative (GRI) Standards 2021, and profitability by Return on Assets (ROA). Fixed-effects panel regression with interaction terms is employed to test the direct and moderating relationships. The results show that capital structure has a positive and statistically significant relationship with firm value, indicating that higher leverage is associated with higher market valuation within the observed sample. In contrast, CSR disclosure has no statistically significant relationship with firm value, suggesting that disclosure breadth alone does not sufficiently explain variation in market valuation. Profitability also does not significantly moderate either the capital structure–firm value relationship or the CSR disclosure–firm value relationship. Overall, the findings indicate an asymmetric valuation pattern in which capital structure is more strongly associated with firm value than CSR disclosure, while profitability does not function as a significant contingency variable for either relationship. The study contributes to the literature by providing recent evidence from the Indonesian capital market on the differentiated valuation relevance of financial leverage and CSR disclosure.
Fadilla Rezky Hendrani, Anita Ade Rahma, R. A. Wijaya· GOVERNORS· 0 citations
Type of the article: Research ArticleAbstractCorporate investment allocation is essential for sustainable firm growth, particularly in emerging markets where firms may shift resources between long-term productive assets and more flexible financial assets under conditions of agency conflicts, weak monitoring, and limited transparency. This study investigates how corporate governance affects real and financial investment in Vietnamese listed non-financial firms and examines whether corporate social responsibility disclosure moderates these relationships. The analysis is based on a balanced panel of 356 firms listed on the Ho Chi Minh City and Hanoi stock exchanges during 2017–2024, yielding 2,848 firm-year observations. The study applies firm- and year-fixed-effects models with clustered standard errors and further addresses endogeneity through lagged-regressor specifications, fixed-effects instrumental-variable estimation, and two-step system generalized method of moments estimation. The results show that larger boards, higher board independence, and greater institutional ownership are associated with higher fixed-asset investment and lower financial investment, whereas chief executive officer duality and ownership concentration are associated with lower fixed-asset investment and higher financial investment. The moderating estimates indicate that corporate social responsibility disclosure strengthens these patterns. Among disclosing firms, the marginal effects of board size, board independence, and institutional ownership on fixed-asset investment increased to 0.556, 0.521, and 0.321, while their corresponding effects on financial investment declined to –0.496, –0.641, and –0.426. Overall, the findings indicate that stronger governance quality and more transparent corporate social responsibility disclosure can jointly improve the orientation and sustainability of corporate capital allocation in Vietnam.
In the digital era, tax compliance served as crucial capital. This study examines the impact of tax compliance, proxied by the effective tax rate (ETR) and validated by book–tax differences (BTD) as an alternative proxy, on the firm value of listed financial institutions in Vietnam from 2018 to 2023. Utilizing a comprehensive panel dataset of 29 listed financial firms, the empirical estimations explore a Fixed Effects Model (FEM) with Driscoll–Kraay robust standard errors to control for heteroscedasticity, autocorrelation, and cross-sectional dependence. The empirical results reveal a statistically significant positive relationship between current-period tax compliance and firm value, supporting Signaling Theory and Stewardship Theory by demonstrating that the market awards a governance premium for tax transparency. Conversely, the prior-period tax compliance exerts a significant negative impact on current valuation, validating the existence of a tax-induced liquidity drain. Under the Information Processing Theory, a legacy of robust tax compliance is conceptually argued to be transformed into a digital credit asset in the digital age. This intangible asset enables financial institutions to seamlessly navigate stringent risk screenings, secure swift access to data-driven supply chain finance systems and effectively resolve short-term cash flow bottlenecks to sustain long-term value growth. Furthermore, firm valuation is significantly shaped by key institutional control parameters. Specifically, chronological firm longevity exerts a statistically significant positive impact on market value, highlighting the pricing of historical resilience, while core accounting profitability remains positive but statistically neutral in the baseline specification. Conversely, traditional revenue expansion scale is negatively valued, signaling market skepticism toward asset-heavy, physical scaling in the digital financial era.
Khuu Thi Phuong Dong, Hoa Thi Ngoc Nguyen, N. Trân et al.· Journal of Risk and Financia...· 0 citations
Corporate governance and regulatory supervision are widely recognized as critical monitoring mechanisms in the banking sector. This study aims to investigate whether these mechanisms mitigate the adverse impact of economic policy uncertainty (EPU) on the earnings quality of Indian banks.
Using a panel of 44 banks over 2005–2024, earnings quality is measured through discretionary loan loss provisions (DLLPs), and EPU is captured using the Baker et al.’s (2016) index. The analysis uses the two-step system generalized method of moments estimator to address endogeneity and dynamic panel bias. Corporate governance is proxied by a composite board index and its subcomponents, while regulatory supervision is measured by the post-2015 asset quality review.
Heightened EPU significantly increases discretionary provisioning, and this effect remains robust across alternative DLLP measures and model specifications. Corporate governance attenuates the EPU–DLLP relationship in private banks but is less effective in state-owned banks. Regulatory supervision weakens the EPU–DLLP link primarily in state-owned banks. These results suggest that the moderating influence of governance and supervision depends on bank ownership.
This study provides novel evidence on the interaction between policy uncertainty, governance and regulatory oversight in shaping earnings quality in banks. By distinguishing ownership-specific effects and incorporating a major regulatory reform, it provides policymakers with timely insights. It contributes to the growing literature on policy uncertainty and bank behavior in emerging markets.
