Public and Private Sanctions for Corporate Misconduct: Evidence From Listed Companies

IF 16.4 1区化学 Q1 CHEMISTRY, MULTIDISCIPLINARY

Accounts of Chemical Research Pub Date : 2023-09-01 DOI:10.1093/joclec/nhad010

Clara Cardone-Riportella, Myriam García-Olalla, Camilo J Vázquez-Ordás

{"title":"Public and Private Sanctions for Corporate Misconduct: Evidence From Listed Companies","authors":"Clara Cardone-Riportella, Myriam García-Olalla, Camilo J Vázquez-Ordás","doi":"10.1093/joclec/nhad010","DOIUrl":null,"url":null,"abstract":"Abstract This paper aims to evaluate the impact that the application of competition legislation exerts on financial markets. The sanctioning process is classified into three key moments: the announcement of an investigation when a case of corporate misconduct is suspected; the imposition of a fine, if applicable; and, finally, the rectification or ratification of the sanction. The impact of these announcements on share prices between 2013 and 2021 is analyzed using the event study methodology. This research focuses on companies listed on the Spanish stock exchange, yielding 22 firms with 95 observations. The results show a negative and significant market reaction to the series of announcements. While this reaction intensifies if the fine is ratified, the response becomes positive when the sanction is rectified and annulled. In conclusion, the evidence found allows us to state that the market does in effect penalize corporate misconduct. Furthermore, the public sanction imposed by the competent authority is then followed by a private sanction, which manifests itself as a drop in market value. This is consistent with a hypothetical effect of reputational loss, especially in those cases in which the sanction is more significant in relation to the company’s market value.","PeriodicalId":1,"journal":{"name":"Accounts of Chemical Research","volume":null,"pages":null},"PeriodicalIF":16.4000,"publicationDate":"2023-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Accounts of Chemical Research","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1093/joclec/nhad010","RegionNum":1,"RegionCategory":"化学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"CHEMISTRY, MULTIDISCIPLINARY","Score":null,"Total":0}

引用次数: 0

Abstract

Abstract This paper aims to evaluate the impact that the application of competition legislation exerts on financial markets. The sanctioning process is classified into three key moments: the announcement of an investigation when a case of corporate misconduct is suspected; the imposition of a fine, if applicable; and, finally, the rectification or ratification of the sanction. The impact of these announcements on share prices between 2013 and 2021 is analyzed using the event study methodology. This research focuses on companies listed on the Spanish stock exchange, yielding 22 firms with 95 observations. The results show a negative and significant market reaction to the series of announcements. While this reaction intensifies if the fine is ratified, the response becomes positive when the sanction is rectified and annulled. In conclusion, the evidence found allows us to state that the market does in effect penalize corporate misconduct. Furthermore, the public sanction imposed by the competent authority is then followed by a private sanction, which manifests itself as a drop in market value. This is consistent with a hypothetical effect of reputational loss, especially in those cases in which the sanction is more significant in relation to the company’s market value.

查看原文本刊更多论文

公司不当行为的公共和私人制裁:来自上市公司的证据

摘要本文旨在评估竞争立法的实施对金融市场的影响。制裁过程分为三个关键时刻:在怀疑企业不当行为时宣布进行调查;罚款(如适用);最后，纠正或批准制裁。使用事件研究方法分析了这些公告对2013年至2021年间股价的影响。本研究的重点是在西班牙证券交易所上市的公司，产生了22家公司的95个观察结果。结果显示，市场对这一系列公告的反应是消极而显著的。如果罚款被批准，这种反应会加剧，但如果制裁被纠正并取消，这种反应就会变得积极。总之，发现的证据使我们能够声明，市场确实在惩罚企业的不当行为。此外，在主管当局实施公共制裁之后，接着是私人制裁，这表现为市场价值的下降。这与声誉损失的假设影响是一致的，特别是在制裁相对于公司的市场价值更为重要的情况下。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

求助全文

约1分钟内获得全文求助全文

来源期刊

Accounts of Chemical Research 化学-化学综合

CiteScore

31.40

自引率

1.10%

发文量

312

审稿时长

2 months

期刊介绍： Accounts of Chemical Research presents short, concise and critical articles offering easy-to-read overviews of basic research and applications in all areas of chemistry and biochemistry. These short reviews focus on research from the author’s own laboratory and are designed to teach the reader about a research project. In addition, Accounts of Chemical Research publishes commentaries that give an informed opinion on a current research problem. Special Issues online are devoted to a single topic of unusual activity and significance. Accounts of Chemical Research replaces the traditional article abstract with an article "Conspectus." These entries synopsize the research affording the reader a closer look at the content and significance of an article. Through this provision of a more detailed description of the article contents, the Conspectus enhances the article's discoverability by search engines and the exposure for the research.