Employee stock ownership plan as a measure of covering up corporate fraud: Evidence from China

IF 2.9 3区经济学 Q1 ECONOMICS

Quarterly Review of Economics and Finance Pub Date : 2024-10-22 DOI:10.1016/j.qref.2024.101934

Ben Ma , Yong Qiu

引用次数: 0

Abstract

Although companies typically claim to implement an employee stock ownership plan (ESOP) for the purpose of incentivizing employees to enhance corporate performance, many non-incentive motives may be hidden behind this move. Using data on China’s stock market from 2014 to 2022, this paper demonstrates that due to optimistic market reactions, employee stock ownership plans may be related to covering up corporate fraud. Companies that have already committed fraud but have yet to have this fraud detected have a higher propensity for declaring an ESOP. In further research, we found this effect is more pronounced for companies with underperforming stock prices.

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员工持股计划是掩盖公司欺诈行为的一种措施：来自中国的证据

尽管企业通常声称实施员工持股计划（ESOP）是为了激励员工提高公司业绩，但此举背后可能隐藏着许多非激励动机。本文利用 2014 年至 2022 年中国股市的数据，证明由于乐观的市场反应，员工持股计划可能与掩盖企业欺诈有关。那些已经存在欺诈行为但尚未被发现的公司有更高的申报 ESOP 的倾向。在进一步研究中，我们发现这种效应在股价表现不佳的公司中更为明显。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Quarterly Review of Economics and Finance ECONOMICS-

CiteScore

6.00

自引率

2.90%

发文量

118

期刊介绍： The Quarterly Review of Economics and Finance (QREF) attracts and publishes high quality manuscripts that cover topics in the areas of economics, financial economics and finance. The subject matter may be theoretical, empirical or policy related. Emphasis is placed on quality, originality, clear arguments, persuasive evidence, intelligent analysis and clear writing. At least one Special Issue is published per year. These issues have guest editors, are devoted to a single theme and the papers have well known authors. In addition we pride ourselves in being able to provide three to four article "Focus" sections in most of our issues.