The relationship between board characteristics and corporate credit ratings—Evidence based on the Chinese market

IF 7.9 2区经济学 Q1 ECONOMICS

Economic Analysis and Policy Pub Date : 2024-11-28 DOI:10.1016/j.eap.2024.11.023

Yuhan Zhao, Yaqi Zhang, Pinglin He

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引用次数: 0

Abstract

Credit ratings serve as a critical mechanism for investors to assess corporate credit risk and mitigate investment risk, while a well-managed board is central to addressing principal-agent problems and thereby effectively reducing a firm's default risk. However, research on the impact of board characteristics on credit ratings rarely focuses on individual characteristics. This study focuses on board composition, board member quality, board motivation, and board governance to provide a more comprehensive description of the impact of board characteristics on corporate credit ratings. Using data on Chinese A-share listed companies from 2010 to 2020, the findings are as follows.(1)Board composition, quality, motivation and leadership have a significant impact on corporate credit ratings. (2)Board characteristics affect corporate credit ratings by influencing internal control, surplus management, and accounting disclosure quality. (3)Under the socialist economy with Chinese characteristics, the influence of board characteristics on corporate credit ratings is significantly higher in regions with higher levels of marketization. Overall, our findings provide new insights into the effect of board characteristics on credit ratings.

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来源期刊

Economic Analysis and Policy ECONOMICS-

CiteScore

9.80

自引率

9.20%

发文量

231

审稿时长

93 days

期刊介绍： Economic Analysis and Policy (established 1970) publishes articles from all branches of economics with a particular focus on research, theoretical and applied, which has strong policy relevance. The journal also publishes survey articles and empirical replications on key policy issues. Authors are expected to highlight the main insights in a non-technical introduction and in the conclusion.