From alignment to crash: How CFO co-option affects stock prices

IF 7.4 2区经济学 Q1 BUSINESS, FINANCE

Finance Research Letters Pub Date : 2025-05-26 DOI:10.1016/j.frl.2025.107586

Wenqiong Liu , Chih-Chuan Yeh , Lingyu Zhang , Ho-Chuan Huang

引用次数: 0

Abstract

This study examines how CFO co-option affects stock price crash risk in Chinese listed companies. Using data from 2000 to 2022, we find that co-opted CFOs significantly increase the likelihood of stock price crashes. This effect is more pronounced in firms with higher financial constraints and weaker in firms operating in more competitive markets. Excessive or high-risk investments by co-opted CFOs drive this risk. The findings underscore the importance of CFO independence in corporate governance to reduce financial instability and protect shareholder value. This research highlights the critical role of CFO co-option in firm risk and calls for stronger oversight mechanisms.

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从一致到崩溃：首席财务官的共同选择权如何影响股价

本研究考察了中国上市公司首席财务官共同期权对股价崩盘风险的影响。利用2000年至2022年的数据，我们发现增选cfo显著增加了股价崩盘的可能性。这种影响在财务约束程度较高的公司中更为明显，而在竞争更激烈的市场中经营的公司则较弱。增选首席财务官的过度或高风险投资推动了这种风险。研究结果强调了CFO独立性在公司治理中减少财务不稳定性和保护股东价值的重要性。本研究强调了首席财务官共同选择权在企业风险中的关键作用，并呼吁建立更强有力的监督机制。

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

Finance Research Letters BUSINESS, FINANCE-

CiteScore

11.10

自引率

14.40%

发文量

863

期刊介绍： Finance Research Letters welcomes submissions across all areas of finance, aiming for rapid publication of significant new findings. The journal particularly encourages papers that provide insight into the replicability of established results, examine the cross-national applicability of previous findings, challenge existing methodologies, or demonstrate methodological contingencies. Papers are invited in the following areas: Actuarial studies Alternative investments Asset Pricing Bankruptcy and liquidation Banks and other Depository Institutions Behavioral and experimental finance Bibliometric and Scientometric studies of finance Capital budgeting and corporate investment Capital markets and accounting Capital structure and payout policy Commodities Contagion, crises and interdependence Corporate governance Credit and fixed income markets and instruments Derivatives Emerging markets Energy Finance and Energy Markets Financial Econometrics Financial History Financial intermediation and money markets Financial markets and marketplaces Financial Mathematics and Econophysics Financial Regulation and Law Forecasting Frontier market studies International Finance Market efficiency, event studies Mergers, acquisitions and the market for corporate control Micro Finance Institutions Microstructure Non-bank Financial Institutions Personal Finance Portfolio choice and investing Real estate finance and investing Risk SME, Family and Entrepreneurial Finance