TITLE:
Central Environmental Protection Supervisor, Nature of Property Rights and Corporate Financial Performance
AUTHORS:
Qichen Wei
KEYWORDS:
Environmental Inspector, Financial Performance, Earnings Management
JOURNAL NAME:
Modern Economy,
Vol.11 No.3,
March
23,
2020
ABSTRACT: After the central environmental protection
inspector, the external environmental regulatory environment facing enterprises
has undergone tremendous changes. This paper uses the double-difference method,
using data from Shanghai and Shenzhen A-share listed companies from 2013 to
2017, to empirically test the impact of the central environmental protection
inspector and its mechanism. The research results show that the financial
performance of listed polluting companies has significantly improved after the
central environmental supervision, but the improvement of financial performance
has heterogeneity of property rights, and state-owned enterprises are
significantly higher than non-state-owned enterprises. Further analysis shows
that there is significant positive earnings management in state-owned listed
polluting enterprises, while non-state-owned enterprises are not. This paper
analyzes the impact of the central environmental protection inspector on the
production and operation of the enterprise in a timely manner, and beneficially
supplements the differences in earnings management of heavily polluting
enterprises in the procyclical period, and supplements relevant literature.