Non-Controlling Large Shareholders’ Exit Threat and Accounting Conservatism

Abstract

Non-controlling shareholders' withdrawal threat means that by showing the withdrawal tendency to the controlling shareholders, the controlling shareholders are forced to make compromises and improve the accounting soundness of the company. At present, the existing literatures mainly discuss the impact of exit threat on corporate finance and corporate performance, but few literatures study the causal relationship between exit threat and accounting conservatism, and the research field of its correlation is not perfect. Based on this, this paper takes the sample of China's A-share listed companies from 2010 to 2021 as the research object, studies the influence mechanism of the withdrawal threat of non-controlling shareholders on accounting conservatism, puts forward theoretical assumptions from the opposite angle, makes descriptive statistics and benchmark regression, and draws a conclusion; The robustness of benchmark regression conclusion is tested by PSM tendency score matching method and replacement variable method. Finally, based on the perspective of differences, this paper studies the heterogeneous influence of company size, long-term solvency and profitability on accounting conservatism, and finds that the withdrawal threat of non-controlling shareholders is significantly positively correlated with accounting conservatism, which expands the related research of withdrawal threat on corporate governance, and has reference significance for the check and balance governance mechanism of non-controlling shareholders of listed companies in China.