This study examines the impact of employee stock ownership plans(ESOPs)on stock-price informativeness in Chinese stock markets.Its findings indicate that firms implementing ESOPs experienced an average 11.89 percent i...This study examines the impact of employee stock ownership plans(ESOPs)on stock-price informativeness in Chinese stock markets.Its findings indicate that firms implementing ESOPs experienced an average 11.89 percent increase in stock-price informativeness.The plans improved stock-price informativeness through increased external attention and supervision.An event study shows that ESOPs gave rise to an announcement effect,driven by anticipated performance improvements and the novelty associated with ESOPs.A mechanism analysis demonstrates that the implementation of ESOPs attracted market attention,and the increased market supervision resulting from this mitigated the moral hazards of management associated with ESOPs.Plans with more positive signals exerted a greater influence.Notably,ESOPs that prioritized management incentives gained more recognition in the market.As the incentive effects of ESOPs were weaker than those of equity incentive plans and the ESOPs lost novelty over time,the annual announcement effect diminished gradually.These findings underscore the necessity of strengthening ESOP incentives for continued optimization of priceefficiency.展开更多
This paper examines whether the announcement of an employee stock ownership plan(ESOP)affects stock price crash risk and the mechanism by which the ESOP may influence crash risk,using a sample of Chinese A-share firms...This paper examines whether the announcement of an employee stock ownership plan(ESOP)affects stock price crash risk and the mechanism by which the ESOP may influence crash risk,using a sample of Chinese A-share firms from the period 2014 to 2017.We provide evidenee that an ESOP announcement is significantly and negatively related to a firm's stock price crash risk.An ESOP announcement sends positive signals to the market that insiders are optimistic about a firmzs future value,which helps enhance investor confidence,resist the pressure for a fire sale caused by negative information disclosure,and reduce stock price crash risk.Further research shows that larger-scale,lower-priced and non-leveraged ESOPs are more helpful in reducing crash risk.This paper sheds lights on the impact of ESOPs in a volatile market environ merit.It also contributes to firms' implementatio n of ESOPs and the development of the legal system in capital markets.展开更多
基金support from the National Social Science Fund of China(No.21BJY079).
文摘This study examines the impact of employee stock ownership plans(ESOPs)on stock-price informativeness in Chinese stock markets.Its findings indicate that firms implementing ESOPs experienced an average 11.89 percent increase in stock-price informativeness.The plans improved stock-price informativeness through increased external attention and supervision.An event study shows that ESOPs gave rise to an announcement effect,driven by anticipated performance improvements and the novelty associated with ESOPs.A mechanism analysis demonstrates that the implementation of ESOPs attracted market attention,and the increased market supervision resulting from this mitigated the moral hazards of management associated with ESOPs.Plans with more positive signals exerted a greater influence.Notably,ESOPs that prioritized management incentives gained more recognition in the market.As the incentive effects of ESOPs were weaker than those of equity incentive plans and the ESOPs lost novelty over time,the annual announcement effect diminished gradually.These findings underscore the necessity of strengthening ESOP incentives for continued optimization of priceefficiency.
基金National Natural Science Foundation of China(No.71272150,and No.71602005)Key Projects of the National Social Science Research Fund of China(No.15AZD012)Humanities and Social Sciences Fund of the Ministry of Education(No.15YJC630164).
文摘This paper examines whether the announcement of an employee stock ownership plan(ESOP)affects stock price crash risk and the mechanism by which the ESOP may influence crash risk,using a sample of Chinese A-share firms from the period 2014 to 2017.We provide evidenee that an ESOP announcement is significantly and negatively related to a firm's stock price crash risk.An ESOP announcement sends positive signals to the market that insiders are optimistic about a firmzs future value,which helps enhance investor confidence,resist the pressure for a fire sale caused by negative information disclosure,and reduce stock price crash risk.Further research shows that larger-scale,lower-priced and non-leveraged ESOPs are more helpful in reducing crash risk.This paper sheds lights on the impact of ESOPs in a volatile market environ merit.It also contributes to firms' implementatio n of ESOPs and the development of the legal system in capital markets.
