Mathematical analysis of civil litigation and empirical research of corporate governance
In addition to reducing R&D investment and changing senior managers or corporate name, the significant uncertainty and reputation shock brought by civil litigation may also have a vital impact on corporate governance of the sued company. We use A-share listed companies in Shanghai and Shenzhen stock exchanges from 2011 to 2018 to empirically examine the impact of civil litigation on corporate governance and its mechanism. It is found that, civil litigation is negatively correlated with corporate governance, and financing liabilities (FL) play an intermediary role in the negative correlation. Furthermore, judicial local protectionism weakens the negative correlation between civil litigation and corporate governance. Finally we close with directions for future research. © 2021 Junling Liu et al., published by Sciendo 2021.
This article is licensed under Creative Commons License and full text is openly accessible in CUD Digital Repository. The version of the scholarly record of this article is published in Applied Mathematics and Nonlinear Sciences (2022), available online at: https://doi.org/10.2478/amns.2022.1.00003
Liu, J., & Formaneck, S. (2022). Mathematical analysis of civil litigation and empirical research of corporate governance. Applied Mathematics and Nonlinear Sciences. https://doi.org/10.2478/amns.2022.1.00003