Browsing by Author "Yao, S."
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Item Open Access Building eco-friendly corporations: The role of minority shareholders(Springer, 2022-12-06) Yao, S.; Pan, Y.; Wang, L.; Şensoy, Ahmet; Cheng, F.Based on China’s mandatory requirement for listed firms to implement online voting in their annual general shareholder meetings, we investigate whether and how minority shareholders influence corporate environmental performance (CEP). We use the difference-in-difference approach and find that the implementation of online voting promotes minority shareholders’ participation in shareholder meetings, which, in turn, leads to improved CEP of listed firms. We discover that “local pollution” exposure and “the increasing awareness of listed firms’ environmental risks” are the main motives of minority shareholders concerning listed firms’ environmental performance. Furthermore, we find that the minority shareholders improve CEP of listed firms through influencing groups with greater bargaining power. © 2022, The Author(s), under exclusive licence to Springer Nature B.V.Item Embargo Can investors’ informed trading predict cryptocurrency returns? Evidence from machine learning(Elsevier Inc., 2022-05-24) Wang, Y.; Wang, C.; Şensoy, Ahmet; Yao, S.; Cheng, F.As an emerging asset, cryptocurrencies have attracted more and more attention from investors and researchers in recent years. With the gradual convergence of the investors in cryptocurrency and traditional financial markets, the research on investor trading behavior from the perspective of microstructure has become increasingly important in cryptocurrency market. In this paper, we study whether investors’ informed trading behavior can significantly predict cryptocurrency returns. We use various machine learning algorithms to verify the contribution of informed trading to the predictability of cryptocurrency returns. The results show that informed trading plays a role in the prediction of some individual cryptocurrency returns, but it cannot significantly improve the prediction accuracy in an average sense of the whole market. The lack of market supervision of cryptocurrency market may be the main factor for relatively low efficiency of this market, and policymakers need to pay attention to it.Item Open Access The dark side of marital leadership: Evidence from China(Elsevier BV, 2021-10) Yao, S.; Zhao, W.; Şensoy, Ahmet; Cheng, F.; Goodell, J. W.Using a unique dataset of Chinese private firms, we find that marital leadership is associated with higher propensity for financial fraud. We examine the potential economic mechanisms that lead to this result, finding that weak internal supervision and inefficient decision-making provide crucial linkages between marital leadership and financial fraud. However, well-functioning corporate governance mechanisms reduce the negative effects of marital leadership. Our findings provide important empirical evidence for the effect of family involvement in corporate governance and contribute to the literature on the determinants of financial fraud in listed firms.Item Open Access Green credit policy and firm performance: What we learn from China(Elsevier BV, 2021-09) Yao, S.; Pan, Y.; Şensoy, Ahmet; Uddin, G. S.; Cheng, F.We explore the effect of green credit policy on firm performance of listed firms in China. We find that green credit policy reduces firm performance in heavily polluting industries. This effect is more prominent in state-owned enterprises, firms with large size, high institutional ownership, high analyst coverage and during high economic policy uncertainty period. Moreover, we observe that green credit policy decreases heavily polluting firms' performance by increasing firm financing constraints and decreasing investment level. Our results help to restrain heavily polluting enterprises and promote industrial transformation in developing markets.Item Open Access Investor attention and cryptocurrency market liquidity: A double-edged sword(Springer, 2022-09) Yao, S.; Şensoy, Ahmet; Nguyen, D. K.; Li, T.This paper explores the double-edged sword effect of investor attention on market liquidity. Based on the analysis on 597 cryptocurrencies from 2014 to 2020, our findings show that static investor attention improves cryptocurrency market liquidity over the next three months by attracting more investors into the market and stimulating buy and sell transactions. By contrast, abnormal attention persistently and negatively affects the liquidity and leads to excessive net buying pressure in the market and a crowded buyers’ market, resulting in a sharp deterioration of liquidity. Moreover, these effects intensify during low global economic policy uncertainty periods and for cryptocurrencies with small market capitalization and low idiosyncratic volatility. Overall, our results have important implications for investors, portfolio managers, and policymakers.Item Open Access Investor attention and environmental information disclosure quality: Evidence from heavy pollution industries in China(John Wiley & Sons Ltd., 2023-03-20) Yao, S.; Li, T.; Şensoy, Ahmet; Fang, Z.; Cheng, F.Using listed firms from 16 heavy pollution industries in China, we show that investor attention can significantly improve the quality of corporate environmental information disclosure. By examining the heterogeneity effects of investor attention under different firm characteristics, locations, and external supervision, we reveal that this improvement effect is more pronounced for smaller firms, state-owned enterprises, firms with weaker corporate governance, and firms located in China's western regions (regions with poor economic development). We further find that public's attention to environmental issues promotes the investor attention level on firms in heavy pollution industries, thus improving firms' environmental information disclosure quality. Overall, our results emphasize the role of external investor attention on corporate environmental issues.Item Open Access Investor attention and idiosyncratic risk in cryptocurrency markets(Routledge, 2021-12-18) Yao, S.; Kong, X.; Şensoy, Ahmet; Akyıldırım, E.We explore the impact of investor attention on idiosyncratic risk in the cryptocurrency markets. Taking the Google Trends Index as the measure of investor attention, we find that investor attention can significantly reduce cryptocurrencies’ idiosyncratic risks by increasing the liquidity. We further study possible cross-sectional variations of the effect of investor attention on idiosyncratic risk. Evidence shows that the investor attention effect is more pronounced for smaller-cap and younger cryptocurrencies. Moreover, a relatively stable external market environment and rising market state are conducive to the further play of the attention effect.Item Open Access Learning from failures: Director interlocks and corporate misconduct(Elsevier BV, 2022-10-20) Wang, Z.; Yao, S.; Şensoy, Ahmet; Goodell, J. W.; Cheng, F.Motivated by social learning and social network theories, we argue that firms learn from failures in their director interlocked firms. Empirical results show that enforcement for violations in errant firms inhibit misconduct commitments in focal firms (i.e., firms interlocked with errant firms). We investigate the role of interlocking directors in facilitating the inhibition of misconduct. Empirical results evidence that information transmission by interlocking directors plays a crucial role in the process of inhibitive learning. Besides information transmission, we also find that interlocking directors react with higher diligence in focal firms. Further, overall diligence of independent directors in focal firms is heightened. Additionally, we test several factors that influence the significance of this inhibition, including characteristics of interlocking directors, firm features, and industry characters. Finally, the enforcement can deter more than one form of misconduct in focal firms. Overall, we thoroughly investigate the reactions of focal firms and their directors. Our study focuses on inhibitive learning, which has received limited attention in corporate finance literature.Item Embargo Positive information shocks, investor behavior and stock price crash risk(Elsevier BV, 2022-03-31) Cui, X.; Şensoy, Ahmet; Nguyen, D. K.; Yao, S.; Wu, Y.This article explores the impact of positive information shocks on investors’ trading behavior and the related stock price crash risk. We use cumulative positive jump returns to measure the positive information shocks and find that these shocks exacerbate crash risk. Moreover, retail investor attention, over-optimistic investor sentiment, and retail trades are channels for this exacerbation. We also provide evidence that the effect of the information shocks varies across firm characteristics and aggregate states. It is stronger for firms with large-cap, long listing times, and state-owned structures and during over-optimistic aggregate states. Overall, our results shed light on investor trading behavior and market risk related to unexpected information shocks, which helps detect and diagnose potential market instability.Item Embargo Unknown unknowns: knightian uncertainty andcorporate opportunistic earnings management(Wiley, 2024-01) Yao, S.; Xie, X.; Boubaker, S.; Şensoy, Ahmet; Cheng, F.Uncertainty is inherent in the real world. Faced with Knightian uncertainty caused by many extremeevents, this paper focuses on the analysis of corporate opportunistic earnings management behaviourunder the unknown unknowns framework. This paper finds that with an increase in market Knigh-tian uncertainty, corporations will significantly adopt both accrual earnings management and realearnings management. More importantly, when compared with upward earnings management, theresults indicate that Knightian uncertainty will lead corporations to implement more downward earn-ings management. Our results are consistent with the big bath theory, which is also verified throughthe adjustment of non-recurring profit and loss accounts. To understand the real process of earningsmanagement, we also discuss the strategic choice behaviour of earnings management under differentheterogeneous situations