Joint Shareholders and Earnings Persistence

Abstract

Abstract: If one company holds the shares of a number of listed companies in the same industry, this company is then one of the joint shareholders of many companies in the same industry. Because the joint shareholders hold the shares of many companies in the same industry, they possess the unique advantage of information integration, which can affect the accounting information process of the companies of which they hold shares, relieve the competition of the product markets and the uncertainty of the business environment, and further affect the earnings persistence of the companies of which they hold shares. Taking China’s A-share listed companies from 2007 to 2018 as research objects, this paper explores and analyzes the impact of the joint shareholders on the earnings persistence. The findings show that the joint shareholders can significantly improve the earnings persistence of the companies of which they hold shares. The results of further analysis of the influencing channels indicate that the joint shareholders can improve the earnings persistence through two paths, i.e., reducing both earnings management and performance fluctuation.

Key words: joint shareholders, earnings persistence, earnings management, performance volatility

CLC Number:

F272.1

YAN Su-yan. Joint Shareholders and Earnings Persistence[J]. Contemporary Finance & Economics, 2021, 0(12): 137-148.

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