Ownership Characteristics、media Supervision And CFO Turnover

The modern corporate governance is the result of assuring the principal-agent relationship to be continued without problems or solving the principal-agent problem. The framework of principal-agent theory is a good start to understand corporate governance. The content of principal-agent relationship consists of the client the agent and the terms of the contract, which three are also the main aspects of framework of principal-agent theory. So we should start with those aspects before deep researches. The turnover of senior executives is the end of principal-agent relationship, as well as one of reflections of corporate governance. Especially, the turnover of senior executives has already become the key variable which measures the level of corporate governance.This paper chooses listing corporations which broke laws or regulations as our samples to study the influence of some concerned variables to CFO turnover and corporate governance. First, I made a summary and analysis about some research results of CFO turnover including home and abroad; Then, I made a general analysis and a specific one about the theory of CFO turnover, especially, I have a better understanding of China corporate governance by analyzing the system environment and other backgrounds; And next, I put concerned variables into regression model, such as ownership concentration、nature of the actual controller and media coverage,and then made a interpretation about the empirical results; At last, I made some proposals on how to improve and perfect China corporate governance.By a special sample:companies listed on main board of A shares which broke laws or regulations and then announced during last ten years from 2002 to 2012,1 empirically tested the influence of ownership concentration、nature of the actual controller and media coverage on CFO turnover based on framework of principal-agent theory. And I come to some conclusions as follows:(1) Ownership concentration has a positive effect on CFO turnover but not significantly; (2) The nature of the actual controller has a significantly negative effect on CFO turnover which means state-owned enterprise has a lower likelihood of changing CFOs compared with private enterprise; (3) The media negative coverage has a significantly positive effect on CFO turnover. Furthermore, state-owned enterprise is more sensitive to media coverage than private enterprise, accordingly, state-owned enterprise even has a higher likelihood of changing CFOs compared with private enterprise after media got involved. Besides, this paper has proved that media coverage can be helpful for corporate governance by influencing CFO turnover.