The Influence Of The Negative Media Coverage On Top Management Turnover

China is currently in a special period of economic restructuring in which the governance mechanism in listed company is still being consummated. Top management turnover, which would impose long-term impact on business investment, operation and decision-making, is the one of most important decisions for the board. The shortcomings of traditional corporate governance mechanisms on executive regulation would bring endless stream of scandals for the corporation. With the development of modern economy, the power of the media is rising step by step in the corporate external governance mechanism. Corporate governance role played by media attracts attention of scholars at home and abroad. The existing literature suggests that media coverage plays a role in corporate governance mainly through these three ways, the reputation mechanism, causing administrative agencies involvement and the market reaction.This thesis analyses the factors that influence executive change and the governance role of media in listed companies, and suggest that negative media coverage eliminates information asymmetry and increases the possibilities of top management turnover by reputation mechanism, causing administrative agencies involvement and the market reaction. Based on theoretical analysis, this thesis regards listed companies in China as the research object, firstly, we propose a hypothesis, establish a model and conduct data collection of the variables in this model; secondly, we take descriptive statistical analysis and correlation analysis on this variable data, take Logistic regression test for the hypothesis, analyze whether the negative media coverage can promote the top management turnover, and compare the different roles of negative media coverage facing different ownership structure and different company performance. This thesis has also classified the top management turnover according to their position and discussed the effects of negative media coverage on different types of top management turnover.The result shows:(1) The negative media coverage is significantly and positively correlated with top management turnover, suggesting that negative media coverage enhance the possibilities of top management turnover; (2) The number of negative media coverage is also significantly and positively correlated with top management turnover, which means that the more negative media coverage comes out, the greater possibilities of top management turnover will be; (3) The negative media coverage is positively correlated with top management turnover in non-state-owned listed company, but not significantly. But this positive correlation is significant at the 1% level for non-state-owned samples. It shows that negative media coverage imposes a greater impact on top management turnover in the non-state-owned listed company; (4) In the sample with higher performance, the negative media coverage is positively correlated with top management turnover, but not significantly. In the sample with lower performance, the number of negative media coverage is positively correlated with top management turnover, but not significantly. It indicates that negative media reports impose great impact on executive changes in the listed companies with poor performance; (5) In addition, as to different types of top management turnover, it indicates that negative media coverage is positively correlated with GM turnover and CEO turnover.In the end, based on the conclusions got through theoretical analysis and empirical research, this thesis makes some recommendations on consummating governance mechanism of listed company, enhancing the governance role played by media, bettering the media environment and so forth.