Empirical Study On The Impact Of Media Coverage On Information Disclosure Quality

High-tech companies have important strategic significance for China's economic transformation and upgrading.The establishment of the GEM has opened up a low-cost financing channel for lots of small-scale companies which possess core technologies.Because of this reason,the GEM is also known as the cradle of growing companies.Due to the high-risk characteristics of GEM listed companies,the information which companies disclose to the outside world is necessary for investors to evaluate companies and make investment decisions.However,while the GEM market is booming,the quality of information disclosure is still a serious problem.A series of effective institutional arrangements are needed to ensure information disclosure quality.The effective corporate governance mechanism improves the information disclosure quality by stimulating and restraining agents to reduce the possibility of using information advantages to exercise opportunistic behavior.In recent years,with the development of information technology,the dissemination and diffusion of data has become more and more efficient.Media is known as “the fourth power” and its function of external management has gradually been recognized by the academia.The media has had a profound impact on agent behavior through information dissemination,reputation mechanisms,and guiding administrativeintervention.Does the increase in media attention improve the information disclosure quality of listed companies on the GEM? Are the effects of different kinds of media reports on the information disclosure quality different? This paper focuses on the above issues.After summarizing the relevant research results,this paper studies the impact of media reports on the information disclosure quality based on the characteristics of China's GEM market.This paper selects the 2015-2017 GEM listed companies as research samples,and establishes a binary logistic regression model to explore the impact of media attention,positive,neutral and negative reports on the information disclosure quality.The results show that media attention,neutral reports and negative reports are significantly positively correlated with the information disclosure quality.However,positive reports are significantly negatively correlated with the information disclosure quality.Further,we examine the role of law on the impact of media attention and different types of reports.Also,we examine the role of government interventions on the impact of negative reports.The study finds that improvements in the level of law have improved the positive impact of negative reports on the information disclosure quality.The decrease of intervention also has significant effect on the positive effects of negative reports.According to the research results,this paper proposes the following three policy recommendations: encouraging the media to mine information and optimizing the media reporting environment so that the media can publish the survey results freely;developing media's reputation mechanism and speeding up government's response to the report so that the media's governance function can strengthen;improving the quality of media reports and emphasizing on media brand building to optimize the media's own supervision and governance capabilities.