Research On The Effect Of Independent Director System On The Stock Return Synchronicity

Introducing and implementing the independent director system is a major measure in the reform of the governance mechanism of listed companies in China.The independent director system is an effective choice to strengthen the company's internal checks and balances mechanism.It can not only restrict the internal controlling shareholder from using its controlling position to make acts that are unfavorable to the company and external shareholders,form an independent supervision and effective for the company managers and management.Constrained,but also eased the problem of entrusted agency and mitigated a series of problems caused by insider control.However,due to China's special corporate system background and cultural traditions,whether independent directors can really play a role,whether China's introduction of an independent director system can effectively improve corporate governance and improve the operating performance and information transparency of listed companies have been controversial.Therefore,it is particularly necessary to explore the validity of the independent director system of Chinese listed companies in both theoretical and empirical aspects.This article uses the data of Chinese A-share listed companies from 2004 to 2014 to explore the impact of independent director system on the stock price synchronization of listed companies from the perspective of the stock price synchronization.This dissertation first reviews and generalizes the relevant literature on the influence of independent director system,stock price synchronicity and independent director system on stock price synchronization.Secondly,this part introduces the theoretical basis of independent director system.Combined with the influencing factors of the stock price synchronization,the theory deduces the influence mechanism of the independent director system on the stock price synchronization,and puts forward the main assumptions of this article.Thirdly,it introduces the data source,the sample selection and the variable index,constructs the basic panel data Regression model,and then use the constructed panel data regression model to test the influence of independent director system on the stock price synchronization of listed companies empirically.The last part is the conclusion and suggestion.The research found that:(1)When the number of independent directors reaches five or above,the independent directors are no longer vase directors.They can truly exert their independence,promote the information disclosure of listed companies,improve the information content of traits,and effectively;(2)The proportion of independent directors is significantly negatively correlated with the stock price synchronization of listed companies,that is,the higher the percentage of independent directors,the lower the stock price synchronization;(3)The education background of independent directors is strictly and negatively related to the synchronization of share prices,that is,the average level of education of independent directors can significantly reduce the synchronization of stock prices and improve the transparency of information;(4)Further,the concentration of ownership The degree of independence of directors and the relationship between the stock price will also have an impact,in the high concentration of companies,independent directors to reduce the role of price synchronization more significant,indicating that in a dominant company,independent directors to better play Supervise,promote the disclosure of trait information,safeguard the interests of medium and small shareholders and other stakeholders;(5)Finally,in the case of differences in the size of the board of directors,the effect of independent director system on the synchronization of stock prices is different.The larger the board of directors,the more significant the role of independent directors in reducing the synchronization of stock prices,while the smaller the board of directors The characteristics of the weakening of independent directors on the impact of price synchronization.On the one hand,the research conclusions of this paper not only expand the research perspective of the independent director system and enrich the relevant research in the field of independent directors,but also help clarify the disputes in the independent director system and provide empirical evidence and advices for evaluating the effectiveness of the independent director system.On the other hand,it has enriched the research on the factors that affect the stock return synchronicity and provided the latest evidence from developing countries.It is also of great significance to effectively reducing the stock return synchronicity of listed companies and improving the information efficiency of capital markets.