The Influence Of Strategic Investors On Managerial Intonation Manipulation

In recent years,Securities Regulatory Commission has introduced and adjusted many regulatory measures on information disclosure to continuously promote regulatory transformation.For example,the implementation of information disclosure through train,the "get to the bottom of the matter" type of supervision,the launch and continuous promotion of sub-industry supervision,the strengthening of the first-line supervision on information disclosure of mergers and acquisitions,and the strengthening of the annual report post-review and inquiry mechanism.These regulatory measures increase the cost of enterprises manipulating quantitative information in financial statements,reduce the motivation of earnings management,and improve the authenticity of financial statements to a certain extent.In spite of this,corporate financial statement information includes not only quantitative information,but also qualitative information.In recent years,with the continuous evolution of technical methods and means in the field of computers,more and more scholars have started to mine the accounting text information of enterprises.As a necessary and beneficial supplement to traditional financial information,the "Management’s Discussion and Analysis"(MD&A)tone has attracted more and more extensive attention from academics and practitioners.For the presentation of textual information in the "Management’s Discussion and Analysis",China Securities Regulatory Commission has not yet issued a mandatory policy to regulate,and because the cost of falsification and concealment of such manipulation is low and not easily detected,which makes it more convenient for management to implement tone manipulation.Therefore,it is not easy to detect the concocting behavior,which provides great convenience for executives to implement management tone manipulation.The improvement of the consistency between textual and digital information in annual reports depends on the improvement of the optimism of the textual tone in corporate financial reports.In view of this,corporate management will achieve impression management by increasing the degree of management tone manipulation,thereby reducing the likelihood of corporate surplus management being identified,hiding negative corporate news and sending positive signals to investors.In addition,with the increasingly prominent role of strategic investors in the capital market,the academic research on strategic investors is deeper and deeper.According to the theory of corporate governance,strategic investors can appoint directors and senior executives to participate in the operation and management of enterprises when they hold shares.could strategic investors play an effective supervisory role and improve the level of corporate governance? To a certain extent,could they reduce the impression management by managers’ manipulating tone of voice?Therefore,on the basis of Image Management Theory and Performance Feedback Theory,this paper selects A-share non-financial listed companies in SSE and SZSE from2009 to 2020 as research samples to investigate the influence of strategic investors on management tone manipulation.After controlling for possible influencing factors,empirical evidence shows that shareholding by strategic investors significantly inhibits MD&A tone manipulation.In addition,this paper discusses the governance behavior of strategic investors under different performance expectation gaps and marketization degree.The results show that strategic investors significantly inhibit MD&A intonation manipulation when the enterprise is in the situation of negative performance expectation gap.However,with the performance expectation gap to the positive gap,the degree of inhibiting MD&A tone manipulation is weakened,and strategic investors tend to choose the behavior mode of "bystander".In addition,compared with enterprises in regions with low marketization degree,Strategic investors in enterprises with high marketization degree have stronger inhibition effect on management tone manipulation.Further mechanism analysis shows that strategic investors can reduce MD&A intonation manipulation by reducing external financing needs and improving corporate governance.By testing the moderating effect of performance expectation gap and marketization degree and examining the theoretical mechanism,this paper reveals the influence and difference of strategic investors on management tone manipulation behavior in a more detailed and comprehensive way.Furthermore,the research expands the influencing factors of management tone manipulation,and provides new evidence for the role of strategic investors in corporate governance.Combined with the actual business performance changes and marketization degree of enterprises,the enterprises should introduce strategic investors prudently,which can effectively inhibit MD&A tone manipulation,so as to improve the quality of information disclosure of enterprises.It also suggests that users of financial statements should pay attention to improving their ability of the annual report information tone,which provide references for strategic investors to participate in the governance activities of listed companies,and for related enterprises to adjust the strategic investment strategy.At the same time,it has important significance for the national regulatory authorities to guide the healthy development of strategic investors and improve the review mechanism of non-financial information disclosure of public companies.