Strategic Aggressiveness,quality Of Internal Controls And Stock Price Crash Risk

In the present international circumstances,the risky of shares price collapse is the plenty of many scholars’ research.Many domestic and foreign experts and scholars have analyzed the influencing elements and reasons of stock price collapse risk from the visual angle of agency cost and information asymmetry,among which the most influential one is the hypothesis of management cover-up put forward by Jin and Myers in 2006.The strategy of the enterprise plays an overall character,which directly determines the corporate’s long-term development direction and future production and operation scheme.Miles and Snow(2003)classify strategies into three categories according to their aggressiveness: defensive,analytical and offensive.With the increase of strategic aggressiveness,enterprises tend to invest more resources in developing new products and exploring new external markets in order to quickly adapt to variation in the external circumstances of enterprises,resulting in increasing business risks and capital requirements of enterprises,lowering the quality of internal control,and failing to effectively identify and block the selfish actions of management,which may eventually lead to enterprises.Therefore,whether the company’s strategic aggressiveness affects the risk of shares price collapse and how it affects the risk of stock price collapse deserve further study.Based on this,this article selects China’s Shanghai and Shenzhen A shares listed companies from 2008 to 2021 as research samples,based on strategic management theory,entrusted agency theory,information asymmetry theory and signal transmission theory,considering that the strategic aggressiveness of enterprises may affect the internal control quality of enterprises,introduces internal control quality as an intermediary variable,and studies the specific pathway of corporate strategic aggressiveness affecting the risk of stock price plummet.The empirical test is carried out again by using the replacement explanatory variable measurement method,lagging variable,and propensity score matching regression method.In addition,this paper introduces analyst attention and management ability as moderating variables for further empirical testing.It is discovered that:(1)Under the condition of some controlling influences,strategic aggressiveness has a positive impact on the risk of shares price crash,that is,compared with enterprises with low strategic aggressiveness,enterprises with high strategic aggressiveness have a greater risk of shares price crash.(2)It mainly due to the quality of internal control plays a partial character as an intermediary in it.Strategically aggressive enterprise improve the risk of share price collapse by reducing the quality of internal controls.(3)Analysts focus on playing a positive moderating character in the influence of strategic aggressiveness on stock price crash risk.Management’s ability plays a negative moderating role in the influence of strategic aggressiveness on stock price crash risk.Through the above argument,this paper discusses not only adds the literature on the influence of strategic aggressiveness on the risk of shares price crash,but also provides experience for the decision-making of listed enterprise.