We investigate and find a significant and positive relation between share pledging by controlling shareholders and the likelihood of corporate misconduct. The results remain robust after classifying misconduct into accounting and non-accounting misconduct, and misconduct receiving severe and light penalties. Alleviation of financial constraints, inflation of stock prices, mitigation of margin calls, and expropriation under poor corporate governance are the main motives for corporate misconduct by firms with pledging controlling shareholders. The positive relation between share pledging and corporate misconduct propensity remains after accounting for endogeneity issues, political connections, intensified bank monitoring, and share repurchasers.

中文翻译：

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股票质押和公司不当行为


我们调查发现，控股股东的股票质押与公司不当行为的可能性之间存在显著的正相关关系。在将不当行为分为会计和非会计不当行为以及受到严重和轻微处罚的不当行为后，结果仍然稳健。缓解财务限制、股价通货膨胀、减轻追加保证金通知以及在公司治理不善的情况下进行征用是拥有质押控股股东的公司进行公司不当行为的主要动机。在考虑了内生性问题、政治关系、加强的银行监控和股票回购者之后，股票质押与公司不当行为倾向之间的正相关关系仍然存在。