The Effect of Shanghai-Hong Kong Stock Connect on Information Quality of Listed Company

Yan'e Kou

Abstract: The Shanghai-Hong Kong stock connect policy is a milestone in the internationalization of China's capital markets. Based on the proportion of foreign investors under the Shanghai-Hong Kong stock connect policy, using the revised Jones model to measure information quality of listed company, the fixed effect model is constructed in order to explore the role of the shanghai-hong kong stock connect in the disclosure process of listed companies. The results show that Foreign investors under the shanghai-hong kong stock connect policy cannot directly improve the information quality of listed companies. Instead, it is to make a positive supervisory role in corporate governance by balancing the largest shareholder. This result Provides basis for policy-making and corporate governance.

Keywords: shanghai-hong kong stock connect policy, information quality of listed company, earnings management, corporate governance