Market-oriented debt-to-equity swap and enterprise financial performance

Honglan Jiang

Finance Research Letters, 2024, vol. 67, issue PA

Abstract: This study primarily examines the correlation between market-oriented debt-to-equity swaps (MDS) and the financial performance of enterprises, while concurrently investigating the mediating effects of internal controls. Our comprehensive analysis reveals a significant positive relationship between the implementation of the MDS policy and the financial performance of enterprises. Moreover, we identify that internal controls function as a crucial mediating factor between these two variables. Specifically, the enactment of the MDS policy leads to an improvement in corporate internal controls, which subsequently elevates the financial performance of the enterprise. Notably, these conclusions remain robust even after conducting rigorous robustness tests.

Keywords: Market-oriented debt-to-equity swap; Enterprise financial performance; Internal control; Mediation effect (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:67:y:2024:i:pa:s1544612324007700

DOI: 10.1016/j.frl.2024.105740

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