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Research on the impact of directors' liability insurance on corporate resilience

Author

Listed:
  • Zhu, Ruikun
  • Lin, Yu
  • Zhang, Xiaofeng

Abstract

This paper uses the data of Chinese A-share listed companies from 2013 to 2023 to examine the impact of directors' liability insurance on corporate resilience. The study finds that, counter-intuitively, when enterprises purchase directors' liability insurance, it significantly reduces their corporate resilience. This is because the purchase of directors' liability insurance significantly increases the aggressiveness of corporate investment and reduces the level of internal management. Moreover, this impact shows significant heterogeneity in firms with different ownership concentration, market competition and profit margins.

Suggested Citation

  • Zhu, Ruikun & Lin, Yu & Zhang, Xiaofeng, 2025. "Research on the impact of directors' liability insurance on corporate resilience," Finance Research Letters, Elsevier, vol. 85(PD).
    • Handle: RePEc:eee:finlet:v:85:y:2025:i:pd:s1544612325014114
    DOI: 10.1016/j.frl.2025.108156
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    References listed on IDEAS

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