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Legal environment and corporate litigation risk: A study based on the perspective of media attention

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  • Luo, Zhenxiang

Abstract

Based on data from Chinese non-financial listed firms during 2011–2023, this study empirically examines the impact of the legal environment on corporate litigation risk through the lens of media attention. The findings demonstrate that improvements in the legal environment significantly reduce corporate litigation risk, while media attention amplifies the governance efficacy of the legal framework. Furthermore, the legal environment effectively mitigates litigation risk by enhancing internal control quality. Heterogeneity analysis further reveals that the governance effects of the legal environment are more pronounced in firms exhibiting higher information disclosure quality and superior technical efficiency.

Suggested Citation

  • Luo, Zhenxiang, 2025. "Legal environment and corporate litigation risk: A study based on the perspective of media attention," Finance Research Letters, Elsevier, vol. 85(PE).
    • Handle: RePEc:eee:finlet:v:85:y:2025:i:pe:s1544612325015715
    DOI: 10.1016/j.frl.2025.108317
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    Cited by:

    1. Mao, Xiaoli & Shi, Benzhi, 2025. "Media coverage, corporate governance and cash dividend payout behavior," Finance Research Letters, Elsevier, vol. 86(PG).

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    Keywords

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    JEL classification:

    • K22 - Law and Economics - - Regulation and Business Law - - - Business and Securities Law
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility

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