Summary:
Corporate compliance constitutes a fundamental pillar of high-quality firm development and serves as the microfoundation for stable capital markets and sustainable economic growth. While government regulation remains the primary instrument for deterring corporate misconduct, the digital era has witnessed increasingly sophisticated, diverse, and concealed violations that strain traditional regulatory approaches. This regulatory dilemma underscores the urgency to cultivate firms' intrinsic incentives for compliance. Reputational mechanisms, as a market-based disciplinary force, theoretically influence corporate behavior through the accumulation and depletion of reputational capital. Yet existing literature presents a paradox: the “maintenance hypothesis” posits that strong reputations deter misconduct, whereas the “opportunism hypothesis” suggests established reputations may instead shield wrongdoing. The effectiveness of reputational governance is closely tied to the external economic conditions—a relationship that remains underexplored. The rise of digital infrastructure offers an ideal setting to re-examine this issue, as in digital contexts, reputational signals are more authentic, widespread and widely applied, better aligning with the ideal conditions assumed by the reputation maintenance theories. Drawing on China's digital transformation as a natural laboratory, this study examines how technological and market evolution shape the efficacy of reputational mechanisms, using corporate misconduct as the empirical lens. Utilizing a comprehensive dataset of Chinese A-share listed firms from authoritative databases including Datago, CSMAR, and CNRDS, this study documents the limited deterrence effect of reputation in traditional economic settings, where high-and low-reputation firms exhibit statistically indistinguishable violation probabilities, suggesting the ineffectiveness of reputational descipline. However, China's “Broadband China” initiative—a nationwide digital infrastructure rollout—provides a quasi-natural experiment that reveals striking heterogeneity. Employing a triple-difference design spanning 2009-2022, we find that regions with more enhanced digital infrastructure, reputational mechanisms exert greater constraint on corporate misconduct. Firms headquartered in pilot cities with advanced digital networks demonstrate markedly lower violation probabilities conditional on reputation levels. This disciplinary effect intensifies among firms with greater market visibility, those in competitive industries, and those producing goods with low product transparency. Mechanism tests indicate digital development operates through dual channels: (1) amplifying the economic value of reputation by easing financing constraints, and (2) intensifying external monitoring through reputational “spotlight effects” that increase detection risks. Event studies further confirm heightened market penalties for violations in digitalized environments, with reputational damage triggering more severe stock price declines. Three actionable insights emerge for policymakers and firms: First, regulators should integrate reputational mechanisms with conventional oversight through technology-enabled solutions. Blockchain and big data analytics can optimize the collection and disclosure of reputational information, and explore a reputation-based, tiered regulatory model that embeds reputation assessments into public procurement and credit policies, thereby fostering market-driven compliance incentives. Second, safeguarding the integrity of reputational markets requires coordinated efforts to ensure transparent public oversight channels, combat information manipulation, and establish digital traceability systems with strengthened platform accountability. Third, corporations should prioritize reputation management as a strategic asset. Integrating reputation stewardship into long-term planning through (1) compliance culture building, (2) public opinion monitoring systems, and (3) proactive ESG disclosures enables organizations to systematically mitigate reputational risks while accumulating valuable reputational capital. This holistic approach strengthens competitive positioning in the digital economy where intangible assets increasingly determine market value. This study advances the literature in three dimensions. Theoretically, it transcends the static “effective-ineffective” dichotomy of reputational discipline by unveiling its dynamic evolution amid technological change, particularly how digitalization recalibrates information efficiency in governance. Practically, this study proposes a novel “digital empowerment+reputational incentives” framework to address the regulatory trilemma of rising enforcement costs, sophisticated violations, and limited resources—a contribution with immediate policy relevance for emerging digital economies. Lastly, as China emerges as a global digital pioneer, this research offers an empirically grounded, institutionally informed analytical framework that enriches cross-border understanding of corporate governance innovation in the digital age. The findings demonstrate how developing economies can leverage technological leapfrogging to build market-disciplined regulatory regimes, providing transferable insights for international governance reform.
赵静梅, 何宝露. 企业声誉与违规行为——基于数字经济视角的新考证[J]. 金融研究, 2025, 541(7): 76-94.
ZHAO Jingmei, HE Baolu. Corporate Reputation and Violations: New Findings from the Perspective of the Digital Economy. Journal of Financial Research, 2025, 541(7): 76-94.
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