The Concussion of Ownership Concentration and Financial Reporting Quality on Investment Efficiency: An Agency Costs and Stakeholder Theory perspective

Abstract

Summary: The financial report has connection to the company's financial status, making investment efficiency as a crucial component of financial operations inside businesses. This study explores the relationship among ownership concentration, investment efficiency, and quality of financial reporting from the standpoints of agency costs and stakeholder theory. Our goal is to expand the current paradigm and reveal the methods in which ownership concentration affects the connection between investment efficiency and financial reporting quality. Using a quantitative approach, this research focuses on the new function of ownership concentration as an extra variable and how it affects investment efficiency in relation to stakeholder theory and agency costs on financial constraints of the subsidy recipients. Also, ownership concentration from the viewpoints of agency costs and stakeholder theory, the research seeks to provide light on the intricate relationships between investment efficiency and financial reporting quality which can boost their earnings for issued rights and delisting avoidance. • Research Methodology: By including ownership concentration as an extra variable in our regression model which will run in SPSS 25.0, we will try to find out its effect on the investment efficiency and financial reporting as well, this study aims to improve our knowledge of the connection between investment efficiency and financial reporting quality by adding ownership concentration as an additional variable into model. By examining ownership concentration from the viewpoints of agency costs and stakeholder theory, the research seeks to provide light on the intricate relationships between investment efficiency and financial reporting quality. • Findings of the Study: The study's anticipated conclusions will shed light on the complex relationship among investment efficiency, ownership concentration, and financial reporting quality. In doing so, this study will clarify the ways in which ownership concentration either exacerbates or lessens difficulties related to stakeholder dynamics and agency costs. • Implications of the Study: This study's implications go beyond academic boundaries and provide useful information for regulators, policymakers, and corporate governance. Gaining insight into how ownership concentration affects the complex relationship between investment efficiency and financial reporting quality will help direct efforts to improve financial reporting's efficacy and transparency, which will ultimately maximise investment efficiency in businesses. In summary, this study adds a distinctive viewpoint by integrating ownership concentration into the current framework. From the perspectives of agency costs and stakeholder theory, it offers insightful information about the intricate relationship between ownership concentration, investment efficiency, and financial reporting quality.