Do External Auditors Perform a Corporate Governance Role in Emerging Markets? Evidence from East Asia
研究东亚新兴市场中，外部独立审计师是否通过监督或绑定机制缓解控股股东与中小股东间的代理冲突，发现存在代理问题的企业更倾向聘请五大审计师，且五大审计师在审计收费和报告决策中考虑了客户的代理问题。
ABSTRACT In emerging markets, the agency conflicts between controlling owners and the minority shareholders are difficult to mitigate through conventional corporate control mechanisms such as boards of directors and takeovers. We examine whether external independent auditors are employed as monitors or as bonding mechanisms, or both, to alleviate the agency problems. Using a broad sample from eight East Asian economies, we document that firms with agency problems embedded in the ownership structures are more likely to employ Big 5 auditors. This relation is evident among firms that raise equity capital frequently. Consistently, firms hiring Big 5 auditors receive smaller share price discounts associated with the agency conflicts. Also, we find that Big 5 auditors take into consideration their clients' agency problems when making audit fee and audit report decisions. Taken together, these results suggest that Big 5 auditors do have a corporate governance role in emerging markets.