A stitch in time saves nine: Does cybersecurity legislation decrease debt default risk?
研究中国网络安全法对上市公司债务违约风险的影响，发现该法通过降低运营风险、缓解融资约束和代理成本来减少违约风险，对非国有及治理较弱的企业效果更明显。
Purpose The purpose of this paper is to examine the influence of cybersecurity legislation on corporate debt default risk and its underlying mechanism. Design/methodology/approach This study investigates the potential of China's Cybersecurity Law (CSL) to affect corporate debt default risk using the Differences-in-Differences method with the sample of listed firms in China from 2011 to 2022. Findings (1) CSL effectively mitigates debt default risk. (2) CSL significantly decreases debt default risk by reducing operational risk, alleviating financing constraints and agency costs. (3) Firms that are not state-owned and have weaker internal governance and external supervision exhibit a strengthened negative association between CSL and debt default risk. Practical implications This paper validates the impact of CSL on corporate debt default risk. In addition, it is recommended that corporate managers should continuously strengthen cybersecurity awareness and response capabilities to effectively mitigate corporate debt default risks. For investors, it is imperative to accord significant attention to the cybersecurity risks of firms during the investment process. And for policymakers, it underscores the necessity to develop and refine corporate cybersecurity institutional standards and frameworks governing corporate information security. Originality/value This study demonstrates cybersecurity's risk-mitigation capacity in emerging market debt markets and advances the debt default risk literature by identifying cybersecurity regulation as an underexplored determinant. In addition, this study provides implications for strengthening corporate managers' cybersecurity awareness and enhancing the implementation and refinement of cybersecurity regulations.