Variable

Symbol

Definition

Dependent variable

Enterprise risk

Z

Calculated according to Z-score model: $Z=1.2\ast X_1+1.4\ast X_2+3.3\ast X_3+0.6\ast X_4+0.999\ast X_5$

Explanatory variables

Cost stickiness

Sticky

Calculated according to Weiss model: Sticky_i,t = log(ΔCOST/ΔSALE_i,a) − log(ΔCOST/ΔSALE_i,b)

Ownership concentration

CR5

The sum of top 5 shareholders’ holdings

Control variables

The enterprise scale

Size

The natural logarithm of the total asset

Asset-liability ratio

Lev

Total debt/total asset

Profitability

Profit

The gross margins

Capital intensity

Intensity

Total assets/operating income