This study examines the priority choice between controlling shareholders’ equity pledges and earnings management within the unique institutional context of Chinese listed companies. The findings suggest that, under equity pledge circumstances, firms are more inclined to prioritize real earnings management (REM) to mitigate stock price volatility and the risk of control transfer. In contrast, accrual-based earnings management (DA) and classification shifting are less favored, as they are more easily detected by regulators and may lead to delayed negative consequences. Among these, classification shifting is less constrained compared to AEM. Empirical results indicate that a higher equity pledge ratio by controlling shareholders increases the likelihood that management will engage in real earnings management (REM), such as cutting R&D expenditures and adjusting inventory purchases, to meet short-term financial targets and reduce regulatory risk. Moreover, due to its relative concealment and lower long-term adverse effects, classification shifting continues to be preferred over accrual-based earnings management (AEM). These findings offer valuable theoretical insights into the motivations behind earnings management and the interaction mechanisms among its different forms, and provide useful implications for promoting highquality development in capital markets.