Yuan George Shan

Using a data set of top 56 corporate social and environmental reporting (CSER) disclosing firms with 112 observations on the H-share and Red-chip lists of the Hong Kong Stock Exchange, results suggest that charitable donations, firm size, and the Songhua River incident response are positively related to the CSER disclosure, whereas debt–equity ratio, profit margin, and firm age revealed counterdirectional relationships. Other variables including media attention and market risk were found to have no impact. Findings imply that the Chinese government and its agencies need to prescribe CSER guidelines and make them mandatory for listed firms.

Since the Asian financial crisis in 1997, there has been renewed interest in corporate governance policies and practices. This study focuses on corporate govern...

Manuscript Type: EmpiricalResearch Question/Issue: Direct transfer (Type I tunneling) means that the controlling shareholders transfer resources from the firm for their own benefit. This study aims to investigate the impact of internal and external governance mechanisms from the perspective of principal‐principal (P‐P) conflicts on Type I tunneling.Research Findings/Insights: Using hand‐collected data comprising 117 Chinese listed companies with 540 firm‐year observations during 2001–2005, the results show that state ownership and the number of board of directors' meetings are positively correlated with Type I tunneling, whereas the number of independent directors reveals a negative association. Other internal governance mechanisms including foreign ownership, the size of the board of directors, supervisory board size, number of professional supervisors, and the number of supervisory board meetings were found to have no impact.Theoretical/Academic Implications: Several implications can be drawn. First, this study has modeled tunneling using a well‐accepted theoretical perspective – agency theory of P‐P conflicts. But the results show that agency theory does not appropriately explain tunneling behavior in China and so institutional theory is suggested as an alternative theoretical perspective for future research. Second, corporate governance reforms relating to supervisory boards have not been sufficient to ensure that they properly fulfill their role of oversight. Rather, such supervisory boards are perhaps playing more of a “rubber stamp” role.Practitioner/Policy Implications: This study recommends prescribing the legal responsibilities and obligations for two‐tier boards in the Chinese context, allowing them to undertake their duties diligently.

The financial sector plays an important intermediary role in the Chinese economy. However, there has been very limited research concerning improvement in corporate governance within this sector. Using an unbalanced data set of 139 firm-year observations covering 1999 to 2009, this study examines the impact of internal governance mechanisms on the performance of Chinese listed financial institutions. Findings suggest that state ownership, legal person ownership, board size, and supervisory board meetings are negatively related to the profitability of these institutions, whereas factors including ownership concentration, foreign ownership, independent directors, board meetings, and supervisory board size have no impacts.

As China approaches economic superpower status, its need to achieve considerably higher standards of corporate governance is becoming paramount. Despite impressive recent advances in its capital and stock exchange markets, the on-going overhang of state ownership in its former state-owned enterprises, together with an unwieldy and ineffective dual board governance system, has left China facing major corporate governance problems that will deter the private investment necessary for its continued growth. This paper illustrates these problems, and suggests possible reforms that will provide the foundation for the efficient further development of China's capital markets that is needed to help China become a major economic superpower.

The objective of this paper is to provide empirical evidence on the influence of corporate governance characteristics and corporate ownership concentrations on the financial performance of Chinese companies. This is based on analysis of a panel data set covering the years 2001 to 2005. The characteristics considered are the ratios of independent directors and professional supervisors on the companies' two boards, and the level of concentration in and type of ownership of the companies. Our chosen performance metric is Tobin's Q. We find that ownership concentration in general is a significant factor in determining firm performance. The degree of board independence is significant, but it only appears to have a positive impact on performance in larger companies. The expertise of the supervisory board is not a significant determinant of corporate financial performance in China. Our findings support a continued focus on making improvements to the operation and effectiveness of China's institutions of corporate governance.

This study analyses the relationships between performance metrics and the corporate control and governance characteristics of a sample of China’s listed non-financial companies in order to assess the influence of corporate governance structures on the quality and independence of corporate decision making. We use a panel data set covering the years 2001 to 2005 comprised of a stratified sample of A, AB and AH non-financial companies listed on China’s Shanghai and Shenzhen stock exchanges. We find that concentration of ownership, including state and foreign ownership, and board size and independence are significant factors in determining performance outcomes, and by association the quality and independence of corporate policy decisions, as measured in the form of firm bad debt to total asset and bad debt to receivables ratios. Our findings support claims of continued inadequacies in the operation and effectiveness of China’s institutions of corporate governance, especially with respect to the effectiveness of the supervisory board.

This study concerns related-party disclosures by listed companies in China, in a corporate context of a high concentration of government-linked ownership, a two-tier board system, and the engagement of directors, key managers and major (...)