Does corporate governance matter in China?
AbstractThis study assesses the quality of corporate governance practices of Chinese listed companies in 2004. Based on the Revised OECD Principles of Corporate Governance [OECD, 2004. Principles of Corporate Governance, Organization of Economic Cooperation and Development.], we develop a corporate governance index (CGI) to measure the overall quality of corporate governance and disclosure practices of the 100 largest Chinese listed firms. The results show that some Chinese companies have been making progress in corporate governance reform. Specifically, there is a significant difference in the CGI of the top versus the bottom performing companies. Further, oversea-listed Chinese companies tend to show more regard for the role of stakeholders and disclosure and transparency than non-oversea-listed Chinese companies. However, further tests show that there is no statistically significant relation between the quality of corporate governance practices, as measured by the CGI, and market valuation among firms in the sample. It appears that, in 2004, the benefits of good corporate governance have not been fully incorporated into the market valuation of these Chinese companies.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Elsevier in its journal China Economic Review.
Volume (Year): 19 (2008)
Issue (Month): 3 (September)
Contact details of provider:
Web page: http://www.elsevier.com/locate/chieco
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Rafael LaPorta & Florencio Lopez-de-Silanes & Andrei Shleifer & Robert W. Vishny, .
"Law and Finance,"
19451, Harvard University OpenScholar.
- Rafael LaPorta & Florencio Lopez de-Silanes & Andrei Shleifer & Robert W. Vishny, 1996. "Law and Finance," Harvard Institute of Economic Research Working Papers 1768, Harvard - Institute of Economic Research.
- La Porta, Rafael & Lopez-de-Silanes, Florencio & Shleifer, Andrei & Vishny, Robert W., 1998. "Law and Finance," Scholarly Articles 3451310, Harvard University Department of Economics.
- Rafael La Porta & Florencio Lopez-de-Silane & Andrei Shleifer & Robert W. Vishny, 1996. "Law and Finance," NBER Working Papers 5661, National Bureau of Economic Research, Inc.
- Lucian Arye Bebchuk & Jesse M. Fried & David I. Walker, 2002.
"Managerial Power and Rent Extraction in the Design of Executive Compensation,"
NBER Working Papers
9068, National Bureau of Economic Research, Inc.
- Bebchuk, Lucian Arye & Fried, Jesse & Walker, David I, 2002. "Managerial Power and Rent Extraction in the Design of Executive Compensation," CEPR Discussion Papers 3558, C.E.P.R. Discussion Papers.
- Bernard S. Black & Hasung Jang & Woochan Kim, 2006. "Does Corporate Governance Predict Firms' Market Values? Evidence from Korea," Journal of Law, Economics and Organization, Oxford University Press, vol. 22(2), pages 366-413, October.
- Anup Agrawal & Charles R. Knoeber, . "Firm Performance and Mechanisms to Control Agency Problems between Managers and Shareholders (Revision of 29-94)," Rodney L. White Center for Financial Research Working Papers 08-96, Wharton School Rodney L. White Center for Financial Research.
- Lixin Colin Xu, 2000. "Control, Incentives and Competition: The Impact of Reform on Chinese State-owned Enterprises," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 8(1), pages 151-173, March.
- Paul A. Gompers & Joy L. Ishii & Andrew Metrick, 2001.
"Corporate Governance and Equity Prices,"
NBER Working Papers
8449, National Bureau of Economic Research, Inc.
- Groves, Theodore, et al, 1994. "Autonomy and Incentives in Chinese State Enterprises," The Quarterly Journal of Economics, MIT Press, vol. 109(1), pages 183-209, February.
- Charles P. Himmelberg & R. Glenn Hubbard & Darius Palia, 2000.
"Understanding the Determinants of Managerial Ownership and the Link Between Ownership and Performance,"
NBER Working Papers
7209, National Bureau of Economic Research, Inc.
- Himmelberg, Charles P. & Hubbard, R. Glenn & Palia, Darius, 1999. "Understanding the determinants of managerial ownership and the link between ownership and performance," Journal of Financial Economics, Elsevier, vol. 53(3), pages 353-384, September.
- Himmelberg, C.P. & Hubbard, R.G. & Palia, D., 1997. "Understanding the Determinants of Mangerial Ownership and the Link Between Ownership and Performance," Papers 97-21, Columbia - Graduate School of Business.
- Durnev, Art & Kim, E. Han, 2004.
"To Steal or Not to Steal: Firm Attributes, Legal Environment, and Valuation,"
CEI Working Paper Series
2004-7, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
- Art Durnev & E. Han Kim, 2005. "To Steal or Not to Steal: Firm Attributes, Legal Environment, and Valuation," Journal of Finance, American Finance Association, vol. 60(3), pages 1461-1493, 06.
- Bai, Chong-En & Li, David D. & Tao, Zhigang & Wang, Yijiang, 2000. "A Multitask Theory of State Enterprise Reform," Journal of Comparative Economics, Elsevier, vol. 28(4), pages 716-738, December.
- John M. Abowd & David S. Kaplan, 1999.
"Executive Compensation: Six Questions that Need Answering,"
NBER Working Papers
7124, National Bureau of Economic Research, Inc.
- John M. Abowd & David S. Kaplan, 1999. "Executive Compensation: Six Questions That Need Answering," Journal of Economic Perspectives, American Economic Association, vol. 13(4), pages 145-168, Fall.
- Agrawal, Anup & Knoeber, Charles R., 1996. "Firm Performance and Mechanisms to Control Agency Problems between Managers and Shareholders," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 31(03), pages 377-397, September.
- Anup Agrawal & Charles R. Knoeber, . "Firm Performance and Mechanisms to Control Agency Problems between Managers and Shareholders (Revision of 29-94)," Rodney L. White Center for Financial Research Working Papers 8-96, Wharton School Rodney L. White Center for Financial Research.
- Bai, Chong-En & Liu, Qiao & Lu, Joe & Song, Frank M. & Zhang, Junxi, 2004. "Corporate governance and market valuation in China," Journal of Comparative Economics, Elsevier, vol. 32(4), pages 599-616, December.
- Benjamin E. Hermalin & Michael S. Weisbach, 2003.
"Boards of directors as an endogenously determined institution: a survey of the economic literature,"
Economic Policy Review,
Federal Reserve Bank of New York, issue Apr, pages 7-26.
- Benjamin E. Hermalin & Michael S. Weisbach, 2001. "Boards of Directors as an Endogenously Determined Institution: A Survey of the Economic Literature," NBER Working Papers 8161, National Bureau of Economic Research, Inc.
- Black, Bernard, 2001. "The corporate governance behavior and market value of Russian firms," Emerging Markets Review, Elsevier, vol. 2(2), pages 89-108, June.
- Morck, Randall & Shleifer, Andrei & Vishny, Robert W., 1988. "Management ownership and market valuation : An empirical analysis," Journal of Financial Economics, Elsevier, vol. 20(1-2), pages 293-315, January.
- Katharina Pistor & Chenggang Xu, 2005. "Governing Emerging Stock Markets: legal vs administrative governance," Corporate Governance: An International Review, Wiley Blackwell, vol. 13(1), pages 5-10, 01.
- Gabe J. de Bondt & Tuomas A. Peltonen & Daniel Santabárbara, 2010.
"Booms and busts in China's stock market: Estimates based on fundamentals,"
Banco de Espaï¿½a Working Papers
1032, Banco de Espa�a.
- Gabe de Bondt & Tuomas Peltonen & Daniel Santabarbara, 2011. "Booms and busts in China's stock market: estimates based on fundamentals," Applied Financial Economics, Taylor & Francis Journals, vol. 21(5), pages 287-300.
- de Bondt, Gabe & Peltonen, Tuomas A. & Santabárbara, Daniel, 2010. "Booms and busts in China's stock market: Estimates based on fundamentals," Working Paper Series 1190, European Central Bank.
- Cheung, Yan-leung & OUYANG, Zhiwei & TAN, Weiqiang, 2009. "How regulatory changes affect IPO underpricing in China," China Economic Review, Elsevier, vol. 20(4), pages 692-702, December.
- Mishra, Anil V. & Ratti, Ronald A., 2011. "Governance, monitoring and foreign investment in Chinese companies," Emerging Markets Review, Elsevier, vol. 12(2), pages 171-188, June.
- Cheung, Yan-Leung & Chung, Cheong-Wing & Tan, Weiqiang & Wang, Wenming, 2013. "Connected board of directors: A blessing or a curse?," Journal of Banking & Finance, Elsevier, vol. 37(8), pages 3227-3242.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.