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The tangible hand? Does Communist Party involvement in governance promote corporate M&A performance

Author

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  • Liu, Dandan
  • Zhu, Ying
  • Xie, Xinxin

Abstract

This paper investigates the impact of the Communist Party of China's (CPC) participation in corporate governance on the M&A performance of Chinese State-Owned Enterprises (SOEs). Using unbalanced panel data from 2008 to 2020, the findings demonstrate that while the CPC's involvement has no significant effect on short-term M&A performance, it positively impacts long-term performance. This effect is especially pronounced in local SOEs and cross-district M&A deals. The research underscores the need for a nuanced approach to political participation in corporate governance and contributes to the understanding of the dynamics in SOEs’ M&A performance.

Suggested Citation

  • Liu, Dandan & Zhu, Ying & Xie, Xinxin, 2024. "The tangible hand? Does Communist Party involvement in governance promote corporate M&A performance," Finance Research Letters, Elsevier, vol. 61(C).
    • Handle: RePEc:eee:finlet:v:61:y:2024:i:c:s1544612324000308
    DOI: 10.1016/j.frl.2024.105000
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