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Corporate governance of Chinese privatized firms: Evidence from a survey of non-listed enterprises

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  • Zhong, Ninghua

Abstract

By using a dataset containing over 1200 Chinese non-listed firms, this study examines the corporate governance of privatized firms. Based on the summary statistics for 22 governance structures, I find that privatized domestic private firms have set up stronger governance than domestic private firms that have not experienced privatization. I propose seven hypotheses to explain the leading performance of privatized firms on corporate governance. I find that while some differences are explained by the diversity of firm-level characteristics, privatized firms’ better performance on setting up a board of directors and providing the CEO with company shares is highly robust. Finally, I find strong correlations between local governments’ fiscal conditions in the privatization year and privatized firms’ governance, which suggests a significant role played by local governments in shaping corporate governance during the privatization process.

Suggested Citation

  • Zhong, Ninghua, 2015. "Corporate governance of Chinese privatized firms: Evidence from a survey of non-listed enterprises," Journal of Comparative Economics, Elsevier, vol. 43(4), pages 1101-1121.
    • Handle: RePEc:eee:jcecon:v:43:y:2015:i:4:p:1101-1121
    DOI: 10.1016/j.jce.2015.05.003
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    3. Ninghua Zhong & Shujing Wang & Rudai Yang, 2017. "Does Corporate Governance Enhance Common Interests of Shareholders and Primary Stakeholders?," Journal of Business Ethics, Springer, vol. 141(2), pages 411-431, March.
    4. Carsten Sprenger & Olga Lazareva, 2017. "Corporate Governance and Investment: Evidence from Russian Unlisted Firms," HSE Working papers WP BRP 160/EC/2017, National Research University Higher School of Economics.
    5. Obey Dzomonda, 2022. "Environmental Sustainability Commitment and Access to Finance by Small and Medium Enterprises: The Role of Financial Performance and Corporate Governance," Sustainability, MDPI, vol. 14(14), pages 1-20, July.
    6. Hammad Riaz & Abubakr Saeed & Muhammad Saad Baloch & Nasrullah & Zeeshan Ahmad Khan, 2019. "Valuation of Environmental Management Standard ISO 14001: Evidence from an Emerging Market," JRFM, MDPI, vol. 12(1), pages 1-14, January.
    7. Helen Wei Hu & Jiamin Zhang, 2023. "How do Corporate Social Responsibility and Innovation Co-evolve with Organizational Forms? Evidence from a Transitional Economy," Journal of Business Ethics, Springer, vol. 186(4), pages 815-829, September.

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    More about this item

    Keywords

    Corporate governance; Privatized firms; Non-listed firms;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • P31 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions

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