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Corporate Governance and Capital Structure Decisions of the Chinese Listed Firms

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  • Yu Wen

    (Maastricht School of Management, The Netherlands,)

  • Kami Rwegasira

    (Maastricht School of Management, The Netherlands,)

  • Jan Bilderbeek

    (Twente University, Enschede, The Netherlands)

Abstract

This paper studies the relationship between some characteristics of the corporate board and the firm's capital structure in Chinese listed firms. The findings provide some preliminary empirical evidence and seem to suggest that managers tend to pursue lower financial leverage when they face stronger corporate governance from the board. However, the empirical results of the relationships are statistically significant only in the case of the board composition and the CEO tenure. The results are statistically insignificant in the case of the board size and fixed CEO compensation. This may in general suggest that, up to the time period of our investigation, the corporate board structures and processes in Chinese listed firms might not as yet be fully working in the manner, or as well, as might have been so far assumed on the basis of Western theoretical finance literature. Copyright Blackwell Publishers Ltd 2002.

Suggested Citation

  • Yu Wen & Kami Rwegasira & Jan Bilderbeek, 2002. "Corporate Governance and Capital Structure Decisions of the Chinese Listed Firms," Corporate Governance: An International Review, Wiley Blackwell, vol. 10(2), pages 75-83, April.
  • Handle: RePEc:bla:corgov:v:10:y:2002:i:2:p:75-83
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    Cited by:

    1. repec:gam:jecomi:v:5:y:2017:i:4:p:47-:d:120891 is not listed on IDEAS
    2. Apostolos Dasilas & Nicolas Papasyriopoulos, 2015. "Corporate governance, credit ratings and the capital structure of Greek SME and large listed firms," Small Business Economics, Springer, vol. 45(1), pages 215-244, June.
    3. Mina Zare & Mahmoud Moeinadin & Forough Heyrani, 2014. "Investigating the Relationship between Board Characteristics and the Sustainable Development of Companies Listed at Tehran Stock Exchange," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 4(6), pages 384-401, June.
    4. ManYing Kang & Marcel Ausloos, 2017. "An Inverse Problem Study: Credit Risk Ratings as a Determinant of Corporate Governance and Capital Structure in Emerging Markets: Evidence from Chinese Listed Companies," Papers 1712.00602, arXiv.org.
    5. repec:eee:jebusi:v:92:y:2017:i:c:p:10-28 is not listed on IDEAS
    6. Albert Agyei & Appiah Richard Owusu, 2014. "The Effect of Ownership Structure and Corporate Governance on Capital Structure of Ghanaian Listed Manufacturing Companies," International Journal of Academic Research in Accounting, Finance and Management Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Accounting, Finance and Management Sciences, vol. 4(1), pages 109-118, January.
    7. Khaled Hussainey & Khaled Aljifri, 2012. "Corporate governance mechanisms and capital structure in UAE," Journal of Applied Accounting Research, Emerald Group Publishing, vol. 13(2), pages 145-160, September.
    8. repec:ibn:ijefaa:v:9:y:2017:i:4:p:90-94 is not listed on IDEAS
    9. Premepeh, kwadwo Boateng & Odartei-Mills, Eugene, 2015. "Corporate governance structure and shareholder wealth maximisation," MPRA Paper 68087, University Library of Munich, Germany.
    10. Uwuigbe Olubukunola Ranti, 2013. "The Effects of Board Size and CEO Duality on Firms’ Capital Structure: A Study of Selected Listed Firms in Nigeria," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 3(8), pages 1033-1043, August.
    11. Nasir Ali & Najeeb Muhammad Nasir & Saqlain Latif Satti, 2014. "The Effect of Corporate Governance on Capital Structure Decisions – A Case of Saudi Arabian Banking Sector," Acta Universitatis Danubius. OEconomica, Danubius University of Galati, pages 51-60.
    12. Haß, Lars Helge & Vergauwe, Skrålan & Zhang, Qiyu, 2014. "Corporate governance and the information environment: Evidence from Chinese stock markets," International Review of Financial Analysis, Elsevier, vol. 36(C), pages 106-119.
    13. Khaled Elsayed, 2011. "Board size and corporate performance: the missing role of board leadership structure," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 15(3), pages 415-446, August.
    14. repec:eee:riibaf:v:42:y:2017:i:c:p:689-709 is not listed on IDEAS

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