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Erratum to: Does Corporate Governance Enhance Common Interests of Shareholders and Primary Stakeholders?

Author

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  • Ninghua Zhong

    (Tongji University)

  • Shujing Wang

    (Shanghai Lixin University of Accounting and Finance)

  • Rudai Yang

    (Peking University)

Abstract

Employing a unique dataset of Chinese non-listed firms, this paper investigates the effects of the presence of 19 governance structures on 20 employees’ interest indicators. In general, we find that firms with the governance structures pay workers higher hourly wages, require less monthly working hours, and have a smaller chance of wage arrears. Meanwhile, the shares of total wage and welfare expenditures in total sales revenue are lower in these firms, which results in higher profitability. Moreover, firms with the governance structures invest significantly more into training and provide employees with better fringe benefits. Considering the low labor protection standard and the weak external regulations of China’s labor market, we explain the positive findings thusly: corporate governance structures induce managers to adjust wage payments to the “efficiency wage” level, which is the best balance point for the interests of both shareholders and employees and, therefore, for maintaining the stakeholder relationships. We also find the governance structures that give blockholders superpower are negatively associated with employees interests. These results highlight the importance of giving enough discretion to managers in order to successfully find the common ground for creating mutual values for shareholders and employees.
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Suggested Citation

  • Ninghua Zhong & Shujing Wang & Rudai Yang, 2017. "Erratum to: Does Corporate Governance Enhance Common Interests of Shareholders and Primary Stakeholders?," Journal of Business Ethics, Springer, vol. 141(2), pages 433-433, March.
    • Handle: RePEc:kap:jbuset:v:141:y:2017:i:2:d:10.1007_s10551-016-3347-8
    DOI: 10.1007/s10551-016-3347-8
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    Cited by:

    1. Luigi Lepore & Francesco Paolone & Domenico Rocco Cambrea, 2018. "Ownership structure, investors’ protection and corporate valuation: the effect of judicial system efficiency in family and non-family firms," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 22(4), pages 829-862, December.
    2. Dominika Bak-Grabowska & Anna Cierniak-Emerych & Szymon Dziuba & Katarzyna Grzesik, 2021. "Women Working in Nonstandard Forms of Employment: Meeting Employee Interests," European Research Studies Journal, European Research Studies Journal, vol. 0(3 - Part ), pages 299-324.
    3. Helen LaVan & Lori S. Cook & Ivana Zilic, 2021. "An analysis of the ethical frameworks and financial outcomes of corporate social responsibility and business press reporting of US pharmaceutical companies," International Journal of Business Governance and Ethics, Inderscience Enterprises Ltd, vol. 15(3), pages 326-355.
    4. Jia Li & Zhoutianyang Sun, 2023. "Government audit, employee efficiency and labor cost stickiness," PLOS ONE, Public Library of Science, vol. 18(9), pages 1-23, September.
    5. repec:ers:journl:v:xxiv:y:2021:i:3b:p:299-324 is not listed on IDEAS

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