Corporate Performance In China Research Articles

The Effects of Equity Incentives on Corporate Performance in China

The Effects of Equity Incentives on Corporate Performance in China

The Impact of Agency Problems on Corporate Performance in China

This paper delves into the intricate dynamics of the horizontal agency problem within the realm of corporate governance in China, scrutinizing the inherent conflict of interest between controlling and minority shareholders amidst a backdrop of concentrated ownership. Its core objective is to comprehensively grasp the repercussions of this agency dilemma on firm value and corporate performance. Central to this investigation is the identification and analysis of institutional features that fuel the agency predicament, notably the pre-existing split-share structure and the prevalent establishment of pyramid ownership arrangements. In response to these challenges, this study advocates for two primary approaches to mitigate the agency conundrum: an informal approach driven by cultural factors, particularly rooted in Confucian ethics, and a formal strategy entailing robust legal safeguards and regulatory frameworks. The potential efficacy of these proposed measures in ameliorating conflicts of interest, curbing unethical conduct, and fortifying the rights of minority stakeholders, all while reducing agency costs and enhancing corporate performance.

Social insurance law and corporate performance in China

Social Insurance Contributions exert a liquidity constraint on firms and hence influence the performance of firms. By exploiting the enforcement of China's Social Insurance Law (SIL) in 2011 as a quasi-natural experiment, this paper studies the impact of social insurance contributions on the performance of enterprises through a difference-in-differences method. We find that SIL negatively affects the performance of firms, and this effect is more pronounced in firms with weaker cost-shifting capacity. Mechanism tests prove the liquidity constraints channel through the perspective of the firm's cash flow, accounts payable, investment-cash flow sensitivity, and scale of operations. Our findings demonstrate that firms cannot fully mitigate the negative impact brought by Social Insurance Contributions.

The impact of environmental protection tax on corporate performance: A new insight from multi angles analysis

This study investigates the practical effects of adopting the environmental protection tax (EPT) policy on corporate performance in China. The analysis uses the Difference in Differences (DID) approach based on a quasi-natural experiment scenario. The findings indicate there is a negative impact of implementing the EPT policy on the financial performance of corporations, and the conclusion remains unchanged despite exhaustive robustness testing. The negative impact can be partly attributed to corporate technology innovation inputs. Meanwhile, enterprise property rights, pollution, and technical levels also substantially influence the implementation effect of the legislation. However, implementing this policy has improved corporations’ environmental performance and established its efficacy in enhancing their sustainable capabilities. This study comprehensively explores the impact of environmental control legislation on business performance, spanning financial, environmental, and social dimensions. Corresponding findings offer valuable insights into how firms react to environmental legislation and adjust to the external environment. Meanwhile, it also provides an objective reference for the comprehensive green transformation.

Enhancing Sustainable Business Performance in China's Food Industry through Green Supply Chain Management

In the context of China's dynamic business landscape, this quantitative study delves into the intricate interplay between Green Supply Chain Management (GSCM) practices and their profound impact on sustainable corporate performance within the country's vibrant Food Industry. As global concerns about environmental degradation intensify, the imperative for sustainable corporate conduct escalates, and GSCM emerges as a pivotal catalyst, nurturing ecological responsibility and operational efficiency. Leveraging advanced statistical methodologies, this research scrutinizes the multifaceted influence of GSCM practices on enduring business excellence, drawing upon an extensive dataset amalgamated from diverse Chinese enterprises spanning various sectors. The investigation encompasses a comprehensive assessment of sustainable performance indicators, encompassing reductions in carbon footprint, minimization of waste, enhancement of operational cost efficiency, and elevation of corporate reputation, juxtaposed with the critical dimensions of GSCM, including green procurement, eco-friendly logistics, reverse logistics, and eco-design. Empirical findings gleaned from this research furnish substantiated insights into the ways in which GSCM techniques can pave the path to sustained corporate performance in China. While shedding light on the GSCM facets wielding the most significant influence, this study also unravels the intricate web of conditions and moderators that may shape this intricate relationship, thereby enriching our understanding of the nuanced dynamics at play. This study contributes to the growing body of knowledge on sustainable business practices in China's Food Industry and offers actionable insights for industry stakeholders, policymakers, and corporate leaders navigating the intersection of environmental responsibility and enduring profitability.

The Influence of Urbanization and Environmental Factors on the Financial Performance of Retail and Automotive Industries in China

This study probes the intersection of urbanization, environmental degradation, and corporate performance in China’s retail and automotive sectors. Utilizing data from 23 regions spanning 2000–2022, the research elucidates the impacts of urban growth, infrastructure development, and particulate matter 2.5 pollution (PM2.5) on these industries. The study uses panel data from 2000 to 2022 and the corresponding analytical random effect model, along with pre- and post-estimation tests for the main results. The findings reveal that while urban population growth bolsters retail sales, it adversely affects the automotive industry. Urban infrastructure does not influence conventional sectors, yet it negatively impacts online retail sales. PM2.5 pollution depresses retail and automotive sales but boosts online sales, underscoring the rising environmental consciousness among consumers. The urban population significantly moderates the relationship between PM2.5 pollution and sales across sectors, hinting at unique consumption patterns in populated urban areas. This study provides critical insights for policymakers aiming for sustainable economic growth, and encourages further research with more region-specific factors and extended time frames.

CEO narcissism and corporate performance in China

This study explores the relationship between chief executive officer (CEO) narcissism and corporate performance in China. Based on the Chinese institutional and cultural background, we introduce organizational innovation as a mediating variable and CEO power as a moderating variable. We find that CEO narcissism is positively related to corporate performance based on 275 companies listed on the growth enterprise market (GEM) from 2012 to 2020. Furthermore, organizational innovation plays a partially mediating role in the relationship between CEO narcissism and corporate performance, and the moderating role of CEO power is partially supported.

Impact of Firm Power on Debt Structure, Bank Loan Financing and Corporate Performance in China

Impact of Firm Power on Debt Structure, Bank Loan Financing and Corporate Performance in China

The Effect of Ownership and Independence of Board of Directors on Corporate Performance in China

Purpose - We examine empirically the relationship between the board of directors and the corporate performance using board characteristics related variables. Design/methodology/approach - We empirically test the hypotheses using fixed effects models (FEM), using data of 3,703 listed non-financial companies in China from 2010 to 2019. Findings - First, the ownership of board of directors is positively related to ROA. Second, the size of the board of directors is positively related to ROA. Third, there is no evidence that interaction between characteristic variables related to the board of directors affect the corporate performance. Research implications or Originality These results show that as the board of directors has larger ownership, the degree of identity of interest between stock holders and the board becomes bigger to reduce agency cost, then it lets the board make decisions to improve the corporate performance. In addition, as the board of directors becomes bigger, the board has strong independence to play the role of monitoring and advising, then it leads to improvement of corporate performance.

Blockchain Development and Corporate Performance in China: The Role of Ownership

ABSTRACT This research investigates the short-term and long-term performance and volatility of publicly traded firms engaged in blockchain business. In particular, it examines how ownership structure impacts performance and volatility in such firms. We manually collected the data of Chinese A-listed companies participating in blockchain development during 2013–2018 as samples, and find that both short- and long-term performance and volatility significantly decrease among these firms after involvement in blockchain business. Ownership concentration has a positive correlation with stock returns, return on assets, and volatilities, whereas the state as a controlling shareholder strengthens these positive links.

Capital Structure and Corporate Performance: A Case of China

This research focuses on the capital structure and the corporate performance in China. This research introduces different theories of capital structure. It reviews the studies conducted in different economic entities about this topic and combine with the current research in China, which can provide the evidences for this research to give the assumptions. This research uses three models, ordinary least squares (OLS), fixed effect (FE), and generalized method of moments (GMM) to process the data and find out the relationship between the capital structure and the corporate performance in China. The results of this research show a significant negative correlation between the leverage level and the return on assets of Chinese firms. It shows the relationship between the capital structure and the corporate performance. This research explains this relationship by the characteristics of Chinese market and tries to give suggestion for practice.

Financialization and Corporate Performance in China: Promotion or Inhibition?

Using a sample of Chinese listed firms for the period 2009 to 2018, we analyze the relationship between the financialization of non‐financial corporations (NFCs) and corporate performance from both long‐term and short‐term perspectives. Our results show that the impact of financialization on firm performance is not simply a crowding‐out or pulling effect but rather depends on the type of financial assets held by the firms. The holdings of investment financial assets generally have a pulling effect on both the short‐term performance and market expectations of a firm's future profits as proxied by Tobin's Q, but they crowd out the innovation activities that are critical to long‐term performance. Although monetary financial assets positively affect corporate profitability, they inhibit the increase of return on invested capital and long‐term performance. Additionally, compared with monetary financial assets, investment financial assets play a more important role in promoting short‐term performance, although the crowding‐out effect on innovation activities is more prominent for investment financial assets. Furthermore, this paper also concludes that compared with manufacturing and non‐state‐owned enterprises (NSOEs), the role of financialization in promoting the performance of non‐manufacturing and state‐owned enterprises (SOEs) is more significant.

The Effects of Compliance Timing on Multinational Enterprises’ Corporate Performance in China: An Application of Institutional Perspectives

Purpose – Multi-National Enterprises (MNEs) tend to face a high level of institutional pressures in regions with high institutional development level. When complying with institutional pressures, firms try to make decisions to maximize profit while minimizing the risks to them. The purpose of this study is to investigate the influence of the institutional development level on institutional compliance timing by MNEs and the relationship between compliance speed and corporate performance. Design/methodology – The research focuses on three main variables, which are the institutional development level (as a determination of the institutional pressure level), the firm’s compliance speed (as a determination of the compliance timing), and the firm’s financial performance (as a determination of the corporate performance). We collected 19,869 firm-level data from CSMAR (the China Stock Market and Accounting Research), 6,922 CSR data from RKS (the Rankins CSR Ratings), and province and city-level data from the NERIM (National Economic Research Institute Index of Marketization) and NBSC (National Bureau of Statistics of China). The firms in China were chosen for analysis, and the analysis period was from 2008 to 2017. Random Effects GLS Regression was used to test the relationships among the variables. Findings – This study examined the effect of the institutional development level on the firm’s compliance speed, together with the effect of compliance speed on the firm’s financial performance of the MNEs in China. We found that the institutional development level positively influenced firms’ financial performances, which means the firms’ financial performances are better in the region with a high institutional development level. The compliance speed of institutional practice by firms was faster in the higher level of institutional development. However, the firm’s delayed compliance led to better financial performance. Originality/value – Studies in the resource dependence view of Institutional Theory often fall short in understanding the theory by overlooking the firm’s active decision-making. Thus, the findings do not present a full scope of corporate performance in this regard. This study not only found a way to test the role of a firm’s independent decision-making (i.e., compliance timing) when facing the institutional pressure but also prove the significant role of the compliance timing on corporate performance. Also, we were able to test the effect of institutional development level, controlling location-specific variables because we used CSR performance data for MNEs operating in China. Lastly, by doing the above, the findings of this study suggest practical implications to the industry practitioners in MNEs.

Does Corporate Charitable Giving Help Sustain Corporate Performance in China?

We examined whether corporate charitable giving (CCG) in China benefits corporate performance (CP) in terms of sales growth (SG), return on asset (ROA), return on equity (ROE), and Tobin’s Q (TQ), and revealed several findings. First, testing shows variation in the impact of CCG on CP. Whereas the ratio of corporate charitable giving (RCCG) to total sales revenue does not significantly enhance SG, ROA, and ROE, it is positively related to TQ. Second, the positive relationship between RCCG and TQ originates from non-state-owned firms (NSOFs) rather than state-owned firms (SOFs). Third, Chinese firms may use CCG as traditional philanthropy to enhance long-term performance instead of strategically using it to generate short-term performance. Lastly, an inverted U-shaped relationship exists between RCCG and TQ, especially for NSOFs.

중국 기업들의 환경경영 역량 개발과 성과 간 관계에 대한 공급사슬관리 전략의 조절 효과

중국 기업들의 환경경영 역량 개발과 성과 간 관계에 대한 공급사슬관리 전략의 조절 효과

Impact of perk expenditures and marketing expenditures on corporate performance in China: The moderating role of political connections

This study examines the performance implications of guanxi-related perk expenditures among listed Chinese firms. Specifically, it investigates how these expenditures influence long-term market-based corporate performance (Tobin's Q and market share) as compared with marketing expenditures. It also examines if political connections moderate this influence. Overall, the findings suggest that guanxi-related perks play an essential marketing role in enhancing long-term corporate success. Furthermore, although marketing expenditures exert much stronger influence on Tobin's Q than guanxi-related perks do, they exert no significant influence on market share. In summary, despite firms' much heavier investments in traditional marketing activities than guanxi-related perk activities, the findings highlight the significant performance contribution that guanxi-related perks can still make to a firm. Moreover, this study reveals that political connections weaken the positive impact of guanxi-related perks on both performance measures, thus reminding executives of the dampening effect of these connections on the effective use of perk spending.

Shareholdings of Board Members and Corporate Performance: A Panel Quantile Regression Analysis

This paper investigates the impact of board member shareholdings on corporate performance in China and Taiwan, and employs unbalanced panel data over the period 2005–2009. In view of the inconsistent empirical findings in the literature and the limitations of least squares regressions, this study adopts a quantile regression method including fixed effects (FE) models. An important finding is that a significant, positive relationship exists between the shareholdings of board members and accounting measures of performance, and this relationship only exists for the more profitable firms in China, while a uniformly significant and positive relationship exists across all quantiles between the shareholdings of board members and accounting measures of performance in Taiwan. These findings, which cannot be obtained using a FE model, suggest that board members can influence firm performance through holding shares in most Taiwan firms and profitable Chinese firms.

Empirical Study on Relations between the Corporate Social Responsibility Practice and Corporate Performance in China

최근 기업의 사회적 책임(CSR)에 대한 문제가 많은 관심을 받고 있고, 기업들도 CSR에 대한 좀 더 적극적인 노력을 하고 있다. 그러나 이러한 CSR의 문제는 주로 기업윤리나 관련 지역사회나 협력업체 등과의 관계만을 파악하는데 그치고 있다. 그리고 이러한 CSR의 문제를 단순히 기업의 자체적이고 선택적 문제로 파악하는데 그치거나, 이에 대한 법, 제도적 장치의 마련에 대해서는 아직도 많은 논의가 진행 중이다. 본 연구는 이러한 CSR에 대하여 기업의 전략적 관점에서 접근하여 가치기반접근법을 통해서, 기업의 CSR의 실행이 실제로 기업의 성과와 연결될 수 있는지에 대한 실증분석을 시도하고 있다. 실증분석을 위해 중국의 제조업체를 대상으로 자료를 조사하여 요인분석을 실시하고, 분류된 요인들을 대상으로 성과와의 관계를 회귀분석을 통해 추정하였다. 연구결과는 기업변수 중에서는 수출변수나 ISO인증변수, 그리고 친환경전략변수 등에서 유의한 결과를 보임에 따라 실제 기업들은 가치기반 접근법과 시스템기반 접근법을 동시에 추구하고 있는 것으로 해석할 수 있다.China considered CSR as trade barrier in advanced nations but demands active CSR practice for environmental protection and public stabilization. China is interested in CSR activities of foreign companies other than those of domestic companies and presses foreign companies to activate CSR activities. In view of that, it is meaningful to search the effects that CSR practices of Chinese companies have on corporate performance. Therefore, the purpose of this paper is to contribute the CSR activities in China by analyzing the effects that CSR practices of Chinese companies have on corporate performance. This paper studies empirically the effects that CSR practices of Chinese companies have on corporate performance by value-based approach in view of corporate strategies. For this study, Field survey is done for Chinese manufacturers and factor analysis was done, the relations of factors were estimated by regression analysis.

The Effects of Environmental Regulation on Corporate Performance: A Chinese Perspective

This paper presents empirical evidence on the effects of environmental regulation announcements on corporate performance in China when performance is proxied by stock returns. While some results indicate the effectiveness of environmental regulation, others point to the opposite. The perverse results are explained in terms of the lack of enforcement of environmental regulation, which is attributed to legislative shortcomings, poorly designed policy instruments, an unsupportive work environment for environmental regulators, a pro-growth political and social environment, and a cultural predisposition to harmony and consensus-building among those involved in the process.

중국기업의 ERP시스템 도입 성과에 관한 연구 - 중국의 상장 기업을 중심으로 -

중국기업의 ERP시스템 도입 성과에 관한 연구 - 중국의 상장 기업을 중심으로 -