Mixed Ownership Enterprises Research Articles

How partial nationalizations affect technological innovation in mixed-ownership enterprises: A theoretical explanation based on the effects of heterogeneous shareholder governance and resource acquisition

Unlike previous studies focusing on mixed-ownership reforms, mainly privatisation of state-owned enterprises, this study discusses the impact of partial nationalization and the appointment of D&Os on innovation investment and quality, measured in two dimensions: the heterogeneous shareholder governance effect and the shareholder resource acquisition effect. We find that the introduction of state-owned capital helps to promote the R&D investment and innovation quality of mixed-ownership private companies, and the introduction of state-owned capital and the appointment of D&Os have a more significant effect on the innovation investment and innovation quality of mixed-ownership private companies. The results of mechanism tests show that the impact of state capital introduction on R&D investment and strategic innovations is mainly through policy resources accesses and suppression of the tunnelling effect of non-state controlling shareholders.This paper verifies the adaptability of the shareholder resource acquisition effect and the heterogeneous shareholder governance effect in Chinese listed companies from the perspective of state-owned capital participation and the appointment of D&Os to promote the technological innovation of mixed-ownership private companies, and, at the same time, enriches the relevant literature on the economic consequences of the mixed-ownership reform from the perspective of the dimension of state-owned capital participation on the technological innovation of private companies.

The Impact of Executive External Pay Disparity on Enterprise Innovation: Evidence from Mixed-Ownership Enterprises in China

ABSTRACT Reasonable compensation contract arrangements have long been an essential means of promoting the hard work of executives and enhancing corporate performance. While internal pay disparity and its incentive effects have garnered widespread attention, few studies have examined the impact of executive external pay disparity on enterprise innovation. Using panel data from Chinese mixed-ownership listed companies spanning from 2013 to 2020, this study explores how executive external pay disparity affects enterprise innovation. Our findings demonstrate that enterprise innovation is positively influenced by the disparity in executive external pay. This facilitating role is further strengthened in enterprises with a high level of board governance. Additionally, the benefits of executive external pay disparity for innovation are particularly evident in general commercial mixed-ownership enterprises. Mechanism tests reveal that executive external pay disparity plays a pivotal role in enhancing enterprise innovation by increasing corporate risk-taking, ultimately leading to improved enterprise value. This study not only enriches our understanding of the influencing factors behind enterprise innovation from a new perspective but also holds significant implications for deepening the reform of mixed ownership and promoting enterprise innovation through the optimization of compensation contract arrangements.

Research on the Path and Effectiveness of Mixed Ownership Reform of State-Owned Enterprises

The theme of this article is how enterprises carry out Enterprises of the Composite-Ownership System and investigate it from three aspects: development history, reform path, and reform effect. The article argues that a mixed ownership economy is the core content of Chinas economic system, which aims to improve the productivity and competitiveness of Chinese capital and prompt the unified and mutual development of the state-owned economy and private economy. The article reviews the four stages of the revolution from 1978 to today and introduces the characteristics and policy measures of each stage. The article also discusses two main paths of mixed ownership reform: whole listing and private enterprise participation, and analyzes their impact on the financing, governance, brand, innovation and other aspects of state-owned enterprises. The article finally evaluates the effect of the reform, taking some state-owned listed companies and mixed-ownership enterprises as examples, proving that mixed-ownership reform can improve the management productivity and innovation deficiency of enterprises.

Is state-owned enterprise merging private enterprise “market choice” or “space crowding” ? —Based on the motives of equity transfer of mixed-ownership enterprises

Many state-owned enterprises have mergers and acquisitions (M&A) with private enterprises, which has caused private enterprises to worry about their living space being squeezed. Based on 572 data records about equity transfers of Chinese listed companies extracted from CSMAR4.0 from 2013 to 2020, this paper categorized ownership structures into three categories: privatization of state-owned enterprises (Category 1), state-owned enterprises merging private enterprises (Category 2), and state-owned enterprises merging state-owned enterprises (Category 3). The categorical regression of ex-ante equity transfer motivation revealed that the motives for Category 1 conformed to the phenomenon of the “pretty girl gets married first” and “embezzlement view.” Category In contrast, the motives for Category 2 conformed to the “fiscal revenue view.” The categorical regression of ex-post equity transfer motivation showed that all three types significantly improved various efficiencies and represented an optimal allocation of resources. Moreover, it was revealed that the transfer of equity to state-owned enterprises by inefficient private firms in Category 2 also significantly improved enterprise efficiency. Thus, it can be considered as a rational behavior of market selection and never squeezed the space crowding. Further analysis showed that the efficiency improvement is due to the symbiotic development relationship rather than the antagonistic relationship between heterogeneous shareholders. Therefore, it is suggested to initiate market-oriented reform by actively developing ownership mixed-ownership economy and adhering to the “two unwavering” basic economic system.

Analysis of China Unicom Corporate Governance Problems and Solutions

Tian Guoqiang, an economist, pointed out that "the mixed ownership economy with cross-shareholding and mutual integration of state-owned capital, collective capital and private capital is an important form of realizing the basic economic system. “The implementation of mixed ownership is conducive to expanding the functions of state-owned capital, maintaining and increasing its value, improving its competitiveness, and helping all kinds of ownership capital learn from each other, promote each other and develop together (Tian, 2005). This shows that China has taken a big step in the reform of mixed ownership with mixed ownership enterprises as the main body. In enterprise management, corporate governance determines the long-term development plan and strategic direction of enterprises. Therefore, the reform of corporate governance structure of mixed ownership enterprises is of great significance to deepen the reform of mixed ownership and the related development of China's economic field (Tian, 2005).The purpose of this paper is to explore the establishment of corporate governance framework of mixed ownership enterprises under China's national conditions, analyze the existing problems of China Unicom, such as the imperfect structure of the board of directors and the loopholes in the professional manager system, and put forward solutions such as optimizing the structure of the board of directors, strengthening the construction of managers, and establishing equity incentive mechanism, so as to improve the corporate governance structure of China Unicom. And provide solutions and experience for the follow-up development of China's state-owned enterprises.

Sustainable Development of State-Owned Enterprises: Research on the Management Transformation Path of Mixed-Ownership Companies from the Perspective of Shareholders Relationship

In recent years, the development of China’s state-owned companies (SOEs) has slowed dramatically due to the improvement of the government–enterprise relationship and maturity in the market system. To accomplish the market-oriented transformation of the management model and promote sustainable development, some SOEs have incorporated private capital to conduct mixed-ownership reforms. Nonetheless, the emergence of heterogeneous shareholder conflicts seriously hampers the transformation of businesses. This paper proposed a two-party evolutionary game model between state-owned and private shareholders in the management transformation of mixed-ownership companies. Based on the proposed model, the evolutionary stability of heterogeneous shareholders’ action strategies was analyzed to obtain the evolutionary stability strategies for the system. The crucial factors of the ideal equilibrium strategies are studied at the same time. The analysis results show that the probability of “change” in private shareholders is positively proportional to factors such as the success rate of change, change dividend, control gain, and policy burden, and it is inversely proportional to the factors including the cost of change, contractual cost of private shareholders, the additional cost of change, hidden income, state-owned shareholders’ shareholding ratio, and loss of change failure. Finally, the findings of this study provide a theoretical foundation for the transition of mixed-ownership enterprises’ management systems.

Bureaucracy in the Service of Law: Holding Chinese Controlling Shareholders Accountable

Common law style fiduciary duty has existed in Chinese Company Law as a statutory matter since 2006 and, by at least one account, far longer in practice. But most of the literature has pronounced it a failure, or, at best, a slowly developing doctrine. All of this literature deals with fiduciary duty in privately-held companies, because that is where virtually all of the cases take place. Yet proposed amendments to the China Company Law double down on fiduciary duty.Company Law also provides for controlling shareholder liability, but cases are few and far between, and virtually non-existent in listed State-Owned Enterprises.How can fiduciary duty be adapted to Chinese institutions in order for it to succeed? My research finds that recent judicial enforcement of fiduciary duty is quite healthy in privately-held companies, at least in Shanghai. Although doctrinal analysis is almost non-existent, Shanghai judges know a fiduciary breach when they see one and possess the statutory means to redress it.Matters are also well when it comes to holding controlling shareholders accountable in privately-held companies. Although the controlling shareholder statute is rarely used, it is the case that virtually all of the defendants in fiduciary duty cases – directors, officers, and senior managers – are almost always shareholders in these companies, if not controlling shareholders, so the effect of liability, disgorgement, and damages is largely the same as if they had been sued as shareholders.The real problem is the virtually non-existent legal accountability of controlling shareholders in mixed ownership enterprises and especially listed SOEs. The problem is institutional. This article proposes a way to situate fiduciary enforcement within the appropriate and suitable Chinese bureaucratic tradition rather than to continue to try to force adjudicative methods where they have failed and will continue to fail because of structural, political, and cultural impediments, thus creating a uniquely Chinese way of controlling shareholder fiduciary enforcement.

Comprehensive Benefit Evaluation and Regional Difference Research of State-owned Mixed-ownership Enterprises.

Scientific and accurate assessment of the comprehensive benefits and regional differences of state-owned mixed-owned enterprises is an important link in promoting the steady progress of mixed-ownership reform of state-owned enterprises and achieving high-quality development of the state-owned economy. Using factor analysis method and GA-BP neural network model to evaluate the comprehensive benefits of listed state-owned mixed enterprises, the results show that, first, the main factors affecting the comprehensive benefits of state-owned mixed enterprises are profitability factor, sustainability factor and solvency factor, and the effect is as follows: profitability factor>sustainability factor>solvency factor; second, factor analysis effectively improves the evaluation performance of the GA-BP neural network model. Further analysis of regional differences, it is found that the average comprehensive benefit of regional state-owned mixed enterprises is: eastern region > central region > western region. Among them, the profitability factor and solvency factor are as follows: eastern region>central region>western region, and the size of sustainability factor is: eastern region>western region>central region. Therefore, we can start from deepening the classification reform of state-owned enterprises, increasing investment in innovation, reducing financial leverage, and improving regional linkages, so as to improve the profitability, solvency and sustainability of enterprises, narrow regional differences, and achieve coordinated development between regions.

Building world-class enterprises though mixed-ownership reform: explaining performance differences in minority and majority state-owned enterprises

PurposeIn the context of China’s efforts to build world-class enterprises through mixed-ownership reform, this study aims to build an agency theory framework to analyze the differential relation between ownership structure and firm performance in majority versus minority state-owned enterprises (SOEs). It also evaluates the differential influence that political connectedness has on firm performance in the two types of SOEs.Design/methodology/approachUsing a panel data set of Chinese state-controlled mixed-ownership enterprises covering the period 2010–2019, this paper uses ordinary least squares, random-effects, fixed-effects and three stage least squares regression analysis to study the differential impact of ownership structure and political connectedness on firm performance in majority versus minority SOEs.FindingsIn minority SOEs, firm performance is positively related to the ownership share of the largest private shareholder and state ownership positively moderates this relation. Furthermore, minority SOEs with a politically connected chairman perform worse than those with a politically connected chairman. In majority SOEs, there is no relation between the ownership share of the largest private shareholder and firm performance. In addition, majority SOEs with a politically connected chairman perform similar to those without a politically connected chairman.Originality/valueThe theoretical framework demonstrates that agency problems are substantially different in minority versus majority SOEs and that this influences how changes in ownership structure and in the type of chairman that is assigned affect firm performance. The empirical analysis confirms these predictions.

State ownership and innovations: Lessons from the mixed-ownership reforms of China's listed companies

Mixed-ownership reforms have been the mainstay of reforming China's state-owned enterprises (SOEs) in recent years. In relation to the broader context of the continuous slowdown in economic growth under the New Normal, the reshaping of the innovative capacity of SOEs has been widely considered to be of systemic importance. Yet, in the relevant literature, the effects of mixed-ownership reforms on innovations have remained unclear. This paper seeks to contribute to the literature by means of studying such effects for China's listed companies in the period 2007–2018, from the theoretical perspective of organizational controls in innovative firms. Our study finds that SOEs tend to be more innovative than non-SOEs, and increases in state shareholding do raise the innovative capacity of mixed-ownership enterprises. Further analyses reveal that, for mixed-ownership enterprises, the lower the level of state shareholding the more reliance of innovations on the capability of organizational controls in corporate governance. These findings offer useful policy lessons for China. Additionally, we discuss the contribution of our study to the broader literature at a conceptual level, with an emphasis on the novelty of highlighting the importance of organizational controls in the reform of SOEs.

Sharing Economy: A Study on the Factors Influencing Consumption Decision to Use Farm Sharing in Guizhou of China

With the rapid development of mobile internet technology, the operator would be no longer a single operator but could participate in the sharing economy as a resource supplier. Shared farms were based on an economic organization that was fully covering the interests of farmers as the primary carrier, with mixed-ownership enterprises composed of various capitals as the leading construction and operation body, supported by information technologies such as mobile Internet and Internet of Things, and sharing farms and homestays as the main features—integrating circular agriculture, creative agriculture, agricultural experience, and service functions, allowing farmers to participate in fully and benefit from the comprehensive operation and development model of rural revitalization, which more and more consumers favor.

Heterogeneous Shareholders’ Participation, COVID-19 Impact, and Innovation Decisions of State-Owned Firms: Evidence from China

Innovation ability has become an important factor affecting the global competitiveness and sustainable development of state-owned enterprises (SOEs) in China, particularly during the COVID-19 period. This study examined the association between heterogeneous shareholders and SOE innovation, in addition to the moderating impact of corporate governance characteristics and the COVID-19 pandemic on this association. Using data from Chinese A-share listed mixed ownership enterprises (MOEs), we found that the mixed ownership reform of SOEs positively affected firm innovation compared to other MOEs by reducing agency costs, indicating that the manager view channel was proven. We also found that heterogeneous shareholders resulted in more innovation output in state-owned holding mixed ownership enterprises (SHMOEs) with affiliated managers, in those audited by lower reputation accounting firms or that had a lower external marketization, or during the COVID-19 period. The implications of this study are of importance for improving heterogeneous shareholders’ active participation in the mixed ownership reform of SOEs.

The Design Path of the Employee Stock Ownership Scheme of the Conventional Holding and Mixed Ownership Enterprises

Employee stock ownership is one of the common medium and long-term incentive methods for state-controlled mixed ownership. As the current state-controlled mixed-ownership enterprise employee shareholding is still in the pilot stage, the State-owned Assets Supervision and Administration Commission of the State Council is still relatively strict on the implementation of relevant conditions for enterprises. Based on the analysis and research on the relevant policies and corporate practices of employee stock ownership, this paper puts forward the implementation path of state-controlled mixed ownership enterprises to carry out employee stock ownership, and gives reminders and early warnings of common risks in the implementation process.

Research on the Influence of Earnings Management of Mixed Ownership Enterprises on Credit Financing

This paper analyzes and sorts out the research literature on the impact of earnings management on credit financing of mixed ownership enterprises, and sorts out the research paths of mixed ownership reform at macro and micro levels. At the micro level, with the completion of the mixed ownership reform of enterprises, the property right nature of enterprises also changes, which will lead to the change of preferences affecting bank credit decisions

Mixed Ownership and Outward Foreign Direct Investment in China

Mixed ownership enterprises (MOEs), the state-owned enterprises mixed up with private investors, is a phenomenon often seen in transition economies like China. How this kind of enterprises participate in international competition is a question unsatisfactorily answered. Integrating a private-government principal-principal conflict perspective, an institutional logic and an efficiency logic, this paper develops a theoretical model to explain the impact of mixed ownership on outward foreign direct investment (OFDI) decisions in the MOEs. We distinguish two types of OFDI decisions: one is whether or not to invest internationally, and the other is at what degree of the investment should be. Both of these decisions depend on the degree of mixed ownership under the moderating effects of time and shareholder characteristics. Using a Logit and a Tobit models separately and gathering 8,829 firm-year observations of non-financial, listed MOEs in China, we find that there is an inverted U-shaped relationship between the degree of mixed ownership and the OFDI propensity, while there is a U-shaped relationship between the degree of mixed ownership and the OFDI degree. In addition, the results provide a strong support for the moderating effects of time and shareholder characteristics on the OFDI propensity, but the moderating effects of shareholder characteristics on the OFDI degree are not statistically significant.

Equity Incentive and Growth of Executives in Mixed Ownership Enterprises Listed Manufacturing Enterprises Based on State-Owned Holdings

This paper takes the state-owned manufacturing mixed-ownership en-terprises as the research sample, selects the data from 2014-2016, and studies the relationship between executive equity incentives and corporate growth. Firstly, theoretical analysis is carried out according to the existing literature, and then empirical research is carried out by regression analysis on the basis of theoretical analysis. The research shows that: in the state-owned manufacturing industry, in mixed ownership enterprises, there is a positive correlation between executive equity incentives and corporate growth, but this correlation will be affected by equity concentration. Only when the ratio of the largest shareholder is in the range of 20% - 50%, the positive correlation between executive equity incentives and corporate growth is significant. The executive equity incentive policy has not significantly promoted the growth of the company in the enterprises with scattered equity or excessive concentration of equity. Based on this, it is proposed that enterprises should establish a reasonable executive equity incentive policy and further optimize the shareholding structure through the reform of state-owned enterprise mixed ownership.

我国港航业混合所有制企业公司治理存在的问题及对策研究

我国港航业混合所有制企业公司治理存在的问题及对策研究

Study on the ownership balance and the efficiency of mixed ownership enterprises from the perspective of heterogeneous shareholders.

Based on the database data of Chinese industrial enterprises from 2000 to 2007 and the LP method, this paper measures the total factor productivity of enterprises and investigates the effect of different mixed ownership forms on enterprises’ efficiency and the effect of heterogeneous ownership balance on the mixed ownership enterprises’ efficiency. The state-owned enterprise and mixed ownership enterprise are identified by the enterprise’s paid-up capital. The results show that, on the whole, for the mixed ownership enterprise, the higher the diversification degree of the shareholders is, the higher the efficiency becomes, and in different types of industries, the mixed forms of shareholders have different effects on the efficiency of enterprises. The heterogeneous ownership balance and the enterprise efficiency show nonlinear U-type relationships. Both the higher and lower heterogeneous ownership balance degrees will promote the enterprise’s efficiency. However, when the ownership balance degree is in the range of [0.2 0.5], the increase in ownership balance will lead to the decline of enterprise efficiency. Therefore, when introducing non-state-owned capital, state-owned enterprises should take full account of their own characteristics by rationally controlling the shareholding ratio of non-state-owned capital and play the positive role of a mixed ownership structure in corporate governance with appropriate ownership balances.

Research on the Performance of China’s Mixed Ownership Enterprises Listed on SME Board—Based on the Perspective of Ownership Balance

This paper examines the relationship between enterprise performance and the largest shareholder’s shareholding, balancing shareholder’s shareholding, and the nature of balancing shareholder by researching into mixed ownership enterprises on China’s SME board. The empirical results show as follows: when balancing shareholder exists in mixed ownership enterprises, there is a reverse U-shaped relationship between the largest shareholder’s shareholding and the enterprise performance. Otherwise, when there is no absolute controlling shareholder in mixed ownership enterprises, balancing shareholder’s shareholding presents a positive correlation of the enterprise performance; the balancing shareholder will play a better role of checks and balances when its nature is different from that of the largest shareholder. State-owned balancing shareholder has a more significant effect of checks and balances in private-controlled enterprises.

Multinational enterprises and partial privatisation of state-owned enterprises

This paper examines the incentives for both multinational enterprises and host developing countries to create, through partial privatisation, mixed-ownership enterprises. The paper argues that the likely benefits of such ventures have been overstated. Some limitations of mixed-ownership enterprises including their efficiency effects and management problems are discussed.