Performance Of State-owned Enterprises Research Articles

Do energy policies bring about corporate overinvestment? Empirical evidence from Chinese listed companies

In an era of profound changes in the global economic and industrial landscape, the ability of renewable energy policies to create new growth drivers is critical to achieving China's economic recovery in the post-COVID-19 period. Consequently, this paper empirically examines whether renewable energy policies bring about corporate overinvestment. Using corporate investment data and hand-curated information on energy firms from Chinese listed companies from 2007 to 2018, the results show that implementing renewable energy policies causes firms to overinvest. Renewable energy investment is more of a government-led industrial policy, reflecting how local governments increase their degree of intervention in firm investment, leading to overinvestment and better short-term firm performance. However, in the long run, the overinvestment encouraged by renewable energy policies will more negatively impact the economic performance of state-owned enterprises (SOEs). Moreover, when economic policy uncertainty is high, renewable energy policies can lead to a more pronounced tendency for firms to overinvest. Despite this trend, renewable energy policies do not significantly increase the likelihood of overinvestment among firms with high state-owned or equity concentration but instead allow firm operators to make more rational investment decisions. Thus, the government should formulate policies to regulate the investment process of enterprises and avoid distorting their investment behavior when providing financial support and preferential policies.

Corporate governance and financial performance of state-owned enterprises in Kenya

PurposeThis paper aims to report the results of an investigation into the effect of aggregate and individual corporate governance factors on the financial performance of state-owned enterprises (SOEs) in Kenya.Design/methodology/approachThe paper uses balanced panel data regression analysis on a sample of 45 SOEs in Kenya for a four-year period (2015–2018).FindingsThe panel data analysis results show that board meetings, board skill and gender diversity individual provisions of corporate governance are significantly and positively associated with capital budget realization ratio (CBRR). Moreover, the study finds that aggregate corporate governance disclosure index, board sub-committees, board size and independent non-executive directors are positive but insignificantly related to CBRR.Research limitations/implicationsThe current study is based on secondary data, other methods of knowledge inquiry such as interviews and questionnaires may provide additional insights on the effectiveness of corporate governance on financial performance.Practical implicationsOverall, the results imply that corporate governance influences the performance of SOEs in Kenya. The results suggest that Mwongozo Code of Corporate Governance provisions should be changed to increase the number of women representations on board and the number of directors with doctoral qualifications because of their positive impact on the financial performance of SOEs in Kenya. Also, policymakers with remit over SOEs should re-evaluate why other corporate governance appear not to have an impact with a view of making the necessary changes.Originality/valueThe paper contributes to the dearth of literature on the efficacy of corporate governance on the financial performance of SOEs in developing countries.

Analysis of Total Quality Management Implementation to Improve Managerial Performance in State-Owned Enterprises

This study aims to analyze the application of Total Quality Management (TQM) to improve managerial performance at the Perum Bulog Sub-Directorate of Makassar. This research is qualitative research conducted at the Office of the Bulog Subdivre Makassar. Data was sourced from interviews with informants and the results of observations and collected documentation. The informants in this study were the head of the warehousing section and the head of other sections, which consisted of 4 informants. Furthermore, qualitative data analysis was carried out in three stages: data reduction, presentation, and conclusion. The results showed that Total Quality Management is a structured system that is used to improve managerial performance. In Total Quality Management, there are improvements to the company's vision, mission, and strategy to be even better, teamwork and focus on customer satisfaction make all employees work together and try to do better in carrying out their duties so that performance management can also improve.

The microeconomic effects of temperature changes

This paper uses financial data from listed Chinese manufacturing companies, combined with meteorological data, to estimate the microeconomic effects of temperature changes. By constructing seasonal average temperatures, we find that average summer temperatures significantly reduce the financial performance, while average winter, spring, and autumn temperatures do not have a significant effect on the corporate financial performance. We further find that the effect of temperature changes on corporate financial performance is nonlinear through temperature bins variables. Both extreme low temperatures (<-12 °C) and high temperatures (>27 °C) have a negative impact on corporate financial performance. The mechanism tests find that high temperatures not only reduce the labor productivity of firms, but also increase the corporate adaptation actions, leading to increased adaptation costs, crowding out productive funds and causing a capital mismatch. Further heterogeneity analysis confirms that the magnitude of the negative effect of temperature changes is limited by the enterprise nature and the region in which the firm is located. The financial performance of state-owned enterprises, firms in the south and developed regions are more vulnerable to high temperatures. This study provides a policy basis for mitigating the negative effects of temperature changes and provides new empirical evidence for climate governance.

Do enterprise ownership structures affect financial performance in China's power and gas industries?

Analyzing state-owned and private enterprise performance can inform enterprise reform, guide structural adjustments, and promote sustainable development. This study established an entropy-TOPSIS-GRA evaluation model to assess four financial performance indicators, including solvency, operational capability, profitability, and development capacity, of listed Chinese state-owned and private enterprises in the power and gas industry from 2008 to 2018. The results indicate no distinct financial performance differences between the two enterprise types, refuting the traditional view that state-owned enterprise performance is lower than private enterprises.

THE MODERATING ROLE OF AGENCY COST ON THE RELATIONSHIP BETWEEN CAPITAL STRUCTURE AND FIRM PERFORMANCE: EMPIRICAL EVIDENCE FROM INDONESIA STATE-OWNED ENTERPRISES

Purpose – The Indonesian government's plan to focus more on infrastructure is an opportunity for State-Owned Enterprises (SOEs) in Indonesia specially in construction sector. Joko Widodo, as the President of the Republic of Indonesia stated, despite various inputs, the government decided to focus on infrastructure development in 2015. With the large-scale construction project, SOEs in construction sector will attempt to achieve an optimal capital structure in order to continue the company’s operations. The purpose of this paper is to explore the moderating role of agency cost on the relationship between capital structure and firm performance. Design/methodology/approach – Using 63 data observations of 7 Indonesia SOEs in construction sector for the period from 2010 to 2019. Multiple Regression Analysis and Moderated Regression Analysis is used to investigates the moderating role of agency cost on the relationship between capital structure and firm performance. Finding – The results indicate that the capital structure has positive effect on ROE. Furthermore, agency cost appears to moderate the relationship between capital structure and firm performance. The means of capital structure and performance before and during Joko Widodo era were analyzed using t-test. Significant difference was found between the groups before and during Joko Widodo era. This result shows that the capital structure and performance of SOEs changed following the infrastructure development policy. Practical implications – This research is to provide further enrichment related to the problem of inconsistency in the relationship between capital structure and firm performance in agency cost hypotheses. In addition, this study provides an overview of the optimal capital structure, especially for SOEs in the construction sector in Indonesia. Originality/value – Despite the extensive research done on the area of capital structure since 1958, understanding in the area is still inconclusive specially in SOEs. The policy of infrastructure development in 2015 insist SOEs to achieve an optimal capital structure in order to continue the company’s operations. Thus, how SOEs manage their capital structure? Keyword Capital Structure, Agency Cost, Firm Performance, SOEs, Construction Sector Paper type Research paper

Corporate Governance and Intellectual Capital: Impact on the Financial Performance of State-Owned Enterprises in Indonesia

Using company size and leverage as control variables, this study aims to evaluate the influence of institutional ownership, an independent board of commissioners, an audit committee, and intellectual capital on financial performance. The population in this study is all state-owned companies registered with the Ministry of SOEs with a period of observation for 4 years, namely in 2016-2019. Purposive sampling was used in this study to collect samples, and a total of 164 samples were collected. The data analysis methods utilized in this study include descriptive statistical tests, classic assumption tests, and hypothesis testing utilizing multiple regression analysis by SPSS 25 version. According to the findings of this study, institutional ownership and intellectual capital have a substantial beneficial influence on financial performance, whereas the independent commissioner has a large negative effect on financial performance and the audit committee has no effect on financial performance.

Corporate Governance and Firm Performance in State-Owned Enterprises (SOEs) in Zambia: A Systematic Review

The research systematically documented and described the corporate governance practices and financial performance in State-Owned Enterprises (SOEs) in Zambia from 2006 to 2017. The research design that was adopted was the descriptive research design to systematically describe the corporate governance practices and financial performance of SOEs in Zambia. The corporate governance attributes for SOEs such as board size, board appointing authorities and board membership have been found to be prescribed by a diversity of Acts of Parliament for different SOEs. This finding suggests that the governance of these entities could be a challenge insofar as the uniformity of the legal framework for the governance of the entities was concerned. In addition to this, board membership which are designated by specific government positions rather than merit based, compromises board effectiveness. The study has further shown that failure to produce and publish, for public scrutiny, audited financial statements on a timely basis leads to lack of transparency and accountability. The financial performance has been found to have been poor as the SOEs on average produced negative returns on total assets and the SOEs were highly geared based on operating gearing and financing gearing. Lastly, financial performance of SOEs and the corporate governance practices differed significantly across different industries under which the SOEs operated.

Analisis Rasio Keuangan Dan Metode Economic Value Added (EVA) Untuk Menilai Kinerja Keuangan Perusahaan

State-owned enterprises (BUMN) liquid a form of government investment that manages the life of many people, state-owned construction (KARYA) liquid state-owned enterprises that focus on the field of considerable construction is very influential in all aspects of the country. Entering the era of globalization and the demands of construction services users to the company's performance permissible better. The very strict competition between construction companies can pose a risk of competition in the financial performance of state-owned enterprises (KARYA), so that state-owned enterprises are still weak in the mastery of local project (market). This research aims to identify financial performance in the STATE of construction (KARYA) from the level of liquidity, solvency, and profitability and examined by the economical value-added method (EVA) to know the value added economy in the company'S construction Field (KARYA). This method of study uses a quantitative descriptive method with the approach of financial analysis and the use of economic value-added methods (EVA). Using data will be financial from Tofu 2015 S. D 2018. Based on the results of the analysis of financial performance of the 4th (four) enterprises in the work in the field of poor debt acquisition is a major factor and added economic value shows less good results because fewer companies obtain positive value. This should be the company to maintain liquidity ratio value..&#x0D; &#x0D; Keywords: Financial Ratio Analysis, Economic Value Added, BUMN Construction

The Effect of the Xi Jinping Administration’s Anticorruption Campaign on the Performance of State-Owned Enterprises

There has been a debate on how the state-driven anticorruption movement during the Xi Jinping administration has influenced state-owned enterprises (SOEs). Research has examined the relationship between corruption and economic development at the country level in Asia and has found paradoxically that economic growth and high corruption levels can coexist. However, the “Asian paradox” that appears at the country level may be a transitional phenomenon of the short term. Not many researchers have empirically compared individual firm-level performance before and after a strong anticorruption drive, drawing on relevant comparison groups. This study tests whether Xi’s 2012 anticorruption campaign improved SOEs’ performance. With a difference-in-differences method, it explores whether the anticorruption campaign had different effects on the financial performance of SOEs and non-SOEs (private companies). We find that the anticorruption initiative improved SOEs’ financial performance and benefited SOEs more than non-SOEs.

PERFORMANCE VARIABILITY OF STATE OWNED ENTERPRISES IN FINANCIAL SECTOR AND FINANCIAL TECHNOLOGY COMPANIES DURING THE COVID-19 PANDEMIC

This study aims to provide empirical evidence related with financialsector performance and the development of fintech lending inIndonesia during the Covid-19 pandemic. The sample consisted of4 State-Owned Enterprises (BUMN) in the financial sector and 149financial technology (fintech) companies registered in the FinancialServices Authority (OJK). This research used descriptive statistics.The results show that during the Covid-19 pandemic, theperformance of State-Owned Enterprises (SOEs) in the financialsector and financial technology companies (fintech) has increased.However, the increase in the performance of State-OwnedEnterprises (SOEs) in the financial sector and financial technology(fintech) companies during pandemic was still below theperformance increase before the Covid-19 pandemic in Indonesia.

Succession Planning for Enhanced Performance in State-Owned Enterprises

Age diversity plays an important role and as a tool can transform the organization, culture, and performance. Research indicates a need to have a balance between the older and the younger generation to foster creativity, innovativeness, and better decision making. Apart from that, age diversity also ensures a smooth transition of power and positions across all organizational thereby leading to enhanced performance. Literature emphasizes that skills and information as a result of age diversity contribute to the quality of the team and overall organizational performance while succession planning ensures consistency and leadership continuity. Adopting a qualitative research method, descriptive in nature with survey design, the objective of this study is to identify age diversity role in succession planning and how effective it is as a tool in succession planning for improving performance in state-owned enterprises (SOEs). Findings reveal a strong correlation between age diversity, succession planning, and the performances of state-owned enterprises.

Does External Monitoring from the Government Improve the Performance of State-Owned Enterprises?

Abstract In this paper we investigate the impact of external monitoring from the government on state-owned enterprise performance, using the variation in monitoring strength arising from a nationwide policy change and firms’ geographic location in China. We utilise a structural approach to estimate input prices and productivity separately at the firm level using commonly available production data. We show that enhanced external monitoring, as a key component of corporate governance, can substantially reduce managerial expropriation in procurement (proxied by input prices) and shirking in production management (proxied by productivity). The results suggest that government monitoring can be an effective policy instrument to improve state-owned enterprise performance.

D&O Liability Insurance，Salary Substitution and Corporate Performance: A Quasi-natural Experiment Based on the “Executive Salary Regulation”

State-owned enterprise salary control is one of the important content of China’s income distribution system. It has a broad and significant influence on the development of state-owned enterprises. As the economic environment changing in different periods, the salary control for the executives of state-owned enterprises has undergone a process from loosening to tightening, but its effect is controversial. On August 29, 2014, the Political Bureau of the Central Committee of the CPC issued the “Executive Salary Regulation”, which set specific regulations on salary and other incentive measures of state-owned enterprise executives. However, this “top-down” and “one-size-fits-all” type of macro regulations cannot meet the differentiated needs of enterprises at the micro level, and it ignores the risk-return matching problem of state-owned enterprise executives. So, it has not achieved the expected results. Therefore, exploring how to adjust and optimize the implementation of macro regulations from the micro level has important theoretical significance and practical value. D&O liability insurance is a kind of non-monetary risk management tool that can reduce the decision-making risk of senior executives and improve their decision-making enthusiasm. This article uses the 2012-2016 listed companies as a research sample to investigate the optimization and adjustment effect of D&O liability insurance on salary control by the DID model from the perspective of risk compensation. The study finds that: The “Executive Salary Regulation” increases the purchase of D&O liability insurance in state-owned enterprises, and this result is more prominent in state-owned enterprises with higher growth. At the same time, D&O liability insurance can significantly improve the performance of state-owned enterprises under the “Executive Salary Regulation”. The positive effect is more pronounced in higher-risk state-owned enterprises. The path research shows that: The positive effect of D&O liability insurance is achieved by increasing the marginal revenue and marginal rate of state-owned enterprises. This result demonstrates the risk protection and auxiliary decision-making functions of D&O liability insurance, and also demonstrates the optimization effect of executive initiative promotion on the efficiency of enterprise production and operation. In theory, the conclusion of this article proves the positive influence of D&O liability insurance in corporate governance and macro policy optimization through the quasi-natural experiment on the “Executive Salary Regulation”. In practice, it emphasizes the importance of risk factors in compensation contract, which provides a reference for China’s salary control and system innovation of state-owned enterprises.

Effects of CEO Overseas Experience on Corporate Social Responsibility: Evidence from Chinese Manufacturing Listed Companies

With increasing economic globalization, CEOs with overseas study or work experience play a crucial role in corporate strategic decision making, especially in emerging economies. Using Chinese manufacturing companies publicly listed on the Shanghai or Shenzhen Stock Exchanges, we explore the influence of CEO overseas experience on corporate social responsibility (CSR), based on the upper echelons theory and behavioral theory of the firm. We find that CEOs with overseas experience have a stronger CSR thinking concept and are more inclined to fulfill CSR than CEOs without overseas experience. We also analyze the effects of the organization’s external environment (market competition intensity) and internal resources (organizational slack resources) on this relationship, and find that all of these factors can strengthen the relationship. We find that the effect of CEO overseas study experience is stronger than that of overseas work experience; CEOs with overseas experience from developed countries such as Europe and the United States have a stronger effect on CSR; CEO overseas experience leads to better performance in state-owned enterprises; but when the CEO is also the chairman of the board, the effect of CEO overseas experience on CSR is weaker; female CEOs’ overseas experience has a stronger positive effect on CSR than male CEOs’; and the effect of CEO overseas experience on CSR is greater when the CEO is highly educated.

A Study on the Correlation between Job Consumption and Performance of Chinese Companies

Purpose - The purpose of this paper is to explore the relationship between corporate governance structure, job consumption, and firm performance in listed companies in China using a sample of listed companies in Shanghai and Shenzhen from 2014 to 2018. Design/Methodology/Approach - Based on empirical analysis, the paper studies the moderating role of the nature of a company on the relationship between job consumption and firm performance, which finds that in-service consumption has a negative correlation with performance, and it has a greater impact on performance in state-owned corporations. Therefore, we put forward three suggestions, Improving the mechanism of supervision and impose additional restrictions on job consumption, Improving the management salary system and establish a reasonable budget and Improving the management equity incentive mechanism. Findings - The paper finds that job consumption has a certain inhibitory effect on enterprise performance, and job consumption have a greater impact on firm performance in state-owned enterprises. Research Implications - The paper offers a theoretical and empirical framework for further formulating and promoting relevant policies on disclosure, compensation, and incentives for job consumption, which will also provide reference for other scholars’ follow-up research.

Non-commercial goals and financial performance of state-owned enterprises – some evidence from the electricity sector in the EU countries

This study considers the financial performance of state-owned enterprises (SOEs) in relation to non-commercial goals. We focus on enterprises operating in the production of electricity sector in the EU countries and analyse their profitability conditioning on the level of electricity prices. We reveal that SOEs underperform as compared to their privately owned counterparts when they operate in those markets that have lower prices. This suggests that their profitability is likely to be substantially affected by pursuing goals other than profit-maximisation - providing crucial products and services at affordable prices - and emphasises a need to consider the non-commercial objectives of SOEs in the empirical research.

The Mediating Effects of Organizational Commitment on Leadership Styles and Employee Performance in SOEs in Ghana: A Structural Equation Modeling Analysis

The primary purpose of this study is to investigate the mediating effects of organizational commitment on leadership styles (transformational, transactional and laissez-faire) and subordinate performance in state-owned enterprises in Ghana. The study adopted the partial least squares structural equation model (PLS-SEM) to test the hypotheses model. The model has been tested with 330 respondents. The data have been validated by the use of measurement modeling to determine internal consistency reliability (CR) and convergent validity (CV) with SmartPLS 3.0. The results indicate that organizational commitment mediates transformational and laissez-faire leadership. It has also been found that transformational and laissez-faire leadership have a statistically positive and significant relationship with job performance at p &lt; .05 while transactional leadership proved insignificant. The implication is that leaders should know any action to improve subordinate commitment and job performance should take into account appropriate leadership behavior. Also, human development training should be instituted to shape the present and future leadership needs of the enterprise. In furtherance to this, the study provides discussions on the findings, limitations and went on to propose directions for future research.

공공기관 종사자의 조직행태가 조직성과에 미치는 영향: 사회적기업가정신의 조절효과를 중심으로

본 연구는 최근 강조되는 공공부문의 사회적가치 지향이 조직구성원의 조직행태 차원에서 어떻게 인식되고, 기존의 공공부문에서 논의된 조직행태와 조직성과의 관계에 어떠한 영향을 미치는지 공공기관 종사자를 대상으로 실증분석을 통해 살펴보고자 한다. 이를 위해 사회적기업가정신을 영향요인으로 상정하고, 이를 측정하고자 하위개념인 혁신성, 진취성, 사회적목적 지향성에 대한 측정문항(Kraus et al., 2017)을 활용였다. 분석을 위해 대구 혁신도시 소재 4개 공공기관 종사자를 대상으로 설문조사를 실시한 후, 총 151명의 응답 데이터를 활용하였다. 분석결과, 공공기관 종사자의 사회적기업가정신과 조직성과 인식은 정(+)의 관계에 있는 것을 확인하였고, 하위개념 가운데 혁신성과 사회적목적 지향성이 영향을 미치는 것으로 나타났다. 또한, 공공기관 종사자의 사회적목적 지향성은 직무만족 및 조직몰입이 조직성과에 미치는 영향을 조절하는 것으로 나타났다. 사회적목적 지향성이 클수록 직무만족에 따른 조직성과 인식이 강화되는 반면, 공공기관 종사자에 대한 지나친 사회적목적 지향에 대한 요구는 오히려 조직몰입에 의한 조직성과 인식의 제고를 약화시킬 수도 있다는 함의를 도출하였다.

Restructuring of State Enterprises as a Prerequisite for Economic Growth in the Republic of Serbia

Abstract This study of the performance of state-owned enterprises in Serbia has shown that the state has great difficulties managing the enterprises that are in its portfolio and under its control. The adaptation of state-owned enterprises to exogenous shocks unfolds at a slow pace and is faced with many problems. The institutional environment for the strategic restructuring of the state sector is not in the service of strengthening the efficiency of its business operation. The study has shown that the economic performance of state-owned enterprises exerts a direct influence on economic growth, the budget, government balance sheets, and debt. While the “healthy” enterprises (the ones conducting their business successfully) are valuable state-owned property, enterprises with a loss or over indebted enterprises are obligations which demand intervention through the injection of additional capital or through other forms of help from the state. The main goal of restructuring state-owned enterprises is to improve responsibility and efficiency. The array of measures for improving efficiency ranges from modifications of the legal framework and corporate governance of socially owned enterprises (including corporatization and separation of activities) to the sale of property to the private sector or complete privatization. Reforms are aimed at improving the transparency and responsibility of state-owned enterprises, not just for the purpose of efficiency, but also for the purpose of harmonization with the ethical and deontological requirements.