Performance Of State-owned Enterprises Research Articles

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 < .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.

The effect of the economic crisis on pay-performance link in South African state-owned enterprises

Purpose: The dissatisfaction with executive remuneration worldwide has increased because it is generally believed to have been instrumental to the 2008 Global Economic crisis. Central to this is the apparent unsatisfactory relationship between business performance and chief executive officer (CEO) remuneration. The primary aim of this study was to compare the pay-for-performance association between CEOs’ remuneration and state-owned entity performance before, during and after the economic crisis. It did so by assessing the chief executive remuneration link with state-owned enterprise performance from the period 2006 to 2014. Design/methodology/approach: Twenty-one schedule 2 state-owned enterprises in South Africa. This quantitative, longitudinal study, obtained secondary data from the annual reports of state-owned enterprises from the period 2006 to 2014. Ordinary least square multiple regression analysis was used as the principal statistical method. Findings/results: The findings indicate that the link between chief executive remuneration and state-owned entity performance demonstrated different patterns in the pre- and post-crisis periods. Practical implications: State-owned entity remuneration committees should place more emphasis on the financial efficiency measurements to enhance efficiencies in South African state-owned enterprises. Shareholders and regulators should take cognisance of measures to be used to assess the potential performance of state-owned entities, through executive remuneration, especially during an economic crisis. Findings could furthermore be of importance to other academics investigating this phenomenon. Originality/value: This research provides additional knowledge to the limited research available on SOEs in South Africa. Further, it reveals that an economic downturn affects the link between CEOs’ remuneration and SOE performance. This addresses a knowledge gap concerning the pay-for-performance link in South African SOEs and in emerging economies in general.

Public sector reform in emerging economies: Does privatisation matter?

BACKGROUND: Privatisation policies have aroused enormous interest in both developed and developing countries. Previous research findings reveal that privately owned companies are more efficient and profitable than comparable state owned enterprises (SOEs). Moreover, it has been argued that these reforms would be even more effective if accompanied by privatisation. As a result, privatisation that aims to enhance the performance of SOEs has been regarded as one of the key features of emerging economies. OBJECTIVE: The purpose of this study is to examine the extent to which the benefits of privatisation have been achieved in emerging economies. In particular, the study assesses the developmental changes and improvements in the performance of privatised companies in Egypt as an emerging economy. METHODS: This study was carried out in three stages. First, it was felt necessary to obtain a broad overview of the effect of the Egyptian privatisation programme on the performance of the privatised companies by analyzing secondary data of privatized companies. Second, in an attempt to obtain a more precise understanding of the impact of privatisation, an online questionnaire survey was distributed to the finance managers of 56 privatised companies during the period September 2020 to January 2021. Third, a series of semi-structured interviews were undertaken with senior managers in 8 different privatised companies. The purpose of these interviews was to supplement and amplify the themes and issues that had arisen from stages I and II of the research. RESULTS: The findings reveal that privatisation improved the process of accountability within the company and efficiency gains is the most important advantage of privatisation. CONCLUSIONS: The study concludes that privatisation leads to more difficulty in safeguarding the interests of the weaker groups in society.

Study on the Impact of Mixed Ownership Reform on the Performance of State-owned Enterprises

Based on 2013-2019 state-owned listed companies as samples, and from the aspects of ownership structure and top management, examine the influence of mixed ownership reform of state-owned listed companies performance, the results showed that the mixed ownership significantly promoted the reform of state-owned enterprise performance, and non-state-owned capital by appointed director of the senior management mode to promote the performance of state-owned enterprises effect is more obvious than ownership; In addition, it is also found that compared with SOEs with stronger government intervention, the improvement effect of mixed-ownership reform on SOEs' performance is more significant in SOEs with weaker government intervention.

Rise of Bank Competition: Evidence from Banking Deregulation in China

Using proprietary individual level loan data, this paper explores the economic consequences of the 2009 bank entry deregulation in China. Such deregulation leads to higher screening standards, lower interest rates, and lower delinquency rates for corporate loans from entrant banks. Consequently, in deregulated cities, private firms with bank credit access increase asset investments, employment, net income, and ROA. In contrast, the performance of state-owned enterprises (SOEs) does not improve following deregulation. Deregulation also amplifies bank credit from productive private firms to inefficient SOEs due mainly to SOEs’ soft budget constraints. This adverse effect accounts for 0.31% annual GDP losses.

Management Skills and Performance of State-Owned Enterprises in Cameroon

Like in most Sub-Sahara Africa, State-Owned Enterprises (SOEs) in Cameroon have a complex, overlapping and unclear management model that impacts its performance. The purpose of this study is to evaluate the effect of managerial skills on the performance of SOEs in Cameroon. Survey research design was used to collect data from top and middle level managers. The sample was drawn form 10 of the 14 SOEs that are wholly or partially owned by the state. By using purposive sampling, likert scale data was collected using questionnaires. The explanatory variables were managerial skills (conceptual, technical, interpersonal, budgeting and planning, cost control and ability to secure capital) and the outcome variable was performance. Managers were asked to rate their abilities in possessing some skills. Their opinions were also asked about the performance of the enterprises they manage. By analyzing the data using Ordinal logistic regression it was found that conceptual, technical, interpersonal, budgeting and planning skills had significant and positive effect on performance while cost control and skills to secure capital had insignificant and positive effects on performance. To improve performance, the study recommended that the government should organize skill-based training seminars for the three management levels (supervisors, middle and top managers).

Board Composition and Performance of State-owned Enterprises: Quasi-experimental Evidence

The quality of governance crucially affects corporate outcomes, and may be particularly important for state-owned enterprises (SOEs) not disciplined by market competition forces. We examine the impact of board composition on the performance of companies controlled by public entities in Italy. For this purpose, we exploit a reform-induced exogenous change in board composition, aimed at increasing female representation and at reducing the revolving-door phenomenon. The law’s provisions were binding for SOEs, but not for companies with a minority share of public ownership, allowing us to adopt a difference-in-differences estimation. The results show that female presence on the boards of directors of SOEs has increased, while that of former politicians has decreased. The new directors have mostly replaced older and less talented men, thereby rejuvenating the boards and improving their quality. To assess the effects of the board shake-up on firm performance, we analyse companies’ balance sheets and survey information on citizens’ satisfaction with the provision of local public services and on objective measures of their quality. While we detect no significant effects on firm productivity, we find that profitability increases and leverage decreases, thereby reducing corporate credit risk. Finally, there is evidence consistent with an improvement in the quality of SOEs’ output.

CEO pay upside down and enterprise performance: evidence from A-share listed companies in China

This paper investigates the phenomenon of chief executive officer (CEO) pay upside down within China’s listed companies and examines its impact on enterprise performance. Using the data of Chinese A-share listed firms from 2010-2019, this paper finds that CEO pay upside down negatively influences enterprise performance. Moreover, evidences show that (1) non-state-owned enterprise performance is more compromised by the inverted pay-position arrangement than state-owned enterprise performance; (2) when CEO’s shareholding percentage rising, the negative effect of CEO pay upside down on enterprise performance will be more restricted; (3) in the region with higher level of marketization, the inverted pay-position contract discounts more enterprise performance; furthermore, this moderating effect of the level of marketization is weaker in state-owned firms. This study adds to the literature about compensate incentive by investigating the effect of the negative pay gap and provides empirical evidences for enterprises to formulate effective compensation mechanisms.

Uporedna analiza upravljanja javnim preduzećima u Republici Srbiji

The results of a comparative study of the effects of state and public enterprise management in transition economies have classified Serbia as a group of countries with inefficient management. Transition countries, members of the EU, achieve better management performance of state-owned enterprises than non-EU countries, due to stronger institutions, efficient state aid rules, as well as greater transparency of budget support. The global pandemic in 2020 and increased health, economic and social risks, in many transition countries have not affected the slowdown of structural reforms in public enterprises, on the contrary, a special focus was directed towards upgrading the mechanisms of management of public enterprises, strengthening the anti-corruption policy, digitalization of state services, etc. The research of the reform balance of the management of large republican public infrastructure enterprises in the Republic of Serbia has shown that the state has major problems in the management of enterprises that are in its portfolio and under its control. Their business poses a permanent budget risk, directly affecting economic growth and key macroeconomic aggregates. Large infrastructure public enterprises have a dominant share in the energy and transport sectors, which affects the business of the entire economy. The balance of their business in the period of economic boom is in increasing discrepancy with the balance of business of the private sector, which clearly indicates the problem of management. The primary reform task in the management of public enterprises is to improve the accountability, transparency and efficiency of their management.

Privatisasi dan Dampaknya Terhadap Kinerja Keuangan Badan Usaha Milik Negara (BUMN) di Bursa Efek Indonesia

This research aims to determine the impact of privatization on the financial performance of State-Owned Enterprises (SOEs) in the Indonesia Stock Exchange. This type of research is comparative, data sources using secondary data with data collection techniques using documentation and literature studies.The population in this research is all State-Owned Enterprises (SOEs) that have been privatized in IDX. The sampling method uses purposive sampling with 5 companies. Data analysis techniques using normality testing, independent sample T-test, and Wilcoxon test. The results showed that there was a difference in the financial performance of SOES after privatization was seen from the ratio of solvency, activity, and solvency with significance values of 0.030, 0.170, and 0.001. Whereas if viewed from the liquidity ratio, the privatization does not give the difference in the financial performance of the State-Owned Enterprises (SOEs) in IDX with a significance value of 0.088. This insulation also finds that privatization has a bad impact on the performance of State-Owned Enterprises (SOEs) from profitability and activity ratios, but has a good impact when viewed from the ratio of solvency and liquidity.

Unintended consequences of carbon regulation on the performance of SOEs in China: The role of technical efficiency

Abstract The change in the level of operating performance of state-owned enterprises (SOEs) under the constraint of climate policies is directly related to the success or failure of subsequent low-carbon development. In this study, taking the Low-carbon Pilot Program introduced in 2010 by the central government as an exogenous natural experiment, we investigate the impact of carbon regulation on the operating performance of SOEs by using the difference-in-differences (DID) strategy for the first time. We conduct a series of robustness tests on the estimated results, including a placebo test by changing the control group, a parallel trend test by advancing the introduction time of the policy, and an interference elimination of the self-selection bias by using the propensity score matching (PSM) method. Furthermore, we examine the heterogeneous effects with regard to carbon intensity reduction targets. Finally, we use the heterogeneous stochastic frontier analysis method to measure the technical efficiency and analyze the influential mechanism of carbon regulation on the performance of SOEs. The results show that the carbon regulation policy significantly reduces the operating performance of SOEs. Through a series of robustness tests, we find that this conclusion is reliable. The higher the carbon intensity reduction target set by the central government is, the greater the negative impact of the carbon regulation policy on the performance of SOEs will be. Under the constraints of climate policies, SOEs acquire additional credit resources and launch a great quantity of inefficient investment. These actions inhibit the improvement of firms' technical efficiency and reduce the operating performance of SOEs. Therefore, the central government should strive to promote R&D activities related to low-carbon technology and improve the technical efficiency of SOEs when introducing any low-carbon policy.

THE IMPACTS OF GOVERNMENT AND MANAGEMENT CONFLICTING OBJECTIVES ON THE STATE-OWNED ENTERPRISES (SOEs) PERFORMANCES: THE CASE OF INDONESIA PUBLICLY LISTED SOEs

Paper is aimed to examine the impacts of conflicting objectives on the StateOwned Enterprises (SOEs) performance. The study motivated by the potential differences between government as the shareholders and management as the operator of SOEs. Government as shareholders may include politician, bureaucrats, and other government’s agents or ministry who have different interests and objectives toward SOEs. The government objectives are mainly dominated by socio-economic expectations. Meanwhile, management may bring his/her own interest and objectives which dominated by market and economic expectation. The conflict may appear and affect the performance. Using the case of the Indonesia public listed SOEs, this study examines in the extent to which the conflicting objectives between government and management stated objectives affect the performance; and which objectives dominate the business. The Statistic tools are used to examine the impacts of government and management conflicting objectives on SOEs performance during the period 0f 2004 to 2018. The period is selected particularly to see whether the changes of political regime contribute to the conflicting objectives. The study indicates that government objectives dominate the business activities which significantly affect the performance of SOEs.

The Performance of State-Owned Enterprises: New Evidence from the China Employer-Employee Survey

Drawing on data from a random sample of manufacturing firms collected in 2016 for the China Employer-Employee Survey (CEES), we examine differences in measures of productivity and financial returns between state-owned enterprises (SOEs) and private firms in China. The summary statistics show that labor productivity and total factor productivity are generally higher at SOEs than at private firms, but the productivity advantage of SOEs can mostly be explained by the higher levels of human capital of their workers, greater market power, and better management. Furthermore, SOEs’ advantage in productivity exists only in industries with higher SOE concentrations. In contrast, measures of financial returns—return on assets and return on equity—are lower for SOEs than for private firms. We believe that these results may reflect the fact that SOEs generally have easier access to capital, human capital, and markets than other types of firms in China.

The Effect of Information Technology Governance and Enterprise Risk Management on the Performance of State-Owned Enterprises in Non-Public Financial Fields Moderated by Corporate Governance

The use of information technology is a necessity and a challenge in this 4th-millennium era. Companies that do not want to use technology that suits their needs will be left behind. The Indonesian government has also required the use of appropriate information technology. The purpose of this study is to evaluate the implementation of the Ministry of SOE Regulation No. Per 02 / MBU / 2013 concerning guidelines for the preparation of information technology management of State-Owned Enterprises (SOE) in the field of non-public finance and the implementation of risk management to SOEs that are moderated by corporate governance. The population in this study is State-Owned Enterprises (SOE) in the financial sector. The research sample of 17 SOEs was sampled with the purposive sampling method. The analysis technique used is multiple linear regression. The results showed that IT Governance does not affect firm performance. ERM significantly influences firm performance. Corporate governance that is proxied by the number of audit committee meetings does not moderate IT governance's influence on firm performance and does not mild ERM's effect on firm performance.

Corporate Governance, Managerial Diversion, and Indonesian State-Owned Enterprises: A Literature Review

This paper looks at managerial diversion and agency theory and how both arguments may be applied to describe the governance practices and performance of state-owned enterprise companies in Indonesia. Managers are the main focus of the approaches, on the assumption that managers tend to expropriate the firms' and shareholders' value for their own benefit instead of looking for ways to maximize shareholders' value and fulfill their stakeholders' needs. Indonesia is selected because it has the highest number of State-Owned Enterprise (SOE) companies among the ASEAN countries. The government holds more than 51 percent of the shares and has a unique governance structure with two-tier boards to manage and run the companies. Besides, most of Indonesia’s SOE companies have a tight connection with Indonesia’s political party. With these characteristics, the agency problem in Indonesia's SOE companies is more prevalent compared to other listed SOE companies. The managerial diversion, which is linked to corruption, might be the principal critical factor that hinders SOE companies from performing well. Thus, even with the introduction of a good corporate governance score by the Indonesian government, which is imposed on SOE companies, it may not be able to improve the overall financial performance of SOEs as well as governance practice in the companies. This paper's objective is to review and examine prior literature on corporate governance and managerial diversion from the perspective of state-owned enterprise companies in Indonesia.

Organizational Design for Performance Management in State-Owned Enterprises

Countries all over the world established state-owned enterprises to ensure improved efficiency and governance. Namibia is no exception, and with the government's desire for betterment of its citizens, many SOEs were established. After two decades of independence with the realization that state-owned enterprises (SOE) were not performing well due to mismanagement, red tape, and corruption, the State Owned Enterprises Governance Act 2006 was promulgated. This act aims to provide efficient governance and monitor performance in line with the government's aspirations of augmenting SOEs performance. Adopting a mixed cross-sectional descriptive case study research design, the aim of this article is to analyze and explore the influence of selected organizational design variables on strategy implementation. Further, within the context of resources-based view and dynamic capabilities of the firm, it aims to understand the influence of performance management on overall organizational effectiveness on a service sector SOE and thereby provide a basis for optimum performance and organizational effectiveness.