Management Of State-owned Enterprises Research Articles

Anti-corruption campaign and SOEs innovation: The role of the central inspection group in China

Using central inspections of China aimed at SOEs as a quasi-natural experiment, we investigate the causal effect of anti-corruption campaigns on the innovation of state-owned enterprises (SOEs). Based on the sample of China's SOEs, we find that the central inspections lead to an uplift in the quantity of SOE innovation at the expense of innovation quality. Further analysis indicates that owing to the unique motivation of political promotion, SOE managers improve the operation indicators valued by the government when subjected to political intervention in the shape of anti-corruption, such as the innovation quantity, referred to as the political monitoring mechanism. Eventually, there will be a decline in the quality of innovation that will supplement the long-term value of SOEs since the central inspection does not contribute to corporate governance.

Rent‐seeking or value‐creating? The impact of managerial autonomy from state‐built corporate pyramids on M&A performance

AbstractHow to give managers autonomy to improve organisational performance has long been a focus of business practice. In this paper, we use a unique Chinese context to investigate the effect of managerial autonomy arising from state‐built corporate pyramids on mergers and acquisitions (M&A) performance. We find that the number of pyramidal layers between the government and the state‐owned enterprise (SOE) is positively associated with M&A performance. This relationship is stronger when the SOE managers possess professional M&A abilities but weaker when the SOE management team and the government are politically connected. We attribute the positive association to the career path incentives of SOE managers. Additionally, we address the role of managerial autonomy in the M&A process and integration. We also analyse this effect in contexts where managerial autonomy is crucial in some investment decisions. Taken together, our study fills a critical gap on managerial discretion within internal organisational contexts.

State Ownership and Green Innovation

Climate change and digital transformation have significant effects on all aspects of society. With the increasing importance of state-owned enterprises (SOEs) that represent governments' stand to respond to environmental challenges, this study investigates how state ownership affects green innovation and how digital transformation factors play a role at both the firm level and the provincial level. Based on the data analysis of Chinese listed firms between 2008 and 2021, we find that state ownership hinders green innovation. However, with a high degree of digital transformation at the firm level and digital innovation capability at the province level, the state ownership and green innovation relationship can be weakened. Overall, this study advances both green innovation and SOE innovation literature by bridging state ownership, green innovation, and digital-related factors. We advocate government and SOE managers to invest more in digital transformation and improve their digital capabilities for better green innovation output.

Chinese SOEs’ technological upgrading through OFDI: The impact of political ties and subnational institutions. A survey of literature

This paper presents a systematic literature review on the relationship between outward foreign direct investment (OFDI) and technological upgrading in Chinese state-owned enterprises (SOEs), emphasizing the moderating role of political ties and subnational institutions. Analyzing 51 core papers from 2011 to 2022, the study synthesizes key theories on how political ties influence Chinese SOEs’ technological upgrading through OFDI. It also finds that political ties affect motivations and resources of SOEs with various types of state ownership and thus affect their OFDI strategies and innovation capabilities. This research further explores the impact of subnational institutions and their interactions with political ties. The findings underscore the perspective that subnational institutions shape a firm’s learning capability, and their impact is moderated by SOEs’ political ties. Finally, the study identifies key issues in SOEs’ technological upgrading through OFDI and offers valuable insights for policymakers and SOE managers. Future research directions are outlined to understand the impact of OFDI on the technological upgrading of Chinese SOEs.

Board demographic characteristics and governance practices of SOEs in Ghana

Across the globe and particularly in the developing country settings, there has been an upsurge of interests from businesses, academics and policy-makers alike in understanding the relationship between corporate board characteristics and governance practices of State-Owned Enterprises (SOEs). This understanding especially in post-pandemic era would aid in formulating best policies for optimal performance of the SOEs. The aim of this study was to investigate the influence of board characteristics on corporate governance practices in SOEs in Ghana. Utilizing a structured questionnaire, data was collected from employees across various SOEs and analysed through Smart-PLS structural equation modelling. The findings indicate that board demographic characteristics have a significantly positive impact on governance practices, underscoring the importance of diversity in board composition. This outcome highlights the need for SOE policymakers to prioritize board diversity to enhance governance efficacy. This research enriches the literature on corporate governance in the developing country context and has practical implications for enhancing SOE management and performance. It also provides a foundation for future research to explore the dynamics of board characteristics in different contexts.

ПРОБЛЕМЫ И МЕРЫ УПРАВЛЕНИЯ ЭКОНОМИКОЙ СОВРЕМЕННЫХ ГОСУДАРСТВЕННЫХ ПРЕДПРИЯТИЙ

In the new situation of economic globalization, state-owned enterprises face the dual pressures of fierce market competition and social responsibility. This article aims to comprehensively discuss the problems faced by modern state-owned enterprises in economic management and propose appropriate measures to solve them. Firstly, it analyzes the effects of competition pressure, internal mismanagement and social responsibility on the economic management of state-owned enterprises. Secondly, it emphasizes the importance of economic management for the competitiveness and long-term development of enterprises and its key role in the international market. Finally, possible ways to solve the economic management problems of modern state-owned enterprises through system innovation, strengthening internal management and raising awareness of social responsibility are suggested. A case study demonstrates the successful experience of a state-owned enterprise in economic management, which serves as a useful inspiration for other state-owned enterprises.

Experimentation at the WTO lab: towards a better ‘Interface’ to accommodate State-owned enterprises

Abstract This article advocates for a more inclusive and adaptable interface mechanism at the World Trade Organization (WTO), specifically tailored to address the nuanced dynamics of State-Owned Enterprises (SOEs). It revisits the foundational ‘Interface Theory’ by John H. Jackson, a cornerstone in shaping initial WTO rules for non-market economies. Drawing upon the critiques of David Kennedy, this article identifies three key limitations inherent in the existing interface theory. It then delves into a critical examination of the regulations pertaining to SOEs within the frameworks of the Trans-Pacific Partnership / the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, arguing that these models inadequately address the complexity of state participation in the economy, with a particular focus on non-market economies like China. This article suggests leveraging the WTO as a global policy laboratory, a forum for the exploration and discussion of varied national strategies concerning SOE management. It posits China’s mixed-ownership reform as an exemplary starting point for such experimental endeavours.

Risks and Control Measures in Enterprise Investment Management

As an important component of China's economy, the investment management level of state-owned enterprises directly affects their operational efficiency and market competitiveness. However, in the increasingly complex and volatile global economic environment, the investment management of state-owned enterprises is facing increasingly severe challenges. The traditional investment management models and methods are no longer suitable for the needs of modern markets, and there is an urgent need to improve the level of investment management through optimization and innovation. This article takes state-owned enterprises as the research object, deeply analyzes the main risks they face in investment management, and proposes targeted countermeasures. This not only helps to improve the investment efficiency of enterprises, ensure the safety and appreciation of state-owned assets, but also provides a solid foundation for enterprises to achieve sustainable development in the complex and ever-changing market environment.

Super Holding of State-Owned Enterprize (Soes) to Realize A Healthy Company Based on The Principles of Good Corporate Governance to Create the Prosperity of All Indonesian People

Objective: This research aims to explore the establishment of a super holding for State-Owned Enterprises (SOEs) in Indonesia, focusing on the implementation of good corporate governance principles. The goal is to create prosperity for all Indonesian people and to enhance government investment management and national development. Method: This study employs a normative legal research approach. The methodology involves researching and reviewing normative legal materials, including applicable laws and regulations. The analysis centers around the establishment of a super holding in SOE management, particularly in relation to state responsibility in financial management and the renewal of SOE management laws. Result: The findings indicate that the establishment of a super holding for SOEs is a significant step in improving government investment management and national development. In this concept, SOEs are managed as a group of companies with a focus on transparency, state wealth management, and appropriate investment strategies. Conclusions: The formation of a super holding for SOEs is expected to bring strategic benefits in financial management, transparency, infrastructure development, and risk reduction. Its primary objective is to promote general welfare by providing adequate goods and services and contributing to national economic development.

ГРАНТИ USAID ТА UKAID ДЛЯ ПІДВИЩЕННЯ РІВНЯ ПРОЗОРОСТІ, ЕФЕКТИВНОСТІ ТА КЕРУВАННЯ В УПРАВЛІННІ ДЕРЖАВНИМИ ПІДПРИЄМСТВАМИ УКРАЇНИ

The article examines the possibilities of grant assistance under the SOERA Program, which is financed by the United States Agency for International Development (USAID) in the amount of 100 million US dollars and is implemented by its contractor – the Deloitte company. It is emphasized that for Ukraine such a tool of financial support is relevant in the context of both the implementation of the reform of state-owned enterprises in Ukraine and the involvement of "third sector" organizations in this process, the role of which is important for influencing the authorities in making key decisions. It was emphasized that the SOERA Program provides an opportunity for civil society organizations and educational institutions to receive grants and implement projects that will contribute to increasing the level of transparency, efficiency and management of state-owned enterprises (SOEs) and state assets of Ukraine, in particular, through conducting research, developing methodologies, projects program documents, recommendations, as well as organization of public distribution of developed materials. The objectives of the program were analyzed, the main ones of which are: providing support in creating a comprehensive and effective centralized information system for SEs (data collection and reporting) with the aim of helping the Government and other interested institutions make informed decisions regarding the sale and management of SEs, financial support for the development and implementation of a reform strategy SOE based on factual data and implementation roadmap, improvement of the legislative and regulatory framework to support the implementation of SOE reform and privatization strategy, support for the development by the Government of Ukraine of effective operational management mechanisms for enterprises that remain state-owned, ensuring transparency of SOE corporate management, reducing corruption among them is the reduction of fiscal pressure on state-owned enterprises, promotion of the growth of the private sector and direct foreign investment, and public support for state-owned enterprise reform and privatization. The importance of compliance by the applicant organizations with all criteria of acceptance of the Program and the development of the project according to its recommendations as a condition for making a positive decision on the provision of financing for projects is substantiated. The consequences of the implementation of projects with the financial support of the SOERA Program and their significant impact at the national and subnational levels are summarized.

国有企业合规管理：现实价值、存在问题及完善路径

国有企业合规管理：现实价值、存在问题及完善路径

Research on the Path of Financial Management of State-owned Enterprises in the Perspective of Meta-universe

With the rise of the meta-universe concept, state-owned enterprises are facing new digital transformation opportunities. Meta-universe is a virtual world constructed by using digital technology, which has a high degree of immersion and interactivity, and can provide state-owned enterprises with new business models and competitive advantages. This preliminary discussion of the impact of the meta-universe on state-owned enterprises and the financial meta-universe management dilemma, puts forward the research on the path of meta-universe of financial management of state-owned enterprises, both from the financial management methods, objects and risks as an entry point, transforming the traditional financial management mode, constructing a meta-universe of financial system, and assisting state-owned enterprises in the development of value innovation and digital transformation.

A Review of Performance Management in State-owned Enterprises and Private Enterprises in China

In order to improve profits, the theory of enterprise performance management has formed a corresponding theoretical framework and system. Enterprises can improve performance management methods based on their own situation. This research compares the differences between state-owned enterprises and private enterprises through literature review. The existing papers mainly focus on performance feedback and communication mechanisms, the application of performance management and corporate strategy, and the enthusiasm of employees to participate in performance management. The existing papers mainly focus on performance feedback and communication mechanisms, the application of performance management in line with company strategies, and the initiative of employees to participate in performance management. Neglecting the specific role of state-owned enterprises and not combining performance management with their social responsibility. In addition, the imperfect performance indicator system has also led to the problem of not being greatly influenced by subjective factors within the enterprise. The accuracy of performance evaluation in many enterprises is often influenced by human factors. The design of performance management evaluation indicators is not scientific, the evaluation is unfair, the concept of human resource management is lack of correctness, strategic planning, single evaluation results, ineffective use, lack of follow-up, and frequent communication in performance management; The recruitment and allocation of personnel are unreasonable, the construction of the management system is highly arbitrary, and there is a significant subjective bias in performance evaluation.

INFORMATION TECHNOLOGY CAPABILITIES AND ENTERPRISE RESILIENCE OF STATE-OWNED ENTERPRISES FOR SUSTAINABLE COMPETITIVENESS: THE MEDIATING ROLE OF LEADERSHIP CAPABILITIES

Background and Purpose: In today's unpredictable, uncertain, complex, ambiguous, and interconnected environment, businesses face various challenges and uncertainties that are anticipated will intensify and become more frequent in the future. In this harsh environment, maintaining sustainable competitiveness is difficult. Information Technology Capabilities (ITCs) are an important element that determines a company's success or failure as well as its Resilience (ER). Given the complexity and uncertainty of today's business world, businesses with good information collection, analysis, and use can anticipate changes and decrease delays. Enterprises should collect high-quality information to meet modern business settings. Business resilience depends on the ability to gather and process resources to handle environmental uncertainty. Enterprises should use information, knowledge, experiences, and other resources to build resilience. The leadership of top management is essential for ensuring the organisation's sustainability and attaining its objectives. This study applies the concept of dynamic capability to assess the impact of ITCs on Indonesian SOEs and their subsidiaries. Additionally, this study investigates leadership capabilities (LCs) as a mediator between ITCs and ER. Due to their vital role in the Indonesian economy and the paucity of research on State-Owned Enterprises (SOEs) resilience and dynamic capabilities, particularly in the emerging market, this research focuses on Indonesian SOEs and their subsidiaries.
 
 Methodology: The study examined 322 valid data from online surveys using questionnaires to Indonesia SOEs and their subsidiaries’ board of directors and senior management. The data is analysed using SmartPLS 3.
 
 Findings: The research demonstrates that ITCs enhance ER. LCs improved the enterprise's resiliency. The relationship between ITCs and ER is mediated through LCs. 
 
 Contributions: The findings may expand the scope of dynamic capability theory to include resilience. The findings extend the methodology by adopting a quantitative and online survey of SOEs in emerging countries and demonstrate to SOE management and regulators that ER can be fostered by strengthening dynamic capabilities and risk management practices. The findings recommend that policymakers develop a road map, scenario, and strategies to ensure the long-term viability of SOEs.
 
 Keywords: Dynamic capabilities, enterprise resilience, Indonesia, information technology capabilities, leadership capabilities, state-owned enterprises.
 
 Cite as: Lisdiono, P., Said, J., Yusoff, H., Hermawan, A. A., & Abdul Manan, D. I. (2023). Information technology capabilities and enterprise resilience of state-owned enterprises for sustainable competitiveness: The mediating role of leadership capabilities. Journal of Nusantara Studies, 8(TI), 382-407. http://dx.doi.org/10.24200/jonus.vol8issTIpp382-407

Development of Risk-Based State-Owned Enterprises Performance Audit Framework to Enhance Company Value

In the face of fierce economic competition among State Owned Enterprises (SOE), encouraging each company to grow its corporate value through the development of a risk-based performance audit framework may be the best option for SOEs in Indonesia. SOE management can make ongoing improvements and respond rapidly to market changes by detecting company performance risks. The purpose of this research is to develop an SOE risk-based performance audit framework in order to increase company value. The Analytical Hierarchy Process (AHP) method was utilized to create an effective and efficient performance audit framework based on expert justification. The study's findings indicate that the Supreme Audit Institution (BPK) strategy’s main priorities for the construction of the SOE risk-based performance audit framework include three important aspects: 1) synergy between BPK audits and SOE risk management and risk assessment by SOE internal auditors; 2) development and improvement of SOE risk management quality, and 3) effective risk assessment by SOE internal auditors. This strategy is supported by various major variables, including SOE risk management, risk assessment by SOE internal auditors, BPK audit scope, BPK audit standards, BPK audit guidelines, and BPK auditor competencies.

Financial risk assessment management of state-owned enterprises based on cloud accounting in the era of big data

Abstract To solve the financial risk problem of enterprise financing difficulties and large financing amounts in the era of big data, this paper constructs a financial risk assessment model and evaluates the indexes of enterprise financial risk by combining it with cloud accounting products. Firstly, we assign and determine the weights, use the evidence theory to develop the enterprise financial risk evaluation, and determine the weights of each risk evaluation index. Secondly, we set up a fuzzy evaluation language set, calculate the maximum value of the fuzzy rubric affiliation function for the risk indicators of state-owned enterprises under cloud accounting, pre-process the obtained data, determine the specific indicator weights with the help of fuzzy hierarchical analysis, and carry out consistency tests on them. Finally, the relative importance of each indicator is calculated among the model factors to obtain the overall risk score of cloud accounting enterprise finance. The experimental results show that the risk level measured according to the steps of the cloud accounting risk assessment system, the data confidentiality risk score is 76.14, the cloud accounting product risk is 85.96, the service risk is 72.88, and only one item is higher risk. This shows that the use of cloud accounting financial risk control measures can improve the quality of financial risk management of enterprises.

Determinants of Financial Performance with Company Size as A Moderation Variable

This is a study of factors that influence profitability and financial performance with moderation of company size to the relationship between profitability and financial performance in government companies in the field of survey business in Indonesia. The study concentrates on the financial management of state-owned enterprises within their operations. The purpose of this study is to determine and analyze the effect of liquidity, leverage and efficiency on profitability and financial performance, as well as the role of moderation of company size on the relationship between profitability and financial performance. Data acquisition through primary data on all branches of the company in the last 11 years so that 143 panel data were obtained as material for further analysis. The analysis model was conducted with the support of SEM PLS and found that liquidity has a negative and significant effect on profitability and financial performance. Leverage and efficiency have a significant effect on profitability. Liquidity, leverage and efficiency negatively and significantly affect financial performance. Profitability and company size have a positive and significant effect on financial performance. The size of the company moderates the relationship between profitability and financial performance.

LEGAL RISKS FOR THE BUSINESS OF PERSERO’S STATE OWNED ENTERPRISE (SOE) AND THEIR IMPLICATIONS FOR STATE FINANCE

This research focuses on legal aspects, notably the risks faced by the management of state-owned enterprises which result in losses to state finances and might potentially cause cases of corruption. The constraints experienced by the Directors of SOE are induced by the established regulation of legal norms in the SOE Law and the Limited Liability Company Law. They result in the ineffectiveness of SOE Directors in the development of Indonesian economy. The study is scrutinises risk management, which enforces normative juridical methods based on primary legal materials. The research findings show that the laws regulating SOEs’ activities prove discriminatory when compared to those for privatelyowned enterprises. Moreover, they hinder integration of the economy into the dynamic global business environment, even though these types of business entities are the primary economic agents in the national economic development. Coordination of efforts is needed for harmonization of laws and regulations, so that the business risks carried out by the Directors of SOE should be very low and ensure legal certainty in managing busines.

Innovative human resource management measures to improve the competitive ability of state-owned enterprises

With the rapid development of China's economy, the reform and innovation of state-owned enterprises have become a hot issue of social concern. As an important part of the core competitiveness of enterprises, the innovation and development of human resources management is not only an important guarantee for state-owned enterprises to maintain vitality and creativity and enhance market competitiveness, but also an important guarantee for state-owned enterprises to be invincible in market competition and achieve sustainable development. Therefore, state-owned enterprises should take human resource management as the core of strategic innovation and development strategy change, giving full play to its advantages while further improving operational efficiency. In this paper, human resource management is the core of research and analysis, and the current situation and problems of human resource management in state-owned enterprises are analysed, studied and discussed, and then strategies and methods to improve the competitiveness and innovative development of state-owned enterprises are proposed.

Unification of power and responsibilities for state‐owned enterprises: A quasi‐natural experiment

AbstractResearch Question/IssueBased on Property Rights Theory and Empowerment Theory, this paper uses the establishment of local State‐Owned Assets Supervision and Administration Commissions (SASACs) as a quasi‐natural experiment to investigate whether and how SASACs improve the efficiency of state‐owned enterprises (SOEs).Research Findings/Insights(1) After the establishment of SASACs, and compared to those not supervised by the SASACs (i.e., the control group), SOEs governed by local SASACs (i.e., the treatment group) have experienced a significant increase in decentralization and empowerment from the government, proxied by corporate pyramid levels. We also find increased pay‐performance sensitivity for SOE managers and higher productivity measured by total factor productivity (TFP). (2) SASACs adopt different strategies to manage SOEs in monopolistic and competitive industries. (3) The above effect of the SASACs is more pronounced in SOEs supervised by high‐quality governments that effectively protect property rights, enforce fair contracts, apply laws and regulations to everyone, and sufficiently refrain from expropriation.Theoretical/Academic ImplicationsUsing a quasi‐natural experiment, this paper expands the existing literature on SOE reform from the perspective of incentive reform at the regulatory level based on Property Rights Theory and Empowerment Theory.Practitioner/Policy Implications(1) Privatization is not necessarily the only optimal solution for SOE reform. We show that the unification of power and responsibilities can be very effective and is perhaps less costly and more practical than privatization. Thus, our study provides an encouraging solution for SOE reform for other countries. (2) Countries experiencing SOE reform should also work on strengthening their government quality in order to fully maximize the benefit of the reform.