Does corporate governance matter in China?

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journal

63 Scopus Citations
View graph of relations

Author(s)

  • Yan-Leung CHEUNG
  • Ping JIANG
  • Piman LIMPAPHAYOM
  • Tong LU

Related Research Unit(s)

Detail(s)

Original languageEnglish
Pages (from-to)460-479
Journal / PublicationChina Economic Review
Volume19
Issue number3
Publication statusPublished - Sep 2008

Abstract

This study assesses the quality of corporate governance practices of Chinese listed companies in 2004. Based on the Revised OECD Principles of Corporate Governance [OECD, 2004. Principles of Corporate Governance, Organization of Economic Cooperation and Development.], we develop a corporate governance index (CGI) to measure the overall quality of corporate governance and disclosure practices of the 100 largest Chinese listed firms. The results show that some Chinese companies have been making progress in corporate governance reform. Specifically, there is a significant difference in the CGI of the top versus the bottom performing companies. Further, oversea-listed Chinese companies tend to show more regard for the role of stakeholders and disclosure and transparency than non-oversea-listed Chinese companies. However, further tests show that there is no statistically significant relation between the quality of corporate governance practices, as measured by the CGI, and market valuation among firms in the sample. It appears that, in 2004, the benefits of good corporate governance have not been fully incorporated into the market valuation of these Chinese companies. © 2008 Elsevier Inc. All rights reserved.

Research Area(s)

  • China, Corporate governance

Citation Format(s)

Does corporate governance matter in China? / CHEUNG, Yan-Leung; JIANG, Ping; LIMPAPHAYOM, Piman; LU, Tong.

In: China Economic Review, Vol. 19, No. 3, 09.2008, p. 460-479.

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journal