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Chinese Firms (chinese + firm)
Selected AbstractsMarket Consequences of Earnings Management in Response to Security Regulations in China,CONTEMPORARY ACCOUNTING RESEARCH, Issue 1 2005IN-MU HAW Abstract Under the 1996-98 security regulations in China, the accounting rate of return on equity (ROE) has to be greater than 10 percent for three "consecutive" years for a firm to qualify for stock rights offers. Despite declining economic conditions during this period, the percentage of firms reporting ROE between 10 and 11 percent is about "three" times that for 1994-95. This unique regulatory environment provides a natural experimental setting for the empirical assessment of earnings-management behavior and its consequences. This study examines whether listed Chinese firms manage earnings to meet regulatory benchmarks and whether regulators and investors consider the quality of earnings in their respective regulatory and investment decisions. On the basis of a sample of listed Chinese firms from 1996 to 1998, we observe that managers execute transactions involving below-the-line items and use income-increasing accounting accruals to meet regulatory ROE targets for stock rights offerings. The firms that apply for, but fail to receive, regulatory approval manage earnings more significantly than do firms that receive approval and pair-matched control firms. Our market study also suggests that investors differentiate the quality of earnings and put less value on earnings suspected of a greater degree of management. Overall, our results imply that the regulatory bodies and investors to some extent make rational adjustments for the quality of earnings. [source] Business Group Affiliation, Firm Governance, and Firm Performance: Evidence from China and IndiaCORPORATE GOVERNANCE, Issue 4 2009Deeksha A. Singh ABSTRACT Manuscript Type: Empirical Research Question/Issue: This study seeks to understand how business group affiliation, within firm governance and external governance environment affect firm performance in emerging economies. We examine two aspects of within firm governance , ownership concentration and board independence. Research Findings/Insights: Using archival data on the top 500 Indian and Chinese firms from multiple data sources for 2007, we found that group affiliated firms performed worse than unaffiliated firms, and the negative relationship was stronger in the case of Indian firms than for Chinese firms. We also found that ownership concentration had a positive effect on firm performance, while board independence had a negative effect on firm performance. Further, we found that group affiliation , firm performance relationship in a given country context was moderated by ownership concentration. Theoretical/Academic Implications: This study utilizes an integration of agency theory with an institutional perspective, providing a more comprehensive framework to analyze the CG problems, particularly in the emerging economy firms. Empirically, our findings support, as well as contradict, some of the conventional wisdom, and suggest useful avenues for future research. Practitioner/Policy Implications: This study shows that reforms in general and CG reforms in particular are effective in emerging economies, which is an encouraging sign for policy makers. However, our research also suggests that it may be time for India and China to stop the encouragement for the empire building through group formation in the corporate world. For practioners, our findings suggest that firms need to balance the need for oversight with the need for advice, while selecting independent directors. [source] Supply Chain Strategy, Product Characteristics, and Performance Impact: Evidence from Chinese Manufacturers,DECISION SCIENCES, Issue 4 2009Yinan Qi ABSTRACT Supply chain management has become one of the most popular approaches to enhance the global competitiveness of business corporations today. Firms must have clear strategic thinking in order to effectively organize such complicated activities, resources, communications, and processes. An emerging body of literature offers a framework that identifies three kinds of supply chain strategies: lean strategy, agile strategy, and lean/agile strategy based on in-depth case studies. Extant research also suggests that supply chain strategies must be matched with product characteristics in order for firms to achieve better performance. This article investigates supply chain strategies and empirically tests the supply chain strategy model that posits lean, agile, and lean/agile approaches using data collected from 604 manufacturing firms in China. Cluster analyses of the data indicate that Chinese firms are adopting a variation of lean, agile, and lean/agile supply chain strategies identified in the western literature. However, the data reveal that some firms have a traditional strategy that does not emphasize either lean or agile principles. These firms perform worse than firms that have a strategy focused on lean, agile, or lean/agile supply chain. The strategies are examined with respect to product characteristics and financial and operational performance. The article makes significant contributions to the supply chain management literature by examining the supply chain strategies used by Chinese firms. In addition, this work empirically tests the applicability of supply chain strategy models that have not been rigorously tested empirically or in the fast-growing Chinese economy. [source] Dividend preference of tradable-share and non-tradable-share holders in Mainland ChinaACCOUNTING & FINANCE, Issue 2 2009Louis T. W. Cheng Stock dividend; Cash dividend; Non-tradable share; Dividend signal Abstract Comprehensive data on corporate announcements of Chinese firms allows us to examine the preference for, and determinants of, cash and stock dividends. The results indicate that Chinese public investors prefer stock dividends over cash dividends, which are preferred by large state and legal person shareholders generally. Stock dividends, which do not require an explicit cash outflow from a firm, are found to be positively related to higher earnings, supporting the signalling hypothesis of dividend policy. In an imperfect market, these results have some implications for government regulation of financial markets. [source] Dimensions of financial integration in Greater China: money markets, banks and policy effectsINTERNATIONAL JOURNAL OF FINANCE & ECONOMICS, Issue 2 2005Yin-Wong Cheung Abstract The financial linkages between the People's Republic of China (hereafter ,China') and the other Greater China economies of Hong Kong and Taiwan are assessed, and compared against those of China with Singapore, Japan and the United States. For both sets of links, there is evidence that ex post uncovered interest parity tends to hold over longer periods, and the magnitude of the parity deviations is shrinking over time. The deviations depend upon the extent of capital controls, and in certain cases, exchange rate volatility. However, while the money markets of China are increasingly linked to money markets in the rest of the world, our empirical results suggest that the banking sector,the main source of capital for Chinese firms,remains insulated. Copyright © 2005 John Wiley & Sons, Ltd. [source] Rights Issues in the Chinese Stock Market: Evidence of Earnings ManagementJOURNAL OF INTERNATIONAL FINANCIAL MANAGEMENT & ACCOUNTING, Issue 2 2008Hung-Gay Fung Using 665 rights offerings of Chinese firms, we demonstrate positive but diminishing price effects of successive announcements at the board meeting, the shareholders' meeting, the prospectus release date, and the ex-rights date, but negative abnormal returns before the ex-rights date. Public investors value the participation from shareholders of state and legal-person shares in the rights offerings, which seem to be linked to the future firm performance. The results overall supports the hypothesis that Chinese company earnings are considerably manipulated in the rights issue process. [source] Securities Regulation, the Timing of Annual Report Release, and Market Implications: Evidence from ChinaJOURNAL OF INTERNATIONAL FINANCIAL MANAGEMENT & ACCOUNTING, Issue 2 2006In-Mu Haw Using a sample of earnings announcements of Chinese firms in the fiscal years 1994,1999, covering the periods before and after the introduction of a regulation to stagger the release of annual reports, we reassess the relation between earnings news and the timing of earnings announcements. We find that even though the reporting lag has significantly shortened as a result of the regulation, the pattern whereby good news is announced earlier than bad news persists. We then examine the behavior of stock prices before earnings announcements and find some indication of information leakage. These findings suggest that the regulation had the expected effect of reducing reporting delay and earnings release clustering. Yet, it did not appear to reduce the extent of the pre-announcement leakage of information. [source] Ownership Types and Strategic Groups in an Emerging Economy*JOURNAL OF MANAGEMENT STUDIES, Issue 7 2004Mike W. Peng ABSTRACT Existing strategic group studies have rarely examined ownership type as a variable to classify firms in an industry. Using Chinese firms of different ownership types, we suggest that ownership type can be a parsimonious and important variable that managers use to cognitively classify firms into different strategic groups. While ownership itself is an objective variable, we contend that different ownership types lead to different managerial outlook and mentality due to a number of macro and micro foundations giving rise to various managerial cognitions. Employing the Miles and Snow typology, we find that state-owned enterprises (SOEs) and privately-owned enterprises (POEs) tend to adopt defender and prospector strategies, respectively, while collectively-owned enterprises (COEs) and foreign-invested enterprises (FIEs) exhibit an analyser orientation that falls between defenders and prospectors on the strategy continuum. Three statistical tests suggest that ownership types can be used to successfully predict strategic group memberships in China's emerging economy. [source] Editor's Introduction , Autonomy of Inquiry: Shaping the Future of Emerging Scientific CommunitiesMANAGEMENT AND ORGANIZATION REVIEW, Issue 1 2009Anne S. Tsui abstract Over two decades, research in Chinese management has exploited existing questions, theories, constructs, and methods developed in the Western context. Lagging are exploratory studies to address questions relevant to Chinese firms and to develop theories that offer meaningful explanations of Chinese phenomena. Framed as a debate between pursuing a theory of Chinese management versus a Chinese theory of management, this forum, through the voices of thirteen scholars, provides an analysis of the reasons for the current status of Chinese management research and offers alternatives to shape the future of Chinese management studies. Based on the principle of autonomy of inquiry and heeding the warning of the constraint of normal science, the Chinese management research community can shape its own future by engaging in research that may contribute to global management knowledge and address meaningful local management problems. [source] A New Perspective on Ownership Identities in China's Listed CompaniesMANAGEMENT AND ORGANIZATION REVIEW, Issue 3 2006Andrew Delios abstract We introduce a new perspective on the conceptualization and measurement of ownership identities of China's listed companies. Previous work analyzing the strategy and performance implications of the ownership structure in Chinese firms has used the official categorization provided by state bodies in China. In this categorization, state shareholding, legal person shareholding and A-shares dominate. This official categorization, however, obscures the ultimate identity of a shareholder; this can confound conceptual and empirical work on the strategy and performance implications of ownership identity. We refine the existing classification by recategorizing shareholders into 16 types, which can then be regrouped into relevant categories of shareholders, such as government or private, to enable analysis of ownership identity and ownership concentration issues in China's listed companies. Our new classification can help provide consistency in the burgeoning research on the strategy and performance implications of the concentration and identity aspects of ownership structure in China's listed companies. [source] Organizational Learning and Productivity: State Structure and Foreign Investment in the Rise of the Chinese CorporationMANAGEMENT AND ORGANIZATION REVIEW, Issue 2 2005Doug Guthrie abstract Over the two and a half decades of economic reform in China, two types of Chinese firms have consistently outperformed their peers. In the 1980s, it was the firms at the lower levels of the industrial hierarchy, the township and village enterprises that were closely monitored by local governments. In the 1990s and beyond, the top performers have been those Chinese firms that have formal relationships with foreign investors. While many studies on the economic reforms in China have focused on the hardening of budget constraints and the transfer of technology from foreign to Chinese firms, I focus here on the stability created by relationships with local government offices and with powerful foreign investors. Where advocates of shock therapy have argued that a rapid transition to market institutions was the best path to building a market economy, I argue that the successful practices of the market are learned gradually over time, and the Chinese firms that are stabilized by attention from local government offices and relationships with foreign investors are well-positioned to successfully navigate China's emerging markets. A quantitative analysis of 81 firms in industrial Shanghai and three case studies help illuminate the mechanisms behind these relationships. [source] Financial factors and company investment decisions in transitional ChinaMANAGERIAL AND DECISION ECONOMICS, Issue 2 2009Jia Liu We investigate the propensity of Chinese publicly listed firms to invest in response to financial factors, according to the a priori degree of a firm's information problems: industry sector, ownership structure and firm size. The firms in primary and tertiary industries are found to be liquidity-constrained in their investment decisions. The investment-cash flow sensitivity of the firms in secondary industry indicates that they lost privileged access to credit in the course of China's market transition. However, we find no evidence that financial liberalization resulted in an easing of financing constraints for small- and medium-sized firms. Our result indicates that agency problems, stemming from a state-controlling pyramidal ownership structure, are responsible for the misallocation of internal funds. The importance of bankruptcy and agency costs in relation to debt finance for certain types of borrowers reflects the transitional nature of the financial environment facing Chinese firms. Copyright © 2008 John Wiley & Sons, Ltd. [source] Multinationals and the creation of Chinese trade linkagesCANADIAN JOURNAL OF ECONOMICS, Issue 2 2008Deborah L. Swenson Abstract., This paper studies the relationship between multinational firm proximity and the formation of new export connections by private Chinese exporters between 1997 and 2003. The results indicate that growth in the presence of multinational firms is positively associated with the formation of new trade by local Chinese firms. Further exploration suggests that information spillovers may drive this result, as the positive association due to own-industry multinational presence is particularly strong in contexts where information improvements may be the most helpful. Thus, it appears that a growing presence of multinational firms may enhance the export capabilities of local domestic firms. Ce mémoire étudie la relation entre la proximité d'une firme plurinationale et la formation de nouveaux liens à l'exportation par des exportateurs chinois entre 1997 et 2003. Les résultats montrent que la croissance de la présence de firmes plurinationales est reliée de façon positive avec la formation de nouveaux liens commerciaux avec les firmes chinoises locales. Ces travaux suggèrent que les débordements d'information peuvent être à la source de ces résultats, car la relation positive attribuable à la présence de plurinationales dans la même industrie s'avère particulièrement forte dans des contextes où l'amélioration de l'information peut être la plus utile. Ainsi, il semble qu'une présence accrue de firmes plurinationales peut accroître les capacités d'exportation des firmes locales. [source] China's Exchange Rate Movements and Corporate Currency Invoicing StrategiesCHINA AND WORLD ECONOMY, Issue 5 2009Jingtao Yi F31; F41; L11 Abstract Since China introduced a new managed floating exchange rate regime in 2005, the persistent appreciation of the renminbi against the US dollar has led Chinese firms to reassess their choice of invoice currency among the dollar and other international alternatives to price their exports. The present paper performs a systematic invoice currency analysis by surveying the published literature, summarizing criteria for decision-making, and evaluating the choices available to Chinese exporters implementing currency invoicing strategies to maximize expected profits. This study finds that the euro could play an increasing role as the invoice currency of Chinese firms, although the US dollar will still play a dominant role. Chinese exporters might shift gradually from the dollar to the euro in the face of the falling dollar, balancing between the two by necessity. [source] | ||||||||||