Non‐controlling Large Shareholders and Firm Performance in China

Yan, Caiyu; He, Hong

doi:10.1111/ajfs.12216

Cited by 12 publications

(22 citation statements)

References 49 publications

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“…Shareholding ratio of the first shareholder (sr ) has a significant negative impact on innovation quantity and innovation quality. As supervisory regulations in the Chinese capital market are not yet sound, substantial shareholders usually employ the tunnel effect to achieve excess control and gain more private income (Yan & He, 2018). Firm innovation is a long‐term process with high risk and uncertainty.…”

Section: Results and Analysismentioning

confidence: 99%

Impacts of top management team fault‐line on firm's innovation—Financial slack over‐investment and underinvestment

Song

Yan

2022

Manage Decis Econ

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This paper aims to how the top management team (TMT) fault‐line affects firm's innovation based on the data of Chinese listed companies from 2009 to 2018. We describe innovation from two dimensions (quantity and quality) in order to better demonstrating of firm's innovation. The empirical results find that the intensity of TMT fault‐line has significant positive impacts on both quantity and quality. Then, we propose three potential mechanisms that include financial slack, over‐investment, and underinvestment and further discuss and explore them. It is found that the intensity of TMT fault‐line promotes the quantity and of innovation through decreasing financial slack, however, cannot affect the quality of innovation. There is a significant negative relationship between TMT fault‐line and over‐investment that enterprise should reduce over‐investment to trigger both quantity and quality. Finally, the results show that TMT fault‐line could alleviate underinvestment and then improve firm's innovation both on quantity and quality. This paper also has verified the robustness of estimation according to instrumental variable method, alternative variables, and adjusting time windows.

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Section: Results and Analysismentioning

confidence: 99%

Impacts of top management team fault‐line on firm's innovation—Financial slack over‐investment and underinvestment

Song

Yan

2022

Manage Decis Econ

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“…Previous research, so far, only tested the value of the relevance of OCI information in the income statement without involving earnings attribution policies (Saymeh, 2019;Elbakry et al, 2018;Banks et al, 2018;Shi and Zhou, 2017;Sajnog, 2017;Schaberl and Victoravich, 2015;Jones and Smith, 2011;Kanagaretnam et al, 2009). Research on earnings attribution has been carried out by Francesco (2018), Yan andHe (2018), andLopes (2013), but all three have not linked earnings attributions to OCI and the ability to predict future CIs.…”

Section: Theoretical Reviewmentioning

confidence: 99%

“…Empirical evidence from a previous study shows that the presentation of earnings attributions is an effort to the transparency of financial statements (Yahaya, KA, Fagbemi, TO and Oyeniyi, 2015). It increases the value of financial statements related to financial performance assessment (Yan & He, 2018) and the principle of fairness and attention to the minority as well as affecting the market value of the company (Francesco, 2018) and returns (So & Smith, 2009). Presentation of the income statement in which there is additional information on OCI components, attributions of NI and OCI earnings to owners of the parent entity (majority shareholder) and noncontrolling interests (minority shareholders) will be more informative and quality (Chebaane & Ben, 2014), more transparent (Shi et al, 2017).…”

Section: Earnings Attribution To the Owner And Aggregate Comprehensive Incomementioning

confidence: 99%

“…The presentation of information about earnings and equity attributions to owners is based on economic unit theory and has been proven to empirically increase the value of financial reporting relevance and is useful for predicting the company's market value and stock returns (So & Smith, 2009). Recent research by Francesco (2018) shows the same result that the presentation of attributions to non-controlling interests provides additional value in predicting stock prices and market capitalization, as well as financial performance (Yan & He, 2018). The opposite results obtained by Lopes, Lourenç o, & Soliman (2013) that whether or not there was information about earnings attributions to non-controlling interests in the financial statements, wherever the location of the information, and whatever the amount, it was not an important concern for users of financial statements.…”

Section: Introductionmentioning

confidence: 99%

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The Effect of Net Income and Other Comprehensive Income on Future’s Comprehensive Income With Attribution of Comprehensive Income as Moderating Variable

Kusuma

Zuhroh

Assih

et al. 2021

IJFR

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This study aims to examine the effect of net income and other comprehensive income on the total of future’s comprehensive income with attribution of earning as a moderating variable. It also tests whether comprehensive income is more persistent than Net Income and whether re-measurement of the defined program is the highest predictive power for future CIs. The dependent variable was Comprehensive Incomet+1, and the independent variables were Net Income and Other Comprehensive Income. Data sources were financial statements 2014-2018 of 367 companies listed in Indonesia Stock Exchange. The empirical evidence were 1).Net income and other comprehensive income can predict future comprehensive income, 2). The CI attribution can improve the ability of NI and OCI in predicting future CI. 3). Net income is more persistent than other comprehensive income, 4). The defined program is the highest predictive power for future CIs.

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“…This supervisory role is particularly pronounced in economies where investor protection is weak, as evidenced by extensive literature. Yan and He (2018) found that the presence of NCLS in Chinese-listed companies would improve the investment efficiency and corporate value of companies. In a study on the ownership structure of listed companies in China, Jiang et al (2017) found that, compared with companies controlled by a single shareholder, multiple large shareholders reduce agency costs.…”

Section: Hypothesis Developmentmentioning

confidence: 99%

Can multiple large shareholders promote corporate social responsibility?

Wang

Haiying

Xue

2020

CMS

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Purpose This study aims to examine the relationship between an ownership structure with multiple large shareholders and corporate social responsibility (CSR) with regard to Chinese-listed companies. Design/methodology/approach Multiple regression analysis was used on 4,940 samples of 884 listed companies in China for the period 2009–2017, to empirically test the influence of an ownership structure on enterprises’ fulfillment of social responsibility. Moreover, the propensity score matching–difference in differences and Heckman two-stage approaches were used for the robustness of the regression results. Findings The results show that ownership structures with multiple large shareholders can promote social responsibility. The check-and-balance ability of non-controlling large shareholders, corporate information transparency and corporate system environment moderate the relationship between multiple large shareholders and CSR engagement. Originality/value This paper complements prior studies on the ownership structure of multiple large shareholders. The findings enrich the literature on corporate governance and CSR. The results also reveal information about the situational factors, helping identify the mechanism through which the ownership structure of multiple large shareholders affects CSR.

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Non‐controlling Large Shareholders and Firm Performance in China

Cited by 12 publications

References 49 publications

Impacts of top management team fault‐line on firm's innovation—Financial slack over‐investment and underinvestment

Impacts of top management team fault‐line on firm's innovation—Financial slack over‐investment and underinvestment

The Effect of Net Income and Other Comprehensive Income on Future’s Comprehensive Income With Attribution of Comprehensive Income as Moderating Variable

Can multiple large shareholders promote corporate social responsibility?

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