The impact of related party transactions on the operational performance of listed companies in China

Chen, Yenpao; Chen, Chien‐Hsun; Chen, Wei‐Ju

doi:10.1080/17487870903314575

Cited by 65 publications

(63 citation statements)

References 14 publications

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“…: prosentase pemegang saham tertinggi pertama Pengukuran transaksi pihak berelasi dari penelitian ini menggunakan proxy sales transaction (RPT_Sales) yang meliputi penjualan barang dan penyediaan jasa kepada pemegang saham terbesar dan entitas yang dikendalikannya. Berdasarkan penelitian terdahulu (Wong et al, 2015;Cheng & Leung, 2014;Chen et al, 2014). Diantara banyak transaksi pihak berelasi transaksi penjualan barang dan jasa adalah transaksi yang paling umum dilakukan oleh perusahaan.…”

Section: Metode Penelitianunclassified

Konsentrasi Kepemilikan, Transaksi Pihak Berelasi, dan Kinerja Perusahaan

Pangesti

Hidayat

2019

E-Jurnal Akuntansi

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Agency theory describe that ownership concentration is a good corporate governance system that helps to reduce agency problems arising from the divergence of interest between shareholders and managers. But, when ownership concentration becomes high, lead to another agency problem that is conflict between controlling shareholders and minority shareholders. This study purposed to examine the relation of ownership concentration and related party transactions on firm performance. This research uses quantitative descriptive method with associative approach. Sample used in this study was 474 manufacturing companies listed on the Indonesia Stock Exchange in 2014-2018. We used multiple linear regression as analysis technique. Results showed that ownership concentration had a positive effect on firm performance and related party transactions had a positive effect on firm performance. Keywords : Ownership Concentration; Related Party Transactions; Firm Performance.

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Section: Metode Penelitianunclassified

Konsentrasi Kepemilikan, Transaksi Pihak Berelasi, dan Kinerja Perusahaan

Pangesti

Hidayat

2019

E-Jurnal Akuntansi

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“…Exploring the relationship between the extent of related party transactions and operational performance, Chen, Chen and Chen (2009) showed that when the listed company is controlled by a related party, the higher the level of related party transactions the worse the operational performance of the listed company. Guo and Ma (2009) provided evidence of tunneling via related lending in listed firms in China.…”

Section: Related Party Transactions In Business Groupsmentioning

confidence: 99%

Ownership structures and effects of related lending and loan guarantees on firm performance in business groups

Maheshwari¹,

Gupta²

2018

AJAG

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This study identifies a sample of listed Indian business group firms, which exhibit an increasing trend in leverage, related lending and loan guarantees. Business groups in India, primarily adopt pyramidal structure in which decision making is done through control rights approach. The paper examines the ownership structures in business groups and studies the effects of related lending and loan guarantees on firm performance in such business groups through a panel data regression with fixed effects. The regression results suggest that lending and loan guarantees to related parties affect the operating performance of group firms positively. The relationship has been found to be significant for most of the categories of business groups studied for the two measures of firm performance, namely gross profit to asset ratio and return on assets. However, their effect on market value is found to be negative, leading to an inference that such deals are taken adversely by the market.

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“…Some scholars characterize business groups as "paragons" that help firms to overcome market failures, especially in difficult economic and institutional conditions (Khanna & Yafeh 2007). It has been argued that intra-group transactions between the group and subsidiaries, associates and joint ventures would help in reducing transaction costs and overcoming difficulties in enforcing property rights and contracts essential for production (Chen, Chen & Chen 2009;Cheung et al 2009;Khanna & Palepu 2000;Kim 2004). RPTs among member firms also involve less information asymmetry than similar transactions with unrelated party (Kohlbeck & Mayhew 2010).…”

Section: However Empirical Evidence Supporting Beneficialmentioning

confidence: 99%

The Moderating Effects of Independent Directors’ Human Capital on the Relationship between Related Party Transactions and Firm Performance: Evidence from Malaysia

Nor¹,

Ismail²

2017

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The purpose of this study is to examine the effect of related party transactions (RPTs) on firm performance and whether this effect is moderated by independent directors' (INEDs) presence and their human capital (i.e. functional and firmspecific knowledge). Based on a sample of 300 non-financial firms listed on Bursa Malaysia for 2013, this study found that RPTs in general, have a positive effect on firm performance and this effect varies according to the parties involved in RPTs. Specifically, this study found that firm performance is higher for RPTs involving subsidiaries, associates and joint ventures. The findings support the efficient transactions hypothesis that RPTs can create value to the firm. INEDs' presence and INEDs' functional and firm-specific knowledge are found not to have any moderating effects on the RPTsfirm performance relationship. Therefore, the agency, resource dependence and human capital theories that stress on the importance of INEDs as corporate monitor and advisor are not supported. This study, perhaps the first, explains the interaction effects of INEDs' functional and firm-specific knowledge on RPTs-firm performance relationship.

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The impact of related party transactions on the operational performance of listed companies in China

Cited by 65 publications

References 14 publications

Konsentrasi Kepemilikan, Transaksi Pihak Berelasi, dan Kinerja Perusahaan

Konsentrasi Kepemilikan, Transaksi Pihak Berelasi, dan Kinerja Perusahaan

Ownership structures and effects of related lending and loan guarantees on firm performance in business groups

The Moderating Effects of Independent Directors’ Human Capital on the Relationship between Related Party Transactions and Firm Performance: Evidence from Malaysia

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