An evaluation of corporate governance evaluation, governance index (CGI
NK
) and performance: Evidence from Chinese listed companies in 2003 |
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Authors: | Wei’an Li Yuejun Tang |
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Institution: | (1) Research Center for Corporate Governance, Nankai University, Tianjin, 300071, China;(2) Department of Business Administration, School of Management, Fudan University, Shanghai, 200433, China |
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Abstract: | In the present paper, based on samples of 2003, empirical analyses of Corporate Governance Index (CGI
NK
) and its six dimensions of listed companies in China, the index of controlling shareholders’ behaviors, board governance
index, top management governance index, information disclosure index, stakeholders’ governance index, and supervisors committee
governance index, are carried out and the results show that CGI
NK
is positively associated with the return on assets (ROA), net assets per share (NAPS), earnings per share (EPS), operating
cash flow per share (OCFPS), total assets turnover (TAV), rate of total assets growth (ITA) and Z-score. These indicate that
good corporate governance mechanisms improve profitability, stock expansion ability, operating efficiency, growth and development
potential, as well as financial flexibility and safety of listed companies. Corporate governance mechanisms of controlling
shareholders, board of directors, top management, information disclosure, stakeholders and supervisors committee are largely
responsible for decision-making and decision-execution mechanisms, and furthermore, they have direct and profound effects
on the performance and value of listed companies.
Translated from Zhongguo Gongye Jingji 中国工业经济 (China Industrial Economy), 2006, (4): 98–107 |
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Keywords: | evaluation of corporate governance Corporate Governance Index (CGI NK ) corporate governance mechanisms corporate performance |
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