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The impacts of independent director and CEO duality on performance in the Chinese post‐institutional‐transition era
Author(s) -
Lew Yong Kyu,
Yu Jing,
Park JeongYang
Publication year - 2018
Publication title -
canadian journal of administrative sciences / revue canadienne des sciences de l'administration
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.347
H-Index - 48
eISSN - 1936-4490
pISSN - 0825-0383
DOI - 10.1002/cjas.1468
Subject(s) - corporate governance , resource dependence theory , china , principal–agent problem , agency (philosophy) , business , accounting , agency cost , transition (genetics) , stock exchange , emerging markets , resource (disambiguation) , initial public offering , transition economy , management , economics , political science , market economy , finance , sociology , shareholder , law , computer network , social science , biochemistry , chemistry , gene , computer science
This paper investigates the influence of corporate governance on the performance of modern Chinese firms. Prior studies were inconclusive about the relationship between corporate governance and firm performance. Little research investigates the performance implications of board structure in the post‐institutional‐transition era in China. Based on agency and resource dependence theories, this paper examines the impacts of board composition and leadership structure on the performance of Chinese manufacturing firms that went public on the Shanghai and Shenzhen Stock Exchanges in 2010. The findings show that separating the posts of CEO and chair promotes better performance. However, appointing a larger proportion of outside independent directors to the board insignificantly affects performance. This research provides partial support for agency theory and extended insights into corporate governance in emerging economy firms. Copyright © 2017 ASAC. Published by John Wiley & Sons, Ltd.