DownloadIt-股权结构、现金流与资本投资

1、Law, Corporate Governance, and Corporate Scandal in ChinaYi ZhangPeking UniversityInternational Conference on Corporate Governance Shanghai March 2005I.IntroductionIthasbeenover tenyearssincestockmarkets established in China.Chinastocksmarket hasbeen playingarole .thereexistsomany listedfirmscommitt

2、edfraud andscandalSince1992,about200listed firms among 1200havebeen subjecttosecurityenforcementaction by China SecuritiesRegulationCommission (CSRC),ShenzhenStockExchange(SZSE)and Shanghai Stock Exchange (SSE).Theratiooffirmswithscandal is farabovethelevelofothercountriesMotivationWhat contributes

3、to firmsscandal?Does corporategovernance matterinChina?Istherea sound corporategovernance mechanismcouldprevent scandal?Does legal andeconomicdevelopmentmatter?- Is there adifferencebetween firms in regionswithvarious legal effectiveness?- economic development?II.Issues andHypothesis:-Corporate gove

4、rnance-legal-economic-finance1.CorporateGovernance1.1.ownershipOneofthe mostessential featureofthe ownershipofChinese listedfirmsisthedominance of thelargest shareholderTherehasnoeffective mechanismtomonitor andrestrictthelargeshareholdersThelargeshareholdercan expropriate theminorityshareholdersfor

5、 privatebenefit1.CorporateGovernance1.1.ownershipJensen(1976)Stulz(1988)H1A:Astheownership of thelargest shareholder increasesfrom zero, afirmismore likelytobeassociated withscandalEntrenchmentoflargeshareholdersExpropriation by large shareholderLaPorta, Lopez-De-Silanes,Shleifer(1999)LaPorta, Lopez

6、-De-Silanes,Shleifer(2002)Claessens,Djankov, Fan,and Lang(2002)Fanand Wong(2002)H1B:Astheownership of thelargest shareholder increasesover certainlevel, afirmismore likelytobeassociated withscandal1.2Firm ControllerThereisfundamentaldifference betweenstateand non-stateshareholdersThereishuge differe

7、nceamongstateshareholders in internal monitoring, etc.-centralgovernment (bu/wei,中央部部委）和和-non-centralgovernment(非部委委）LiandZhang（2005）LiandZhang（2004）Linand Zhang（2004）1.2Firm Controller-centralgovernment (bu/wei,中央部部委）和和-non-centralgovernment(非部委委）central governmentcontrolledlocalgovernment controll

8、edlocalStateEnterprises(SOE)controlledNon-statelegalperson controlledNatural personothers1.2Firm ControllerCentral governmentcontrolledfirmsareassociatedwith clearerownership,( alittle)more transparency,moremonitoringmore socialresponsibility，(maybe) betterprotection of minority shareholdersNon-cent

9、ralSOEand non-statelegalpersoncontrolledfirmsareassociatedwith lesstransparency andlack of monitoringuptoless socialresponsibilitylack of protectionofminorityshareholdersH2: Firms controlledbycentral(/local) governmentarelesslikelytobeassociatedwith scandal1.CorporateGovernance1.3BoardFamaandJensen

10、(1983)theorizethat theboardofdirectorsisthe highestinternalcontrolmechanismresponsiblefor monitoringthe actionsoftop management.-the composition of individuals whoserveontheboardofdirectors is an importantfactorincreatingaboardthat is an effectivemonitor of managementactionsFamas(1980)andFamaandJens

11、ens(1983) theorywouldpredict thathigher percentages of independent directorsincreasetheboardseffectiveness as amonitorofmanagement.Jensen(1993) arguesthat boardsofdirectorareineffectivemonitorswhentheboardistoo large,when theboards equityownershipissmall, andwhen theCEOisalsotheChairmanofthe Bpositi

12、onoftheboardofdirectors determinesits effectivenessDeFondandJiambalvo(1991)Beasley (1996)Dechow, Sloan andSweeney (1996),etc.BoardcompositionanddisclosureChen andJaggi（2000）TheboardsizeH3A:Firm withalargerboardsizeismore likelytobeassociated withscandalTheboard-managementrelationshipTheCEO/ChairmanH

13、3B:Firm withaseparateCEOand Chairman is lesslikely to be associatedwithscandalIndependentdirectorsIndependentdirectors, compared withinside directors,are lesslikely to colludewithmanagementH3C:Firmswith lower proportion(seats)ofindependentdirectorontheboardofdirectors aremore likelytobeassociated wi

14、thscandalDirectorholdingsH3D:Firmswith ahigher ratio(number)ofdirectors holdfirmstockarelesslikelytobeassociatedwith scandalChairmanHoldingH3E:Firmswith higherChairmanstockholding areless likelytobeassociated withscandalDirectorCompensationH3F:Firm withhigher ratio(number)ofdirectorpaidarelesslikely

15、tobeassociatedwith scandal1.4SupervisoryCommittee (BoardofSupervisors-监事会)SupervisoryCommitteesizeH4A:Firmswith alargerSupervisoryCommitteesizeismore(less?)likelytobeassociatedwith scandal1.4SupervisoryCommittee (BoardofSupervisors-监事会)SupervisoryCommitteememberholdingsH4B:Firmswith ahigher ratio(nu

16、mber)ofsupervisorsholdfirm stock is lesslikely to be associatedwithscandalSupervisoryCommitteememberCompensationH4C:Firm withhigher ratio (number) ofSupervisoryCommitteememberpaidisless (ormore?)likely to be associatedwithscandal4Institutioninvestors机构投资资者能够够降低公公司内部部的代理理成本，减少公公司管理理层的不不良行为为Jarrell an

17、dPoulsen(1987)Brickley, Lease,andSmith(1988)机构投资资者更倾倾向于反反对减少少股东财财富的行行为机构投资资者相比比其他类类型的投投资者而而言更需需要透明明度和信信息的披披露Healyetal.(1999)Bushee和Noe(2000)机构投资资者更偏偏好购买买那些持持续披露露信息的的公司的的股票长期持有有公司股股票的机机构投资资者，很很可能出出于自身身的利益益而合谋谋进行不不法行为为机构投资资者可以以从中得得到的益益处财务性的的收益，如低于于市价的的转让价价格，阻阻止封闭闭式基金金的赎回回以及承承销、财财务顾问问方面的的合同（Barclay,Hol

18、derness,和Pontiff (1993)）非财务性性的收益益，如影影响公司司在政治治、经济济或社会会方面的的政策就我国的的实际情情况而言言，基金金、证券券等机构构重仓持持有上市市公司的的股票，利用内内部信息息进行炒炒作、牟牟取暴利利已不是是秘密因此，在在我国机机构投资资者的持持股比例例同公司司违规行行为是正正相关还还是负相相关或不不相关需需要实证证检验。H4：Institutionholdingsare relatedtothe likelihoodfor firmtocommit scandalFinancialdistressFirmsconfrontingwith financia

19、ldistressaremorelikelytocommit financialstatementfraudNeed controlfor financials3.EconomicdevelopmentFirmsinmore economydeveloped regionarelesslikelytobeassociatedwith scandal4.LawWritten lawLLSV (1998)Allen,Qian,Qian(JFE,forthcoming)Effectiveness of lawismore importantthan thewritten lawina transit

20、ioneconomyBerkowitzetal(2003)Alford(2000)LuandYao(2004)Chinas provincessignificantly differsintermsoflegaldevelopment.Whether laweffectiveness in theregionaffectsfirmsdecisiontocommit fraud?Maybelawdoesnotmatter since lawisnoteffective overall in China?四、实证研究究方法（i）变量SCANDAL，公司是否否被监管管机构认认定为违违规并公公开批评评

21、,谴责责或处罚罚控制变量量DEBT：公司的资资产负债债率ROA：公司的资资产收益益率LIQUIDITY：公司的流流动比率率2实证回回归模型型Matchingscandal firms withnon-scandalfirmsLogisticregressionExamine firmspropensity to commitscandalSCANDAL=f(0+1GOVERN+2INSTITUTE+3BOARD+4FSIZE+5DEBT+6ROA+7LIQUIDITY+（Other Controls）)（1）五、样本与数数据（一）数数据Inordertoidentifyfirmsthat co

22、mmitscandal,werefertotheChinaSecurities Journal, Shanghai SecuritiesJournalandtheGuotaianDataset forfinancialscandals.Thetotalnumber of firms subjecttoenforcementactionsbytheCEC,SSE, andSZSE between1993and2003is178.Weeliminate12firmswhosegovernanceinformationinandbefore thefraudperiodare notavailabl

23、e, 2firmslisted on B-StockMarket of China,and4firmsthat cannotbematched by industry code, andthen thesamplesizeisreduced to 160虚构利润润虚列资产产虚假陈述述重大遗漏漏擅自改变变资金用用途大股东占占用资产产违规担保保五、样本与数数据Each of thescandalfirmismatched withano-scandal firm, creating achoice-based sampleof160scandaland160 no-scandalfirms.The

24、controlfirm is obtained by thefollowingfour-step process:(i)StockExchange(ii)Industry. 3-digitindustrialcode.Iftheres no firmmatchingthe three digits,thenselectthatofthesameprimary twodigits(iii)Firm Size.53of160committedscandalina periodlasting 2ormoreaccounting years,andwedefine thefraudperiodofth

25、esefirmsasthe first dateoftheirfinancial statementfraudWhen firms committedscandal andwasdenounced/criticized/punishedmorethan once, we onlyrecord thefirsttimeSampledescriptionlogistic回归分析析Governance andfinancialsAddmarketizationindexProxyforeconomics developmentProxyforlegaldevelopmentProxyforfinan

26、cial developmentCorporateGovernanceOwnershipLARGEST回归系数数为负,在5%水平上显显著,LARGESTSQ的回归系系数为正正，在10%水平上显显著第一大股股东持股股比例从从零开始始增大, 公司司越不会会commitscandal;当第一大大股东持持股比例例达到一一定水平平,持股股比例越越高,公公司越可可能commitscandal;LOCAL和LEGALP的回归系系数为正正，LOCAL在5%水平上显显著，LEGALP在0.1%水平上显显著非国有法法人和地地方政府府控制的的公司更更有可能能违规董事会BOARDSIZE, INDEPENDENT均不

27、显著著董事会规规模和独独立董事事席位（比例）CHAIRCEO不显著CEO是否兼任任董事持股董事事人数（比例）和付报报酬董事事人数（比例）均不显显著CHAIRHOLDING为负，在在10水平上上显著董事长持持股比例例越高，公司越越不会commitscandal监事会监事会规规模不显显著持股监事事人数（比例）不显著著付报酬监监事比例例显著为为正(10%水水平)取得报酬酬的监事事比例越越高，公公司越可可能commitscandal机构投资资者机构投资资者持股股比例不不显著分拆上市市或整体体上市分拆上市市或整体体上市没没有显著著影响Controls流动比率率的回归归系数显显著为负负流动比率率越高的的公

28、司，financialdistress的可能较较小,违违规可能能较小DEBT的回归系系数为正正，但统统计上不不显著ROA的回归系系数显著著为负资产收益益率较高高的公司司违规可可能较小小RegiondevelopmentNortheast显著为正正,公司发生生丑闻的的可能性性较高midyangtz显著为正正,公司发生生丑闻的的可能性性较高Economicdevelopmentlgdppc，该省人均均GDP对数值为为负，并并在统计计上显著著经济越发发达，公公司发生生丑闻的的可能性性越小LegaldevelopmentMeasure of legal effectiveness检察院(procura

29、torialsystem)ProcuratorialCases_per_capita:立案经济济案件ProcuratorialCases_gdpLoss_to_GDP:The ratio of saved lossbyprocuratorialsuitstolocalGDPCadre_In_procurate:This measures thecorruptnessofofficials. Thenumberofcadres at countylevelorabove(县处级以上)involvedinprocuratatedivided by thepopulationLegaldevelopment法院(courtsystem)Case_Close_RateRCMP:Thenumber of commercialcasesreceivedbythe court permillion of population律师协会会 (lawyerassociation)Lawyer_per_capitaLawyer_GDP