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This paper systematically analyzes the relationship between government support and private enterprise innovation. A firm‐level proxy for government support is derived based on Chinese context. Specifically, we explore whether and how government subsidies affect private firms' innovation output. We find that government subsidies can promote private enterprise innovation, and this impact will be further strengthened when firms face high level of financing constraints and when large shareholders pledge their equities. However, this impact will be weakened in regions with high marketization degree and good information environment. Further analysis shows that government support can have a positive impact on corporate innovation by increasing private firms' innovation input and reducing financing costs. Our study sheds new light on the role of government support by investigating the boundary conditions and exploring the impact channel of its effect. Also, this paper fills a gap in the research on the role of government support and the situational research by putting this issue in Chinese context. [ABSTRACT FROM AUTHOR]

This research applies the dynamic slack-based measure (DSBM) model to evaluate the dynamic efficiency of manufacturing companies in the long run and uses the Censored Least Absolute Deviations (CLAD) model to analyze the effect of corporate governance on their overall efficiency and the efficiency of each input factor. We find the following main results. First, overall efficiency of the manufacturing industry listed companies is low. 2) Debt efficiency is lower than the efficiency of shareholders' equity and exhibits a downward trend. 3) Labor efficiency is the lowest among all inputs. 4) The efficiency of the medicine and bio-products industry is the highest, while the efficiency of the paper and printing industry (which causes serious pollution) is the lowest. 5) Companies with low export intensity and high capital intensity are the most efficient, while companies with high export intensity and low capital intensity are the least efficient. 6) Ownership concentration and efficiency have a significantly positive U-shape relationship. 7) Board size and efficiency have a significantly inverted U-shape relationship. 8) An actual controller with a state-owned nature has a significantly negative impact on efficiency. 9) Executive compensation, equity incentive, and institutional ownership have a significantly positive impact on efficiency. [ABSTRACT FROM AUTHOR]

Based on the unbalanced panel data of China's A-share listed companies from 2013 to 2021, this paper empirically examines the influence of controlling shareholders' equity pledge on the listed companies' stock repurchase. It is found that listed companies will stabilize the share price through stock repurchase to prevent the risk of control right transfer due to stock price decline. There is a positive correlation between equity pledge and stock repurchase. Moreover, this positive correlation is more significant among nonstate-owned listed companies and listed companies in the eastern region. Further research shows that the positive influence of equity pledge on stock repurchase is more significant under a good information environment and good corporate governance. However, the earnings management behavior of listed companies has no significant influence on the positive influence of equity pledge on stock repurchase. [ABSTRACT FROM AUTHOR]

Adopting fair value measurement may bring more earnings fluctuations and induce irrational psychology and radical financing behavior of managers and major shareholders. Based on behavioral corporate governance theory, using the sample of A-share nonfinancial listed companies of China during 2015–2017, this paper empirically examines the regulatory effect of fair value measurement; that is, whether fair value measurement affects the company's financing decisions when major shareholders have irrational psychological characteristics, i.e., overconfidence. The study found that overconfident major shareholders increase the probability of equity pledge and increase the proportion of equity pledge; further inspection found that if the level of accrued earnings management is higher, the adjustment effect of fair value measurement is also higher; when the risk of stock price collapse is higher, fair value measurement obviously increases the probability and ratio of overconfident major shareholders' equity pledge. The above conclusions provide empirical evidence that fair value measurement has a positively regulatory effect on financing decisions of major shareholders. [ABSTRACT FROM AUTHOR]

Using a large sample of listed Chinese companies, we investigate how the equity ownership of business group insiders affects subsidiary cash holdings. We find that ownership by the largest shareholders and senior managers in the listed parent firm is negatively related to its subsidiaries’ cash holdings, whereas there is a positive relationship with minority equity in subsidiaries. We also find that the market places a more significant value discount on listed firms whose cash holdings are more located in the affiliated subsidiaries. Our evidence demonstrates how cash policy inside business groups is influenced by insider ownership, and it reveals to what extent cash allocated in subsidiaries may suffer from losses in efficiency. [ABSTRACT FROM PUBLISHER]

Using the data on related-party transactions between Chinese publicly listed firms and their controlling shareholders in 2005, this article empirically examines the characteristics of related-party transactions and their impact on the firms’ performance. The results show that the companies that completed related-party transactions with their large shareholders possess a higher concentration of ownership structure and lower P/E ratios, and their performance is significantly improved after these transactions. The current related-party transaction is also not used to achieve the necessary requirements for refinancing and the tunneling behavior of large shareholders follows a significant declining trend. Further regression analysis shows that the size of related-party transactions is positively correlated with the large shareholders’ equity ratio, and is negatively related to the P/E ratio and the performance of listed companies prior to the transactions. Finally, the research reveals that Chinese listed company performance has a significant positive correlation with the size of related-party transactions and the large shareholders’ equity ratio. Since China launched the split share structure reform (SSSR) in 2005, we have attributed all the above results to the change in the environment caused by the SSSR and concluded that large shareholders prop up a listed company through related-party transactions. [ABSTRACT FROM PUBLISHER]

Purpose – The purpose of this study is to investigate reporting incentives for accounting conservatism in the context of asset and equity tunnelling and to provide empirical evidence that accounting conservatism can be reported for opportunistic reasons rather than efficiency reasons. Design/methodology/approach – A cross-sectional analysis of data from the period 2002 to 2004 is conducted. Findings – This study provides empirical evidence that firms undertaking asset or equity tunnelling transactions report higher conservatism than firms undertaking other kinds of connected transactions. Further tests document a positive association between accounting conservatism and the private benefits gained by controlling shareholders from asset and equity tunnelling. Originality/value – Contrary to the prevalent view that accounting conservatism signifies better quality accounting and benefits financial statement users, this study shows that accounting conservatism is influenced by institutional factors and the incentives of financial statement preparers. Researchers should exercise caution in interpreting higher accounting conservatism as an indication of better accounting information quality, especially in cross-country research involving different institutions. [ABSTRACT FROM AUTHOR]

Several charts and tables are presented which show the performance of various aspects of credit market in China including frequency of lending stock, loan growth and ownership share of public firms.

The main agency problem in the Chinese economy comes from a conflict between strong controlling shareholders and weak minority shareholders. In such economy, seasonal equity offerings (SEOs) are used as a means to exploit minority shareholders. This paper examines the effects of a regulation (the classified voting system [CVS]) that attempts to protect the interests of minority shareholders by excluding controlling shareholders from the voting process of SEOs. This results show that the rejection rate significantly increases after the CVS comes into effect. SEOs proposals are more likely to be rejected when perceived private benefits are high and security benefits are low, and when minority shareholders have higher bargaining power. Further, investors receive significantly higher post-SEO stock returns for SEOs approved under the CVS than for those approved before the CVS. [ABSTRACT FROM AUTHOR]

• We focus on how government roles moderate the impact of economic performance on sustainable operations in manufacturers. • Shareholders' equity and profitability improve sustainable operations, while the impact of R&D input is negative. • State-holding plays a significant positive moderating role, while such role of fiscal subsidy is minor. • Higher state-holding has a stronger moderating role, but fiscal subsidy at different levels does not show this disparity. • We suggest improving the role of government incentive for supporting firms' sustainability strategies. Following 3289 firm-year observations of China's manufacturing firms given their significant impacts on climate change, substantial contributions to industrial prosperity, and distinctive governance mode, we investigate the moderation effect of government involvement in linking firms' economic performance and sustainable operations. We clarify the role of government involvement with elements of government stake (state-holding) and government incentive (fiscal subsidy), together with economic performance indicators divided into shareholder equity, R&D intensity, and profitability. Our empirical findings witness that both shareholder equity and profitability significantly improve sustainable operations, while R&D intensity has a significantly negative effect on sustainable operations. State-holding exercises a significant moderation effect between economic performance and sustainable operations, while the positive moderation effect of fiscal subsidy is minor. Moreover, there is a difference in the roles of high and low state-holding with higher state-holding having a stronger moderation effect, while fiscal subsidy at different levels does not generate such difference. Overall, our findings agree with the positive role of state-holding in linking economic and sustainability outcomes, while further analysis is required to improve the role of government incentive for supporting manufacturers' sustainability strategies. [ABSTRACT FROM AUTHOR]

Yang, K.Z.; Li, M.Y., and Suo, L.L., 2020. The impact of controlling shareholders' share pledge on enterprise's innovation investment—Evidence from listed firms in coastal region of China. In: Qiu, Y.; Zhu, H., and Fang, X. (eds.), Current Advancements in Marine and Coastal Research for Technological and Sociological Applications. Journal of Coastal Research, Special Issue No. 107, pp. 408-412. Coconut Creek (Florida), ISSN 0749-0208. Utilizing the data of A-share listed companies in Chinese coastal areas from 2008 to 2017, this paper empirically analyses the relationship between the pledge of controlling shareholders' equity and the enterprise innovation. The results show that: (1) Controlling shareholders' share pledge will restrain innovation investment, but this negative impact will only play a role when the share pledge rate is high; (2) After subdividing the nature of property rights, it is found that the restraint of controlling shareholders' share pledge on enterprise innovation is more significant in coastal non-state-owned enterprises than in state-owned enterprises. [ABSTRACT FROM AUTHOR]