Relational dimensions of corporate governance in translation: networked governance in China and India

The effectiveness of corporate governance mechanisms has been a subject of academic research for many decades. Although the large majority of corporate governance studies prior to mid 1990s were based on data from developed market economies such as the U.S., U.K. and Japan, in recent years researchers have begun examining corporate governance in transition economies. A comparison of China and India offers a unique environment for analyzing the effectiveness of corporate governance. First, both countries state-owned enterprise (SOE) reform strategies hinges on the Modern Enterprise System characterized by the separation of ownership and control. Ownership of an SOE’s assets is distributed among the government, institutional investors, managers, employees, and private investors. Effective control rights are assigned to management, which generally has a very small, or even nonexistent ownership stake. This distinctive shareholding structure creates conflict of interest not only between management (insiders) and outside investors but also between large shareholders and minority investors. Moreover, because both governments desire to retain some control—in part through partial retained ownership of commercialized SOEs, further conflicts arise between politicians and firms. Second, directors in publicly listed firms in both countries are predominantly drawn from institutions with significant non-market objectives: the government and other state enterprises, particularly in China, and extended families, particularly in India. As a result, the effectiveness of internal governance mechanisms, such as the number of independent directors on the board and the number of independent supervisors on the supervisory committee, are likely to be quiet limited, although this has yet to be fully evaluated. Third, because of the political nature of the privatization process itself, typical external governance mechanisms, such as debt (in conjunction with appropriate bankruptcy procedures), takeover threats, legal protection of investors, product market competition, etc., have not been effective. Bank loans have traditionally been viewed as grants from the state designed to bail out failing firms. State-owned banks retain monopoly or quasi-monopoly positions in the banking sector and profit is not their overriding objective. If political favor is deemed appropriate, subsidized loans, rescheduling of overdue debt or even outright transfer of funds can be arranged with SOEs (soft budget constraints). In addition, a market for private, non-bank debt is limited in India and has yet to be established China. There is no active merger or takeover activity in Chinese stock markets to discipline management. Information available in the capital markets is insufficient to keep at arm’s length of the corporate decisions. In light of the above peculiarities, China and India share many of the typical institutional characteristics as a transition economy, including poor legal protection of creditors and investors, the absence of an effective takeover market, an underdeveloped capital market, a relative inefficient banking system and significant interference of politicians in firm management. Su (2005) finds that the extent of political interference, managerial entrenchment and institutional control can help explain corporate dividend policies and post-IPO financing choices in this situation. Allen et al. (2005) demonstrate that standard corporate governance mechanisms are weak and ineffective for publicly listed firms while alternative governance mechanisms based on reputation and relationship have been remarkably effective in the private sector. Because the peculiarities are significant in this context, the differences in the political-economies of the two countries are likely to be evident in such relational terms. In this paper we explore the peculiarities of corporate governance in this transitional environment through a systematic examination of certain aspects of these reputational and relationship dimensions. Utilising the methods of social network analysis we identify the inter-organisational relationships at board level formed by equity holdings and by shared directors. Using data drawn from the Orbis database we map these relations among the 3700 largest firms in India and China respectively and identify the roles played in these relational networks by the particularly characteristic institutions in each case. We find greatly different social network structures in each case with some support in these relational dimensions for their distinctive features of governance. Further, the social network metrics allow us to considerably refine proxies for political interference, managerial entrenchment and institutional control used in earlier econometric analysis.

Association of fever and severe clinical course in bronchiolitis

Little attention has been given to the relation between fever and the severity of bronchiolitis. Therefore, the relation between fever and the clinical course of 90 infants (59 boys, 31 girls) hospitalised during one season with bronchiolitis was studied prospectively. Fever (defined as a single recording > 38.0°C or two successive recording > 37.8°C) was present in 28 infants. These infants were older (mean age, 5.3 v 4.0 months), had a longer mean hospital stay (4.2 v2.7 days), and a more severe clinical course (71.0%v 29.0%) than those infants without fever. Radiological abnormalities (collapse/consolidation) were found in 60.7% of the febrile group compared with 14.8% of the afebrile infants. These results suggest that monitoring of body temperature is important in bronchiolitis and that fever is likely to be associated with a more severe clinical course and radiological abnormalities.

Legal method and legal reflection: experiential learning in the law school

The two main themes of the conference centre around teaching experiences in legal education and theme and international and European perspectives in legal education.

Systematic review of worldwide variations of the prevalence of wheezing symptoms in children

Background: Considerable variation in the prevalence of childhood asthma and its symptoms (wheezing) has been observed in previous studies and there is evidence that the prevalence has been increasing over time. Methods: We have systematically reviewed the reported prevalence and time trends of wheezing symptoms among children, worldwide and within the same country over time. All studies comprising more than 1000 persons and meeting certain other quality criteria published over a 16-year period, between January 1990 and December 2005, are reported and a comparison of ISAAC (International Study of Asthma and Allergies in Childhood) and non-ISAAC studies is made, in part as a way of expanding the power to examine time trends (the older studies tend to be non-ISAAC), but also to examine possible methodological differences between ISAAC and non-ISAAC questions. Results: A wide range of current prevalence of wheeze was observed between and within countries over time. The UK had the highest recorded prevalence of 32.2% in children aged 13–14 in 1994–5 and Ethiopia had the lowest prevalence, 1.7% in children aged 10–19 in 1996. All studies in Australia and the UK were compared using multiple logistic regression. ISAAC phase I and III studies reported significantly higher prevalence of current wheeze (OR = 1.638) compared with non-ISAAC studies, after adjusting for various other factors (country, survey year, age of child, parental vs child response to the survey). Australia showed a significantly higher prevalence of current wheezing (OR = 1.343) compared with the UK, there was a significant increase in the prevalence odds ratio per survey year (2.5% per year), a significant decrease per age of child (0.7% per year), and a significantly higher response in current wheezing if the response was self-completed by the child (OR = 1.290). These factors, when explored separately for ISAAC and non-ISAAC studies, showed very different results. In ISAAC studies, or non-ISAAC studies using ISAAC questions, there was a significant decrease in current wheezing prevalence over time (2.5% per year). In non-ISAAC studies, which tend to cover an earlier period, there was a significant increase (2.6% per year) in current wheezing prevalence over time. This is very likely to be a result of prevalence of wheezing increasing from the 1970s up to the early 1990s, but decreasing since then. Conclusion: The UK has the highest recorded prevalence of wheezing and Ethiopia the lowest. Prevalence of wheezing in Australia and the UK has increased from the 1970s up to the early 1990s, but decreased since then and ISAAC studies report significantly higher prevalences than non-ISAAC studies.

Adult personality inconsistency and problems with parents: uncovering the roots of the false self

Research has established that individuals who tend to vary their personality depending on who they are with, show a variety of signs of psychological maladjustment in comparison to those who do not; they show more negative affect (Baird, Le and Lucas, 2006), lower life satisfaction (Suh, 2002), lower self-esteem (Sheldon et al., 1997), lower role-satisfaction (Donahue et al., 1993), higher rates of depression (Lutz and Ross, 2003), more anxiety (Diehl, Hastings and Stanton, 2001) and poorer physical health (Cross, Gore and Morris, 2003). It has also been shown that personality variability is positively related to the experience of inauthenticity and falsity (Sheldon et al., 1997). Donahue, Roberts, Robins and John (1993) found that personality inconsistency of this type is related to tension within the family. Psychoanalytic theory has also linked the operation of an adult false self to experiences with parents, particularly in early life (Winnicott, 1960). It was hypothesized that personality variability and the adult experience of falsity in social situations would be related to an emotionally unstable relationship with parents. The method to test this comprised a questionnaire-based survey given to a non-clinical population. The final sample comprised 305, with 193 women and 112 men, aged from 19 to 55. The first questionnaire asked participants to rate personality traits, including emotional stability, in three social contexts - with parents, with friends and with work colleagues. The second part involved 3 questions; participants were asked to select in which of the aforementioned three social contexts they felt “most themselves”; in which they were “most authentic” and in which they “put on a front”. It was found, consistent with predictions, that an index of overall personality variability calculated from the personality questionnaire correlated strongly with emotional instability around parents (r = 0.46, p<0.001), while not correlating with emotional instability in either of the other two contexts measured. This suggests a specific link between a person’s relationship with their parents and their overall personality integration. Furthermore, it was found that participants who cited one of the three social contexts (parents, friends, work colleagues) as being one in which they were “more themselves” or “more authentic” had significantly higher ratings of emotional instability with parents than those participants who found that they were equally authentic across settings (F = 9.8, p<0.005). The results suggest a clear link between a person’s relationships with their parents and their adult personality integration. An explanation is that individuals who experience an anxious or ambiguous attachment with their parents in childhood may fear rejection or abandonment in later life, and so habitually adapt their personality to fit in to social contexts as adults, in order to be accepted by others and to minimize the possibility of social rejection. These individuals meanwhile retain an emotionally unstable relationship with their parents in adulthood. This interpretation is speculative but is open to empirical testing. Clinicians should be aware that attachment problems with parents may underlie poor personality integration in adulthood.

Early growth and adult respiratory function in men and women followed from the fetal period to adulthood

While some studies suggest that poor fetal growth rate, as indicated by lower birth weight, is associated with poor respiratory function in childhood, findings among adults remain inconsistent. A study was undertaken to determine the association between early growth and adult respiratory function.