Does control-ownership divergence impair market liquidity in an emerging market? Evidence from China

This paper examines how institutional characteristics of emerging economies influence the effect of control-ownership divergence on market liquidity. We find that the divergence is negatively associated with liquidity and that this negative relationship is more pronounced in firms with more severe agency problems and information asymmetry. We argue that in an emerging market, the negative effect of the divergence on liquidity is worsened by state ownership and poorer shareholder protection, both of which result in more severe agency conflicts; we also find, however, that this effect is alleviated by the NTS reform, which aligns the interest of different shareholders.

Disproportional ownership structure and pay–performance relationship: evidence from China’s listed firms

This paper examines the impact of ownership structure on executive compensation in China's listed firms. We find that the cash flow rights of ultimate controlling shareholders have a positive effect on the pay–performance relationship, while a divergence between control rights and cash flow rights has a significantly negative effect on the pay–performance relationship. We divide our sample based on ultimate controlling shareholders' type into state owned enterprises (SOE), state assets management bureaus (SAMB), and privately controlled firms. We find that in SOE controlled firms cash flow rights have a significant impact on accounting based pay–performance relationship. In privately controlled firms, cash flow rights affect the market based pay–performance relationship. In SAMB controlled firms, CEO pay bears no relationship with either accounting or market based performance. The evidence suggests that CEO pay is inefficient in firms where the state is the controlling shareholder because it is insensitive to market based performance but consistent with the efforts of controlling shareholders to maximize their private benefit.

Managerial ownership, capital structure and firm value: Evidence from China’s civilian-run firms

This paper examines the influence of managerial ownership on firm performance through capital-structure choices, using a sample of China’s civilian-run firms listed on the Chinese stock market between 2002 and 2007. The empirical results demonstrate a nonlinear relationship between managerial ownership and firm value. Managerial ownership drives the capital structure into a nonlinear shape, but in an opposite direction to the effect of managerial ownership on firm value. The results of simultaneous regressions suggest that managerial ownership affects capital structure, which in turn affects firm value. Our findings imply that the “interest convergence” and “entrenchment” effects of managers’ behaviour in terms of managerial ownership can also explain the agency-relevant situation of China’s civilian-run firms.

The effect of ownership structure on leverage decision: new evidence from Chinese listed firms

This paper examines the effect of state control and ownership structure on the leverage decision of firms listed in the Chinese stock market. Our results show that state-owned enterprises (SOEs) have higher leverage ratios than non-SOEs, and SOEs in regions with a poorer institutional environment have higher leverage ratios than SOEs in better regions. We also show that the largest shareholding (the percentage of shares held by the largest shareholder) in the SOEs has a negative relationship with the leverage ratio, while the largest shareholding in non-SOEs has a non-linear relationship with the short-term and long-term debt ratios. Finally, this study also shows that the share split reform and the improvement of institutional environment both weaken the negative relationship and strengthen the positive relationship between largest shareholding and leverage of SOEs and non-SOEs to some extent. This paper documents how the financing behaviour of SOEs is more influenced by government intervention, while the financing behaviour of non-SOEs is more market oriented.

The ownership and ownership concentration? The impact on the performance of China’s firms

This paper investigates the impact if ownership and ownership concentration on the performance of China's listed firms. By recognizing the differences between ownership and ownership concentration, and between total ownership concentration and tradable ownership concentration, we find that ownership concentration is more powerful than any category of ownership in determining firm performance and that it has approximately positive linear relations with firm value. The tradable ownership concentration has a more significant and positive influence on firm performance than total ownership cocncentration. The highest level of firm performance is approached when a firm is characterized with both total ownership concentration and tradable ownership concentration. Thus, we conclude that it is a rule that ownership concentration enhances firm performance regardless of who the concentrated owners are.

Ownership and ownership concentration: which is important in determining the performance of China’s listed firms?

This article investigates the impact if ownership and ownership concentration on the performance of China's listed firms. By recognizing the differences between ownership and ownership concentration, and between total ownership concentration and tradable ownership concentration, we find that ownership concentration is more powerful than any category of ownership in determining firm performance and that it has approximately positive linear relations with firm value. The tradable ownership concentration has a more significant and positive influence on firm performance than total ownership cocncentration. The highest level of firm performance is approached when a firm is characterized with both total ownership concentration and tradable ownership concentration. Thus, we conclude that it is a rule that ownership concentration enhances firm performance regardless of who the concentrated owners are.

Managerial ownership, capital structure and firm value

This paper extends prior research to examine the managerial ownership influences on firm performance through the choices of capital structures by using a new sample of S& P 500 firm in 2005. The empirical results of OLS regressions replicate the nonlinear relationship between managerial ownership and firm value. However, we found that the turning points had moved up in our sample compared with previous papers, which implies that the managerial control for pursuing self-interst, and the alignment of interests between managers and other shareholders can only be achieved now by management holding more ownership in a firm than that found in previous studies. Managerial ownership also drives the capital structure as a nonlinear shape, but with a direction opposite to the shape of firm value. the results of simultaneous regressions suggest that managerial ownership affects capital structure, which in turn affects firm value. Capital structure is endogenously determined by bith firm value and managerial ownership; while managerial ownership is not endogenously determined by the other two variables.

Does ownership affect a firm’s performance and default risk in Jordan?

This paper seeks to examine the impact of ownership structure on firm performance and the default risk of a sample of publicly listed firms.

Trust in management: the role of employee voice arrangements and perceived managerial opposition to unions

This study examines the relationship between employee voice arrangements and employees’ trust in management using data from the 2007 Australian Worker Representation and Participation Survey of 1,022 employees. Drawing on social exchange theory and employee relations literature, we test hypotheses concerning the relationships between direct and union voice arrangements, perceived managerial opposition to unions and employees’ trust in management. Consistent with our predictions, after controlling for a range of personal, job and workplace characteristics, regression analyses indicated that direct voice arrangements were positively related to employees’ trust in management. Union voice arrangements and perceived managerial opposition to unions were negatively related to trust in management. The article concludes by highlighting the study’s implications for management practice and avenues for further research.

Employee voice and job satisfaction in Australia: the centrality of direct voice

This study examines the relationship between employee voice and job satisfaction using data from the 2007 Australian Workplace Representation Survey (AWRPS) of 1,022 employees. Drawing on human resource management and industrial relations literature, we test hypotheses concerning the relationship between direct and union voice arrangements and job satisfaction. This relationship represents a gap in the literature, which is important from both theoretical and practical perspectives. Controlling for a range of personal, job, and workplace characteristics, regression analyses suggest that although evidence of voice complementarity exists, direct voice appears to be the central voice arrangement underpinning employees’ job satisfaction. The article concludes by highlighting the study’s implications for management practice and identifi es avenues for further research.

Industrial relations climate, employee voice and managerial attitudes to unions: an Australian study

This article examines how employee voice arrangements and managerial attitudes to unions shape employees’ perceptions of the industrial relations climate, using data from the 2007 Australian Worker Representation and Participation Survey (AWRPS) of 1,022 employees. Controlling for a range of personal, job and workplace characteristics, regression analyses demonstrate that employees’ perceptions of the industrial relations climate are more likely to be favourable if they have access to direct-only voice arrangements. Where management is perceived by employees to oppose unions (in unionized workplaces), the industrial relations climate is more likely to be reported as poor. These findings have theoretical implications, and significant practical implications for employers, employees, unions and the government.

The contours of employee voice in SMEs: the importance of context

This article develops a context-sensitive approach to analyse how and why voice operates in small- to medium-sized enterprises (SMEs), an area that remains under-theorised and under-researched. By building on a priori frameworks with proven ability to unpack complexity and take account of the wider context of SMEs, this article explores how resources (human and social capital) and constraints (product market, labour market and strategic orientation) interact to shape voice practices. The article finds significant differences between 'reported' compared with 'actual' practices in situ, and identifies different types of firms ('strategic market regulation', 'strategic market-led' and 'non-strategic market-led') along with the factors that influence the form and practice of voice. Overall, the article argues that researchers should further pursue research that appreciates the layered nature of ontology and the role played by firm context to explain complex organisational phenomena, if we are to advance our understanding of voice practices in SMEs and beyond.

Relationships between psychosocial working conditions and multiple employee performance measures

 The outcomes of the current study suggest employee performance should be taken into account when examining the effects of stress-related working conditions. Furthermore, the current study highlights the need to pay careful attention to the types of analyses that are undertaken in stressor-performance research and not to assume the relationship between stress-related working conditions and employee performance parallels the stressor-health literature.

Ownership concentration and product innovation in Chinese private SMEs

Product innovation is extremely important to the growth, success, and ultimate survival of firms. Although its unique features in small and medium-sized enterprises (SMEs) have gained growing attention in the literature, there is limited knowledge as to how ownership concentration moderates the relationship between product innovation and its determinants. Based upon insights from agency and institutional theories, we examine the moderating effects of ownership concentration on the relationship between product innovation and its key determinants in Chinese SMEs, utilizing a large dataset of 43,728 Chinese firms over the period 2005-2006. We focus on examining the differences between single-owner SMEs, where there is dominant control of one family member, and multiple-owner SMEs, where principal-agent conflicts and principal-principal conflicts are more likely to occur. Our findings indicate that single-owned firms tend to convert research and development into product innovation more efficiently than firms with multiple owners, who are typically better at utilizing external sources of knowledge and human capital.

Organizational rewards and employee commitment: a Chinese study

Purpose: The purpose of this study is to assess how the cultural value orientations of individual employees moderate their attitudinal responses to different categories of organizational rewards. Specifically, it seeks to examine how one dimension of traditionality, respect for authority, moderates the relationship between affective organizational commitment and three variables: pay satisfaction, autonomy and satisfaction with supervision. Design/methodology/approach: Hierarchical regression analysis was utilized to analyze survey data obtained from a sample of 290 employees of a major Chinese airline company. Findings: Employees high in traditionality were found to exhibit higher levels of affective commitment when autonomy and satisfaction with supervision was low. When autonomy and satisfaction with supervision was high employees low in traditionality exhibited higher levels of emotional attachment to the organization. Research limitations/implications: The cross-sectional design is an obvious limitation of the study. Another limitation relates to the generalizability of the study findings outside the context in which the research was undertaken. Social implications: Organizations should consider taking the cultural orientations of their workforce into account when developing appropriate human resource policies aimed at heightening employee commitment. This should enhance employee well-being, which is especially important in a global economy characterized by uncertainty and rapid change. Originality/value: This is the first study to examine how employees with different cultural value orientations respond to different categories of organizational rewards, in a predominantly traditional society.