Purpose Using a data set of listed firms domiciled in Taiwan, this paper aims to empirically assess the effects of ownership structure and board of directors on firm value. Design/methodology/approach Using a sample of Taiwanese listed firms from 1997 to 2015, this study uses a panel estimation to exploit both the cross-section and time–series nature of the data. Furthermore, two stage least squares (2SLS) regression model is used as robustness test to mitigate the endogeneity issue. Findings The main results show that the higher the proportion of independent directors, the smaller the board size, together with a two-tier board system and no chief executive officer duality, the stronger the firm’s performance. With respect to ownership structure, block-holders’ ownership, institutional ownership, foreign ownership and family ownership are all positively related to firm value. Research limitations/implications Although the Taiwanese corporate governance reform concerning the independent director system which is mandatory only for newly-listed companies is successful, the regulatory authority should require all listed companies to appoint independent directors to further enhance the Taiwanese corporate governance. Originality/value First, unlike most of the previous literature on Western developed countries, this study examines the effects of corporate governance mechanisms on firm performance in a newly industrialised country, Taiwan. Second, while a number of studies used a single indicator of firm performance, this study examines both accounting-based and market-based firm performance. Third, this study addresses the endogeneity issue between corporate governance factors and firm performance by using 2SLS estimation, and details the econometric tests for justifying the appropriateness of using 2SLS estimation.

Purpose This study aims to apply signaling theory to examine whether corporate social responsibility (CSR) disclosure can deliver effective signals to stakeholders to increase a firm’s competitive advantage in China. Whether ownership patterns or environmental sensitivity causes a significant difference in the relationship between a firm’s CSR disclosure and competitive advantage is also examined. Design/methodology/approach Data analysis is based on a regression model. Content analysis is performed to convert qualitative CSR information of Chinese firms into quantitative data, while intellectual capital (IC) is used as a proxy variable for competitive advantage. Findings The difference in competitive advantage impairment between environmentally sensitive industries (ESIs) and non-environmentally sensitive industries (NESIs) is significant. Further comparisons on the relationship between overall CSR disclosure and competitive advantage among state-owned enterprises, privately owned enterprises, ESIs and NESIs suggest that the relationship is negative. Research limitations/implications The study extends research of strategic CSR to signaling theory and competitive advantage. In particular, a research using IC as a proxy for competitive advantage is rare. It also contributes to the literature on competitive advantage and strategic CSR by examining the effects of both CSR disclosure and IC. Originality/value This paper provides evidence related to stakeholders’ reaction to managers’ various CSR strategies in China. The contribution of this study is that it confirms that different CSR initiatives have different effects on the competitiveness of enterprises in China.

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This study focuses on whether information transparency can reduce a firm's idiosyncratic risk. We measure information transparency from an annual report on the public transparency of Chinese companies. Using a simultaneous equations approach, we find that idiosyncratic risk is reduced when a firm discloses more financial and non-financial information. Our results highlight the importance of information transfer in an emerging economy.

Purpose This study aims to examine the Taiwan setting, where audit partners’ names are presented in the audit report and where audit committee formation is voluntary in the initial stage of audit committee reform. This paper investigates the effects of the formation of voluntary audit committees on the selection of individual audit partners, and, in turn, the audit quality. This contrasts with previous studies investigating the relationship between audit committees and auditor selection at the audit firm level. Design/methodology/approach This paper samples all of Taiwan’s publicly listed firms for the period 2007–2012 and uses Heckman’s (1979) two-stage estimation model to achieve our objectives. Findings Using different characteristics of individual engagement partners as proxies for a higher quality auditor, the main empirical results show that voluntary audit committee formation is positively related to an industry specialist lead partner and a lead partner that has a larger number of clients. In addition, this paper also finds that voluntary audit committee formation has a positive impact on audit quality (proxied by discretionary accruals). The results suggest that the voluntary formation of an audit committee contributes positively to both auditor selection and audit quality. Furthermore, an additional test shows that the main empirical results are robust to a validity threat that firms that have good corporate governance prior to the formation of voluntary audit committees tend to select high-quality audit partners. Originality/value The paper contributes to the audit committee literature in the following ways: this paper takes advantage of Taiwan’s unique setting, where forming an audit committee is not compulsory in the initial stage of audit committee reform, to investigate the voluntary audit committee, auditor selection and audit quality; this paper expands on Abbott and Parker’s (2000) study of audit committee characteristics and auditor selection at the audit firm level by examining this relationship at the individual audit partner level; this paper responds to the call by Church et al. (2008) and DeFond and Francis (2005) who propose more studies on audit quality at the individual engagement partner level.