Purpose The existence of controlling shareholders creates a remarkable difference between the corporate governance structures of Chinese firms and those of western firms. Despite the increasing importance of controlling shareholders, it remains disputable whether they are playing the “tunneling” roles or the “governance” roles. Therefore, more research is needed on what roles controlling shareholders are playing and how they play their roles. Previous empirical studies document a common phenomenon that directors play dual roles both on the board and in the top management team. Because of information asymmetry, the board of directors may not be able to perform its supervisory and strategic decision-making functions. Therefore, this paper aims to investigate whether controlling shareholders participate in firm management by appointing the executive directors and examine the economic consequences of controlling shareholder involvement. Design/methodology/approach In the empirical tests, the authors use the split share structure reform in China as a natural experiment. Using the data from Chinese listed firms between 2001 and 2015 and difference-in-differences analysis, the authors examine the impact of the split share structure reform on the executive directors of controlling shareholders and the governance effect of controlling shareholders’ appointing executive directors to the management. Findings The authors find that controlling shareholders get involved in firm management by appointing executive directors to strengthen the supervision and incentives of managers. The authors also find that firms exhibit a lower level of earnings management and enhance and higher pay-performance sensitivity after controlling shareholders appoint executive directors to the top management team. Originality/value As the natural experiment of the split share structure reform enables us to mitigate endogeneity, the authors investigate the channels through, which controlling shareholders get involved in firm management from the unique perspective of executive director appointment. The study expands the literature on corporate governance and board functions. The findings provide new insights to the effect of controlling shareholder governance and casts light on a new way for controlling shareholders of Chinese firms to participate in firm management – by appointing executive directors.

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The enrichment of peri-cancerous adipocytes is one of the distinctive features of colorectal cancer (CRC), which accelerates the disease progression and worsens the prognosis. The communication between tumor cells and adjacent adipocytes plays an important role in this process. However, the detailed mechanisms remain largely unknown. Here we demonstrated MIIP is downregulated in high-grade CRC, and revealed its role and mechanism in tumor cell-adipocyte communication. By detecting MIIP expression in CRC tissues and adjacent normal tissues, we found MIIP was significantly decreased in CRC, and was closely related to adjacent adipocytes browning. In detail, MIIP reduction altered the N-linked glycosylation modification of AZGP1 and thus alleviated the inhibition of secretion. AZGP1, a critical lipid mobilization factor, led to the intensification of adipocytes browning and the release of free fatty acids (FFAs), which in turn fueled for CRC progression. Our data demonstrate that MIIP plays a key regulatory role in the communication between CRC and neighboring adipocytes by mediating AZGP1 secretion, and MIIP reduction leads to adipose browning-induced cancer rapid progression and poor prognosis.

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