Corporate performance and CEO compensation in China

Firth, Michael; Fung, Peter M.Y.; Rui, Oliver M.

doi:10.1016/j.jcorpfin.2005.03.002

Cited by 533 publications

(415 citation statements)

References 30 publications

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“…For example, the relation between state ownership and executive pay is either negative (Adithipyangkul & Zhang, 2011;Conyon & He, 2011Firth et al, 2007) or insignificant Firth, Fung, & Rui, 2006a;Markoczy et al, 2013). The same is true about the relation between state ownership and executive turnover.…”

Section: Internal Mechanism: Ownership Structurementioning

confidence: 91%

Empirical Research on Corporate Governance in China: A Review and New Directions for the Future

2015

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The ownership structure of Chinese firms has experienced significant changes over the last three decades, including the development of a fast growing stock market through which a large number of domestic firms have become publicly traded corporations. These changes have drawn increasing attention from researchers of corporate governance. In this article, we review the empirical research on corporate governance in China, with a focus on the internal and external governance mechanisms that have been investigated and the findings about the effectiveness of these mechanisms. On the basis of our review of 132 studies, we summarize the major findings and discuss the limitation of agency theory in understanding the governance issue in Chinese firms. We offer several ideas (e.g., the importance of the social context, new conceptualization of governance, different outcomes of governance, and data/method issues) for a new agenda to guide future research in the corporate governance of firms operating in the Chinese and other emerging economy contexts.

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Section: Internal Mechanism: Ownership Structurementioning

confidence: 91%

Empirical Research on Corporate Governance in China: A Review and New Directions for the Future

2015

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“…To our knowledge no previous studies have explored the practice of setting up CCs in China, nor have they explored CEO compensation in China for the length of time we do here (Buck et al ., 2008;Firth, Fung, and Rui, 2007;Firth et al ., 2006;Kato and Long, 2006). For this study we developed a unique dataset of corporate interlocks among listed firms.…”

Section: Methods Datamentioning

confidence: 99%

“…Although boards can appoint CEOs and decide their pay, breaching the implicit norms of seniority and (near) equality with workers can easily trigger public outrage concerning 'unfair' income distribution. This outcry can trigger the intervention of officials (Adithipyangkul et al ., 2011;Firth, Fung, and Rui, 2006). One form of state intervention is to manipulate access to state-controlled resources by punishing firms that deviate too significantly from the state's political and socio-economic priorities, including the goal to maintain social harmony and avoid public outrage (Firth et al ., 2010).…”

Section: Empirical Contextmentioning

confidence: 99%

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Social network contingency, symbolic management, and boundary stretching

Markóczy

Sun

Peng

et al. 2013

Strategic Management Journal

122

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“…This extends our understanding of the governance roles of executive compensation beyond the confines of agency framework. Research in other Asian countries have also shown stakeholder influence on executive pay in South Korea (Kato, Kim, & Lee, 2005) or the importance of relationship and network influences in China (Firth, Fung, & Rui, 2006;Kato & Long, 2006), even despite newer elements of ''stock market capitalism'' after the Chinese economic reforms. Buck, Liu & Skovoroda (2008: 4) suggest that "Chinese institutions (including culture as an informal institution) may have inhibited the adoption of long-term incentives in the form of equity-based pay, and thus reduced the responsiveness of pay to share price performance.…”

Section: Executive Compensation Debates and Informal Institutionsmentioning

confidence: 99%