Does one size fit all? A study of the simultaneous relations among ownership, corporate governance mechanisms, and the financial performance of firms in China

Michael A. FIRTH, Oliver M. RUI

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Abstract

We draw on the many aspects of corporate governance examined in the developed economies and extend them to the Chinese environment. We find evidence of strong linkage and interdependence in the use of different control mechanisms. While there are significant relations between the governance control mechanisms and firm performance, these disappear when using simultaneous equation estimation. Our findings support the argument that governance control mechanisms are substitutes for one another and there is no one set of mechanisms that are optimal in maximizing firms' performances.
Original languageEnglish
Title of host publicationCorporate Governance: Recent Developments and New Trends
PublisherSpringer-Verlag GmbH and Co. KG
Pages29-57
Number of pages29
ISBN (Print)9783642315787
DOIs
Publication statusPublished - 19 Dec 2012

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FIRTH, M. A., & RUI, O. M. (2012). Does one size fit all? A study of the simultaneous relations among ownership, corporate governance mechanisms, and the financial performance of firms in China. In Corporate Governance: Recent Developments and New Trends (pp. 29-57). Springer-Verlag GmbH and Co. KG. https://doi.org/10.1007/978-3-642-31579-4_2