Value creation and value distribution in Chinese listed firms: the role of ownership structure, board characteristics, and control
研究中国上市公司所有权结构和董事会特征如何影响价值创造与分配，发现控股股东投票权、管理层持股、独立董事等对不同控制类型企业的盈利、生产率、关联交易和现金股利有差异化影响。
We investigate how ownership structure and board characteristics affect the value creation and value distribution in Chinese listed firms. Our results reveal that value creation – captured by firm profitability, labor productivity, and asset utilization efficiency – is superior when the firm’s largest ultimate shareholder controls a larger fraction of voting rights. Ownership by managers and by countervailing shareholders both improve value creation, yet only in privately controlled firms. In state-controlled firms, value creation is better when independent directors occupy a larger fraction of board seats. As to the proportional distribution of the generated value, operationalized by related-party transactions (RPT) and by cash dividends, we note that RPT are more extensive when the government controls a larger fraction of voting rights. In state-controlled firms, the wedge between the government’s voting rights and cash-flow rights is also positively associated with RPT, while negatively associated with the firm’s disbursement of cash dividends. Ownership by managers helps curb RPT in state-controlled firms, while it stimulates cash dividends in privately controlled firms. Regardless of who controls the listed firm, ownership by countervailing shareholders contributes to the proportional distribution of the firm’s generated value. Finally, independent directors have a positive influence on the distribution of cash dividends in Chinese listed firms. Overall, companies that generate more value trade at a larger market-to-book ratio. The effects of our measures of value distribution on a firm’s stock market valuation are generally insignificant, except for the negative impact of RPT in privately controlled firms.