The primary objective of this dissertation is to examine the role of corporate governance in the performance of publicly listed corporations. The normative research suggests that stronger corporate governance should lead to better market performance and a firm’s governance practice should have a positive effect on its market value. This research focuses on Chinese capital markets because of their unique characteristics with respect to elements of corporate governance.

Hao He. / Thesis (M.Phil.)--Chinese University of Hong Kong, 2006. / Includes bibliographical references (leaves 84-86). / Abstracts in English and Chinese. / Abstract / Chapter Chapter 1. --- Introduction --- p.1 / Chapter Chapter 2. --- Literature Review --- p.3 / Chapter 2.1 --- Recent Work on Synchronicity --- p.3 / Chapter 2.2 --- Recent Work on Corporate Governance --- p.5 / Chapter 2.3 --- Motivation´ؤWhy Stock Return Synchronicity Matters --- p.6 / Chapter Chapter 3. --- Theory and Hypotheses --- p.9 / Chapter 3.1 --- Derivation of Dependent Variables --- p.9 / Chapter 3.1.1 --- Corporate Governance Mechanisms --- p.9 / Chapter 3.1.1.1 --- Static Corporate Governance Mechanisms --- p.9 / Chapter 3.1.1.2 --- Dynamic Corporate Governance Mechanisms --- p.11 / Chapter 3.1.2 --- Regional Governance Mechanisms --- p.12 / Chapter 3.2 --- Quantification of Dependent Variables --- p.14 / Chapter 3.2.1 --- Quantifying corporate Governance Mechanisms --- p.14 / Chapter 3.2.1.1 --- Quantifying Static Corporate Governance Mechanisms --- p.14 / Chapter 3.2.1.2 --- Quantifying Dynamic Corporate Governance Mechanisms --- p.15 / Chapter 3.2.2 --- Quantifying Regional Governance Mechanisms --- p.19 / Chapter 3.2.3 --- Quantifying Control Variables --- p.22 / Chapter Chapter 4. --- Data --- p.23 / Chapter 4.1 --- Sample --- p.23 / Chapter 4.2 --- Definitions of Main Synchronicity Measures --- p.25 / Chapter 4.3 --- Methdology --- p.26 / Chapter Chapter 5 --- Empirical Results --- p.27 / Chapter 5.1 --- Results on Corporate Governance Mechanisms --- p.27 / Chapter 5.1.1 --- Results on Static Corporate Governance Mechanisms --- p.27 / Chapter 5.1.2 --- Results on Dynamic Corporate Governance Mechanisms --- p.29 / Chapter 5.1.2.1 --- Results on President-Changing Variables --- p.29 / Chapter 5.1.2.2 --- Results on General manager-change Variables --- p.31 / Chapter 5.2 --- Results on Regional Governance Mechanisms --- p.34 / Chapter Chapter 6. --- Conclusion --- p.36 / Reference --- p.38 / Tables and Figures --- p.41

Although Chinese economy has been growing remarkably, the development of the institutional, legal infrastructure and financial system remains a numbers of distinctive characteristics (Allen et al., 2004). One of the unique features is the dominance role of the government as shareholder of corporations, even for those listed on the stock exchange. This paper investigates empirically the impact of this significant characteristic on company performance. In particular, this dissertation presents an empirical study of the relationship between ownership structure and the company performance of listed property companies in China. Previous theoretical and empirical studies suggest government ownership is detrimental to company performance. Estrin and Perotin (1991) propose that corporations with the government as ultimate owner and/or with a large stake of government shareholding may not pursue profit maximization objective since the government tends to focus on its political objectives rather than the economic ones. Consequently, the firm performance in such government-related publicly listed firms will be inferior. Moreover, Shleifer and Vishny (1998) show that private ownership is preferable to state ownership because the government has a ‘grabbing hand’ that expropriates firm assets for the benefit of politicians and bureaucrats. However, the impact of state ownership on property company performance in China is more complicated and may not be always be negative due to (1) state owned company usually have better access to cheaper credit offered by major state banks; (2) state owned companies may be able to acquire development rights and can go through the development approval process more smoothly; (3) weaker institutions for protecting small investors in Mainland China’s as it is still a less developed equity market; (4) the government may have motive to demonstrate the efficiency of companies that the government has a major stake. By separating property companies into two groups according to the place of listing, namely Mainland listed group and Hong Kong listed group, based on a more recent panel data including 170 real estate firms between 2006 and 2011, this dissertation generates several distinctive results. Firstly, tradable ownership concentration has a significant positive effect on firm performance. Secondly, by separating the property companies into two groups, I found an initial positive but non-linear impact of state ownership on firm performance in Mainland listed property companies; whereas an initial negative but non-linear impact is found in those listed in Hong Kong. However, when the state’s stake of shares is relative large, the positive impact outweighs the negative impact in Mainland China. This is because the investor protection rules and regulations and their enforcement are relatively weak in Mainland China, the government shareholder can act as private block-holder and provide effective monitor on management in solving the traditional agency problems. This is not the case in Hong Kong where the market is more transparent and the interests of small investors are better protected. When the state owns a sufficiently large percentage of the shares, the relationship between state ownership and firm performance becomes positive for both groups. This empirical result suggests that the positive impact of state ownership on firm performance is always positive irrespective of the institutions for protecting the rights of minority shareholder when the state’s shareholding is sufficiently large. / published_or_final_version / Real Estate and Construction / Doctoral / Doctor of Philosophy

published_or_final_version / Business / Master / Master of Philosophy

published_or_final_version / Geography / Master / Master of Philosophy

published_or_final_version / Business / Doctoral / Doctor of Philosophy

published_or_final_version / Business Administration / Master / Master of Business Administration

published_or_final_version / Business Administration / Master / Master of Business Administration

published_or_final_version / Business Administration / Master / Master of Business Administration

published_or_final_version / Public Administration / Master / Master of Public Administration