Korea Trade Review (무역학회지)

Korea Trade Research Association (한국무역학회)
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Corporate Governance and Long-term Corporate Survival in an Emerging Economy

신흥국 기업의 지배구조와 기업의 장기 생존

  • Jang-Hoon Kim (Department of Business Administration, Chungnam National University) ;
  • Se-Yeon Ahn (College of Business Administration, Seoul National University)
  • Received : 2021.03.31
  • Accepted : 2021.06.28
  • Published : 2021.06.30
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Abstract

This paper investigates how corporate governance characteristics are related to long-term corporate survival in an emerging economy. We used the data of 311 companies listed on the Korean Stock Exchange (KSE) in 1979 and examined the survival chances of those companies through the IMF crisis in 1998, upon governance characteristics that are expected to increase long-term strategic orientations. We utilized Cox regression model for the analysis. The results indicate that firms with particular governance characteristics that may be tied to CEO's long-term orientations show higher long-term survivability. Specifically, the probability of a firm's long-term survival is increased when founding family ownership is sustained, the company ownership is concentrated, and the CEO is the largest shareholder. This study has significance in that it is one of initial tries to examine the impact of corporate governance on long-term corporate survival with large scale statistical analysis. Also, the study findings provide some clues as to why the portion of family firms in emerging economies is continuously increased, thus providing meaningful insights to corporate governance literature.

Keywords

Acknowledgement

This work was supported by the National Research Foundation of Korea Grant funded by the Korean Government(MOE).

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