• Journal of the Economic Geographical Society of Korea
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• v.14 no.4
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• pp.657-670
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• 2011

China has gone through rapid economic growth due to transitional economies since 1978. In particular, Chinese transitional economies has led to fundamental changes in firms' activities under the socialist system. Nevertheless, Chinese firms have formed new industrial production organizations and spatial orders by sustaining personal networks based on existing traditional firm practice, which is called 'guanxi'. Therefore, the main purpose of this research is to identify the influence of personal networks, guanxi, on the business activities of Chinese firms by investigating the formation of guanxi mechanism. The main characteristics of guanxi represented in inter-firm relations are as follows. First, guanxi has played a role in facilitating inter-firm relations and business activities, because it has an inter-debt relations based on inter-reciprocal relations between firms. Second, Chinese firms has depended on posteriori guanxi rather than inherent guanxi by the internalization of personal networks through 'guanxi communicators'.Third, guanxi between firms and local government in extra-firm relations has been established to minimize risks from unstable legal regulations.

• Asia-Pacific Journal of Business
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• v.14 no.1
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• pp.59-71
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• 2023

Purpose - The purpose of this study is to investigate the effect of corporate social responsibility (CSR) on firm performance in China, plus the moderating effects of advertising intensity and environmental pollution. Design/methodology/approach - We analyzed our dataset that consists of 188 public Chinese firms drawn from the Shanghai and Shenzhen exchanges during 2010-2020. Findings - Based on the stakeholder theory and signaling theory, we proposed the positive relationship between the CSR level and the firm performance. Further, we configured consumers and the government as major stakeholders in China, suggesting positive moderating effects of advertising intensity and environmental pollution, respectively. Research implications or originality - The results show that the CSR level increases the firm performance. The advertising intensity positively moderates the relationship between the CSR level and the firm performance, but there was no significant moderating effects of environmental pollution. The findings confirm the importance of consumers for the CSR stakeholders. While the Chinese government strongly reinforces environmental regulation, CSR itself does not seem to be the fine-aligned action prioritized for mitigating environmental pollution.

• Asia-Pacific Journal of Business
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• v.9 no.1
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• pp.91-106
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• 2018

An appreciable number of Chinese firms have successfully expanded their businesses into foreign economics although they have limited resources. Advocating that home country government supports can mitigate firms' resource-disadvantages in international expansions, we attempted to investigate whether and how the Chinese government's support enables Chinese firms to compete in foreign markets. Based heavily on the knowledge-based theory of the firm and the resource-based theory of the firm, we developed a model that explain and predicts the effects of home-country government-supports on superior financial performance. The model was empirically tested using a accounting dataset regarding Chinese firms' 323 international expansion events from 2008 to 2015. Empirical evidence presents that the Chinese government's support has a positive effect on Chinese firms' international success and that these firms' marketing, technological, and managerial resources positively moderate the effect of the government support on the firms' international success. Nonetheless, because we employed an event-study method, the limitations of the method can be applied to the current research. In addition, because of the empirical context, the results of the research might lack generalizability. We, however, provided an understanding how firms from emerging countries can succeed in international expansions specifically when they have lack of resources for international competition.

• Analyses & Alternatives
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• v.8 no.2
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• pp.87-115
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• 2024

This study examines the effect of R&D investment on firm performance and value of Chinese private firms. Through R&D investment, firms aim to acquire knowledge and technological resources to create innovation and competitive advantage, which ultimately enhances firm performance and value. However, unlike other investments, R&D investments are characterized by high adjustment costs and risks, uncertainty and asymmetric information. In addition, the effect of R&D investment on firm performance and value has been shown to be mixed results due to various internal and external contextual factors. Therefore, this study intends to consider how the ESG activities of firms, which have recently attracted attention, act as a contextual factor in the results of R&D investment. This is because interaction with stakeholders through ESG activities is considered to be an important factor in securing competitive advantages and sustainable growth. In this context, this study measures the effect of a firm's R&D investment on its business performance by dividing it into financial performance and value, respectively, and examines the moderating effect of ESG score on the relationship. Based on empirical analysis of all Chinese private firms from 2010 to 2019, the results show that a firm's R&D investment has a negative impact on performance and a positive impact on value. Furthermore, a high ESG score of private firms positively moderates each relationship, emphasizing the importance of ESG activities.

• Asia-Pacific Journal of Business
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• v.14 no.1
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• pp.131-148
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• 2023

Purpose - Since the 2020s, the management philosophy of Chinese firms' ESG has been rapidly established under the leadership of the Chinese government. We empirically analyze the ESG characteristics and effects on corporate value of Chinese firms. Design/methodology/approach - Using OLS and random effect panel regression analysis, we identify ESG determinants. In analyzing the impact on corporate value, likewise a large number of literatures, we adopt a 2SLS methodology using instrumental variables in the reason of endogeneity between ESG and firm value. We analyze using the G2SLS methodology, which is improving the efficiency of the estimation coefficients along with 2SLS. Findings - We find that ESG ratings are high in state-owned and foreign capital invested companies, ESG ratings are low in companies with a high proportion of non-floating stocks which implies information asymmetry. However, there are no significance in the institutional investor's, the major 10 largest shareholders' and manager's ownership. Furthermore, we can support most of the hypotheses that ESG ratings will be high in companies with high management performance. ESG ratings are significantly higher in companies with high ROA, rich in cash asset, low debt ratio, and large size. we strongly support the hypothesis that the higher the ESG rating, the higher the firm value, and ESG has a moderating effect on state-owned companies, non-floating shares, the ownership of institutional investors, manager, and the 10 major shareholder. In particular, state-owned companies, the proportion of non-floating shares, and the ownership of the 10 major shareholders have a negative impact on firm value, however, ESG attenuates this negative effect. Research implications or Originality - This study looks forward to enhancing our understanding of ESG characteristics in East Asia.

• Asia Pacific Journal of Business Review
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• v.4 no.1
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• pp.1-34
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• 2019

This study investigates whether and how a firm's cost of equity capital is influenced by the extent of a firm's real earnings management (REM). Using a large sample of Hong Kong and Chinese firms over the 9-year period 2009-2017, we find that our implied cost of equity estimates are positively associated with both the extent of REM and the extent of accrual-based earnings management (AEM), but the positive association is stronger for REM than for AEM. We also provide evidence suggesting that the effect of AEM and REM on the cost of equity is more pronounced for Hong Kong firms than Chinese firms, and within Chinese firms, it is less pronounced for the state-owned enterprises (SOEs). Collectively, our results suggest that while both REM and AEM exacerbate the quality of earnings used by outside investors, REM does so to a greater extent than AEM, and thus the market demands a higher risk premium for REM activities than for AEM activities and that this cost of capital-increase effect is more prominent in a developed market like Hong Kong and mitigated by state ownership in China because of investors' expectations for a lower level of detriments to firm fundamentals by REM due to government's protection in a less developed market like China.

• Korea Trade Review
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• v.42 no.3
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• pp.123-142
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• 2017

This study is to investigate Right to Chinese Name for Foreigners under Trademark Law of the People's Republic of China. The basketball star Michael Jordan sued Qiaodan Sports in 2012, saying the company had built its business around his Chinese name read as Qiaodan in Chinese without his permission. The Chinese supreme court ruled that the trademark for Jordan's Chinese name should be returned to China's State Administration for Industry and Commerce to be re-awarded, and it means Qiaodan Sports Co. must stop using the Chinese characters for Qiaodan on its merchandise. However, the court rejected Jordan's claim to the romanized or pinyin form of the name "Qiaodan," saying in its judgment that this version may not be closely linked with him. People who want to claim the right to Chinese name, he/she must prove the specific name has linked with him/her. Furthermore, he/she must prove the Chinese firm's actions had displayed "malicious intent" by registering trademarks for his/her Chinese name. The courts approve infringement by Chinese firm and stop to use his/her name in the country.

• International Journal of Advanced Culture Technology
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• v.11 no.3
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• pp.33-38
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• 2023

This study examined the influence of ESG performance on the firm value of Chinese equipment manufacturing companies over the period from 2011 to 2020. The analysis indicated that while ESG performance exerted a negative influence on firm value, this impact was not statistically significant. These findings substantiate the Institutional Difference Hypothesis (IDH), which posits that country-specfic institutional variations sifnificantly shape the strategic decision-making of organizations. When disaggregating the three components of ESG, variations in the results were observed both for overall ESG performance and for each individual dimension. Of the three dimension elements, the environmental (E) and governance (G) facets had a negative bearing, whereas the social (S) facet had a positive influence. Notably, only the governance dimension (G) demonstrated a statistically significant influence. These outcomes affirm the institutional difference hypothesis, illustrating divergent results across distint ESG dimensions.

• Korea Trade Review
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• v.41 no.2
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• pp.61-96
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• 2016

This study investigates the effects of M&A experience of Chinese firms and characteristics of deal partners in cross border M&A deal failures. 1,610 firms that participated in 1,558 cross border M&As from 2000 to November 2015 are used as samples. The dependent variable is the M&A transaction failures, which were cases of deal pending or withdrawal of Chinese firms. Major independent variables are the nationality diversity of transaction partner firm, the partner firm belonging to a developed country, domestic M&A experience of the Chinese firms, M&A experience in a particular target country, etc. After conducting a probit model analysis, we find that deal partner firm's nationality diversity increases the failure rate of M&A. While prior domestic M&A experience in China has no influence on deal failure, prior M&A experience of Chinese and focal firms in a particular country have a negative effect on the probability of deal failure. This study has academic implication on figuring out why firms are likely to fail in the process of strategic activities based on the inter-organizational learning through partnerships perspective.

• The Journal of Information Systems
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• v.28 no.4
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• pp.131-153
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• 2019

Purpose This study examines the roles of firm-level IT competence in the relationship between marketing orientation and marketing performance in the context of Chinese SMEs. To achieve this goal, this study presents and empirically tests a model of how competitor orientation and customer orientation can be exploited to positively influence marketing performance through IT competence. Design/methodology/approach The competitor orientation and customer orientation are based on the market orientation construct developed by Trainor et al. (2011). IT competence re based on the market orientation construct developed by Reitz et al. 2018) and the marketing performance are based on the performance construct developed by Hooley et al., (2005). To complete the investigation, we conducted a survey in China from February 2019 to April 2019. Randomly contacted 150 Chinese SMEs, including SMEs of all sizes and types. To test our hypotheses, partial least squares (PLS) method was employed. Findings The findings indicate that customer orientation is antecedent to IT competence, while competitor orientation has no significant relationship with IT competence. This study provides a better understanding of the connection between IT competence and firm performance. So companies should focus on shaping customer-oriented culture and training IT competence.