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Related party transactions, benefits of control
and earnings quality
TONG Yan , WANG Huacheng
Front. Bus. Res. China. 2008, 2 (2): 187-203.
https://doi.org/10.1007/s11782-008-0011-x
Controlling shareholders pursue benefits of control (private benefits and shared benefits) via related party transactions, which result in different levels of earnings quality. Using data from all A-share listed companies in Shenzhen and Shanghai stock markets in the year 2001 and 2002, we found that when the share ratio of controlling shareholder is less than 50%, they prefer pursuing private benefits of control via related party transactions, giving rise to deterioration in earnings quality. By comparison, when the share ratio is more than 50%, controlling shareholders prefer pursing shared benefits of control through related party transactions, which improve earnings quality as a result.
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Leadership capability and the effectiveness of
state-owned enterprise
JING Runtian , LIU Yuhuan , LIU Ping
Front. Bus. Res. China. 2008, 2 (2): 219-239.
https://doi.org/10.1007/s11782-008-0013-8
In this paper, a conceptual model of state-owned enterprises(SOEs) is built up based on several different perspectives, such as property right approach, management approach, and leadership capability approach. Using the data of World Bank’s survey on 1500 Chinese firms from five cities in 2001, the authors conclude that differences in leadership capabilities represented by leaders’ demographic characteristics exert influences on enterprise efficiency. Specifically, the degree of such influences in the SOEs is much higher than that of in the non-state-owned enterprise(NSOE) due to reasons of property right problems and insufficient incentive mechanisms in SOEs. Furthermore, the authors argue that empowering reforms will lead to phenomenon of differentiation in SOEs, causing huge differences in enterprise performances in the long run.
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Uncover the black-box of leadership effectiveness:
Leader-member exchange as the mediator
Jean LEE , WEI Feng
Front. Bus. Res. China. 2008, 2 (2): 240-255.
https://doi.org/10.1007/s11782-008-0014-7
This study is an integration of the leader-focused perspective and leader-follower exchange perspective, attempting to understand the relationship between leadership styles, leader-member relationship, and their joint impact on followers’ effectiveness, satisfaction, extra effort and organizational commitment. 615 respondents from five big pharmaceutical companies in China participated in this study. Results show that: (1) transformational leadership has positive influence on followers’ effectiveness, satisfaction, extra effort and organizational commitment; contingent reward has positive influence on effectiveness; management-by-exception leadership has negative influence on satisfaction; laissez-faire leadership has negative influence on effectiveness and satisfaction. (2) Leader-member exchange partially mediates the relationship between transformational, contingent reward, management-by-exception, laissez-faire leaderships and followers’ effectiveness, extra effort, satisfaction and organizational commitment.
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