Social Sciences in China (Chinese Edition)

No.1, 2013

 

Corporate Governance and Firm Performance: A Sociological Analysis Based on Chinese Experience

(Abstract)

 

Yang Dian

 

Based on the 1997-2007 panel data of 676 listed companies and a group of interviews with the senior executives, independent directors, fund managers and securities analysts of these companies, the study analyses the relationship between corporate governance and firm performance, with a view to revealing the relationship model of corporate governance and firm performance in the Chinese institutional environment, which is different from the predictions of the Agency Theory. The so called “optimal” corporate governance is a “constructed” outcome of a variety of complicated social forces and interest groups in specific social, political and cultural institutions. How “optimal” corporate governance plays its role depends to a large extent on whether it fits in with the institutional environment in which it is embedded. There exists no universal “optimal” model of corporate governance. Our empirical sociological study based on Chinese experience offers new perspectives and evidence for the resolution of the global myth of corporate governance.