Corporate Governance in China: Research and Evaluation

Corporate governance is essential to effectively assess the structure and mechanisms of a company. The application of a governance index in analyzing listed companies can help management pinpoint problems and make improvements. It also provides investors with a sound evaluation tool and a set of standards against which to measure potential investments. This can help to reduce information asymmetry between those inside a company and those outside, and also encourages companies to improve their performance.

Corporate Governance in China: Research and Evaluation outlines a governance evaluation system and establishes a corporate governance index. It also examines a large number of listed companies in China, and assesses them against six criteria that are vital to company success—the behavior of:

controlling shareholders;  
board of directors;
supervisors' committee;
management;
information disclosure; and
other stakeholders.

Corporate Governance in China also provides empirical research on the relationships between the corporate governance index and corporate performance. The research provides theoretical guidance that will help companies across China improve their own corporate governance, which will benefit companies, the economy and investors. It is also essential to the success of an evaluation system that it be designed for particular circumstances; the index provided in this book has been created specifically with a focus on China, making it essential reading for any companies with China business interests.

Li Wei–An is Chair Professor of Cheung Kong Scholars Programme of the Ministry of Education, China. He is also the Dean of Business School, Director of Research Center for Corporate Governance of Nankai University. Professor Li holds a Master Degree and Ph. D. in Economics from Nankai University, and Ph. D. in Business Administration, Keio University (Japan).

Prof. Li is a member of the Program Appraisal Group of Academic Degrees Committee of the State Council; and Vice–Chairman of Business Administration Education Committee, Ministry of Education. Prof. Li has written extensively on corporate governance issues in research and education for 20 years, having published over 40 articles during that time in respected academic journals. His monograph Corporate Governance was granted the highest honor in China′s Economic Academic Circle—"Sun Ye–Fang Economic Science Prize" in 2002. His monograph Studies on Stability of the Shareholding System was granted as the "Excellent Book" by the 2nd Appraisal of "Jiang Yi–Wei Corporate Reform and Development Foundation."

Prof. Li having presided the formulation of Chinese Corporate Governance Index(CCGINK), the Chinese Corporate Governance Principles, Chinese Corporate Governance stock index, Chinese Corporate Governance appraisal systems, and  has recently received the Award of Outstanding Contribution in Chinese Enterprise Management, the highest level award in Management area in China.

Prof. Li has also made presentations on Corporate Governance and Reforms research, practice and education at numerous forum in China, Korea and Japan. Prof. Li and his team has become an important think tank in China government's economic reform.

"Great progress has been achieved for the structural reform in China enterprises for the past one and a half decades. Along with the reform, the corporate governance structure has been established accordingly. The Chinese Corporate Governance Index (CCGI-NK) is a useful tool to objectively observe and analyze shareholder behavior, board execution, management incentive and restriction, supervisory committee operation, information disclosure and stakeholders' interest protection, and is helpful in diagnosing issues that may arise during corporate operations. The CCGI-NK provides guidance for improvement of corporate governance, and can be used to enhance the sustainable development of corporations." 
-- Chen Qing-Tai, Vice Director, Economic Committee, National Committee of Chinese People's Political Consultative Conference (CPPCC), Former Vice Director of Development and Research Center of the State Council Dean, Public Administration School of Tsinghua University.

"The phenomenal growth of China's capital markets during the past decade belies the fact that Chinese companies have only gradually adopted modern corporate governance structures. Professor Li's book offers a candid and timely assessment of the quality of the governance mechanisms they employ including the factors that influence their quality and how they relate to subsequent corporate performance. A proper understanding is critical for global investors with an interest in China's markets and for scholars who seek to disentangle corporate governance theory and practice in a fascinating market place." 
-- G. Andrew Karolyi, Charles R. Webb Professor of Finance, The Ohio State University.

"Corporate governance is a vital issue that China listing companies and enterprises has to deal with. This book reports an important investigation on the subject of corporate governance. As a major result of the study, a series of governance indices conforming to China's situation were proposed in the book. The author of the book hence received the Award of Outstanding Contribution in Chinese Enterprise Management, and I was very pleased to preside the ceremony to present him with this prestigious award' - Cheng Si-Wei, Vice Chairman of the Standing Committee of National People's Congress, Vice President of Fudan Management Award Foundation.' Corporate governance issues are important around the world. The ability of a firm to raise capital, to align with partners, and ultimately, to sell products and services to customers, all depend, to some extent, on the quality of corporate governance. This is why the research reported here is so important. That it focuses on corporate governance among Chinese corporations makes it all the more important. With only a limited history of publicly-traded firms, Chinese firms are inventing - right now - the kinds of corporate governance they will need to compete in global markets. It is hard to imagine a more timely research endeavor." 
-- Jay B. Barney, Professor and Chase Chair for Excellence in Corporate Strategy, The Ohio State University.