Artikel
Internal corporate governance and the use of IPO over-financing: Evidence from China
In this paper, we describe how Shenzhen A-share listed companies used funds raised in over-financed IPOs during the 2006-2010 period. In exploring the relationship between internal corporate governance and the use of funds raised in over-financed IPOs, we find that the use of such funds to engage in severe over-investment behavior is prevalent among listed companies. Reasonable internal corporate governance mechanisms can effectively alleviate over-investment problems listed companies encounter in using funds raised in over-financed IPOs. However, the same individual serving as both chairman and CEO leads to funds raised in over-financed IPOs being over-invested. Moreover, executives driven by high levels of monetary compensation are more likely to use funds raised in such IPOs to engage in over-investment. We find that improving the balance of power between shareholders will help alleviate the over-investment of excess IPO funds. In addition, the over-investment problem is less severe in state-controlled listed companies than in their non-state-controlled listed counterparts. This study provides policy recommendations for Chinese securities regulators to ensure listed companies use funds raised in over-financed IPOs both rationally and effectively.
- Sprache
-
Englisch
- Erschienen in
-
Journal: China Journal of Accounting Research ; ISSN: 1755-3091 ; Volume: 5 ; Year: 2012 ; Issue: 3 ; Pages: 231–249- ; Amsterdam: Elsevier
- Klassifikation
-
Management
General Financial Markets: General (includes Measurement and Data)
Capital Budgeting; Fixed Investment and Inventory Studies; Capacity
Corporate Finance and Governance: Government Policy and Regulation
- Thema
-
Internal corporate governance
IPO over-financing
Over-investment
Non-capital investment
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Xu, Xin
Xia, Yun
- Ereignis
-
Veröffentlichung
- (wer)
-
Elsevier
- (wo)
-
Amsterdam
- (wann)
-
2012
- DOI
-
doi:10.1016/j.cjar.2012.08.003
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:43 MEZ
Datenpartner
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Objekttyp
- Artikel
Beteiligte
- Xu, Xin
- Xia, Yun
- Elsevier
Entstanden
- 2012
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