Executive accountability systems and the financial investments of state-owned enterprises in China

IF 5.3 2区经济学 Q1 BUSINESS, FINANCE Pacific-Basin Finance Journal Pub Date : 2025-02-10 DOI:10.1016/j.pacfin.2025.102702

Guoqiang Hu , Wenxiang Sun , Yuanzheng Xu , Hong-an Mao

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Abstract

This study examines the impact of executive accountability systems on the financial investments of state-owned enterprises (SOEs). Utilizing the staggered regional implementation of the Accountability System for Irregular Operations and Investments (ASIOI) in Chinese SOEs as an exogenous shock and a difference-in-differences design, we observe a significant reduction in SOEs' financial investments after the implementation of the ASIOI. Further analysis reveals that mitigating managerial myopia and strengthening internal control are potential mechanisms through which the ASIOI affects SOEs' financial investments. Cross-sectional tests show that the ASIOI's effects are more pronounced in SOEs with more intense market competition, shorter chairperson tenures, lower financing constraints, and higher agency costs. Moreover, the ASIOI reduces over-investment and speculative investment in financial assets while enhancing core business performance. Overall, our findings highlight the positive impact of executive accountability systems on corporate financial investments and the implications of improving resource allocation efficiency in SOEs.

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中国国有企业高管问责制与财务投资

本研究探讨行政问责制对国有企业财务投资的影响。我们利用中国国有企业不规范经营与投资问责制（ASIOI）的交错区域实施作为外生冲击和差异中的差异设计，观察到实施ASIOI后国有企业的金融投资显著减少。进一步分析表明，缓解管理短视和加强内部控制是影响国有企业金融投资的潜在机制。横断面检验表明，在市场竞争更激烈、董事长任期更短、融资约束更低、代理成本更高的国有企业中，亚洲投资组合的影响更为明显。此外，ASIOI减少了金融资产的过度投资和投机性投资，同时提高了核心业务绩效。总体而言，我们的研究结果突出了高管问责制对企业财务投资的积极影响，以及提高国有企业资源配置效率的意义。

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来源期刊

Pacific-Basin Finance Journal BUSINESS, FINANCE-

CiteScore

6.80

自引率

6.50%

发文量

157

期刊介绍： The Pacific-Basin Finance Journal is aimed at providing a specialized forum for the publication of academic research on capital markets of the Asia-Pacific countries. Primary emphasis will be placed on the highest quality empirical and theoretical research in the following areas: • Market Micro-structure; • Investment and Portfolio Management; • Theories of Market Equilibrium; • Valuation of Financial and Real Assets; • Behavior of Asset Prices in Financial Sectors; • Normative Theory of Financial Management; • Capital Markets of Development; • Market Mechanisms.