Corporate Governance, Investment, and Firm Valuation in Asian Emerging Markets

28 Pages Posted: 14 Sep 2011

See all articles by Yan-Leung Cheung

Yan-Leung Cheung

The Education University of Hong Kong

Aris Stouraitis

affiliation not provided to SSRN

Weiqiang Tan

Hong Kong Baptist University (HKBU)

Date Written: Autumn 2011

Abstract

We investigate the effects of corporate governance and family ownership on firm valuation through investment efficiency in Asian emerging markets. Using 3 years of time series data from the Credit Lyonnais Securities Asia corporate governance score for 10 Asian emerging markets, we find that good corporate governance leads to better or more efficient investment decisions and eventually to higher firm value. We also find that investors reward firms for improvement in corporate governance. The findings do not hold for Asian firms with a family or concentrated ownership structure. The results are not driven by changes in accounting standards in these markets.

Suggested Citation

Cheung, Yan-Leung and Stouraitis, Aris and Tan, Weiqiang, Corporate Governance, Investment, and Firm Valuation in Asian Emerging Markets (Autumn 2011). Available at SSRN: https://ssrn.com/abstract=1927113 or http://dx.doi.org/10.1111/j.1467-646X.2011.01051.x

Yan-Leung Cheung (Contact Author)

The Education University of Hong Kong ( email )

Department of Social Sciences
10 Lo Ping Road, Tai Po, New Territories
Hong Kong
Hong Kong

Aris Stouraitis

affiliation not provided to SSRN

No Address Available

Weiqiang Tan

Hong Kong Baptist University (HKBU)

Department of Economics
Kowloon, Hong Kong
Hong Kong

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