Author
Joseph P. H. Fan
Other affiliations: Hong Kong University of Science and Technology, Australian National University
Bio: Joseph P. H. Fan is an academic researcher from The Chinese University of Hong Kong. The author has contributed to research in topics: Corporate governance & Shareholder. The author has an hindex of 46, co-authored 101 publications receiving 18545 citations. Previous affiliations of Joseph P. H. Fan include Hong Kong University of Science and Technology & Australian National University.
Papers published on a yearly basis
Papers
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TL;DR: In this article, the authors disentangle the incentive and entrenchment effects of large ownership and find that firm value increases with the cash-flow ownership of the largest shareholder, consistent with a positive incentive effect.
Abstract: This article disentangles the incentive and entrenchment effects of large ownership. Using data for 1,301 publicly traded corporations in eight East Asian economies, we find that firm value increases with the cash-flow ownership of the largest shareholder, consistent with a positive incentive effect. But firm value falls when the control rights of the largest shareholder exceed its cash-flow ownership, consistent with an entrenchment effect. Given that concentrated corporate ownership is predominant in most countries, these findings have relevance for corporate governance across the world.
3,190 citations
TL;DR: In this article, the authors disentangle the incentive and entrenchment effects of large ownership and find that firm value increases with the cash-flow ownership of the largest shareholder, consistent with a positive incentive effect.
Abstract: This article disentangles the incentive and entrenchment effects of large ownership. Using data for 1,301 publicly traded corporations in eight East Asian economies, we find that firm value increases with the cash-flow ownership of the largest shareholder, consistent with a positive incentive effect. But firm value falls when the control rights of the largest shareholder exceed its cash-flow ownership, consistent with an entrenchment effect. Given that concentrated corporate ownership is predominant in most countries, these findings have relevance for corporate governance across the world.
2,910 citations
TL;DR: Li et al. as discussed by the authors found that firms with politically connected CEOs underperform those without politically connected CEO by almost 18% based on three-year post-IPO stock returns and have poorer 3-year earnings growth, sales growth, and change in returns on sales.
1,768 citations
TL;DR: In this paper, the authors examined the relations between earnings informativeness, measured by the earnings-return relation, and the ownership structure of 977 companies in seven East Asian economies and found that concentrated ownership is associated with low earnings informattiveness as ownership concentration prevents leakage.
1,486 citations
TL;DR: In this article, the authors review the literature on corporate governance issues in Asia to develop region-specific and general lessons, and show that conventional and alternative corporate governance mechanisms can have limited effectiveness in systems with weak institutions and poor property rights.
Abstract: Corporate governance has received much attention in recent years, partly due to the Asian financial crisis. We review the literature on corporate governance issues in Asia to develop region-specific and general lessons. Much attention has been given to poor corporate sector performance, but most studies do not suggest Asian firms were badly run. The literature does confirm the limited protection of minority rights in Asia, allowing controlling shareholders to expropriate minority shareholders. Agency problems have been exacerbated by low corporate transparency associated with rent-seeking and relationship-based transactions, extensive group structures and diversification, and risky financial structures. The controlling shareholder bears some of agency costs in the form of share price discounts and expenditures on monitoring, bonding and reputation building. The Asian financial crisis further showed that conventional and alternative corporate governance mechanisms can have limited effectiveness in systems with weak institutions and poor property rights. Overall, the understanding of the determinants of firm organizational structures, corporate governance practices and outcomes remains limited, however.
827 citations
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TL;DR: In this article, the authors argue that the legal approach is a more fruitful way to understand corporate governance and its reform than the conventional distinction between bank-centered and market-centered financial systems, and discuss the possible origins of these differences, summarize their consequences, and assess potential strategies of corporate governance reform.
6,387 citations
TL;DR: The authors examined the separation of ownership and control for 2,980 corporations in nine East Asian countries and found that voting rights frequently exceed cash-ow rights via pyramid structures and cross-holdings.
4,195 citations
TL;DR: In this paper, the authors examine systematic differences in earnings management across 31 countries and propose an explanation for these differences based on the notion that insiders, in an attempt to protect their private control benefits, use earnings management to conceal firm performance from outsiders.
3,662 citations
Posted Content•
01 Jan 2012
TL;DR: The 2008 crash has left all the established economic doctrines - equilibrium models, real business cycles, disequilibria models - in disarray as discussed by the authors, and a good viewpoint to take bearings anew lies in comparing the post-Great Depression institutions with those emerging from Thatcher and Reagan's economic policies: deregulation, exogenous vs. endoge- nous money, shadow banking vs. Volcker's Rule.
Abstract: The 2008 crash has left all the established economic doctrines - equilibrium models, real business cycles, disequilibria models - in disarray. Part of the problem is due to Smith’s "veil of ignorance": individuals unknowingly pursue society’s interest and, as a result, have no clue as to the macroeconomic effects of their actions: witness the Keynes and Leontief multipliers, the concept of value added, fiat money, Engel’s law and technical progress, to name but a few of the macrofoundations of microeconomics. A good viewpoint to take bearings anew lies in comparing the post-Great Depression institutions with those emerging from Thatcher and Reagan’s economic policies: deregulation, exogenous vs. endoge- nous money, shadow banking vs. Volcker’s Rule. Very simply, the banks, whose lending determined deposits after Roosevelt, and were a public service became private enterprises whose deposits determine lending. These underlay the great moderation preceding 2006, and the subsequent crash.
3,447 citations