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This study aims to examine the impact of employee treatment on stock price crash risk in emerging markets. The study further sheds light on the economic channels and boundary conditions between employee treatment and crash risk.

This study employs a large-scale archival dataset of Chinese A-share listed firms covering 2010 to 2021. To establish causality, the study leverages multi-way fixed effects, Oster’s test, change regression and instrumental variable methods to alleviate endogeneity concerns.

The results reveal that employee-friendly treatment leads to a lower crash risk. Moreover, improving internal control quality and enhancing firm reputation appear to be the two plausible economic channels through which employee treatment mitigates crash risk. Cross-sectionally, the documented impact is more evident for human-capital-intensive firms, firms with weaker external monitoring and those operating in fiercely competitive industries.

This study is among the first to show that employee treatment has a favorable consequence for shareholder benefit through reducing crash risk. The study thus adds to the ongoing debate regarding the relationship between employee treatment and shareholder wealth. The study also extends the nascent literature on the role of rank-and-file employees in shaping corporate information landscapes.

This study explores whether and how Buddhism impacts corporate cash holdings. Buddhist culture affects investors' perception of how cash is deployed and then influences corporate cash holdings. This study first examines the impact of Buddhism on corporate cash holdings and then investigates whether formal governance mechanisms such as legal institutions and institutional ownership influence the relationship between Buddhism and corporate cash holdings.

The authors conduct empirical tests with data on Chinese listed companies between 2006 and 2019. Buddhism is measured with the natural logarithm of the number of Buddhist temples within a radius of a certain distance around a firm's headquarters. The authors adopt the OLS method to regress and take the 2SLS method, Heckman selection model and FEVD approach to address the endogeneity issue.

The results show a positive relationship between Buddhism and corporate cash holdings. This positive relation is more prominent for firms located in regions with weak legal institutions and for firms with low institutional ownership. Further analysis shows that Buddhism works through the channel of alleviating agency problems and finally improves the value of cash to investors.

The authors’ findings have important implications. First, this study provides inspiration for incorporating the ethical values of traditional cultures, such as Buddhism, into the corporate governance system. Second, the findings imply that informal institutions can influence corporate financial decisions beyond the effect of formal institutions, suggesting that informal systems should be emphasized when dealing with business affairs in countries where legal institutions are relatively weak. Third, the results suggest the significance of encouraging research on religious culture to explore its active role in corporate governance.

This study illustrates the positive value of religious culture in advancing corporate governance by relating Buddhism to corporate cash holdings based on the explanation of investors' perception. It makes a marginal contribution to the literature that investigates the determinants of cash policies and explores the firm-level consequences of religious culture, adding to the research area of culture and corporate finance.

The purpose of this paper is to investigate whether and how affiliation with the government-controlled business association, namely, China Federation of Industry and Commerce (CFIC), affects corporate philanthropy in an emerging market.

Through an analysis of survey data gathered from Chinese private firms, this paper conducts multiple regressions to examine the impact of the CFIC membership on corporate philanthropy.

Empirical results show that the CFIC membership of private entrepreneurs is significantly positively associated with corporate philanthropy. Moreover, this study finds that the provincial marketization level and the firm Communist Party branch attenuate the positive association between CFIC membership and corporate philanthropy, indicating that the effect of CFIC on corporate philanthropy is more pronounced in regions with lower marketization level and firms without Communist Party branch. The findings are robust to various alternate measures of corporate philanthropy and remain valid after controlling for potential endogeneity.

Firms will be more active in corporate philanthropy to respond to the government’s governance appeal when they join the CFIC. This highlights the implications of political connections and in particular on the value of government-controlled business associations in the Chinese business world.

This study extends the literature on the determinants of corporate philanthropy and deepens the theoretical understanding of the governance role of business association with Chinese characteristics.

This study aims to investigate whether and how corporate seniority culture (a form of high power distance or hierarchy), a typical feature of Confucian norms, affects the corporate innovation efficiency in emerging markets.

This study defines and measures seniority culture through the ranking method of independent directors in company’s annual report. Unlike most companies in the USA where directors are listed alphabetically, the ranking of directors in China is meaningful and reflects hierarchy. This study considers a firm with seniority if independent directors are ranked according to their status, including age, social position and political connection. Using data from Chinese listed companies between 2009 and 2013, this study conducts multiple regressions to examine the impact of seniority on innovative efficiency.

The empirical results show that seniority culture is negatively associated with innovative efficiency. Moreover, the negative association between a corporate culture of seniority and innovative efficiency is more pronounced in firms with more male executives and knowledge-intensive firms. Further analysis reveals that seniority culture expands pay disparities among different classes, hinders their enthusiasm to communicate and ultimately damages the corporate efficiency of innovation.

Corporate seniority culture is an essential factor that may hinder employee communication and inhibit innovation efficiency. Therefore, companies should break the identity barrier at different levels and advocate a culture of equality to promote information exchange and knowledge sharing among employees.

This study extends the field of literature on the determinants of corporate innovation efficiency and deepens our theoretical understanding of the negative impact of corporate seniority culture.

Drawing from Upper-Echelons Theory (UET), this paper aims to examine whether an increasing number of board members studying and working overseas, especially in Anglo countries, provides some impetus for increased corporate environmental disclosures (CED) in Vietnam.

This study used quantitative data collection and analysis. The data collection involved a content analysis of annual, sustainability and integrated reports to capture the quality and quantity of CED. The authors subsequently developed ordered probit models to quantitatively test the hypotheses.

The authors find that board members studying in Anglo countries positively impact firms’ levels of CED in emerging economies. However, overseas work experience is found to be an insignificant explanatory variable. Further, the findings suggest that, in Vietnam, Chairs appear to be more influential than chief executive officers in affecting CED levels.

Despite the positive influence of overseas study, the authors find overall levels of CED in Vietnam remain relatively low. This suggests the necessity of dialogue about potential reform in CED policies, which could involve the introduction of mandatory reporting requirements. In addition, to enhance sustainability disclosures, shareholders should appoint board members who possess international qualifications.

This study adds to the literature exploring the impacts of Anglo cultural traits of board members on CED levels, within an economy transitioning from a communist ideology to a market-oriented system context. The connection between international study and cultural norms, beliefs and traditions in these countries and their positive influence on directors’ values and attitudes towards CED have not yet been studied. The study also extends UET by examining the potential positive influence of different national contexts on board members’ education levels.

This paper aims to study the impact of external fairness of executive compensation on M&A premium, and examine the moderate role of institutional investors. The high M&A premium is the main factors that induce the huge impairment of listed companies’ goodwill and the plummeting performance. Executives are the decision-makers of M&As, and their decision-making process is inevitably affected by the psychological factors. In recent years, institutional investors have become an important external force that can affect the governance of listed companies.

The authors use M&A data of listed companies from 2008 to 2018 and use OLS regression to test the relationship between executive compensation fairness and M&A premium.

The results show that the lower the external fairness of executive compensation, the greater the M&A premium. Institutional investors can effectively reduce the impact of external compensation unfairness on M&A premiums. The mechanism tests show that executives' psychological perception of fairness induced by external unfairness reduces their motivation to work and prompts them to use high premium to seek alternative compensation incentives. Further examinations of executive characteristics and corporate characteristics show that the role of external unfairness in executive compensation in driving M&A premiums is more pronounced in companies with longer executive tenure, weaker executive reputation incentives and private property.

This paper enriches the research on the pre-factors of M&A premiums from the perspective of executives’ psychological perception of fairness, provides evidence that institutional investors play a positive governance role and provides decision-making references for companies to take corresponding measures to reduce M&A premium risks.