| Since the 18 th National Congress of the CPC,economic development has entered a new normal.The thorough implementation of the innovation-driven development strategy has become the fundamental driving force for the long-term and stable development of China’s macroeconomy.The Third Plenary Session of the 18 th Central Committee clearly stated that the market should play a central role in resource allocation and the government should play a better role.Since the 19 th National Congress of the CPC,with the in-depth implementation of supply-side structural reforms and the policy of "three eliminations,one reduction and one supplement",it has become an important task to steadily resolve excess capacity and debt risks in traditional industries and firmly guard against the occurrence of systemic financial risks.The heaviest.Zombie firms exist in large numbers in traditional industries with excess capacity.Their main businesses lack profitability,have heavy debt burdens,and can barely survive by occupying bank credit resources.Actively and prudently disposing of zombie firms will not only help resolve debt risks and speed up the clearance of excess capacity,but also improve the efficiency of resource allocation,enable finance to better serve the real economy,and promote high-quality macroeconomic development.Accurate definition and identification are prerequisites for proper disposal of zombie firms.At present,the academic community and economic authorities mainly identify zombie firms from the following two aspects: one is that their main business lacks profitability and faces a heavy debt level;the other is relying on the support of external forces to barely maintain their existence,like government and shareholders.The current research on the governance of zombie firms is mainly carried out from the perspective of external macro policies.Although policy factors have a certain positive effect,restoring the sustainable profitability of the main business is the fundamental strategy for zombie firms to get out of the predicament.This requires not only the continuous improvement of the external business environment,but also the continuous improvement of the internal corporate governance level.This paper conducts research from the perspective of internal corporate governance,and analyzes what characteristics of CEOs are most helpful to cure zombie firms.The CEO is not only a member of the board of directors,but also plays a decisive role in the management style and future development direction of the company as the core manager responsible for the daily operations of the company.Hiring a CEO is a complex decision for a business that goes through a series of steps.First of all,it is necessary to determine the source,that is,choose one of the three mainstream sources from internal promotion,exchange and appointment with other subsidiaries of the group,or external transfer.After determining the selection scope of the successors,it is necessary to further examine other personal characteristics of the candidate,including education,professional title,age,origin,occupational experience,etc.Compared with other personal characteristics,occupational experience can best reflect managers’ cognitive level and operational ability.Therefore,the follow-up focus will be on the influence of candidates’ occupational experience,and the research will be conducted from the perspectives of diversified occupational experience and political connection.Since diversified professional experience and government background are relatively scarce among listed company CEOs,this study further analyzes the influence of the geographical distance between managers’ work and the company’s registered location to examine the impact of multicultural experience and social resources,thus completely answering the question of how zombie firms should hire CEOs.Based on the above ideas,this study uses the financial data of non-financial listed companies,CEO resume text data and personal characteristic data from 2004 to 2020 to study the influence of CEO succession sources and occupational experience on the cure of zombie firms.Firstly,according to the common standards in academia,the zombie firms of China’s non-financial listed companies from 2004 to 2020 were identified and the heterogeneity of industry,region and ownership was analyzed.Next,we study the impact of CEO succession sources,and analyze which of the three mainstream succession sources is more conducive to curing zombie firms.On the basis of determining the source of succession,it further analyzes the role of different career experiences of CEOs.Firstly,we study the specific influence and realization mechanism of CEOs with diversified professional experience on the governance of zombie firms.Secondly,it analyzes whether the choice of political strategy by zombie firms can help them get out of the predicament.Finally,it examines the effect of the geographical difference between the CEO’s past work and life region and the current registered place of listed companies.To sum up,this study selects the source of CEO succession,professional experience and regional differences to comprehensively answer the question of how zombie firms hire CEOs.Based on the above theoretical analysis and empirical test,the main conclusions of this study are as follows.First,from 2004 to 2020,the proportion of zombie firms fluctuated in the range of8%-13%.During the period of rapid macroeconomic development,the probability of zombification of enterprises is low,and when the speed is relatively slow,it is more likely to become zombified.The proportion of zombie firms and the proportion of zombie firms weighted by assets,liabilities and number of employees generally show the same trend.Zombie firms have the highest proportion of employees,and the proportion of liabilities is higher than the proportion of assets,which proves that zombie enterprises generally lack profitability,high debt levels,and the fact that local governments intervene in the bankruptcy process of poorly managed enterprises by administrative means based on public goals such as employment..Second,the distribution of zombie firms is heterogeneous in terms of ownership,geography and industry.In terms of ownership,the proportion of state-owned zombie firms has always been higher than that of private zombie companies.In terms of region,before the outbreak of the global financial crisis in 2008,the Northeast region accounted for the highest proportion of zombie firms,followed by the Central and Western regions,and the Eastern region the lowest.After the outbreak of the global financial crisis,the proportion of zombie firms in the eastern region began to increase rapidly,surpassing that in the central and western regions,and second only to the northeast region.However,with the vigorous implementation of the "4 trillion" economic stimulus plan,the economic development of the eastern region took the lead in stabilizing and rebounding in an all-round way,and the proportion of zombie firms declined rapidly in the next two years.Since 2012,the state has paid more attention to the quality and efficiency of economic development,and the proportion of zombie ffirms in all regions has increased.With the country’s vigorous elimination of outdated production capacity in 2016,the proportion of zombie firms has shown a downward trend.In terms of industry,manufacturing zombie firms have always been the main component,but they account for a small proportion of the number of listed companies in the same industry.The number of zombie firms in the utility industry is second only to the manufacturing industry,and the proportion is also higher.Third,the results on the influence of CEO succession sources and diverse career experiences on the cure of zombie firms show that CEO succession originates from non-internal promotion and diversified career experiences have positive effects on both temporary and permanent cure of zombie firms.Since it is more difficult to permanently cure zombie firms and there are more influencing factors,the effect is not as obvious as temporary cure.In non-internal promotion situations,CEO succession comes from external transfers and a diverse career experience is more helpful in curing zombie firms than exchanges.The channel of influence is reducing the overhead rate of zombie firms.There are two influence mechanisms,one is the compensation incentive mechanism,and the other is the reputation mechanism.Analysis of regional and ownership heterogeneity shows that CEOs with diverse career experiences from non-internal promotions have a more pronounced role in promoting the cure of zombie companies in state-owned enterprises and in the Midwest and Northeast regions.Fourth,the results on the effect of CEO succession sources and political connections on the cure of zombie firms show that the appointment of governmentbacked CEOs has a significant promoting effect on both temporary and permanent cures of zombie firms.The channel of influence is now reducing the asset-liability ratio of zombie firms.There are two influence mechanisms,one is to improve the level of business diversification,and the other is to promote mergers and acquisitions.Heterogeneity analysis shows that private zombie firms need more CEOs with government background than state-owned zombie firms;government officials are more active in the cure of zombie firms by analogy with representative committee CEOs;experience in local government is more than that in central government CEOs are more helpful to cure zombie firms;zombie firms without political connections are more eager to gain political connections by hiring CEOs with government backgrounds,so as to achieve bigger and stronger through resource effects.Fifth,the results on the effect of CEO succession sources and geographic distance on the cure of zombie firms show that foreign CEOs have a significant promoting effect on both temporary and permanent cure.The main channel of influence is to increase the value of zombie firms.This chapter further proves the mechanism of improving the innovation level of zombie enterprises on the basis of Chapter 4.Heterogeneity analysis shows that the promotion effect of foreign CEOs on the cure of zombie firms is affected by the innovative cultural environment and multicultural experience of the registered place.The stronger the innovative cultural environment in the registered place,the more conducive it is for CEOs in other places to enhance the value of zombie firms.Different cultural experiences broaden personal horizons and improve their own risk tolerance,which also helps foreign CEOs to enhance the value of zombie firms.Compared with the existing research,this paper mainly has the following marginal contributions.First,the academic research on zombie firms mainly focuses on three aspects:identification,formation causes and adverse effects,and there are few literatures related to zombie firms’ governance.Existing studies have also been carried out from the perspective of external macro policies such as deregulation of foreign capital,mixed ownership reform of state-owned enterprises,and reduction of social security contribution rates.Starting from the new internal governance perspective of CEO appointment,this study analyzes the influence of CEO succession sources and past career experiences on the governance of zombie companies,deepening the academic community’s understanding of this issue,and providing solutions to zombie companies,a society that has received widespread attention.The problem provides new ideas,and also has a certain marginal contribution to preventing and resolving systemic financial risks and promoting high-quality macroeconomic development.Second,in terms of CEO career experience,existing literature mainly focuses on a single career experience,including political experience,financial experience,R&D experience,overseas experience,and military experience.While academia has recognized the many advantages of diverse career experiences,there is no consensus on how to measure it accurately,and research on economic consequences is in its infancy.This study draws on existing results and combines the reasons for the formation of zombie firms to define diversified career experiences from four aspects: government,finance,overseas and academic backgrounds.The above four aspects accurately measure the CEO’s past industry category and social capital accumulation,making certain contributions to related research.Third,on the basis of professional experience,this study further analyzes the influence of the CEO’s past work and living geographical differences on the cure of zombie firms from the perspective of cultural environment,and expands the relevant research on regional cultural differences.To sum up,this study provides theoretical basis and policy suggestions for accelerating the construction of a market-oriented and highly efficient professional manager market,improving the training environment for compound talents and the innovative selection and employment mechanism of zombie firms.It has a certain marginal contribution and practical significance to promote the reform of the economy,improve the ability of financial services to serve the real economy,and promote the high-quality development of the macro economy. |
