Research On Corporate Governance Performance Of China 's Cross - Listing

Cross-listing is when a firm lists its equity shares on one or more stock exchange in addition to its domestic market. The academic community recently focuses more attention on this kind of behavior due to the integration of global markets. Bonding hypothesis suggest that cross-listing has a positive impact on corporate governance and corporate value in addition to financing. China is experiencing a rapid growth in its capital market, many enterprises chose to cross list especially in the form of "A+H" share. Whether or not the strategy of cross-listing as "A+H" share can achieve a higher level of corporate performance is a problem that should be pondered upon by those enterprises.The majority of Chinese cross-listed companies in the form of "A+H" share is government-driven and has certain political background. The unique feature could affect the recognized impact of bonding. This article studied the impact that cross-listing could bring in three steps. Firstly, the article investigated the relationship between cross-listing and management remuneration to see if there exists a better incentive system. Then the article further explores whether the level of corporate governance will be improved from the angle of the dismissal of the poorly performed CEO. Lastly the article tests whether cross-listing would bring the enhanced relative corporate value.Using2006-2011"A+H" share and A share companies as comparison, the article investigated whether A+H cross-listing has a positive relationship between corporate performance under Logit model and mixed regression. The article found positive relationship between management salary and cross-listing, negative relationship between corporate value and cross-listing, but no relationship between CEO turnover and cross-listing was found.The results are as follows, cross-listed companies have better incentive system but do not have a more effective system to recognize those poorly performed CEO and dismiss them in time, the value of companies would reduce when the company cross list. Due to the unclear evidence of bonding, the article believes that cross-listing as "A+H" share does not bring positive effect to corporate performance.